PROPERTYMARK GIVES EVIDENCE TO TOWNS AND CITIES INQUIRY
22nd June 2021
Mark Hayward, Chief Policy Advisor at Propertymark gave evidence outlining demand for green space has accelerated rapidly. Developers would need to adapt to meet the consumer appetite. And whilst the need for green space appears to be equal across renters and buyers, Mark stated that we have seen a reduction in the PRS for the first time in almost 20 years with landlords feeling victimised, and the attractiveness of being a landlord is decreasing.
More space has been the most common reason for people moving, but also popularity of rural or coastal life, confidence in improving broadband, and the attraction of more indoor and outdoor space can be linked to the lockdowns and changing consumer habits.
Andrew Carter, Chief Executive of Centre for Cities gave region-based evidence and discussed the differences across regions in the potential offered for residents to work from home.
Craig McLaren, Director of Scotland, Ireland and English Regions, Royal Town Planning Institute discussed the benefits of the ’20 Minute Neighbourhood’ a way of describing a complete, compact, and connected neighbourhood, where people can meet their everyday needs within a short walk or cycle. He also discussed the Open Space Standard Strategy that he said had been working well in Scotland.
ADDITIONAL COSTS AND RISKS MUST BE PART OF DEBATE ON RENTING WITH PETS
16th June 2021
A briefing from Propertymark was sent to Lord Black of Brentwood before the debate. In the debate, Lord Berkley asked if the Minister was aware of clauses that can be added to the tenancy for cleaning and Lord Goddard asked if the UK Government would encourage wider use of pet CVs to allow more responsible pet owners to keep their pets in rented accommodation.
Lord Flight extended the discussion proposing new ideas, including landlords rendering a modest additional rental for pets. Furthermore, he said it might be worthwhile requiring insurance policies to be taken out by tenants. It might also be an idea to have a system of interviewing tenants and choosing tenants who seem to be responsible with regard to pets.
Model Tenancy Agreement
Earlier in the year, the UK Government updated its Model Tenancy Agreement to encourage landlords to allow pets, but Baroness Gardner of Parkes asked what will the UK Government do to help allay landlords’ concerns over the inadequacy of a five-week deposit to address any pet damage at the end of the tenancy?
In response, the Minister Lord Greenhalgh said that it is right to point out the impact of the Tenant Fees Act 2019 and the UK Government recommends that the rental deposit of five weeks is a maximum rather than a default.
The Minister concluded by saying: “charging a deposit of four weeks’ rent would provide leeway to expand it to five weeks for such things as pet ownership and also to take up some of the suggestions that we have heard today around insurance or potentially looking at rent levels to accommodate wider pet ownership.”
PERSIMMON AND AVIVA PAY LEASEHOLDERS BACK
23rd June 2021
In September 2020, the CMA launched an investigation into housing developers and investment firms involved in creating leasehold terms and purchasing freeholds from the developers.
Investment company Aviva, which owns the freehold on a large number of leasehold developments has committed to remove terms that double ground rents. Persimmon the housing developer, will now offer leasehold house owners the opportunity to buy the freehold of their home at a discounted price. Both companies have made undertakings to replace leasehold doubling clauses with RPI-based ground rent terms.
Leasehold purchasing regrets
Propertymark conducted research with more than 1000 leasehold house owners in 2018, which revealed that 94 per cent regret buying a leasehold house, 57 per cent didn’t understand what being a leaseholder meant until they had already purchased the property and 62 per cent felt like they were mis-sold.
Leasehold terms can make routine household improvements such as replacing windows, changing kitchen units, and replacing flooring, prohibitively expensive. The cumulative impact of leasehold terms regularly prevents owners from finding a new buyer when they decide to sell. The UK Government is taking action to restrict ground rents in future leasehold terms.
The CMA investigation into other developers and investment groups is ongoing.
Click on any one of the buttons below to access the latest guidance information: