National Landlords Association NLA NEWS and UPDATE Joanne Dron

Contents 1.Section 21 – New prescribed form and potential defence 2.Smoke / Carbon Monoxide Alarms 3.Summer Budget “Right to Rent” Checks 5.Deregulation Act 2015 – Retaliatory Eviction & restrictions on S21

New Section 21 New regulations which introduce a new prescribed form for S21 Notices, and ‘new’ obligations on landlords which if not complied with, form a defence for the tenant against a S21 notice. These only apply to new tenancies starting on or after 1 October! Applies in England only

New Section 21 Will be a review to inform the Sec of State whether to make them apply to all tenancies from 1 October 2018 Under these regulations landlords will have to provide tenants at the start of a tenancy with –A valid energy performance certificate –A valid Gas Safety Certificate - regulation 36 of the Gas Safety (Installation and Use) Regulations –A copy of the Government’s How to Rent Guide.

New Section 21 The landlord should supply these documents at the start of each new tenancy. If not supplied at the start of the tenancy, they should be supplied as soon as possible thereafter. If documents have not been supplied, the landlord cannot serve a section 21 notice. However as soon as the landlord supplies these documents this restriction is removed.

New Section 21 New standard form (Form 6a) that must be used for section 21 notices. for all tenancies created on or after 1 October This form cannot be served within the first four months of a tenancy 2 The form is valid for six months following the date of its issue 3

Smoke and Carbon Monoxide Alarms Changes to the law from 1 October will require landlords to install working smoke and carbon monoxide alarms on all floors in their properties No specific type – battery not hard wired Locations are specific for Carbon Monoxide Alarms – high risk rooms with solid fuel burning appliances. Must be tested at start of every tenancy Free alarms available Fines for non-compliance – also plans by Government to restrict a S21 if alarms not fitted

Summer Budget The government will restrict the relief on finance costs that landlords of residential property can get to the basic rate of income tax, e.g. higher rate payers will only be able to claim at the lower rate. The restriction will be phased in over 4 years, starting from April –in the deduction from property income (as is currently allowed) will be restricted to 75% of finance costs, with the remaining 25% being available as a basic rate tax reduction. –in , 50% finance costs deduction and 50% given as a basic rate tax reduction. –in , 25% finance costs deduction and 75% given as a basic rate tax reduction. –from all financing costs incurred by a landlord will be given as a basic rate tax reduction.

Further new Budget announcements From April 2016 the 10% wear and tear allowance will be replaced by a system that is based on the actual costs incurred.* Rent-a-room scheme will increase from £4,250 to £7,500 a year from April 2016 Family homes worth up to £1m passed to children/grandchildren to be taken out of IHT. Allowance on top of existing IHT thresholds. Local Housing Allowances frozen for 4 years from to From April 2017, those out of work aged 18 to 21 making new claims to Universal Credit will no longer be automatically entitled to the housing element.

“Right to Rent” Checks The Immigration Act places new restrictions on illegal immigrants accessing private rented accommodation Landlords will need to carry out checks to identify whether a potential tenant has the right to reside in the UK. The scheme was rolled out to areas in the West Midlands* from 1 December as a first phase. (Birmingham, Dudley, Walsall, Sandwell and Wolverhampton) Will now be rolled out nationally – NLA will keep members advised of developments

Deregulation Act 2015 – Retaliatory Eviction From Thursday 1 October 2015, thanks to measures included in the Deregulation Act,1 Section 21 notices will be rendered invalid where, before issue, –the tenant has made a complaint in writing to the landlord regarding the condition of the property, –which the landlord has not adequately responded to and –results in a local authority issuing a ‘relevant notice.’ The protection from eviction will only apply if the authority has confirmed that there is a potential health and safety risk and where the tenant requested a repair before the section 21 notice was served.

Retaliatory Eviction contd. A relevant notice is defined as an improvement notice served under section 11 or section 12 of the Housing Act 2004, or a notice of emergency remedial action served under section 40(7) of the Housing Act 2004, e.g. –an improvement notice relating to a category 1 hazard; –an improvement notice relating to a category 2 hazard; or –an emergency remedial action notice. A landlord is then banned from using S21 for 6 months from the serving of that order.

Retaliatory Eviction contd. The law will not cover situations where a landlord serves an eviction notice and the tenant subsequently requests a repair. There is a 14-day period given to the landlord to respond. This is the period for an initial response only. The landlord is not required to fix the problem in this time. The law will not apply where a local authority determines the tenant has breached their duty to use the property in a tenant like manner (this includes non-paying of rent). By the time that the possession case comes to court, a local authority will need to have carried out an inspection or, decided whether there is a defect that poses a risk to the tenant’s health and safety. If the local authority fails to do so, a tenant will not have a defence against S21. The landlord must also be given 24 hours’ notice before a local authority inspects.

Thank You I’ll take your questions now. National Landlords Association 2nd Floor, 200 Union Street LondonSE1 0LX Tel: Web: