The National Landlords Association (NLA) has voiced its opposition to intentions to introduce mandatory three-year tenancies.
Responding to the overcoming barriers to longer tenancies consultation, which seeks views on a proposed three-year tenancy model, the NLA has strongly objected the proposals.
The NLA’s response outlines:
• The increased risk associated with longer term tenancies for landlords, particularly with regard to removing tenants who breach the terms of their tenancy
• The urgency of reforming court processes so that tenants can be removed where there is a breach of tenancy without undue delay or cost before any longer tenancies can be introduced
• The importance of maintaining Section 21
• The importance of flexibility in lengths of tenure, to account for the needs of different tenants and landlords
• The risk that break clauses and regulated annual increases in rent will lead to landlords changing behaviour to end tenancies before they enter into the longer fixed period and enforce rent increases more regularly than under the current system
• The value of using incentives to encourage behaviour change, rather than enforcing a mandatory approach, which will not be suitable for either landlords or tenants
• The danger that, should a mandatory approach be enforced, landlords will choose to leave the market rather than take on additional risk.
NLA’s Chief Executive Officer, Richard Lambert, commented: “In his speech to the Conservative Party conference last October, Sajid Javid announced plans for a consultation on how to encourage longer tenancies. That’s been the tone of the discussion ever since – consultation and encouragement. Frankly, right now, I feel we’ve been misled.
“This is supposed to be about meeting the needs of the consumer. NLA research with tenants finds consistently that around 40% of tenants want longer tenancies, but 40% do not. More than 50% consistently say that they are happy with the tenancy length they were offered, and 20% tell us that when they asked for a longer tenancy, they got it.
“We would accept that the flexibility of the current Assured Shorthold Tenancy isn’t used as effectively as it could be, and that we should be looking to find ways to ensure that tenants are offered the kind of tenancies they need at the time they need them. That means thinking about how to modernise a model devised 30 years ago, to take account of the changes in the people who are renting and the way they live their lives. How will that be achieved by moving to a more rigid system, more reminiscent of the regulated model the current system replaced?
“It’s like urging someone to update their 1980s brick-style mobile phone, but instead of giving them a smartphone, offering them a Bakelite dial phone plugged into the wall.
“This is a policy which the Conservatives derided when it was put forward by their opponents in the past two general election campaigns. It’s hard not to see this as more of a political move aimed at the renter vote than a genuine effort to improve how the rented market works for all those involved.”