A prominent country property expert has issued an urgent appeal to rural landlords to become involved in the consultation process which has just begun into the Scottish Government’s proposed New Deal for Tenants.
Jennifer Campbell, head of estate agency at Baird Lumsden - the rural property arm of DM Chartered Surveyors - says many of the changes in the proposed new legislation could have a significant impact on landlords and present them with new challenges.
The draft strategy, which will be open for consultation until April 15, will be finalised by the end of this year and the new legislation will be brought before parliament in 2023.
Its key proposals include:
- Applying the extensive range of rights and protections currently enjoyed by social rented tenants to their counterparts in the private sector;
- Making permanent the restrictions on evictions which were applied as an emergency measure in the early stages of the pandemic;
- Establishing a Regulator for the private rented sector;
- Implementing rent controls for the private rented sector;
- Setting minimum standards for energy efficiency and zero emissions heating.
Campbell says: “The availability of rural properties to let is already difficult, particularly when there is competition from second homes and holiday lets. Further legislation will simply deter landlords who may look to sell. Private rented properties are essential where social housing cannot provide and for many, it is simply a lifestyle choice.
“Property owners operate under a considerable amount of existing regulation and a survey concluded that the majority of tenants were happy under the current PRS system, questioning why such changes were required.
“It is of vital importance that the voice of the private rented sector is heard before these wide-ranging alterations to the current system are implemented and all landlords should make it a priority to respond to the consultation.”
Campbell’s views have been echoed by Daryl McIntosh, policy manager at agents’ trade body Propertymark.
He says: “The private rented sector plays a crucial role in the housing system, providing homes to people who cannot, or simply do not want to, own their own home and for whom the social rented sector is not an option.
“We ask that the Scottish Government show careful consideration before introducing additional regulations to the sector. We continue to see landlords feeling the pressures of endless legislative changes and exiting the market. Additional pressures could see the sector further crumble.
“Working in collaboration with our members, stakeholders, politicians and parliamentarians, we aim to continue to raise the standards across the entire industry ensuring people can rent affordable, warm and safe homes from reputable landlords.”
Here is the Scottish Government consultation document.
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For the life of me I can't understand what all the fuss is about landlords not being able to improve the energy efficiency (and therefore the EPC) of their investment buildings. I, like thousands of other professional landlords, realised this when EPCs were introduced way back in 2008. It not like the Government has sprung it on us!
Over the years I've been spending some of my annual rental income on improving loft insulation and cavity wall insulation. I've used external wall insulation on one of my properties - the EPC up-lift for me and energy cost saving for the tenant have been extremely good.
I've recently installed Dimplex Quantum night storage heaters in a rental flat. I've helped my tenant sign-up to an off-peak electricity tariff, which is a fraction of the cost of expensive 'day time' electricity'. Night storage heaters have come on massively since the 1980s and retain the heat all day whilst the tenant is out at work. It's a pile of bricks in a steel box and is ideal for rental homes where the tenant can be less than careful.
A domestic EPC is an energy COST calculation, the worse the Grade the more my tenant has to pay to the NPower, British Gas (and indirectly the Qatari Royal Family and Vladimir Putin) and the less money they have to pay my rent. It makes good financial sense to drive down the money my tenants have to pay in energy costs. Don't landlords on this Blog understand this? Every single resi landlord mate of mine in the Thames Valley has either fixed-up their houses and flats to EPC Grade C or long since sold their 'difficult' assets and reinvested the capital in energy efficient homes (which can indeed be both older or modern buildings)
For me and other professional landlords this simply is not an issue and not a problem. Relaxing Planning regulations so I and others can build a few more houses and flats for renters would be a far better issue for us all to campaign on. Domestic EPCs and MEES is NOT what rational landlords worry about.
Not this again - I'm fed up with reading the EXACT SAME post. Nobody believes you are real!
Trica, I see his name and I don't read any further, he's not a landlord at all
Martin, you are very tedious. Surely even you've got the message by now
You're in the minority Martin, I am coming up to reitrement (like a lot of small LL's), i am not going to spend god knows what on my D and E properties to get them to a C..... Not ever, i would need to live way past 100 years old to get my ROI back. They are mortgage free.... i will sell, and so will many thousands of others. If all the EPC upgrade nonsense is so good for the tenants, then why are the social LL's and councils not included ? Are their tenants ok to pay more for their utilities ? This and other such punitive legislation will kill off the PRS and leave it open for the BTR brigade...... god help the tenants of the future, my children will certainly never rent with the market that is to come.
It would be an interesting exercise to do a survey on just this ie how many landlords are approaching retirement and hence likely to sell off rather than throw lots of money for little return.
I'm in a similar boat and I'm working with a local EPC chap, that I've used for years, on a consultancy basis, to review all my properties in light of potential upcoming EPC changes. I'll then crunch the numbers taking into account a number of factors. When the EPC C changes were first mooted, my instinctive reaction was to sell off all the poorer performing properties. However, with rents growing as they are, some of the investments are looking more worthwhile. Work in progress .... I'm in no rush yet.
The mere fact the council flats don’t need epc show it’s all about destroying the prs
Grumpy Doug - Sensible to look at the options, we are all in a different stage of our lives, but one thing is for sure, we are all in the SAME position when it comes to life expectancy, and i for one, do not want to leave it too late, i want to enjoy what i have worked for, my children will inherit enough as it is.
Indeed, as they say, ,2 guarantees in life - death and taxes!
As I stopped growing my portfolio as from 2015 when Osborne announced S24, it's actually been quite enjoyable having the time to reshape my strategy. There's been some consolidation (a couple of sales), extensive refurbs across the board that have enabled me to increase rents more than I would have, and the opportunity to do more IHT planning.
EDIT - just seen Robert's post below. Same strategy!
EPC's are only one of many weapons which the unholy SNP Green alliance plans to use to batter the Scottish PRS landlords even more, in the mistaken belief that this will get them more votes and secure " independence".
Most of their voters are renters, but mainly in social housing. Many PRS renters are students or young professionals and in my discussions with them, the effects of the December 2017 private rental legislation in Scotland are far from welcome, with fewer properties to choose from, no dependable time when most properties are coming up for rent, rents up 30% for the best properties - assuming they're no longer reserved for short term rentals only etc.
Most of these more savvy renters will never support the SNP but unfortunately most also won't participate in this consultation process, which is a foregone conclusion and its harmful effects on the prs as predictable as its conclusion!
I'm not selling up as I believe market forces will win, as they have in totally destroying the ill-fated energy price cap.
I have already taken some precautions, in upgrading my properties to justify higher rents and more affluent tenants with home owning guarantors, having several tenants with joint and several liability, mainly students or young professionals who won't want to stay for ever, avoiding families who might outstay their welcome and can't be easily evicted.
The new legislation is a disaster for decent young families but the blame is firmly on the loony lefties who introduced it and now, recognising it hasn't worked as planned, now seek to make it worse.
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