The government has announced plans to launch a brand new Housing Complaints Resolution Service, that will act as a single reason for contact for tenants looking to raise disputes against their landlords.
Buy-to-let landlords will need to join the service or face fines as high as lb5,000.
Here, you can find out how the new system could work, and get info on another regulations facing buy-to-let landlords in 2022.
Landlords must join redress scheme
The government’s new Housing Complaints Resolution Service is going to be open to homeowners and tenants who have failed to resolve issues directly with their housebuilder or landlord.
The government believes that bringing together the different resolution systems now available can make it simpler to gain redress.
Housing minister James Brokenshire says: ‘Frequently the procedure [of resolving disputes] could be confusing and overly bureaucratic, leaving many homeowners and tenants feeling like there is nowhere to go in the event of problems with their home.’
Landlords revolt against new proposals
This news hasn’t been welcomed by everyone.
The Residential Landlords Association (RLA) claims that little thought has been provided to the way the system will work in practice, and says the changes can lead to higher costs for landlords.
David Smith from the RLA said joining a redress scheme ‘will be another cost but another layer of complexity, possibly with relatively little end product’.
He added: ‘We need clarification on what the problem will be for landlords who use letting agents. Agents curently have to become a member of a redress scheme, so landlords using them would be paying twice.’
Current redress options for landlords and tenants
Currently, landlords can opt to become people in an answer service like the Housing Ombudsman, but this isn’t required by law.
That doesn’t mean tenants can’t complain, however.
Many landlords employ managing agents which are registered with industry bodies, like the Association of Residential Letting Agents (Arla) or the Property Ombudsman, and therefore must adhere to a code of conduct and provide resolution services.
If a landlord manages the home themselves, it’s a bit more complicated. In such instances, the tenant will need to complain towards the council when they can’t resolve an issue directly.
When will the brand new rules come into force?
These plans are part of a suite of presidency proposals to improve the avenues of redress available to homeowners and tenants.
It’s not yet clear, however, when the rules can come into force. First, they’ll need parliamentary approval – and this might take some time.
It’s also unclear just how much landlords will need to pay to become listed on the redress scheme, although the government has suggested it might operate a tiered structure as opposed to a flat rate.
Buy-to-let landlord regulations
This move may be the latest inside a raft of buy-to-let reforms introduced in the past few years.
In addition to buy-to-let stamp duty rates and mortgage interest tax relief reforms, some investors also have seen their profits challenged by the introduction of recent House in Multiple Occupation (HMO) rules.
Next up may be the Tenant Fees Bill, which will enter into force in June. Most of all, this will result in letting agents being banned from charging up-front fees to tenants – thus placing a further burden on landlords, who're likely to have to foot the balance.
