"Landlords, especially those in coastal areas and other areas popular with holidaymakers might want to seek out candidates’ views on the impact of short-term lets and whether, given the opportunity to deny a change of use consent, they would choose to do so. "
This Thursday, voters up and down the country will be casting their votes in local elections which are likely to reflect on the Conservative Government’s turbulent term to date and provide some indication as to the likely result of the next general election.
For private sector landlords there are many very pressing and immediate local issues which may be determined by these elections – from the application of local rules, regulations and restrictions, to candidates’ views on the future of the private rented sector, specifically in relation to the contentious Renters’ Reform Bill.
So as a landlord, which issues do you take into account when casting your vote? And if a candidate turns up on your doorstep, how can you use the opportunity to lobby for much-needed change in support of the private rented sector?
We’ve given the topic a bit of thought and come up with the following suggestions.
Short term lets
Holiday lets may now be under threat in certain areas of the country. This follows recent political announcements at a national level but will be determined locally by councillors. As such it is a topic on which all candidates should have a view.
The issue is exemplified in the words of housing secretary Michael Gove, who told Parliament last month that there was a “problem in the private rented sector, particularly in beautiful parts of our country, where homes are being turned into Airbnbs and holiday lets in a way that impedes the capacity of young workers to find a place where they can stay in the locale that they love and contribute to the economy of which they wish to be part".
Gove promised to bring forward measures to introduce, "restrictions on the way in which dwelling homes can be turned into Airbnbs".
Consequently, his Department announced its proposal for a new planning use class for short-term let properties. This would require planning consent, through permitted development rights, for the ‘conversion’ of houses into holiday homes.
According to the consultation document Introduction of a use class for short-term lets and associated permitted development rights, a use class C5 would permit local planning authorities to “consider planning applications for new build short-term lets and grant permission conditioned to the new class where appropriate”.
Existing properties would automatically fall under class C5. But for new short-term lets, planning permission would be required. Essentially this gives more power to local authorities over short-term lets: if holiday homes are seen as threatening the supply of permanent homes, the council may refuse permission. This is an important consideration for landlords wishing to add to their short-term lets portfolio.
Furthermore, the Department for Culture Media and Sport has launched a separate consultation on a new registration scheme for short-term lets to be introduced through the Levelling up and Regeneration Bill. The intention is to, “help to provide local planning authorities with information about which properties are being let out in their area” and “could provide valuable information to help them apply and enforce the use class changes.”
Landlords, especially those in coastal areas and other areas popular with holidaymakers might want to seek out candidates’ views on the impact of short-term lets and whether, given the opportunity to deny a change of use consent, they would choose to do so.
Landlords will be familiar with selective licensing, which in many local authorities requires that in specific areas privately let homes are licenced – effectively giving councils the ability to cap the number of HMOs. In such areas, all private landlords must obtain a licence and if they fail to do so, or fail to achieve acceptable management standards, the authority can impose a fine.
According to the legislation, Selective Licensing Scheme should only be introduced in response to a problem with low housing demand or where there are significant and persistent problems of anti-social behaviour and should be consistent with the council's housing strategy.
Landlords looking to expand their portfolios in areas with SLSs should question candidates as to why the council has introduced (or plans to introduce) selective licensing, how the (potential) impact on landlords can be reduced, and how any funds already raised through selective licensing have been used.
Another contentious issue currently awaiting a response is the question of individual council tax bandings per room for HMOs. Proposals to remove the contentious tax are contained in the recent consultation Council tax valuation of Houses in Multiple Occupation.
Currently, the tool is used very inconsistently and its impact comes at a considerable cost to landlords – another potential conversation point for the doorstep.
Renters’ Reform Bill
Other emerging policies will impact landlords, many of which will be included in the long-anticipated Renters’ Reform Bill. These include a change to open-ended tenancies (specifically student lets) and the abolition of Section 21. LRG has carried out some considerable research into the use of Section 21 and found that suggestions that it is widely misused are vastly over-stated: our research found that 80% of landlords have never used Section 21 and of those that had, 6% did so when the tenant was in breach of the lease and only 3% where the tenant was not in breach of the lease.
When talking to candidates about the Renters’ Reform Bill, landlords have an opportunity to quiz the door-stepper on their knowledge of and support for these contentious policies, and perhaps to ascertain whether candidates understand the pressures being put upon landlords - or wrongly believe that penalising the private rented sector will somehow resolve the housing crisis. This should give an indication as to whether, as a politician, they will understand landlords’ difficulties in daily challenges or blindly take the tenant’s side in any dispute.
The suggestions outlined above may provide for some lively doorstep conversations. And hopefully, they show that local elections present a very valuable opportunity for landlords to persuade our future decision-makers of the potential impact of various policies, both local and national.