The Private Rented Sector (PRS) has grown rapidly over the past few years as terms like ï¿½generation rentï¿½ have become commonplace, whil...
The Private Rented Sector (PRS) has grown rapidly over the past few years as terms like Â‘generation rent' have become commonplace, while several MPs and high profile pressure groups have taken an increased interest in the fortunes of Britain's tenants, landlords and letting agents.
The sector's growth has been so significant that in 2014 the Intermediary Mortgage Lenders Association reported that if current market trends continue, by 2032 over half of UK homes will be rented.
As higher sums of money enter the PRS every year, the formalisation, regulation and subsequently professionalism of the sector have all moved to a higher level. As well as diminishing the small number of rogue operators, these changes have increased the workload of the UK's letting agents.
Since 2010 there have been a number of landmark moments for the professionals working within the UK's PRS and specialist rental software provider OnBoard Pro has been speaking to a number of letting agents to find out the word on the high street.
OnBoard Pro's research details the ever-changing role of the agent, breaking down the milestone pieces of legislation in the past five years, the present day and what awaits lettings professionals in the futureÂ…
The past decade
- April 2006, Scottish landlords must join national register before letting property - April 2012, Mandatory for rented properties to have an Energy Performance Certificate - November 2013, Advertising Standards Authority rules for agents to include information about non-optional fees in adverts - November 2012, Letting agent fees charged to tenants banned in Scotland - October 2014, mandatory for letting agents to be a member of one of three government-approved redress schemes - February 2014, Landlords and agents required to carry out Legionnaires' disease risk assessment after updated guidance from Health and Safety Executive
- May 2015, Mandatory for all letting agents to disclose full fee tariff, as well as highlighting which redress scheme they are a member of and whether they offer client money protection - June 2015, Under the Deregulation Act, it became mandatory for the small number of deposits taken before April 6 2007 which then became periodic to be protected with one of three schemes - Ongoing, HMRC requesting agents to provide a list of landlords they have collected rent on behalf of - Ongoing, The introduction of high profile selective landlord licensing schemes in areas across the UK including Liverpool and several parts of London
- October 2015, It will be mandatory for all rented properties to have a carbon monoxide alarm that is checked regularly - October 2015, Smoke alarms to be fitted on every floor of any rented property - October 2015, Changes under the Deregulation Act will affect landlords' ability to serve a Section 21 notice if they or their agent do not handle repair requests properly - 2016, Landlords and agents will be required to carry out energy improvements to rental properties as requested by tenants - 2018, It will be illegal for properties to be let unless they have an Energy Performance rating of Â‘E' of above - TBC, Right to Rent immigration checks to be rolled out nationally - TBC, Proposed localised rent controls and landlord repossession changes in Scotland
What does the industry say?
Stephen Purvis, Chief Executive Officer, OnBoard Pro said; Â“As we have found from talking to agents around the country as well as in Scotland, the role of a full service letting agent becomes more complicated and regulated as each year passes. That is not to say that increased regulation is necessarily a bad thing. The more rogue landlords and agents that are prohibited from operating in the sector, the fewer negative portrayals of agents we will see in the mainstream media. The majority of agents are very quick to get up to speed with the latest changes affecting them. However, after breaking it down like we have here, it shows the quite astonishing amount of new tasks and checks letting agents are taking on all the time.
In just five years agents have gone from having to join a redress scheme and organise Legionella assessments to having to also disclose their full fees tariff and make sure all of their landlords' old deposits are protected.
And in the next five years we can expect the list to lengthen yet further as agents and landlords will be expected to check tenants' immigration status, make sure rented properties are energy efficient and install fire and carbon monoxide alarms in all properties.
With all of this in mind, keeping up with industry news outlets as well as thoroughly digesting any government or industry body information issued has become more important than ever. On top of this, as legislation and administration duties increase, utilising the latest technology allows agents Â– and landlords Â– to efficiently streamline processes and subsequently spend more time looking after tenants and brushing up on the latest legislation and industry practice.Â”
Karl Knipe, Director, Kings Group (London) said: Â“I don't feel the front end of the job has really changed. It's no different today than it was five, 10 or 20 years ago. However, it's the backend, the legalities, which have and are changing all the time. This makes doing the job - if being compliant and safe - more costly for the agent, landlord and ultimately the tenant.Â”
Brian Callaghan, Founder, Letting Solutions (West Lothian) said: Â“Scotland has much to be proud of in the Private Rented Sector. A sharp focus on tenant safety and rights has led to enlightened legislation and rules over many years. However, it is sad to see the industry in danger of losing its way. The Scottish Government's adoption of some of the destructive elements in Shelter's agenda is in danger of leading Scotland into a cul-de-sac.
Stimulating the supply side should be the absolute priority. Instead, the Scottish Government is moving in the other direction. Misconceived tenancy reform, including localised rent control, seems to be on the way. If this comes, a reduction in supply is certain.Â”
Talitha Setz, Lettings Director, Mishon Mackay (Brighton and Hove) comments: Â“The last five years have seen significant changes, and more importantly, an improvement to the UK lettings industry. Under the guidance of a professional letting agent when basic steps are followed the relationship between landlord, tenant and agent is a harmonious one.Â”
A competent experienced letting agent with local knowledge and national accreditation will guide landlords through this entire process. Many dual selling and letting agents will manage the process from purchase to tenant, find to full management; whilst limiting the mounting costs where possible and provide a safe and well maintained property for many years to come.Â”
Simon Kerley, Lettings Manager, Capital & Coastal (Bournemouth) said: Â“Most of the changes brought into the rental market are positive and designed to protect consumers and encourage those providing a service (landlords and agents) to raise their standards.Â”
Â“Often the effectiveness of some of these changes can be hard to measure, especially with the market changing so rapidly, making it difficult for regulation to keep pace and remain relevant. Competition for letting agents remains high, especially since there is no legal requirement to have a formal qualification to be an estate agent; therefore anything which helps the good stand out from the bad, in our opinion, can only be positive.Â”
Kenny Sahota, Director, Amilli Property (East London) said: Â“As the demand for renting grows, so has the number of lettings agents. Over the past five years we have seen rogue traders leaving landlords and tenants out of pocket. The rules and regulations have been getting tighter to prevent these issues from happening which is great for landlords.Â” https://www.propertyreporter.co.uk/landlords/the-ever-changing-role-of-letting-agents.html