Why we say NO to cancelling rents!

Cancelling rents would be disastrous for landlords and investors says Ringley

Cancelling rents for private tenants without reimbursing landlords would be “stealing from people’s pension pots” says Ringley Group MD Mary-Anne Bowring in response to demands for more radical policies to help renters.

More than 4,000 Labour party members recently signed an open letter backing cancelling rent as a policy. The letter argued Labour’s five-point plan to help renters, which included extending the evictions ban by at least six months and giving tenants two years to pay back rent arrears, did not go far enough. Meanwhile, the London Renters’ Union and others are calling for rent strikes, claiming renters are having to choose between food and paying rent.

The government’s ban on evictions has been extended until August 23rd, which has calmed fears that thousands of tenants could lose their homes if the ban wasn’t extended.

However, Mary-Anne firmly believes that cancelling rents in the private sector would punish hundreds of thousands of pensioners, as well as risk halting the current appetite from UK pension funds who are investing billions into creating new high-quality homes for rent. The most recent English Private Landlord Survey estimates there are at least 1.5m landlords in England alone. Of those, nearly half said they invested in rental property to supplement their pension and approximately one-third are retired.

This means if a rent cancellation was to be introduced, at least 500,000 retired landlords would see their rental income wiped out entirely. This would also dramatically reduce rent revenues for pension funds, many of which have suffered losses from retail and office investments and rely on income from property to match their liabilities.

No one can doubt or deny that millions of renters are facing major financial difficulties or anxieties but cancelling rents is not the answer. Some renters may need more financial assistance from the government but cancelling rents or getting the government to pay would be hugely damaging,” warns Mary-Anne.

 Both private and institutional landlords would lose rental income unless the government stepped in to pay private residential rents, which could cost the taxpayer billions and is completely unacceptable.

That’s our take on Labour’s proposals. What do you think?


Why not READ our Property Blog: www.ringleypropertyblog.co.uk

New regulations for landlords now in force in Wales

New regulations are now in force for landlords in Wales.  The Renting Homes (Fees etc.) (Prescribed Limits of Default Payments) (Wales) Regulations 2020 came into force on 28 April and sets the maximum fee that landlords can charge if a tenant defaults on their rental contract.

If a tenant doesn’t pay their rent, the new regulations set a limit on the amount which can be charged.

  • Up to the end of a period of seven days from when the rent is due, zero can be charged.
  • After the end of the period of seven days from due, 3% above the Bank of England base rate may be charged.

The formula for calculating the 3% plus base rate is:

the aggregate of the amounts found by applying, in relation to each day after the due date for which the rent remains unpaid, an annual percentage rate of three per cent above the Bank of England base rate to the amount of rent that remains unpaid at the end of that day.

The Renting Homes (Fees etc.) (Wales) Act 2019 came into force in Wales on 1 September last year, with the legislation being similar but not identical to the Tenant Fees Act 2019 in England.

In Wales, landlords may now only charge tenants entering into new rental agreements for

  • rent
  • security deposits
  • holding deposits of one weeks rent
  • council tax
  • utilities
  • tv licence payments
  • communication services or
  • payments in default.

Replacement locks and keys

Also with effect from 28 April, if tenants lose their keys and/or need their locks changed, landlords in Wales can only charge them for the actual cost of replacing keys and of changing, adding or removing a lock. They cannot levy an additional service charge for doing so, although they can pass on the charge for a contractor to do the work, as long as evidence of the additional cost is provided in the form of an invoice or receipt.

Landlords who are members of the Residential Landlords Association (RLA) can click here for guidance on the differences between the Welsh and English legislation, download a number of fee ban compliant documents, find out what charges can be made under the fee bans and read some practical tips on adapting to the new requirements.


Why not READ our Property Blog too at www.ringleypropertyblog.co.uk