News from Manor Lettings
1 October 2010: RLA: New Tenancy Legislation Puts Landlords At Risk
Landlords in England could be caught out by new tenancy legislation that became law today.
The change raises the annual rent threshold for common 'assured shorthold tenancies' from £25,000 to £100,000. But the move is backdated to include all existing tenancies not just new ones.This will bring thousands more higher-end properties in England - the new order does not apply elsewhere - under the tenancy deposit protection schemes.
So the Residential Landlords Association is warning that landlords are at risk from any unregistered deposits, taken after 6 April 2007, for properties with an annual rent up to £100,000. Deposits taken before that date, however, do not have to be protected unless the tenancy agreement has been renewed. And these properties also now fall under different legal procedures for termination of a tenancy or breach of contract.
"All these issues could create courtroom minefields," says RLA chairman Alan Ward. "By law tenancy deposits have to be registered with a tenancy protection scheme within 14 days of receipt. But deposits taken long before 1st October could now leave a landlord in breach of that law. And any actions currently going through the courts to terminate a tenancy could be relying on the wrong notices because the tenancy agreements have now, in the meantime, officially become assured shorthold tenancies."
"We argued that the new order should not be retrospective but the Communities and Local Government department decided otherwise. These problems will now, no doubt, need to be worked out by the courts."
The Residential Landlords Association is the leading national organisation whose members own over 100,000 properties in the UK's private rented sector. The range of members' services - on www.rla.org.uk - includes advice, insurance, financial services, credit referencing and training.
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