Tired of reading and hearing about how young people can’t buy a home?
The average private tenant spends more than 30% of their income on rent, according to a recent BBC survey. In London, it’s far worse – a tenant in their twenties on an average income might be spending 55% of salary on a mid-range one-bedroom flat.
Renting is a necessary stop gap in most young people’s lives. So let’s end the #rentalstigma and help the younger generations feel this is a valid life choice, not a sign of failure. It is far better to rent and maintain a good relationship with an understanding landlord than buy the wrong house in the wrong place at the wrong time.
But knowing your rights and getting the best deal you can is essential. Let’s check in on the current landscape and see how achievable that is with our in-depth Q’n’A on renting.
Is anything being done to stop rip-off deposits being charged by letting agents?
Yes – at last! On June 1, the Tenant Fees Act will limit the upfront deposit to five weeks rent, in properties where monthly rent is under £4,167. Landlords at present can charge what they like and it’s typically six weeks rent. The upfront cost for a tenant who pays the average rent will be reduced to £1,087 for a deposit.
In London, the average tenant will still have to pay a whacking £2,415 deposit per property (£4,065 in Kensington), according to Rightmove. In the North East it would be only £630.
Agents and landlords caught charging more than the cap will be slapped with a £5,000 fine, which could rise to £30,000 if the case goes to court.
Your landlord must put your deposit in a government-backed deposit scheme if you rent your home on an assured shorthold tenancy (the usual one).
The Tenancy Deposit Scheme has launched a calculator to help you pay the right amount. It can be found on its website here.
What about other fees?
Well, the new Act also bans letting fees, which used to be a huge sting in the tail for renters. The housing charity Shelter says tenants on average have had to shell out £272 in upfront fees to letting agents every time they move. But agents and landlords will still be allowed to charge fees for:
- a change or early termination of tenancy requested by the tenant – but this will be capped at £50 unless they can demonstrate that greater costs were incurred.
- utilities, communication services and council tax
- payments arising from a default by the tenant, such as replacing a lost key.
What about getting the deposit back at the end? Isn’t that one of the big plagues of renting?
Landlords and estate agents will now only be able to recover “reasonable costs”. That should put an end to rogue landlords charging tens or hundreds of pounds for replacing a light bulb or a cushion, and exaggerating claims for damage. Or in the case of one of my former landlords, no more £50 charges for *forgetting to hoover under one bed*.
Can a landlord throw me out for no reason if he wants the property back, even if I’m a model tenant?
Yes, but that could be about to change. At present, landlords can issue a ‘Section 21 notice’ to tenants giving them just eight weeks notice to find a new home, without having to give a reason.
Around half of all landlords admitted issuing a Section 21 notice in the past year, in a recent survey by the Residential Landlords Association. But the government has just announced plans to end so-called ‘no fault evictions’.
Instead, landlords would be able to use a ‘Section 8 notice’ if they want to sell the property or move into it. Currently Section 8 notices are used against tenants who have broken the terms of the tenancy, but landlords dislike them as being hard to push through the courts. Your landlord can’t make you leave your home unless they’ve gone to court to get a possession order and a warrant for eviction.
What effect will the no-fault ban have?
It could ban mean greater security for 1 1 million renters who might otherwise be subject to no-fault evictions. But it could also mean less supply of rental property. The RLA claims that landlords are selling up in droves in response to the new rules, along with the end to mortgage tax relief (from January), higher stamp duty on more expensive property, and better tenants’ rights generally. For instance, new rules introduced in October 2015 have made it harder to evict people for reporting problems with their property. While this will push many rogue landlords out of the market, it will undoubtedly make buy-to-let a less attractive option for good landlords, restricting the supply of rental properties and (possibly, but not definitely) pushing prices up.
Can you report problems and hope to get anywhere?
Yes. At the end of March, a tweet from Ben Leonard went viral in rent-world when he pictured himself and four flatmates punching the air outside Leeds Town Hall, with the caption: “Just took our ex-landlord to court and won all our rent back”.
Just took our ex-landlord to court and won all our rent back ✊✊✊ pic.twitter.com/2RSRfpgZkZ
— Finesser Redgrave (@benleeds94) March 28, 2019
The landlord had failed to comply with the rules for homes in multiple occupation (HMO) which have to be licensed for safety reasons. Tenants can ask their local council to check if the property they’re renting currently holds an HMO licence, and if not, they can take the landlord to court at low cost and win back their rent with a Rent Repayment Order. The gang were awarded a year’s rent, and (after a partial rebate to the landlord because of his financial circumstances) they walked away with £9,000.
What are the key areas I need to know about?
Know who has to pay the bills and if it’s you, pay them promptly. You can choose your energy supplier so take advantage of your power to switch to better deals. Investigate apps like billbutler to split, manage and save on utilities.
Keep the place reasonably clean and tidy, and don’t be anti-social. Otherwise you could be in breach of your tenancy agreement.
Report any repairs and allow access for them to be addressed. If you don’t, and a major problem occurs, your landlord may try to reclaim costs from your deposit.
☠️ If you’ve reported a potential health and safety hazard and your landlord or agent hasn’t resolved it in a reasonable time, contact your local council. You can also ask the council to inspect a neighbouring property if issues with it could affect your own health and safety.
If you believe your landlord or letting agent is harassing you, keep a note or diary of all incidents and copies of all communications – they may be useful as evidence. Your local authority has a number of enforcement powers that it can use to tackle harassment by a landlord.
There’s a full guide to your rights and responsibilities here.
What do you think? Are things getting better for renters – or is it still a homeowner’s world? Let me know by leaving a comment below or tweeting me: @ionayoungmoney.
Eager to learn more? Of course you are! Check out the Young Money Crash Course chapter on the Rental Revolution. And if you’re looking to buy your first home, make sure you read our home saving guide and lowdown on specialist first-time buyer Isas first.