According to a recent article in The Guardian, seven in 10 landlords do not understand their obligations under the controversial new ‘right to rent’ rules. Effective as of this February, the new right to rent laws mean that the onus to check tenants’ right to live in England is now placed firmly in the hands of landlords. Announcements concerning implementation of the rules in Scotland, Wales and Northern Ireland are expected at a later date.
Under the new law, landlords that fail to comply and monitor the immigration status of their tenants could face penalties of up to £3,000. So, what do people up and down the country think about the law changes? Read on to find out.
The West Midlands Trial
Before the new law was rolled out across the country, it was trialled in the West Midlands. From 1st December 2014, private landlords in the region were required to check whether prospective tenants had the right to live in the UK before granting them a tenancy.
As a result, landlords were expected to request proof of identity documents, such as a passport, or face the prospect of being fined if their tenants were found to be living in the UK illegally. Within six months of the trial being launched, the first West Midlands-based landlord received a fine of £2,000 for failing to check a tenant’s immigration status.
Speaking to the Property Industry Eye, Phil Stewardson, owner of 135 rental properties in the West Midlands, accused the authorities of using landlords as “free labour” for border control. So, even before the new laws came into full effect, it was clear that at least some landlords were unhappy with the changes.
Are Landlords Doing the Job of Border Control?
Landlords like Phil Stewardson are essentially arguing that the new right to rent law is a thinly veiled attempt by the Government to pass some of the burden for monitoring immigration on to everyday people. And it’s a point of view that has gathered some political support.
Writing about the subject on the Politics Home website, Baroness Hamwee, a Liberal Democrat Peer, had this to say:
“I find it a bit rich that landlords should risk imprisonment for housing an illegal immigrant when it is the Government’s failure in their duty to protect the borders of this country that has resulted in the illegal immigrant being here in the first place.”
On the opposite side of the fence, however, there are landlords who are happy to comply with the new right to rent laws. Supporters of the changes argue that the right to rent checks are quick and easy to perform, and that there is an abundance of supporting documents and Government published literature to help any landlords that are struggling.
Furthermore, the new laws will also make it a lot more difficult for people to stay in the country when they have no right to do so. Plus, they will act as the first line of attack against an increase in criminal landlords that exploit illegal immigrants by renting out unsafe and often overcrowded accommodation.
A Huge and Difficult Market
It’s no secret that the rental market is huge in the UK. In fact, research suggests that, by 2025, there could be more people renting than who have a mortgage in the UK. In part due to the growing size and complexity of the market, there is doubt whether landlords are sufficiently able to carry out checks on tenants’ right to live in the UK.
In an article published by the Financial Times, policy director of the Residential Landlords Association, David Smith, raised concerns about landlords’ lack of expertise verifying documents:
“How familiar are you with a passport of Liechtenstein? Can you spot a forgery? I certainly can’t. But that is what landlords are being asked to do and if they don’t they will be at risk of a financial penalty.”
Some Landlords Could Be Exploited For Profit
In addition to securing the relevant data, the extra costs of performing the initial checks are going to place a significant burden on the shoulders of many landlords. It is entirely feasible that many landlords will now prefer to pay for the services of independent companies to perform tenant checks on their behalf.
A recent article in The Telegraph highlighted that a handful of companies are already charging £100 for bespoke immigration checks in an effort to profit from the law changes. However, the same article warns that certificates from such companies are not official documents, and it is unclear if the Home Office considers these services to be legitimately recognised.
As a result, the only way for landlords to legally escape liability for these checks is to pay a letting agent to do them on their behalf. Therefore, the right to rent laws could force more DIY landlords to hire the services of letting agents, which, in turn, will increase the costs involved in running a rental property.
The Course of Least Resistance
The new laws have also drawn criticism because they could, potentially, increase the chances of some landlords flouting anti-discrimination laws. With the introduction of right to rent, The Telegraph wrote an article stressing that campaigners against the law changes might only “rent to white tenants with British-sounding names” in a bid to avoid red tape.
When you add the prospect of a £3,000 fine into the mix, in theory, the chances of this happening probably increase. Therefore, even sub-consciously, some landlords may take the course of least resistance to ensure they avoid fines and the likelihood of additional Home Office bureaucracy.
Are you a landlord? What are your thoughts on the new right to rent laws? Are they a necessary burden or an example of the Government relinquishing its responsibilities? Join us in the comments section below for a discussion.
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