Draconian Anti-Landlord Laws

Being a landlord today is a test of endurance. Why? Over the past couple of years, Governments have changed the rules and legislation around providing long-term rental accommodation. There is more risk for landlords, which starts with tenant selection, i.e., getting it wrong, and there’s no easy way out of the tenancy agreement. However, this is just one area of concern, so property investors are choosing to get out and invest in other asset classes.

So what’s been going on to cause such antipathy against Landlords?

Causes

Over the years, housing crises have put Governments on the back foot. Their strategies to provide enough houses to meet demand have failed, so the humble landlord has become the fall guy to distract from their own failings.

Tenancy Laws

Over the last couple of years, revised stringent tenancy laws and regulations have provoked landlords to reconsider if owning rental properties is really for them.

Health & Safety

In the UK, USA, Australia, and other countries, there is an increasing demand for landlords to meet a growing list of health and safety requirements. With these new conditions, rental homes will be in better shape and far exceed that of many owner-occupier houses!

Regardless of how you feel about property investment, a healthy return on investment is essential for attracting private investment in homes for tenants.

\investor take this type of investment risk? The answer is that astute investors will not, and instead, invest their money elsewhere. This is the real threat to tenants, i.e., a lack of new investors willing to own rental properties, and with less supply of rentals, many tenants will have nowhere to live.

Lack of Support During The Pandemic

Then came COVID-19, and while every man and his dog were considered for handouts and grants, landlords were left out and ignored even though they were providing an ‘essential service’—shelter.

Eviction moratoriums and rent freezes have caused undue stress on decent people whose only error was being landlords! No relief for rates, insurance, or maintenance has been offered, and no grants or subsidies have been provided redd to see the landlord through the unpreceded lockdown. The outcome of this anti-landlord behaviour will not be pretty.

Landlord sentiment has reached an all-time low; for many investors, the only way forward is to sell up.

There may be some initial delight in landlords selling up. More property listings and for really struggling investors rise in mortgagee sales; however, the elation among some groups, particularly those with the anti-landlord sentiment, will be short-lived when they realize the unintended consequences of fewer rental properties is more tenants with nowhere to live. For example, for every rental property sold, at least one tenant must find somewhere else to live! Typically, there are three tenants per rental property but only two occupants per rental property sold to owner-occupiers.

Scapegoat

Landlords have long been the scapegoat for housing problems because they are easy targets.

Private landlords are individuals. While a property investor association representative will get some airtime to voice landlord grievances, what’s lacking is a group with real clout among political leaders. Until this happens, landlords will continue to be the ones to blame for everything wrong with housing.

New Zealand

Let’s take New Zealand, for example. It seems to be the fairest country globally, but appearances can be deceiving.

The Residential Tenancies Amendment Bill 2020 was pushed through Parliament, and the landlords struggling with rising insurance costs, rates, and compliance will sell up.

What’s in the Residential Tenancies Amendment Bill 2020?

There are some pretty innocuous changes, including:

• One rent increase every 365 days
• When the house is needed for a family member, give the tenant 63 days’ notice. The tenant must move in and stay for at least three months.
• Fixed tenancies automatically become periodic.
• No eviction without proving anti-social behaviour three times within 90 days

Then there are these changes that have caused landlords to be justifiably unhappy.

Since the change of Government from Labour to a National-led coalition – some of the rules have been amended – like the no-fault evictions, which are now allowed with the Landlord giving either 63 days if they are requiring the home for their own use or ninety days.   Tenants are to give 28 days’ notice under the periodic tenancy agreement.

Healthy Homes

The requirement for healthy homes remains a focus for all rental properties that must adhere to it.  It is similar to the Decent Home Standard – which is part of the Renters Rights Bill UK.

United Kingdom

The Renters’ Rights Bill will become law in 2025. It includes a ban on no-fault evictions, the end of fixed-tenancy agreements, and a focus on Decent Home Standards.

Homes in the UK are old, and the call is for Landlords to do whatever is necessary to improve their livability for health reasons, including addressing dampness and mould, sealing drafts, and upgrading insulation and heating where required.

Summary

Investing in private residential property should be a win-win situation for both landlord and tenant. However, there is little to celebrate in property investment, and getting tough on private landlords is not the right way to solve social housing woes.