Landlords on the hook for ‘thousands' after Labour's rent reforms U-turn
A tabled amendment to the Renters' Rights Bill has reversed a previous pledge to allow landlords to require tenants to take out insurance to cover pet damage.
The legislation, which is passing through the Lords, will ban 'no-pet' tenancies. This means landlords will have to accept renters with pets unless they have a good reason not to.
Angela Rayner had promised that landlords would be able to require tenants with pets to take out insurance. The Housing Secretary previously said that this would mean 'no one is left unfairly out of pocket'.
However, the amendment, tabled this week by Baroness Taylor on behalf of the Government, would reverse this commitment.
Chris Norris, of the National Residential Landlord Association (NRLA), said the about-turn had 'betrayed' landlords, who risked having to pay out 'hundreds or even thousands of pounds' to repair damage, as deposits are capped at five weeks' rent.
He added: 'I can't fathom why the Government won't allow the landlord to take an extra deposit if they have a pet. It's now illegal for [landlords] to do that.
'This would be cheaper than insurance for the tenant and they would get it back if their pet does no damage, and give landlords reassurance.'
The average claim on home insurance for pet damage is £225 per incident, according to research by price comparison site Compare the Market. The most common mishaps included ripped or stained carpets, damage to sofas, skirting boards and doors, and broken ornaments.
Greg Tsuman, of estate agency Martyn Gerrard, said removing the option to require pet insurance was a 'prime example of an ill-thought-through policy' that would inevitably push up rents.
He added: 'Once again, landlords are being penalised for trying to strike a fair balance between accommodating tenants and protecting their investments.
'If landlords can't offset risk, they'll build it into the base rent. The inevitable result? Higher starting rents and a market distorted by forced assumptions that every tenant will come with a pet in tow.'
The Renters' Rights Bill has been dubbed the biggest overhaul of rental law in 30 years. It will end fixed-term tenancies, stop landlords from taking action against non-paying tenants for up to three months, and ban bidding wars by requiring landlords and letting agents to publish an 'asking rent' for the property.
The legislation will also eliminate Section 21, otherwise known as 'no-fault evictions', for all new and existing tenancies from next summer. Instead, landlords will need to rely on Section 8 to evict a tenant, a piece of legislation undermined by long court delays.
The Bill had been expected to become law this summer, but delays in the parliamentary process mean it is now not expected to gain Royal Assent until the autumn. The Government's Employment Bill has also been pushed back.
Critics of the Bill have warned that it could lead to a rise in rents, as landlords sell up and flee the sector amid tougher conditions and dwindling profits.
One in three landlords are now looking to sell off some or all of their rental properties, according to the latest English Private Landlord Survey, with just under two thirds blaming recent changes in legislation.
Ben Beadle, chief executive of the NRLA, said: 'This is a shoddy and outrageous way to make law.
'Yet again the Government simply expects responsible landlords to shoulder even greater risks without any consultation about the likely impact.'
A Government spokesman said: 'Our landmark Renters' Rights Bill will bring long overdue fairness to the market and deliver much-needed reforms to the system.
'It is only fair that tenants are given the same choice to keep a pet as homeowners, and landlords will remain protected from the cost of any damage caused by pets through their existing deposits.'
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