Private rented sector regulation should be simplified, recommends report

The report (79-page / 2.78MB PDF) by a Communities and Local Government select committee said that a new framework should be supplemented by a publicity campaign to ensure tenants and landlords are fully aware of their rights and responsibilities.

The report said that the private rental market is "developing one" which requires action across a number of different areas to help "edge its way towards maturity".

It recommended that councils should be given more flexibility to enforce the law and raise standards and implement approaches suitable to the needs of their areas. Councils should be "afforded more flexibility over landlord licensing given greater ability to generate resources; and encouraged to learn from each other," the report said.

The report also said that lettings agents should be subject to the same controls as estate agents to help combat the existing "sharp practice and abuse" by lettings agents. "This includes giving the Office of Fair Trading the power to ban agents who act improperly, and making client money protection and professional indemnity insurance mandatory," it said.

The Government was recommended to take action to crack down on hidden and unreasonable fees and charges imposed by lettings agents, including requirements to tell tenants about fees before starting the lettings process and for all property listings and advertisements to list in full the fees a tenant would have to pay.

“I want to see renting as an attractive alternative to owner occupation," said committee chair Clive Betts MP. "The market has to better meet the needs of renters. Tenants and landlords need to be much better informed about their rights and responsibilities. Bad landlords should be driven out of the sector."

“The legislation governing the private rented sector has evolved over many years and often in response to specific problems at a particular point in time. Far from providing clarity, the result is a bewildering regulatory framework. It should be simplified and all parties made aware of their rights and responsibilities,” Betts said.

The British Property Federation (BPF) welcomed the committee's recommendations. “Agents should spell out all letting fees upfront to make everyone involved fully aware of the costs they are facing at the outset. Greater transparency will mean a better deal for tenants and landlords," said BPF director of policy (real estate) Ian Fletcher in a statement.