What every landlord in 2023 needs to know
This year is already looking like a rollercoaster of a year for landlords, as there is a lot of change about to come into place with several major legislative and compliance reforms set to come into force.
This guide contains all you need to know about the rules that will go into effect in 2023, as well as how to guard against ongoing economic changes.
- Minimum Energy Efficiency and EPC Modifications
Changes to the Minimum Energy Efficiency Standard (MEES) for privately leased properties in England and Wales are part of the government's aim to reach net zero by 2050.
The MEES currently has an Energy Performance Certificate (EPC) grade of 'E'.
This means that properties with an 'F' or 'G' grade cannot be legally rented.
At the moment, you need an EPC rating of at least an ‘E’ to be able to rent out your property. The big change is that beginning in 2025, any newly rented properties will need a rating of at least a ‘C’ and any existing tenancies will have until 2028 to do the same.
While the rule change is two years away, if you are already renting out a property with a 'D' or 'E' rating, you should begin making efforts to improve it before the deadline.
- Renters Reform Bill
The Renters Reform Bill is the most significant prospective legislative change this year. Section 21 'no fault' evictions would be prohibited under the Renters Reform Bill. This would imply that tenancies could only be terminated when the tenant decides unless you have legitimate grounds for possession via a revised Section 8 process.
To balance this, the bill aims to offer landlords stronger grounds for possession. To invoke the new Section 8 reasons, just deposit protection would be required. This implies that, in addition to making it easier to sell or move into a house, landlords will find it easier to deal with antisocial tenants or those who are in arrears.
- There are no blanket tenant bans.
If the Bill becomes law, blanket bans on tenants claiming benefits or desiring to rent with children would be prohibited.
- Growing tenant demand and rising rents
Since there aren't enough properties to meet demand from tenants, rental costs are rising across the UK.
In fact, Rightmove projects that, a significant lowering in the number of available houses, rents will increase by an additional 5% in 2023.
Prices have increased by 9.7% compared to the same period in 2021. Rising rents suggest that landlords may discover some nice return opportunities in 2023.
Over the past few years, rental values have been rising steadily in the UK, and they are currently climbing at the quickest rate ever seen. Being a landlord is a wise investment as it not only gives you a passive source of income but also helps you safeguard your possessions.
Although having a rental property is a major responsibility, you can manage it yourself. As an alternative, you can use our completely managed services to relax and take in the benefits of being a landlord.
