The Rugg Review: Private Rental Sector Review by Julie Rugg

Introduction | RLA Response | See the Review | Your Comments

Introduction

The Government asked Dr. Julie Rugg of York University to review the Private Rented Sector. Her Report was published on the 23rd October 2008. The RLA made submissions to the Review, and has welcomed the report. The Law Commission has recently published a report on encouraging responsible letting. All of this fuels the ongoing debate as to how the Private Rented Sector should be regulated in the future.

The RLA strongly believes that the current way in which the Sector is regulated is broken. The whole range of local authority enforcement powers including HMO and selective licensing is going nowhere. There is historical antagonism between landlords and local authorities. Although this has reduced over the years there is still a strong perception on the part of landlords that local politicians and officers are hostile to the Sector.

Importantly, although wrongly, there is still a poor public perception of the Private Rented Sector. This has to be overcome.

The RLA strongly advocates a professional and responsible Private Rented Sector. Those who manage properties need to be trained and have the necessary management skills. Tenants need to be regarded as consumers.

Voluntary accreditation schemes have shown the way and the RLA is looking to introduce its own national accreditation scheme for landlords. Currently, accreditation schemes themselves are not validated but this is about to change which will give them greater credibility.
The RLA supports the idea of self regulation through a scheme of approved national and local accreditation schemes. Those who manage properties including owners who self manage should be a member of such a scheme. An owner who does not wish to qualify to manage in this way could rent out his or her properties through an accredited managing agent. Many do this already anyway. Alternatively, they would continue to be regulated by the local authority.

Alongside this, there needs to be proper accreditation and regulation for letting and managing agents. There needs to be proper bonding for monies which they hold.

There should be a national property standard giving the bench mark for good management. This should concentrate on management standards rather than property standards. The RLA has always said that it wanted to concentrate on the people involved rather than good management; not the properties which has been the traditional focus.

Those who were regulated in this way would be outside the scope of local authority control. Current experience shows that local authorities because of limited resources concentrate on the responsible landlords who would comply anyway. A small number of poor quality landlords flout the system. They are largely ignored by local authorities. Current legislation, particularly licensing, creates a costly bureaucracy which, by and large, is a non compliant flout. Local authorities would be left to policy landlords who will not joint accreditation scheme members.

A new central regulator is required to oversee this new system supported by representatives of all stakeholders including landlords and tenants. Such a regulator should ensure that the national and local accreditation schemes are operated properly.

Accreditation schemes would be managed by local authorities, landlords associations and the like.

The RLA believes that landlords need incentives to support such a scheme, such as much fairer tax regime. This kind of incentive, supported by the removal of local authority control, would mean that landlords would be able to operate in an entirely different regulatory environment. This would give greater confidence for tenants and the public. It would encourage investment in the private rented sector. We now need to break the historic mould and replace the current system with a much more effective but light touch system fit for the 21st Century.