As of 6th April 2018, parts of the Housing and Planning Act 2016 come into effect that see the introduction of 'Banning Orders' for rogue landlords and a database of rogue landlords and property agents in England.
This new system is intended to stop landlords with convictions for housing offences in one council area from letting homes in another council area and is housing Minister, Sajid Javid plan to fight against bad landlords and provide better protection for tenants.
Until now, rogue landlords renting out homes in more than one council area were able to avoid detection as councils did not swop data about offenders.
Now however, if a landlord or letting agent is convicted of one of a list of offences, the council can apply to the First Tier Tribunal for a banning order, which will see the offender’s details posted to the database.
If a landlord is convicted of a “banning order offence” a local authority may apply to the First-tier Tribunal for a banning order against the landlord or agent who committed the offence.
There are 41 separate banning order offences, including:
• illegally evicting or harassing a residential occupier
• using violence to secure entry
• providing false or misleading information
• failing to comply with an improvement notice
• failure to comply with a prohibition order
• offences in relation to licensing of Houses in Multiple Occupation
• offences in relation to selective licensing under Part 3 of the Housing Act 2004 (section 95)
• violence for securing entry
• offences related to drugs
• contravention of an overcrowding notice
• fire and gas safety offences
• harassment and stalking
The full list of offences that could attract a banning order can be found in the Schedule to The Housing and Planning Act 2016 (Banning Order Offences) Regulations 2018.
A banning order will ban the person from letting housing or acting as an agent (or both) in England.
A banning order also prohibits a person from holding a HMO licence or a licence granted under a selective licensing scheme. Local authorities must revoke a licence when it has been granted to a person who subsequently becomes subject a banning order.
A banning order must last for at least 12 months (although there can be exceptions to allow for example a landlord to obtain possession orders against current tenants or to allow a letting agent wind down their business.) There is no upper time limit.
A local authority must put anyone subject to a banning order on the national database of rogue landlords and agents.
Where a landlord or agent breaches a banning order:
In addition, a local authority or a tenant (or licensee of the landlord) can apply to a First-tier Tribunal for a rent repayment order where a landlord has breached a banning order.
A tenant who is granted a tenancy by a landlord who is a subject to a banning order has a legal tenancy. To terminate the tenancy a landlord must follow the lawful procedure for ending the type of tenancy granted.
At the same time, a national database of rogue landlords is introduced and anybody with a banning order must be placed in the database.
Even without a banning order, a local authority may place a person on the database if they have been convicted of a banning order offence or have received a financial penalty in respect of a banning order offence at least twice in a 12 month period.
Local authorities throughout England will have access to the database (and are responsible for keeping it up to date) which will allow them to ensure a landlord or agent with a banning order can’t move areas within England.
Only councils will have access to the database, so tenants will not see if their prospective landlord has any convictions.
To work out you your gross rental yield, you simply divide the annual rental income by the purchase price of the property. However, a more accurate indicator of the return you are going to get is to work out the NET rental yield. This is the return after property management, lettings fees, maintenance and repair and other running costs have been taken into consideration, and gives you a far more realistic view of your return.
