These changes came into effect on 6th April 2012, meaning that:-

- New tenancies created on or after 6th April 2012 will be covered by the new requirements.

- Tenancies already in existence on 6th April 2012 have 30 days to comply with the new requirements, if they have not already done so.

- The new requirements will only apply to Court proceedings for a breach of the Housing Act, where those proceedings started on or after 6th April 2012.

Here is a summary of the changes:-

30 days – not 14 – to protect deposits

From 6th April, landlords and letting agents have 30 days from receipt of deposit in which to protect it.

The re-wording and extension of this timeline closes any loopholes with regards to deposit protection deadlines so that, now, if a deposit is not protected within 30 days, the tenant can take their landlord or letting agent to court – there is no other way to interpret this legislation.

A tenant may make an application to a county court for a penalty award against a Landlord or Agent even if the deposit has been protected after 30 days, although the courts will then take the fact that protection has occurred into account when deciding what level of penalty to impose.

A claim can be made even where the tenancy has ended.

Once the tenancy has ended the landlord cannot retrospectively protect the deposit in order to comply with the Act and avoid penalties. If the tenancy has ended, the only option is for the landlord to repay the deposit, or part thereof, to the tenant.

The courts have discretion to award not less than the amount of the deposit and not more than three times that amount depending on the individual case. e.g a repeat offender may find themselves with a larger fine compared to a landlord who has simply forgotten to protect as an administrative oversight.

Prescribed Information

The requirement for providing the Prescribed Information to the tenant has also changed to within 30 days of receipt of the deposit.

It is the landlord or letting agent’s responsibility to ensure that it is issued at the correct time, so should be given to the tenant(s) along with their copy of the signed AST.

Section 21 notices

A Section 21 notice for possession may not be given where a deposit has not been protected within the 30 day period. However, this prohibition may be mitigated where:

-the deposit has been returned to the tenant in full or with such deductions as have been agreed;
-an application to the county court under section 214 has been made and has been determined by the court or withdrawn or settled between the parties.

On 6 April 2012 the legislation on Energy Performance Certificates (EPC’s) changed for both commercial and residential property transactions.

You need to be aware of these changes.

Change 1 – An EPC must be commissioned before marketing a property for rent

Since 2007, it has been a requirement that an up to date EPC must be provided to a prospective buyer or tenant.  However, concern that the EPCs have not been delivered in good time to allow the buyer or tenant to make a judgment regarding the property’s energy efficiency status has lead to the following three main changes to be brought in by the 2011 Regulations:

1.    An EPC must be commissioned before placing the property on the market, unless a valid EPC is already available.

2.    ‘All reasonable efforts’ must be made to ensure that the EPC is obtained within 7 days of the property being put on the market.

3.    After that point, there is an additional 21 day grace period to obtain the EPC after which the owner is in breach of the 2011 Regulations and may have to pay a penalty.  There is no defence of using reasonable efforts after this time is up.

NOTE:  This does not apply to properties already on the market prior to 6 April 2012.

Any Agent acting on behalf of the property owner will be bound by the 2011 Regulations.  An agent marketing the property will be liable for any breach and therefore must be satisfied that the landlord has commissioned an EPC or has one available before marketing the property on their behalf.

Change 2 – information to be contained in the property particulars

A copy of the first page of the new style EPC must be included in the written particulars for all properties.  It must be physically attached to the particulars.

This rule also applies to written particulars on internet sites,  The national EPC register operator has provided a technical solution which will enable agents to retrieve the EPC from the register and attach it to online written particulars.  More detailed information for agents is available on request by emailing: epc.enquiry@communities.gsi.gov.uk.

NOTE:  There is no requirement to change the written property particulars for buildings already on the market prior to 6 April 2012.

Change 3 – air conditioning reports.

EPCs have to be lodged in a central register, maintained by Landmark.  Under the existing regulations air conditioning systems over 12kw are inspected and a report is obtained.

From April it became a mandatory obligation to lodge air conditioning reports on the central government register

The amendments to the legislation relating to EPCs are quite small and should be easily brought into practice.  However, not being aware of the rules could lead to costly fines.

The fines for non-compliance are up to £200 for residential properties.  (For commercial properties fines start at £500 and rise up to £5000 depending on the rateable value).

For more details about all of these changes and FAQ’s click here 

THE LETTING PART

Industry regulators, The National Approved Letting Scheme (NALS), has announced its brand new designated ‘NALS Approved Service Provider’ offering which makes available recognition to firms who provide back office services to letting firms.  This enables them to comply with NALS strict criteria in client accounting and save on costs in being part of the scheme.  The Letting Partnership is the first to achieve designated status.

Caroline Pickering, Chair of NALS said, “We are delighted to be able to offer back-office service providers the opportunity to apply to gain this designation. This growing industry is a vital part of the lettings market and we look forward to helping to support these firms moving forward and enable their clients to become NALS licensed.”

“We have established that a number of firms now use or are considering outsourcing elements of the operation of their business to a back office service provider.  The services this type of provider might offer through their software includes client accounting and/or deposit protection, referencing or full property management.  The issue has been in the past however that if a lettings firm outsourced elements of the service they offer to landlords and tenants, the firm could not gain recognition by NALS.

“We recognise that the industry is changing and the way in which agents choose to operate is changing as new technology is developed. With the introduction by NALS of a new designation “NALS Approved Service Provider” specifically focused on those firms providing back office services we would recognise where their services would enable lettings and management firms to meet NALS compliance criteria.”

This will potentially bring cost savings to lettings firms in NALS with no dilution of standards or our criteria. For example, instead of a firm supplying an annual accountant’s report to NALS, if the firm’s client money accounting/deposit protection was outsourced to an approved service provider vetted thoroughly by NALS the provider would fulfil the compliance requirement in this particular area rather than the agent.”

Jenny Markham at The Letting Partnership said, “We have seen demand for our services go from strength to strength so approaching NALS to find out if we could help our clients to gain a NALS licence and gain recognition of our services was the next step. It made good business sense for us to achieve the NALS ‘tick’ so we could promote ourselves to our customers, and confirm to them that we adhere to strict guidelines and are a reputable organisation they should want to partner with.”

For more information click here.

The Property Investor Show returns to ExCeL London for a 10th successive year and Directors of The Letting Partnership, Jenny Markham and Angela Albiston will be there on Thursday 19th April.

This will be the largest property investment expo staged in the UK during the first half of 2012 – an event that active investors and landlords will not want to miss.

It attracts the largest audience of UK investors and landlords to gather under one roof – plus several thousand real estate professionals from around the world – all keen to take advantage of this unique sales and business networking opportunity.

The show opens at 10.00 am and closes at 6.00pm.

The first phase of seminars are now available for booking online. Several sessions will sell out before show opening, thus book early to avoid disappointment.  Remember you MUST register online for free show entry before completing a seminar booking.

To view the seminars click here.

We hope to see you there.