The government wants renters to stay in their home for a minimum of three years but landlords are not convinced
The government has outlined new plans that would see the introduction of a minimum three-year tenancy term with the option for renters to move out after six months if they wish.
At present, most tenants stay in their rented homes for just under four years, but despite this 81% of tenancy contracts are for a minimum of 6 months or 12 months, meaning there is always a level of uncertainty as to whether tenants will be asked to move on.
READ MORE: The UK's fastest rising rental market is not where you might think
Announcing the new proposals, the Secretary of State for Communities, James Brokenshire MP, said: “It is deeply unfair when renters are forced to uproot their lives or find new schools for their children at short notice due to the terms of their rental contract.
“Being able to call your rental property your home is vital to putting down roots and building stronger communities.”
The government says the new plans will also give added financial security to landlords, and help them avoid costly periods when they need to find new tenants, but not everyone is convinced.
A political move?
Richard Lambert, CEO at the National Landlords Association (NLA) said that although research it has conducted shows that 40% of renters want longer tenancies, it also shows that 40% do not. He believes that the new proposals are too rigid and actually seem to mirror the older more regulated model that the current system replaced.
Lambert said: “It’s like urging someone to update their 1980s brick-style mobile phone, but instead of giving them a smartphone, offering them a Bakelite dial phone plugged into the wall.
“This is a policy which the Conservatives derided when it was put forward by their opponents in the past two General Election campaigns. It’s hard not to see this as more of a political move aimed at the renter vote than a genuine effort to improve how the rented market works for all those involved”.
There is also some concern that the proposals could have a negative impact on the buy-to-let market as shorter tenancies give mortgage companies confidence that they could repossess properties more quickly, if necessary, while longer-term tenancies could make them more reluctant to lend.
The plans will now undergo an eight-week consultation period until 26 August, in which tenants, landlords and related organisations will be invited to give their views on how to tackle any potential hurdles to longer tenancies.
READ MORE: Top tips for creating a buy-to-let your tenants will love (and pay well for)