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Private rented sector landlords letting one property “less likely to comply with legal requirements”: report

Landlords with smaller property portfolios are the least likely to be compliant with legal requirements on lettings, research for the government has found.

The research by the Department for Levelling Up, Housing and Communities was carried out to inform policies on improving standards in the sector, which accommodates some 20% of all households.

There are high rates of turnover - higher than either the owner occupied and social rented sectors - but indicators of quality are lowest in private rented sector stock with 25% of homes deemed ‘non-decent’, and 12% with a category 1 hazard.

The research found four groups of landlords with different patterns of compliance.

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Some 30% were in the ‘demonstrating good practice’ cluster, the group most likely to comply with all legal requirements, and most likely to adhere to good practice indicators.

This group was also the most likely to conduct ‘right to rent’ checks, issue the How to Rent guide, provide an energy performance certificate (EPC) and conduct electrical installation checks.

These landlords were the most knowledgeable about their most recent let, most likely to be aware of changing EPC regulations and most likely to know the EPC ratings of their properties.

They also tended to own multiple properties and had good awareness of tax and legislative changes.

Nearly 25% of landlords fell into the next cluster of ‘meeting legal requirements’.

They were less likely than the highest cluster to have undertaken all legal requirements and tended not to have completed good practice indicators, though complied with most legal requirements .

Some 35% of landlords were in the ‘mixed compliance’ cluster, and conducted some but not all legal requirements, though many had implemented non-mandatory good practice activities.

There was a much lower likelihood of them checking tenants’ ‘right to rent’ or providing a ‘How to Rent’ guide and they tended to have limited awareness of EPC ratings and requirements.

These landlords were most likely to be retired, or outright owners of a single property they did not buy with the intention of letting.

Just 10% of landlords fell into the ‘lower compliance and awareness’ cluster, who displayed limited compliance across the range of legal requirements and good practice indicators.

These were the least likely to have made tenant checks or provided an EPC and tended to not have conducted either electrical installation or appliance checks.

Landlords with patterns of higher compliance were more likely to have five or more properties than landlords with lower compliance, while landlords with lower compliance were more likely to have just one property.

The research concluded though that compliance appeared unrelated to the number of years of experience as a landlord.

Fitting a smoke alarm was the legal requirement most likely have been met among landlords of all kinds, with 98% having done so, closely followed by registration of tenant deposits.

Mark Smulian

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