LETTING & ESTATE AGENT

Deregulation Bill receives Royal Assent

Deregulation Bill receives Royal Assent

The Deregulation Bill received Royal Assent last week so now is the time for all landlords to ensure that their properties will be compliant with the new laws regarding both deposit protection and revenge evictions.
  
The Act contains amendments to tenant deposit protection (TDP) legislation, lobbied for by the National Landlords Association (NLA), to finally correct the issues created by the Superstrike and Charalambous legal decisions which imposed unreasonable duties on landlords with tenancies which pre-dated TDP. 

Any deposits taken before April 2007 and where the tenancy has become periodic after that date, must be protected and the prescribed information must be served within 90 days. Then the deposit will be treated as if it had always been protected.

Any deposits taken after April 2007, that were protected with the prescribed information and have been served at some stage during the initial tenancy, will be treated as if the prescribed information had been served on every renewal or whenever a statutory periodic tenancy arose.

Any deposits taken before April 2007, which became periodic before that date must be protected or the money must be returned to the tenant (or the person who paid it) before a section 21 notice can be served. Landlords will not be liable for any financial penalty for non-protection.

The prescribed information rules have been amended to allow for agents’ details to be given instead of landlords’ details where the agent is dealing with the deposit. The 90-day period is a chance for all landlords and letting agents to regularise the situation regarding their deposits.

However, although the Deregulation Bill clears up much of the confusion around deposit protection, it also makes it illegal to carry out a so-called “revenge eviction”.

David Cox, managing director of ARLA, said this will create a number of unintended consequences.

“The measures will mean that protections previously afforded to compliant landlords may be eroded by dishonest tenants using the new powers to defend against legitimate possession proceedings; possibly by intentionally causing damage to properties,” he warned.
 
Now it’s been given Royal Assent, the Deregulation Bill needs a “commencement order” to bring it into force – it’s thought this will happen in October.