Landlords in the UK are struggling to keep pace with new reforms that have been introduced over the past 12 months, new research from Market Financial Solutions (MFS) has found.
The bridging lender commissioned an independent survey of 400 UK landlords, all of whom let one or more residential properties to tenants. It found that 30% do not understand the changes to House in Multiple Occupation (HMO) licensing, which came into effect in October 2018 to stipulate on the minimum sizes of rooms.
Almost one in three (28%) landlords admitted to not fully knowing what the abolition of Section 21 means. The reform, which was implemented in June 2019, aims to prevent unfair tenant evictions.
A similar number (27%) said they do not understand the tenant fees ban (June 2019) or how it may affect them.
MFS’ research uncovered a similar lack of knowledge when it comes to tax reforms that are likely to impact UK landlords. A quarter (25%) said they are not up-to-date with the latest changes to reduce tax relief on buy-to-let mortgage repayments, while even more (28%) do not understand the reforms to inheritance tax with regards to passing down properties.
The survey also showed widespread opposition to the new legislative changes. Over two-fifths (44%) of landlords are against the ban on tenant fees, compared to 23% who are in favour. The abolition of Section 21 (37% against, 16% for), and the changes to buy-to-let mortgage relief (48% against, 16% for) attracted similar disapproval.
Paresh Raja, CEO of MFS, commented: “The legislation and regulation governing the UK’s rental market is constantly evolving, and today’s research clearly shows that landlords are struggling to keep pace with the change. From HMO regulations to the abolition of Section 21, these are significant reforms that, for the most part, are rightly designed to protect tenants.
“Nevertheless, there’s evidently frustration among landlords who feel they are being unfairly targeted, particularly when it comes to the stricter taxes being introduced. It’s essential that anyone renting out a property – even if they would not consider themselves a landlord – understands all the new reforms and takes action to ensure their properties meet the necessary standards and their finances are structured in line with the new reforms.”
Paresh Raja, CEO of Market Financial Solutions