ARLA calls on Treasury to offer tenants greater protection

In a submission delivered to Downing Street, the lettings experts asked for:

* Greater protection for private sector tenants during the economic downturn;
* Incentivisation for private sector landlords to improve the quality of housing stock;
* Reform to mitigate the adverse impact of Stamp Duty on larger investor landlords.

Ian Potter, operations manager of ARLA, said: "Scrutiny has rested on the sales market during the downturn but the threat to the lettings market holds equally as grave consequences."

On the issue of greater tenant protection, Potter said: "ARLA calls on the Government to ensure lenders give tenants at least two months’ notice of an eviction after a repossession order has been granted.

"This would rest the issue of blame with the landlord, not the tenant if the tenant has kept up to date with their rental payments, if the mortgage is defaulted and will also allow the tenant more time to find alternative accommodation. The lender may also decide to take rent in receivership in appropriate circumstances. This is obviously more likely, should the tenant be able to prove the rent has been kept up to date."

He added that a quarter of the accommodation provided in the private rented sector was in dire need of improvement – and called on the Government to offer incentives to landlords to improve the quality of UK housing stock.

ARLA wants the Government to implement the following initiatives:

* Remove VAT on the purchase of materials and labour for capital expenditure to improve older property brought into the rental market;
* Introduce capital allowances for landlords improving housing stock over a certain age;
* Increase the Landlords Energy Saving Allowance (LESA) to include the installation of central heating systems.

Stamp duty also needs reform, Potter said.

"Larger investor landlords can be put off buying blocks of property as Stamp Duty is based on the total value of the transaction, rather than value of individual properties within the block. This almost always has the effect of the duty being at the highest rate," he said.

"Again, Government incentives could be provided to purchasers of older property where a survey report and an Energy Performance Certificate show a property is likely to benefit from investment.

"Where this is the case, and the landlord completes the work within a period of say, 12 months of purchase, the stamp duty could be refundable. There could also be a ‘clawback’ facility whereby the Government could claim back the refunded stamp duty if the property was not kept for a given period, say 10 years, as a rental property."

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