There are a number of things to be on the lookout for in the coming year – some we can’t do anything about, such as the pandemic and Brexit, but there are some we can, and that’s where we need to keep on top of things.
Stamp Duty Holiday
While there may be additional measures put in place to counter economic issues, the present stamp duty holiday is set to end, meaning that all landlords hoping to take advantage of the current 3% flat rate (in England, on purchases up to £500,000) need to ensure that their purchases are completed prior to the March 31st cut off.
End to Mortgage Holidays
If the latest lockdown – which increasingly looks set to last until at least March – is likely to cause issues with your payments, or those of your tenants, then you have until March 31st to apply for a mortgage holiday:
- Those that haven’t taken a payment holiday can apply for deferrals of up to six months.
- Those that have a first deferral in place, or that resumed payments after one deferral, can apply for another which will take them to the six-month limit.
- Those that have already had six months of deferrals are not eligible for further payment holidays.
Deposit Protection Schemes
There will be new rules for deposit protection from April 2021. With possible fines up to £30,000 for landlords and agents failing to join one of the six approved schemes which hold funds in accounts registered with the Financial Conduct Authority, landlords will need to ensure they take this particular change extremely seriously.
End of ‘no reason’ eviction
While consultation began on section 21 notices back in 2019, there is likely to be an outcome one way or the other on the ability for landlords to end ‘rolling tenancies’ with no reason required and a two month notice period. Although the Renters’ Reform Bill has been held up indefinitely by the pandemic, the vaccine rollout could see the bill make some progress in 2021 – the bill also includes the possibility of a moveable ‘lifetime deposit’ which would follow tenants from one property to the next in place of security deposits and the opening up of the rogue landlord database to the public.
An additional 2% surcharge will need to be paid on purchases by overseas investors from April of 2021 (in addition to the regular by-to-let surcharge). Any non-UK residents – those who have spent fewer than 183 days resident in the UK in the year prior or in the after the purchase – will be required to pay this additional charge on all purchases.
Right to Rent Uncertainty
Current rules on the requirements for landlords regarding the ‘right to rent’ are set to expire on the 30th of June 2021 with no clear guidance as to what will replace them. While we can hope that the new requirements will be made clear soon, the only thing landlords can do in the meantime is continue to check that tenants have the right to live in the UK using valid passports and ID cards until that happens.
Electrical Safety Rules
From the 1st of April existing tenancies will also be subject to the new guidance on electrical safety – with all properties needing their electrical installations inspected at least every five years and tenants provided with a copy of the report within 28 days of completion. While new tenancies have been subject to the terms since July 2020, landlords will need to ensure that all of their existing tenancies are in line with the rules by the end of March.
2021 is still shrouded somewhat by the joint uncertainties of Covid-19 and Brexit, but there are definite hurdles that landlords will need to be aware of throughout the year – and if you’d like some help navigating them, then you can Contact Us for expert advice.