A recent survey conducted by AXA insurance has identified a positive shift within the property industry, finding that standards are beginning to improve within the market.
Changing property standards
Landlords will be aware of the significant amount of increasingly stringent legislation relating to the private rental sector which has come into force over the last year, including new Minimum Energy Efficiency Standards, The Deregulation Act (2015) and changes to HMO licencing.
These changes have sought to further regulate the industry and improve the environment in which landlords and agents operate, whilst also seeking to raise living conditions for tenants.
This year, 2,000 UK tenants were asked to take part in the English Housing Survey to find out what progress has been made in raising standards in the private rented sector over the last four years. The aim being to assess whether the introduction of new legislation has had a positive effect on the industry.
Interesting statistics reported by the survey include:
- The average tenancy length is 4.3 years
- 82 per cent of tenants were satisfied with their accommodation; 10 per cent of private renters were dissatisfied, compared to 13 per cent of social renters
- Of those who had repairs carried out in last 12 months, 18 per cent were dissatisfied with how they were done. This was compared to 22 per cent of social renters
- Of tenancies that were brought to an end, 73 per cent were due to tenant demand. 11 per cent were terminated by the landlord. Only two per cent left because of a rent increase
The measurement of progress over the past four years has painted a positive picture for property standards in the market.
Statistics relating to the number of landlords providing tenants with essential information appears encouraging, with the number of British rental homes complying with safety rules reported as follows:
|Tenancy agreement||81 per cent (up from 73 per cent)|
|Energy Performance Certificate (EPC) provided||33 per cent (up from 19 per cent)|
|Carbon monoxide alarms||34 per cent (up from 27 per cent)|
|Inventory report||41 per cent (up from 36 per cent)|
|Current gas safety certificate||58 per cent (up from 30 per cent)|
|Smoke alarms (on each floor)||59 per cent (up from 42 per cent)|
|Government ‘How to Rent’ guide provided||15 per cent (received)|
Despite these positive findings there is clearly still a way to go in relation to fire and gas safety. For example, although every rental property requires an annual gas safety inspection, the survey reports that only 58 per cent have had this check completed in the last 12 months. In addition, four in ten tenants also report that they do not have smoke alarms in their rental property, even though this is a legal requirement.
The essential documents such as the EPC and ‘How to Rent’ guide must be provided to tenants or the landlord will be unable to serve a valid section 21 notice, should it be required. Landlords therefore need to fully understand their obligations in order to remain compliant.
Interestingly, 75 per cent of tenants were also not aware that landlords are legally obligated to ensure a minimum energy rating for the property as a result of recent (April 2018) MEES regulations.
Based on these findings, AXA estimate that this means approximately 150,000 rental properties in the UK are failing to meet these new standards. Of this 50 per cent, tenants reported that they believed their rental property negatively impacted on their health, reporting cold, damp and inadequate heating as the main reasons.
Property standard upgrades
AXA Insurance also report that landlords are making further changes to their properties in order to upgrade and provide energy saving features. This is a positive move for the industry and shows that steps in the right direction are being taken by model landlords. For example, smart meter installation is at 26 per cent (up from 14 per cent) and double glazed windows at 78 per cent (up from 73 per cent), of benefit to landlords and tenants alike.
What does this mean for the property industry?
Gareth Howell, Managing Director at AXA Insurance, reports:
“Landlords are getting more professional, and we are seeing standards rise in British rentals, driven by legislation and desire of landlords themselves.
“We know that many start out as ‘accidentals’, and there is a big learning curve for them at the start, particularly as legislation changes so often.
“We find that both landlords and their tenants lag behind, so public awareness campaigns are vital to correct myths and promote new rules and standards. Gas and fire safety should be the priorities here: our research suggests that millions of properties are not compliant with today’s laws.”
Find out more about the current property standards, including additional survey findings, here.