New Fit for Habitation Law for Landlords; and Forthcoming Prohibitions on Charges and Deposits on Tenants

There are two important developments landlords need to know about. First, residential landlords must ensure all their properties let for less than seven years are fit for human habitation; and second, the ability of landlords and agents to impose charges on tenants will soon be restricted.

Fit for human habitation

From 20 March, residential landlords of private and social property must comply with the Homes (Fitness for Human Habitation) Act 2018. This imposes an implied duty on residential landlords to ensure the properties they let, as well as their common parts (such as in a block of flats), are ‘fit for human habitation’ from the first day of the tenancy and throughout. The parties cannot contract out of the new law so tenants are protected from any attempt by landlords to pressurise them to waive their rights.

The Act applies to most residential tenancies, particularly those from 20 March 2019 for less than seven years. This includes tenancy renewals, and tenancies for more than seven years but with a break clause that can be triggered within seven years.

It also applies to periodic or secure tenancies which existed on 20 March 2019, or are created after 20 March. For example, this could be in circumstances where a shorthold tenancy ends and automatically becomes a statutory periodic tenancy.

In deciding whether a residential dwelling is fit for human habitation, the court will consider various factors including whether there are serious defects in relation to:

  • The stability and state of repair of the premises
  • Any damp
  • The natural light available
  • Ventilation at the premises
  • Water, drainage and sanitary facilities
  • Facilities for preparing and cooking food
  • Waste disposal facilities, and
  • The presence of any ‘prescribed hazards’

In most cases, the landlord will be responsible to ensure the property is fit for habitation (or face a claim), but with any rules there are exceptions. So where the tenant is responsible for the property being unfit for human habitation, the landlord will not be in breach of the new law. Nor does the Act require landlords to carry out works or repairs which, if carried out, would put the landlord in breach of any obligation imposed by other legislation.

Further exceptions include where problems are caused by fire, flood or storm.

Deposits and charges made to tenants

From 1 June 2019, landlords will face tighter rules on the deposits they can request from tenants in the private rented sector, and the money they charge tenants for works and other things. The provisions of the Tenant Fees Act 2019 outlaw unfair administrative fees levied on tenants. This means landlords and agents should be looking now at their procedures relating to taking tenancy deposits and how they charge tenants.

Once in force, the rules will prevent landlords and letting agents from charging security deposits of more than five weeks’ rent or holding deposits of more than a week’s rent. They must not disguise letting fees as something else, and they will only be permitted to charge tenants a fee if it relates to specific things such as:

  • A change or early termination of a tenancy if the tenant so requests (to a maximum charge of £50)
  • Utilities, communication services and council tax
  • Payments arising out of the tenant’s default – but charges must be reasonable

In the case of a breach of the rules, civil penalties could include a fine of up to £5,000 for a first offence, and if it continues or is repeated, a landlord or agent could face a criminal prosecution and a potential fine of up to £30,000.

The Government will be publishing guidance for tenants, landlords and letting agents to help explain how the legislation affects them.



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