19th February 2024

Trading Standards on the home front

Could much-hyped but delayed new legislation bring some security for renters in the private housing sector?

By Helen Nugent
Freelance writer for JTS
We discovered quite quickly that this isn’t something that Trading Standards or environmental health or housing can enforce in isolation
Certainly, if the Bill is enacted in its current form, it will make things easier from an enforcement perspective
While we haven’t got the resources to deal with every single complaint, if we don’t know about it, we certainly can’t do anything about it

Few people have been spared the vicissitudes of the cost-of-living crisis, and this is particularly true for renters. Average private rents in the UK have rocketed by more than quarter since the beginning of the pandemic and will keep on climbing, according to a recent report by the estate and lettings agent Savills.

Some have dubbed the property rental market as ‘broken’ and it’s not hard to see why. Decent rental homes and apartments are in short supply and rising mortgage costs have priced many out of the house-buying market. Savills estimates that the typical tenant household is now spending 35.3% of their income in rent. In London, that figure is 42.5%.

It’s been difficult for landlords too, with endless interest rate hikes adding to the cost of buy-to-let mortgages. There’s also been a rise in the number of people not paying their rent, often due to pressures on household budgets thanks to increased costs of fuel, energy and food. In addition, changes to capital gains tax allowances will mean that landlords looking to sell their properties could be squeezed financially.

Measures included in the Renters (Reform) Bill are intended to address some of these problems, not least the issue of tenant evictions. The Bill would mean the scrapping of Section 21 ‘no-fault’ evictions, which has long been called for by campaigners. Currently, Section 21 of the Housing Act 1998 allows landlords to demand that tenants move out with two months’ notice without having to disclose a reason for the eviction. That leaves renters feeling powerless to contest evictions and makes it hard to establish a stable home environment.

Figures released by the Ministry of Justice earlier this year showed that court proceedings for no-fault evictions in England have reached their highest level in six years. Between April 2023 and June 2023, some 7,491 no-fault evictions were brought before the courts. During the same period, bailiffs conducted 2,228 no-fault evictions, up 41% year-on-year.

The new Bill would require landlords to use a Section 8 notice which insists on specific grounds for eviction such as rent arrears or antisocial behaviour. Unlike Section 21, the landlord is not guaranteed to take back possession of the property.

Hope on the horizon?
With 11 million private renters and 2.3 million landlords in England alone, the Renters (Reform) Bill could offer better protection and peace of mind. But it is not a done deal, with delays raising the prospect of the government running out of time to enact the legislation.

The Renters (Reform) Bill had its first reading in May 2023. In addition to the abolition of Section 21, its measures include comprehensive possession grounds so landlords can recover their property if they wish to sell it or where the tenants are at fault; stronger protections against backdoor eviction, ensuring tenants can appeal excessively above-market rents designed to force them out; a new Private Rented Sector Ombudsman; the creation of a Privately Rented Property Portal for landlords, tenants and local councils; and the right for a tenant to request having a pet in the property.

The Bill has now completed the Committee Stage, meaning that MPs have scrutinised it. Next, it will move onto the Report Stage and the Third Reading, before moving on to the House of Lords.

By the government’s own admission, nearly a quarter of private rented homes do not meet basic decency standards. But the Bill is still grinding through parliament following years of pledges by successive Conservative governments to reform the rental sector. The housing charity Shelter said recently that one in ten private renters risks losing their home this winter due to potential eviction notices and rent arrears.

Nevertheless, Michael Gove, Secretary of State for Levelling Up, Housing and Communities, has said that the ban on no-fault evictions will not be implemented until action has been taken to improve the court system. This decision has angered parliament’s all-party Levelling Up, Housing and Communities Committee. In a letter to Gove, the chair of the committee, Labour MP Clive Betts, wrote: “The Government has had four years to ensure the legal system is fit to handle the consequences of the abolition of Section 21. It is therefore difficult for us to understand the Government’s lack of urgency and transparency around court reforms.”

Trading Standards steps in
So, where does this leave Trading Standards? To properly understand the impact of the upcoming legislation, it’s necessary to look back to the Tenant Fees Act 2019, which cemented Trading Standards’ position at the centre of housing and tenancy issues.

Alison Farrar is Operations Manager of the National Trading Standards Estate and Letting Agency Team (NTSELAT), as well as being CTSI Lead Officer for Property and Lettings and Consumer Education. She says that the Tenant Fees Act (which only covers England) was designed to make sure there were no hidden fees for tenants.

“That’s partly what we do in Trading Standards, isn’t it? We make sure that everything is fair, clear, honest and upfront, and you know exactly what you’re getting. You know how much it’s going to cost and when you’re going to pay it, and all that information is there for you.”

Farrar says that, when the Tenant Fees Act came in, it was clear that, for the first time, Trading Standards should be looking at the contracts between tenants, landlords and agents.

“But what we discovered quite quickly is that this isn’t something that Trading Standards or Environmental Health or Housing can enforce in isolation. And this is because of the changing nature of the way that tenancies and property investments work. Now you’ve got these huge portfolio landlords, you’ve got people doing property investments and buying properties all over the country. And you’ve got agencies helping to manage property or helping to find tenants. Some of them are clearly portals but some of them are very clearly property managers. These are huge businesses.”

The changing landscape for enforcement officers across local authorities has been further complicated by the influx of bigger companies, virtual offices in the larger cities, and registered companies which have never traded, says Farrar.

“That means that all our expertise in Trading Standards comes into play. We deal with businesses who try and hide from the law, we deal with businesses who phoenix so they can shut down and open up another company. And it’s not just for tax purposes, it’s for other obligations as well. It’s about leaving the debts behind. It’s about leaving their obligations to their customers behind.”

Decent Homes Standard
Looking ahead to the new rental reforms, Farrar highlights the quality of rental properties. She says: “The Renters (Reform) Bill talks about introducing a new Decent Homes Standard in the private rented sector, which means that all private rented properties would have to reach a certain level for different standards. And that’s a good thing for tenants.”

However, she says there are some concerns for Trading Standards if the Decent Homes Standard comes in. “Does that mean the construction industry will be affected in some way? It could open the floodgates for rogue traders and scams. It could also mean that prices rise. So, creating even more demand for all private rented sector properties to be brought up to a certain standard could mean a massive influx of the kind of issues that you see with poor and dodgy workmanship. We’ve seen it before with government schemes. When there’s a good scheme, there’s always a scam alongside it.”

Meanwhile, James Munro, Senior Manager at NTSELAT (and Chair of CTSI), says that another challenge around the Renters (Reform) Bill will be how the enforcement works and who does it. “It is Housing and Environmental Health Officers who will be the primary enforcement officers in this particular piece of legislation,” he observes. “Trading Standards are in there, they do have a role, but it’s a limited role when you compare it to things like the Tenant Fees Act.”

He adds: “We’re there to try to protect consumers as best we can, but also to support and help legitimate businesses. We’re there to support local authorities.

“And then we also act very carefully as a backstop enforcement function, where we can take enforcement action if a local authority can’t or won’t get involved. But that’s got to be managed very carefully. Because clearly, we’ve got limited resources. And we cannot be taking over or making up for any lack of resources in a local authority area.”

Munro also points to the Renters (Reform) Bill and landlord redress. “It would effectively identify all of the landlords in England and the properties they own. And that is one of the big gaps at the moment in terms of enforcement. I think it would be of huge assistance in actually working out who is in the sector and who is involved in which properties. A lot of the time, investigation time is taken up in establishing who the landlord is and how many other properties they have because the first thing you need to look at is whether or not that particular behaviour is replicated in other areas.

“Certainly, if the Bill is enacted in its current form, it will make things easier from an enforcement perspective.”

Better together
According to Munro, the fundamental issue for Trading Standards regarding the Renters (Reform) Bill will be collaborative working with Housing and Environmental Health colleagues. He says that at the moment the approach is rarely joined-up, partly because of the way that the structure of local government works, where Trading Standards sits within those differing local authority structures, and varying levels of communication between different council departments.

“As the lead enforcement authority, at the moment we’ve got two big pieces of work going on regarding improving that collaboration. Firstly, that’s between housing authorities and Housing Officers. Secondly, it’s between Housing and Trading Standards using the national intelligence database which, traditionally, has only been available to Trading Standards. Now, with this work that we’re carrying out with local Housing and Environmental Health Officers, they’ve got access to it and can share that intelligence.

“This should help in a number of ways. It should help Trading Standards be more aware of what’s happening within the Housing and Environmental Health section. And it will also benefit Housing Officers to find out what Trading Standards has been doing.”

He continues: “The other project about improving collaboration with housing authorities started in September this year. We’re overseeing that particular piece of work which is running for 18 months. That’s basically trying to replicate the Trading Standards regional working, and introduce that to housing authorities so they have access to the intelligence systems, and they have access to advice, guidance and support.”

A London initiative
In London, there has been very good collaboration when it comes to housing issues, Munro points out. But that’s not the only thing happening in the capital.

London authorities have recognised that people don’t necessarily think of Trading Standards when they need to complain about housing issues. Instead, they approach the local Housing department or contact organisations like Citizens Advice or Shelter. But a reporting line established by the Mayor of London has provided a new model.

Stuart Radnedge, Regional Coordinator at London Trading Standards (LTS), explains. “Right at the start of the year, we booked a call with the Mayor’s Office. We knew they had this ‘Report a Rogue’ tool [the Rogue Landlord Checker and Report a Rogue initiative launched in 2017, enabling the capital’s 2.7 million renters to report rogue landlords and letting agents more easily]. We asked them if they’d like to collaborate, and it was a really, really warm reception in terms of them wanting to hear what our plans were.

“Our idea was to get Housing colleagues working better together with Trading Standards. Trading Standards enforce the Tenant Fees Act, but Housing obviously has the obligation to investigate complaints.

“What we were saying was that we needed to pull these people together.”

Working with the Mayor’s Private Rented Sector team, LTS launched the project in September 2023. LTS hopes that the tool will encourage tenants to report problems with things like unfair evictions, prohibited charges or fees, deposits, and the behaviour of landlords and agents. LTS is optimistic that this will bring about change given that, over the past six years, the Mayor’s Report a Rogue tool has been used more than 6,000 times.

In October 2023, of the 33 unitary authorities in London, nine agreed to take part. From January 2024, that number will increase to 22.

Radnedge says: “The intention, if it goes well, is to attempt to roll it out across all the parts of London.

“We’ve also had conversations with Citizens Advice to better understand their process in terms of when complainants are contacting them and saying, ‘I’ve got a problem with housing’. We said to them quite openly, ‘what do you do?’ They told us they don’t have the manpower to deal with housing complaints.”

Instead, housing issues are often referred to Shelter who, in turn, aren’t in a position to prioritise various tenants’ issues unless they relate directly to homelessness.

Radnedge and his team were told that, of 1,000 calls made to Citizens Advice, only two people call back to follow up their complaint or seek an update.

“There should be a complaint mechanism where you can go directly to Trading Standards. But those days went a long time ago because everything’s done at a distance. However, Citizens Advice also have been very pragmatic and they’ve changed their advice specifically tailored to this London project. So, if you’re in London, you will have a different route on the website in terms of where you’re sent to. And the same with Shelter as well. Reflecting this project, they’re both referring to the Mayor’s reporting line now.”

Radnedge adds: “If we can show that this approach works, maybe people can start having this conversation in terms of creating a reporting line.”

Farrar agrees that establishing a reporting line is important, as is making sure that the complaints received achieve two key objectives. “The first one is that the person who’s calling gets the advice they need, and that they can go ahead and help themselves and work out what to
do next. That’s vital. But the second thing is just as crucial. It’s about making sure that Trading Standards or the local authority know about that complaint. Because while we haven’t got the resources to deal with every single complaint, if we don’t know about it, we certainly can’t do anything about it.

“So that intelligence, knowing about those numbers of complaints, what they are, how they work, what they look like, how many of them there are, and how they get resolved at the end, is crucial intelligence for local Trading Standards services. And to be able to do that for the whole of the London region means that they can get a really clear and true snapshot of what’s going on.

“It will also mean that, with some high-level stats, we’ll be able to use them to identify patterns and issues.

That helps us as a team when we consider what guidance needs writing and what further projects need to happen, and that might help us to understand what’s actually going on out there — because what happens in London might be happening in other areas.”

Update: February 2024
The Renters Reform Bill completed its Committee Stage on 6 December 2023 but has not yet been scheduled for its Third Reading. Meanwhile, it was reported that the number of households evicted by bailiffs as a result of no-fault evictions rose 39% in 2023 compared with 2022, according to housing charity Shelter’s analysis of new Ministry of Justice figures.

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