Landlords could be rewarded with financial incentives for longer tenancies
Following some negative reaction to news earlier this week of the longer, 3 year tenancies being proposed by government, there are also proposals to provide landlords with financial incentives.
The government’s three year tenancy model addresses the demand for longer tenancies from the growing numbers of families and older people in the private rented market.
However, the lack of flexibility and control for landlords isn’t universally popular. One option could be to provide landlords with ‘financial incentives’, which is being welcomed by the Residential Landlords Association (RLA).
David Smith, Policy Director for the RLA, said financial incentives would be good, but warned against the dangers of introducing minimum three year tenancies as standard.
He said: “With landlords having faced a barrage of tax increases we believe that smart taxation, such as that being proposed today, would provide the longer term homes to rent many families and older people want.
“We would warn against making it a statutory requirement to introduce three year tenancies.
“Many tenants simply do not want to be tied to a property long term. It is vital that the market is able to provide the flexibility that many need in order to swiftly access new work and educational opportunities.”
Over the weekend, the government revealed that it would be consulting on plans to have three year tenancies as standard, with a six-month break clause and some exemptions for renters such as students.
National Landlords Association (NLA) CEO, Richard Lambert, said: “This is supposed to be about meeting the needs of the consumer.
“NLA research with tenants finds consistently that around 40 per cent of tenants want longer tenancies, but 40 per cent do not.
“More than 50 per cent consistently say that they are happy with the tenancy length they were offered, and 20 per cent tell us that when they asked for a longer tenancy, they got it.
“We would accept that the flexibility of the current Assured Shorthold Tenancy (AST) isn’t used as effectively as it could be and that we should be looking to find ways to ensure that tenants are offered the kind of tenancies they need at the time they need them.”