Landlords - Stop press for Stoptober!
Market Insight 25 October 2022 25 October 2022
UK & Europe
UK Real Estate Insights
This October has brought about many updates in the property industry which will affect many parties to include private landlords and property developers.
Smoke and Carbon Monoxide Alarm Regulations
On 1 October 2022 the Smoke and Carbon Monoxide Alarm Regulations in England changed. Landlords are now required to provide carbon monoxide alarms in any room with a fixed combustion appliance (gas cookers excluded) which is an extension of the previous position.
They are also required to repair or replace any alarm found not to be in proper working order (upon the tenant notifying) as soon as reasonably practicable, rather than simply testing it at the outset and then passing the buck to the tenant for the duration of the tenancy.
If the property is let subject to a HMO licence or a selective licence, the regulations will be set out in the licence conditions; the mandatory conditions set out therein will now change to reflect the new provision as mentioned above. This will be in respect of property licences in England that are granted on or after the 1 October 2022.
And we can’t forget about repercussions, the local authority can now suspend a remedial notice if a landlord has served written representations in response; the notice suspension will be lifted once the local authority has made a decision. Failing to comply to the remedial notice can result in the local authority carrying out the remedial works and imposing a fine of up to £5,000.
The New Homes Ombudsman Service (NHOS)
The NHOS provides a formal scheme where homebuyers can submit a complaint or seek redress when faced with poor building work in a new-build property; prior to the Building Safety Act 2022, homebuyers had no formal scheme to fall back on. Now remedies from rectification, compensation (proposed maximum of £75,000) and even an apology are available. The aim being that there is some sort of regulation of the building industry and better consumer protection for buyers of new homes.
The NHOS will review each case to decide whether they have breached the New Home Quality Code (NHQC), which sets the standards for newly built homes. Whilst there is no statutory requirement for developers to register with the NHOS, this month (October 2022) is the earliest date to activate. When the scheme is live, registration is likely to be compulsory and to be done by December 2022.
Once registered, developers will be required to adhere to the New Homes Quality Code with the prime aim being that buyers are protected from when they put down their reservation fee to two years after occupation of the property. Structural warranty insurance policies will also need to reviewed particularly for defects that materialise after the first two years of occupation.
If October wasn’t busy enough, the Insolvency Service has confirmed that it will be increasing the deposit amount in all cases where a petition is filed at court on or after 1 November 2022 for the purpose of obtaining a bankruptcy or winding-up order. The increases are as follows:
Fee from 1 Nov 2022
Creditors’ bankruptcy petition deposit
Company liquidation petition deposit
The Insolvency Service believes that this adjustment will allow for enough money in the pot to recover the Official Receiver’s administration costs whilst carrying out investigations cost-effectively, which in turn should lead to better returns for creditors such as landlords. However, the increase may be a deterrent for many creditors. Knowing this, if they have a valid debt creditors who wish to take action may want to think about doing so now (before the fee hike on 1 November) in order to keep their costs down.