Sean Hooker, Head of the Property Redress Scheme, shares his thoughts on the proposals to make it easier for tenants to have pets in their rental homes.
So here we go! The Renters (Reform) Bill is finally starting its passage through parliament. After the anticipation, the speculation, and the frustration, the starting gun was fired with a low-key parliamentary procedure. Called a First Reading, it lasted less than a minute.
Thereafter the frenzy started. Everyone pouring over the close to ninety pages of the bill, trying to navigate its formal language, and cross referencing the plethora of other legislation that it refers to that will be affected or changed by the proposed provisions.
Although it's the most fundamental change to renting in a generation, as of today absolutely nothing has changed. It will be the best part of a year before any of the reforms will hit the statute books or at least are introduced.
Balancing detail and delegated powers
Some sections are quite detailed in the changes they propose, such as the change of tenancy type, the abolition of section 21, and the introduction of new grounds for section 8.
However, others are vague and the liberal use of Henry VIII clauses or delegated powers will mean the fine detail of how this is all going to work will take time to emerge.
The official guidance does give clues on what their intentions and aspirations are. However, given the timescales involved in rolling out the programme, the fact it could be amended and that there could even be a new government in place to implement least part of the package, nothing can be a hundred percent assumed.
So, whilst everyone is looking for answers to what they need to know and more importantly what they need to do, the short answer is they are going to have to be patient for a while yet.
The surprise of pets in lets
Pets in lets was a relatively surprising addition to the legislation. While pet-friendly tenancies were lauded in the white paper, it was not certain whether a detailed proposal would be put forward. However, there it was.
Not only is the proposal to make the keeping of a pet an implied tenancy term, but there is also a provision for amending the Tenants Fees Act and excluding the recovery of premiums for pet damage insurance from the tenant from the list of prohibited payments.
This is quite a big shift in the thinking of the government. It moved from believing an obscure clause in their widely not used model tenancy agreement was sufficient to tackle the issue, to saying that a landlord should have to have a jolly good reason not to accept pets.
The emotional capital in pets
Given the scale of the other proposals to the market, this one reform will attract a disproportionate amount of attention and the expenditure of vast amounts of emotional capital from both sides of the rental equation. This is England after all.
Nothing provokes more polarised debate than our furry family members (apologies to those with feathers, scales, or exoskeletons) – not even Marmite!
The facts, however, are clear. The sector can be quite anti pet and the restrictions on keeping animals in the majority of rental properties makes the tenure for many a far less appealing option for their choice of home.
The lack of choice of pet-friendly tenancies is a major sentiment and helps explain some of the resentment felt by tenants.
Where tenancies are available for pet renting, they increasingly come at a rent premium. This is partly of government's own making with the cap on deposits. However, blanket bans frequently seen on property advertising are, for the most part, uninformed prejudice.
The supply of pet-friendly homes
I can now feel the collective blood pressure rise as some of you are reading this but stay with me, we don’t need a defibrillator – yet. The figures out there show that the supply of pet-friendly properties is tiny.
The government's own figures, as pointed out in the latest Goodlord guide, show only 7% of adverts welcomed pets and this despite a 120% increase in demand by tenants. I, however, have seen some even more interesting figures, these being from one of the major property portals.
Its figures show just 3.49% of UK residential lettings properties say that pets can be considered and 17.46% say that they cannot (with 79.05% not specifying either way). However, even when pets are allowed, many adverts are not black and white.
Advertising around pets
Examples given to me range from “pets are permitted”, through “pets considered/by arrangement” to the specific: “Pets are welcome at the property which due to its size and location would be ideal for a family with dogs. Additional £20 per month for 1st pet and £10 for extras up to maximum of 4.”
The figures also contain pet provisions with conditions and caveats such as this bizarrely diametric statement - “'Pets welcome (unfortunately no dogs)” - an oxymoron if ever I saw one!
Where pets are omitted or excluded
The number of adverts that specifically exclude pets are thankfully low. However, they are at least honest and most of the ones the portal provided as examples were preceded by an apology. “'With regret, the landlord cannot consider students, smokers or pets” is a good example.
The close to 80% of adverts that do not say either way, I would venture to say, are contravening the material information disclosure rules by omission under the Consumer Protection Regulations.
This becomes more relevant if the prospective tenant is told no pets or if they're discounted from being selected on the basis of being or want to be a pet owner after applying for the property or viewing.
Even if the vast majority of the adverts silent on pets were accepting them - which is clearly not the case - the new proposals in my view will make this an illegal practice.
Having a valid reason to say "no"
This said the provision in the bill would make it mandatory for a landlord to provide a valid reason for denying a request to keep a pet so long as the request is made in writing.
That written request will require the tenant to provide a statement describing the animal. This is vague in terms of the information that would be adequate but evidently more than “cute and cuddly” would be required.
The legislation will attempt to define what a pet is, with keeping an animal for personal reasons, companionship, or ornamental reasons or any combination of the three.
The interpretation therefore of the provisions - if adopted unamended - will have to have a degree of reasonability applied. The interpretation of this may well fall to a redress scheme to determine.
The start of pet referencing?
I do think this is the advent of pet referencing, where the responsible pet owners should be rewarded if they are prepared to ensure their cat or dog have the appropriate jabs, chips, vet insurance and even training.
It may prove more difficult for more exotic creatures and we won’t even go down the path of the keeping rabbits or chickens under the Allotment Act 1950.
I have also adjudicated cases such as where permission was given but then the number, size, type, or behaviour of the animal became an issue.
These cases have tended to go in favour of the tenant on the basis the conditions given to them were too woolly. While I could not force the agent to accept an unsuitable animal, compensation was awarded.
Are the rules realistic?
The new rules could sort this issue out. However, in my view, it may well be worth looking at making the role of a landlord or agent more proactive in specifying the conditions for pets up front.
It is clear the timescales of forty-two days may not be a realistic timescale for lettings when a tenant turns up with a pet in tow and wants to move in a week next Thursday.
There is also the issue of when a property is clearly unsuitable for a property. Landlords and agents can be reassured that provisions contained in the bill do make it clear that, in a leasehold arrangement, if the lease conditions prohibit pets, this is a legitimate reason for not giving permission.
I anticipate there may be shenanigans where the covenants have been widely flouted or permission inconsistently applied. Ultimately, a court will be empowered to determine on these issues, although the redress provisions that exist or that are proposed will have a big role in sorting out any mess.
Insurance over extra deposit charges
The proposal for the requirement for insurance appear to be reasonable and should negate the need for higher deposits to be charged or indeed extra rent. However, there are many things to iron out as the right products and the right pricing needs to be calculated.
I will return to these challenges down the line - not least after I have delved more into technical challenges this will present, as the insurance sector is all about risks and actuarial evidence and this is yet to be firmly determined.
All in all, it looks like some real heavy petting will be required to make this all work, but it is to the credit of those campaigners such as Jen Berezai of Advocats, whose report, Heads for Tails!, was influential in forming the basis of this part of the bill.
There will be more work to bring the issue to heel and I have sat on a working group that has taken the lead on the insurance solutions, however I believe there is a good foundation for a practical and sensible solution that will sit well with all stakeholders in the sector. Not pawfect but definitely one ready for walkies.
