‘Tenant’s Charter’ could be a winner for landlords too

At the recent Conservative Party Conference, Communities Secretary Eric Pickles announced plans for a ‘Tenant’s Charter’, which would promote the use of longer-term tenancies. Under the plan, renters would be able to request extended tenancy periods lasting between two and five years.

The Conservative Party says this will provide a better deal for tenants, with more stability for families and lower costs. What hasn’t been widely discussed is the benefit to landlords that the scheme would also represent.

Here at ludlowthompson, we have been actively encouraging landlords and tenants to consider longer-term tenancies for some time. We have found that many landlords prefer the security of a longer-term letting, as it allows them to ‘lock in’ good rental prices for an extended period, and cement mutually beneficial relationships with their tenants.

Crucially, the scheme will also ensure the possibility of void periods is minimised. A five-year tenancy period without voids would be an enviable situation for any landlord.

One potential obstacle for the Tenant’s Charter is negotiating terms with buy-to-let mortgage lenders, as the lender has to agree to the tenancy and may choose not to agree to a longer tenancy.

Stephen Ludlow, Chairman, ludlowthompson, comments: “The Tenant’s Charter represents a win for both tenants and landlords, with both parties benefitting from increased security and cost savings.

“It’s important that the Government does everything within its power to bring the lenders on board with the charter. The lenders hold the key to turning the charter from a good idea into a real game-changer in the residential rentals market.

“Our experience has been that a lot more landlords would strongly consider using two to five year rental periods if it were allowed by the terms of their mortgages.”