Information Provided Courtesy of Ellison's Solicitors....

We have received a few questions recently about the Private Rented Sector Landlord Ombudsman and the Private Rented Sector Database which are intended to be introduced alongside the Renters Rights Bill. We thought that some further information about these would be of interest.

The Private Rented Sector Landlord Ombudsman

What is the Ombudsman service?

Private landlords with assured or regulated tenancies in England will be required to join the Ombudsman service, whether or not they are assisted by an agent. Local authorities will be entitled to take enforcement action against landlords that fail to register with the Ombudsman, and anyone who markets a privately rented property on behalf of a landlord when the landlord is not registered. Landlords may be given fines of up to £7,000 for an initial breach, or up to £40,000 or even face criminal prosecution for repeated offences. If a landlord persistently fails to join the Ombudsman service, the tenant may be entitled to seek a rent repayment order.

The Ombudsman service is intended to provide impartial and binding resolutions for tenants’ when they complain about their landlords. Landlords will have the benefit of guidance and support from the service in handling complaints. The Ombudsman will have the power to require landlords to provide information, take remedial action and pay compensation to tenants, amongst other things. If a landlord fails to comply with a decision by the Ombudsman, they can be expelled from the scheme and subjected to enforcement action by their local authority. Landlord will have the opportunity to re-join after being expelled once they have become compliant.

Even when a landlord stops renting properties, they will be expected to remain members of the service for a reasonable timeframe so that tenants can still use the service at the end of the tenancy.

When will the Ombudsman be introduced?

The government plans to introduce the service as soon as possible after the Renters Rights Bill received royal assent and becomes law. The government says that landlords will be informed of the deadline by which they must sign up to the service.

Will there be a fee?

It is expected that landlords will be required to pay what has been described as a ‘small annual fee’ per property. We are yet to see any indication of what that fee might be.

What sort of complaints will the Ombudsman deal with?

The service will consider complaints about actions, inactions and behaviours of landlords which have caused harm or inconvenience. The Renters Rights Bill intentionally maintains a broad scope of issues so as to allow the Ombudsman to have some discretion in considering complaints. Landlords will not be able to complain about their tenants via the Ombudsman.

Letting agents will not be required to register with the Ombudsman, seeing as there are existing agent redress schemes that will remain in place. If the landlord and their agent are both found to be at fault when a tenant makes a complaint, the Ombudsman can work with the existing agent redress schemes to carry out investigations and make joint decisions where appropriate.

Private Rented Sector Database

What is the Database?

All landlords of assured and regulated tenancies will be required to register themselves and their properties on the Private Rented Sector Database. It does not appear that agents will be required to register for the Database. Landlords may be subjected to penalties if they fail to register for the service while marketing or letting a property.

The Database is intended to help landlords understand their obligations and demonstrate compliance, changes to requirements will be communicated via the Database. The government say that it will provide tenants with access to information about a property before they decide to rent it, and whilst they are renting.

When will the Database be introduced?

As of September 2024, the government confirmed that the Database is undergoing development. The service is intended to be in operation as soon as possible once the Bill and any secondary legislation has passed.

Once the Database becomes operational, landlords will be able to register online, or offline. If they do not register for the Database, they will only be entitled to seek a possession order on the basis of grounds 7A or 14 (anti-social behaviour of the tenant). Local authorities will be able to implement the same enforcement measures against landlords who fail to register for the database, as landlords who fail to register with the Ombudsman.

Will there be a fee?

Landlords will be required to pay a fee to register on the database. The government have not confirmed how much this might be.

What information will be available on the Database?

The government have not yet determined precisely what information will be available. Regulations will be produced to confirm this. It appears that the Database will be concerned with property standards.

You may already be aware of the Database of Rouge Landlords; the Private Rented Sector Database is intended to replace this. Selective licensing schemes are expected to remain in place.

If you have any questions about the information above, or anything else relating to the Renters Rights Bill, please do let us know.