Is “professionalisation” a dirty word in the private landlord community?

Businessmen Shaking Hands 2021 08 26 15 44 04 Utc

Whether or not you think the question is rhetorical, it is the case that an element of professionalism is increasingly required of landlords operating in the private rented sector and that this requirement isn’t just coming from tenants and groups supporting or lobbying for tenant interests.

In recent years various reports on the private rented sector have pointed out that, historically, large numbers of landlords have operated just a couple of rental properties and, though these words weren’t used, the implication was that some landlords in that cohort, effectively, operated a “cottage industry” rather than a business. Some are described as “accidental landlords” - people who inherited a property following the loss of a parent and had never intended or planned to be a landlord. Others simply bought a property as they saw bricks and mortar as future security above and beyond their pensions (for those who might remember the late Robert Maxwell’s easy come, easy go attitude to his employee’s pension fund). Many more are part time landlords who rely on full time employment as their main occupation.

Time (and the rental market) has moved on though and perhaps any “non professional” landlords who object to any requirement to professionalise and operate as a business need to ask themselves why. To be fair, this objection often comes in the form of push back against being regulated and it is true that there is a maddening amount of legislation governing the private rented sector. But - whether one is a bone deep free marketeer resistant to national or local government “nanny state” interference or someone who believes that, purely and simply, you’re a “good landlord” as opposed to a rogue landlord, it is no longer possible (or acceptable) to sit back, freewheel and just collect the rent.

The regulation of any industry sector has a purpose and the private rented sector is no exception: that purpose is public safety and consumer protection. Landlords who wish to stay landlords in the changed and still changing private rented sector that we have today just have to deal with this fact. Putting aside the point that (some) knowledge of and compliance with regulation is also about managing and lessening the legal, financial and reputational damage risk of the regulated for their own protection (“rogue” landlords have their names in the public domain), the fact is that there are more and more consumers in the market now (otherwise multi billion pound hedge funds and pension funds wouldn’t be investing in driving the growth in build to rent property portfolios) and those consumers require more than a landlord’s moral and subjective view of his or her own capabilities. Which is what simply calling oneself without evidence, a “good landlord” amounts to.

The letting agent sector recognises the need for its own increased professionalism with training and continuous professional development courses (Propertymark being just one example) - which hadn’t been seen as particularly necessary until relatively recently.

Landlord bodies such as the NRLA provide training courses for their landlord members (though membership numbers are likely in the tens of thousands rather than anywhere near the estimated 1.5 million private sector landlords in the country - which sort of proves a point about the need for greater professionalism amongst landlords as a business sector). Even local authorities make available, in some cases, access to an element of landlord training as well as setting up or working with localised landlord accreditation schemes though, again historically, accreditation schemes tend not to be able to recruit anywhere near the total number of private landlords in a given council area.

Through the tax system, national government is directing private landlords to operate more like businesses though it still remains to be seen what the effect of upcoming rental reform will have on the numbers of landlords seeking to professionalize their letting operations.

Above all, the sector has a bad reputation despite Government statistics showing that most tenants are happy with their tenancies. Consumers still feel there is a wild west element to the private rented sector and a reason for this probably is that “bad news” about bad landlords sells but just as we are all good drivers …. until we’re not, you easily can be a good landlord …. until you’re not. And the fact that you didn’t know the highway code had been updated won’t cut the mustard. The training courses available to landlords aren’t university PhD courses in quantum physics and the market is now such that if you object to being required to evidence that you’re a good landlord, perhaps it’s time to get out of the kitchen. There are umpteen training courses available via trusted providers out there that won’t break a landlord’s bank; every local authority has webpages full of information on private rented sector requirements and signposting for private landlords. So - “professionalisation” isn’t a dirty word for the sector. Or at least if it was, it shouldn’t any longer be.

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