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Landlords are welcoming ideas to provide tax incentives in return for longer tenancies. The government is looking into a number of options to put in place a three-year tenancy model. With more people renting for a variety of reasons, rather than turning to home ownership for their property needs, more are seeking the security of longer tenancies. In particular, the growing number of families and older people who are tenants are looking for longer tenancies. The Ministry of Housing, Communities and Local Government has published its consultation paper, Overcoming the Barriers to Longer Tenancies in the Private Rented Sector. It points out that the sector has changed incredibly over the past 30 years, with double the number of households now in rented accommodation. Half of these are families with children and older tenants, who are looking for long-term rental properties. That’s why the government is seeking a new model which balances the tenants’ desire for protection with the landlords’ needs to regain their property if their circumstances should change.

One option could be financial incentives for landlords to voluntarily offer longer tenancies, as this could be quicker to set up than mandatory or obligatory three-year tenancy agreements. Residential Landlords Association policy director, David Smith, said the smart taxation, which is being proposed, would provide the solution for long-term rents that many families and older tenants are seeking. The RLA is warning against a mandatory implementation of three-year tenancies, because it is not in the best interest of many tenants. Many tenants, such as young professionals, do not want to be tied to a property for the long haul. This is one reason why many opt to rent rather than buy – because of the flexibility it offers. It is important for tenants to continue to have the choice of tenancies and the flexibility they require, in order to move for work or take up educational opportunities.

Many buy-to-let landlords are against proposals for a minimum three-year contract. However, one residential landlord has welcomed the proposal. Get Living CEO, Neil Young, said home ownership is at a 30-year low. He said many people are eschewing home ownership and are renting instead. He said that it is now more common to rent rather than buy commodities. Netflix and Spotify have led the way and now homes are set to follow. Mr Young, whose company is behind the build-to-rent project in East Village, London, said longer-term rents would benefit tenants and landlords. Tenants would have the security of tenure and landlords would have a stable rental income with fewer void periods. Get Living offers three-year tenancies as standard.

Get Living has also scrapped security deposits, which is another barrier to renting, as tenants need to find a deposit as well as their first month’s rent when they move into a new rental property. Moda managing director, Johnny Caddick, is also backing better security of tenure for tenants. Moda is backing build-to-rent schemes in both England and Scotland. He argues that there needs to be a more customer-centric market to create greater confidence in the rental sector.

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