The National Residential Landlords Association (NRLA) have received reports over the last few months of prospective tenants who have been defrauded out of hundreds of pounds by criminals who have advertised a fake property to rent.
How it works?
A fraudulent landlord will typically use a non-mainstream channel to advertise a property. Please have used a local Facebook Group or Community to find properties in the area they wish to rent and have fallen victim to a bogus landlord. They pretend to advertise a property which may actually exist, but they do not have the right to let it. They then convince the victim to part with a deposit to secure the property and if successful, try to get the victim to part with rent upfront as well. Naturally, the fraudster then promptly disappears with the money.
In addition to this there is a rise in fraudulent tenancy applications on the rise. Latest figures, from tenant referencing group, Barbon, which includes HomeLet, Let Alliance and Rent4Sure, reveal the extent to which tenancy application fraud is on the rise and reporting a 10% rise in fraudulent applications. The group completes a million tenant references a year.
Rising rents and the cost of living crisis are just two of the factors helping to increase the pressure on household budgets. Barbon's CEO, Andy Halstead warns that application fraud has spiked over the 18 months, with fraudsters becoming smarter at a time when the UK is facing the biggest income squeeze in nearly 50 years.
"The volume of alerts on applications is continually increasing and in the 12 months alone, we've flagged over 50,000 suspicious applications", he said.
"As demand for property soars and rental prices rise, tenancy fruad is becoming more profitable and many more chancers want to get in on the act. They'll use any opportunity, and we're seeing increasingly sophisticated methods being used to try to obtain access to properties to support criminal activity or sublet illegally".
"Referencing tenants is the first line of defence, and our experience, expertise and procedures help keep customers safe. We're continually optimising our checks, which mix technology with the most experienced team in the market. We call it Intelligent Referencing for a reason".
The Renter's Reform Bill has been officially on the table. Theresa May's Government first announced the bill in April 2019 as a 'step change' in protections for renters, ending no-fault evictions and giving landlords and tenants more rights. It was hailed as the biggest change to the private rental sector for a generation.
ARLA Propertymark is warning the Government that it should not delay further on its long-awited Renters' Reform Bill, because of the uncertainty it is causing the Lettings sector. The Bill was introduced in outline in last week's Queen's speech, suggesting it would be put on the Parlimentary timetable for sometime in the coming 12 months.
There have been so many proposals to this Bill already.
- July 2018: Consultation Number One
In 2018, the Government launched a consultation on 'Overcoming the barriers to longer tenancies in the Private Rented sector'.
This was the first step towards creating the Renters' Reform Bill as we know it today, and the first invitation to the industry at large to contribute views on the benefits and barriers of landlords offering longer tenancies.
- April 2019: The Government Responds to the Consultation
In April 2019, the Renters' Reform Bill started to take shape. Just before the Tenant Fees Ban came into effect, Theresa May's Government published its response to the 2018 consultation.
The Government shared that it woule ban no-fault evictions, amend the Section 8 Notice, and reform the court process to 'improve security for tenants'. Doing so would also 'effectively create open ended tenancies' and bring about the 'biggest change to the Private Rental sector for a generation'.
The press release from the Government announced a new consultation on eviction and court processes, saying that this was "the start of a process of engaging with landlords and tenants to amend these grounds".
- July 2019: Second Consultation is Launched
In July 2019, the consultation, 'A new deal for renting: resetting the balance of rights and responsibilities between landlords and tenants' was launched.
The paper invited views on 'how the Section 21 Notice has been used in the past and the circumstances in which landlords should be able to regain possession once it has been abolished'.
It highlights that landlords feel that the Section 21 Notice is more efficient than the Section 8 Notice, becuase 'the existing grounds for possession do not provide enough flexibility to respond to changing circumstances' - hence why it is consulting to understand how to strenthen the Section 8 grounds.
The consultation also examined the implications of removing Assured Shorthold Tenancies (ASTs), how the possession process could be improved, and whether housing associations should also be included under the reforms.
- October 2019: Renters' Reform Bill first announced in the Queen's Speech
The second consultation closed in October 2019, and the Renters' Reform Bill was announced offically in the Queen's Speech for the first time in the same month. The Bill promised to 'introduce a package of reforms to deliver a fairer and more effective rental market'.
- May 2021: The Second Queen's Speech to include Renters' Reform
In 2020, the pandemic struck, and the Government set aside many pieces of legislation already in the works to focus on the impact of Covid-19. However, in May 2021, the Queen's Speech was back, and so were Renters' Reforms.
- The last Step to Legislation
This Parliamentary session is particularly important to the current Government, as it is one of the last chances it has to fulfil the commitments it made in the party manifesto, before the next general election.
Nikki da Costa, former advisor to Number 10, said "the last major legislating session of this Parliamentary term. A final, fourth, session is now more likely than not to begin next May....
"....It is also unwise to leave politically important Bills to the last session: this risks backbench rebellions, criticism for not having legislated sooner, and / or distracting from the electoral narrative".
This will increase the sense of urgency around converting these proposals to legislation before the Government's time runs out.
The Government may also intend to present an airtight, final proposal in the white paper, that has thoroughly addressed all angles and that will see little opposition as it moves through the houses.
We may therefore have confirmation of the final form of the Bill will take earlier rather than later.