NLA proposals on sale and rent back charter

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by Gill Montia

The National Landlords’ Association (NLA), which represents private residential landlords, has published guidelines for its forthcoming Code of Practice for members involved in the sale and rent back market.

The sector has been expanding rapidly since the onset of the credit crisis, as homeowners in financial difficulties opt to sell their properties but remain in them as tenants.

However, some unscrupulous operators have exploited vulnerable people by paying well below the market price for properties.

Homeowners-cum-tenants have also not understood that the terms of their tenancy agreements cannot guarantee continued occupation of their homes and that if their landlord is unable to meet mortgage payments, they could be evicted.

The NLA wants to see greater transparency in the sector and is calling for standardised key fact documents to be provided by member landlords, allowing homeowners to compare the deals on offer.

In addition, the association is proposing that every tenant has access to an independent dispute resolution service and that member landlords breaking the terms of the Code of Practice should face significant financial penalties.

The proposals state that member landlords will be expected to commit not to seek possession of the property unless the tenant breaks the terms of the tenancy agreement.

They will also be required to support their own valuation of a property with local evidence corroborating the actual market value.