Ms Margaret McCormick:

There are quite a number of issues. It is amending legislation but it is not balanced. It is substantially in favour of tenants and is not balanced for landlords. It will sanction landlords on one side without dealing with the problem of rents that are substantially below market rent. That needs to be in the legislation. It needs to be added in to give any sort of balance. We are criminalising people who may have just one choice. The choice from their banks is to increase their income and payments. The market and the law are telling them they cannot do it even when they are substantially below market rent. If they do increase it, they are breaching legislation. If they increase the rent, they may keep their properties. These rents are below market rent. If they do not increase the rent, the banks will repossess. We have 22,000 buy-to-lets in arrears. We have a massive problem.

The other thing about the rent pressure zones is they do not take into account long leases. The market is looking for security and some landlords gave security and long leases including indefinite leases in some cases. RAS leases had requirements around when rent could be increased built into them.

Many of these leases are based in the initial legislation. They now have to comply with the rent pressure zone provision introduced in the new legislation. In some cases, rents can only be increased every three years. The law also sets specific timeframes for tenancies. The people who have provided the lengthy leases and the security of tenure we were looking for are the people who are substantially disadvantaged. The legislation needs to be amended to allow for an increase in rents that are substantially below market rent. This could be a once-off, or something a landlord could be allowed to do over a period of time. This must be done to make this legislation balanced.

On the technical problem around the termination of tenancies, I welcome that where a previous notice has been technically wrong this can now be rectified within 28 days. We have no problem with that, assuming the correct notice was given in the first instance, but we need to look at the problem around the first six months and at the end of tenancy. If a person wants to serve notice of termination of a tenancy he or she must do so before the tenancy ends and this must be done correctly. The legislation is really difficult in this regard. Barristers come to us for advice on it and solicitors also have difficulties with it. A landlord trying to negotiate it has severe difficulties. It is really easy to get it wrong. If a tenant does get it wrong, he or she cannot serve it again because a new tenancy will have come into play and for six years. It is really important that this be addressed in the legislation.

As stated earlier by my colleague in regard to rent arrears, there a are small number of tenants who, on signing a one year lease, are not paying a penny from start to finish. The law is allowing this. The law states that the rent must be paid during the tenancy but it also provides for an appeal. We need to provide in law that during the appeals process rent must continue be paid to the landlord or the RTB. Approximately 92% of landlords have less than three properties and 70% have only one. We are losing landlords and properties from the market because of this.