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An update... http://www.netrent.co.uk/netrent_homev2/blog.asp

S21 looking safe for now but it looks like more regulation is on its way:-

We recommend that the housing standards monitors and stakeholder boards should be asked to develop proposals for piloting a scheme for home condition certification.

Father Fred:

I don't want to force people to do anything...

What? You want to punish people who do not do your bidding by taking a lot of money off them for which they receive nothing in return. Yeh, right...

Father Fred:

I really don't see the problem.

No, I am quite sure you don't.

But before you propose a solution to a perceived problem you really ought to think things through and ask yourself a few questions e.g. Is it really a problem? How much of a problem? Who is going to pay to fix the apparent problem (either financially or by experiencing some other disadvantage)? What are the unintended consequences of this interference? Is it reasonable to keep putting more and more restriction and cost on people who are already conducting their business ethically in order to attack a minority who are not?

I want to reward good tenants.  I want them to be able to live somewhere for 3, 4, 5 years if they want.

As a good tenant I had to move every 6 or 12 months and it was a pain.  If I had kids in the local school it would have been a nightmare.

Yes it is a problem.  Yes it is a big problem.

Vendors will pay - they will not receive as much for their property.  (Potential owners occupiers will also benefit as they will be bidding against fewer BTLers).

I am not a big fan of regulation but I would be in favour of compulsory registration for landlords and agents - if the landlord falls short they should be struck off and have to hand over FULL control to a registered agent - or sell.

Ultimately this would not really cost BTLers much, it would punish speculators and traders who masquerade as landlords in the short term.  

If you want to let the property then make a long term commitment.  If you don't, then sell it or face a financial penalty.  It really is that simple IMHO.

And I would like you to remain free to offer 3, 4 or 5 year tenancy agreements if that is what you wish to do. Who is stopping you?

Why did you have to move every 6 or 12 months? Did no landlord who had you as a tenant want to keep you as a tenant? Were you simply unlucky enough, on every occasion, to choose a property that was owned by somebody “masquerading” as a landlord? Why did you sign up for a 6 month tenancy if it wasn’t what you wanted? Did you ask for a longer tenancy, and offer to pay a higher rent in order to secure it? Or was it not that important to you after all?

You say there will be fewer BTLers. That means fewer properties available for tenants to rent, which means higher rents and more homelessness.

Since landlords are running a business, not a charity, they must cover their costs (including taxation) and earn a return on their investment that is at least as good as simply leaving their cash in a savings account. Hence increased costs must be passed on to tenants, which means higher rents.

Banks are also businesses, not charities. If they are forced to take a greater risk because they are lending on a longer assured tenancy then, as has already been said, they will require a higher rate of interest in order to compensate for the increased risk, which means increased costs for landlords, which means higher rents.

What happens if a tenant wants to leave before their 5 year tenancy is up? Is your contract even handed, or is it OK for the tenant to terminate it whenever they want but not the landlord? How are rent increases handled?

How does the Inland Revenue keep track of this dual tax status? What if a landlord has some properties on long tenancies and some on short? It's going to cost more in accountancy fees. And who is going to foot the bill for your compulsory (“I don't want to force people to do anything...” ) registration scheme? There’s no such thing as a free lunch, and all these costs will be passed on to tenants.

I do appreciate that your intentions are honourable, but there are good reasons why we have ASTs in their present form. The situation may not be perfect, but it is much better than before 1988 and tampering with it risks causing more problems than it solves. And those new problems are as likely to punish tenants as much as anyone else.