A leading property lawyer has poured scorn on government estimates that the Renters’ Rights Bill will cost landlords £12 per rented property each year.

Its impact assessment puts the net cost to businesses at £33 million annually, working out at £22 per rented property, but with a benefit of £9 per rented property per year, from lower letting agents fees due to fewer household moves and a reduction in void periods.

Property lawyer at JMW, David Smith, says these sorts of figures can only be seen as best guesses and are notoriously unreliable.

The £33 million figure is not the true picture because secondary legislation does not exist yet, he explains. “So, the cost when we add in the fees for the PRS Database and Landlord Ombudsman rise to £40.1 million and the cost of Awaab’s law and the widening of the Decent Homes Standard are not quantified.”

Smith also doubts that Ombudsman fees - estimated at between £4.42 and £13.25 per property per annum and for the database at between £12.23 to £45.31 per property every three years – will be accurate.

Benefit

“Apparently, landlords will also benefit by £9 a year due to tenants staying longer and having less void periods. I find this to be fanciful given that most tenants left property of their own accord already,” says Smith.

He adds: “The cost of learning about the changes, increased court costs in evicting tenants, providing more evidence to deal with cases, new s13 notices, considering pet requests etc is all costed at £22 per property per year over the ten-year impact assessment period, so a total of £220…I consider it to be a gross underestimate based on what I anticipate agents charging to prepare a s13 notice for a landlord.”

He also believes the estimated cost to a tenant for keeping a pet at £7 is much too low and reckons the estimated extra £1,719 cost per letting agent per year over the ten years cannot be right.