Six rules and laws for homeowners and renters coming in 2021 – and how they affect you explained

WHETHER you’re renting or own your own home, there are changes to rules you should be aware of this year.

Here we talk you through what’s happening and when.

There were plans announced in the Queen's Speech to help renters and buyers — There were plans announced in the Queen’s Speech to help renters and buyersCredit: Getty

1. Covid eviction ban ending

Since the coronavirus crisis first hit last year, there’s been a ban evictions to protect renters from being made homeless during lockdown.

The pandemic has lasted longer than anyone expected, and so this ban has been extended several times.

There are exceptions in extreme circumstances, such as anti-social behaviour or domestic abuse.

But with vaccines happening and normal life returning as lockdown lifts, this ban will come to an end on May 31.

Once the ban ends Landlords will also have to give tenants six months notice if they wish to evict renters in England.

But this notice period is set to shrink too.

From August 1, landlords will be allowed to give tenants an eviction notice of just two months if they owe four or more months of rent.

And then from October 1, landlords will can serve two month eviction notice periods, returning to pre-pandemic rules.

What to do if you can’t pay your rent

FOR private renters, speak to your landlord as soon as you can.

They may be able to defer your payment, or to allow you to pay a smaller amount – but they don’t have to do this.

Social renters should speak to their housing association or local council.

If you’ve tried speaking to your housing association or landlord and they aren’t being sympathetic, contact Shelter for advice and support. They’ll be able to guide you about what to do next.

If you’re finding it difficult to manage your payments because you’re in debt, here are some tips for you to curb it:

Check your bank balance on a regular basis – knowing your spending patterns is the first step to managing your money

Work out your budget – by writing down your income and taking away your essential bills such as food and transport
If you have money left over, plan in advance what else you’ll spend or save. If you don’t, look at ways to cut your costs

Pay off more than the minimum – If you’ve got credit card debts aim to pay off more than the minimum amount on your credit card each month to bring down your bill quicker

Pay your most expensive credit card sooner – If you have more than one credit card and can’t pay them off in full each month, prioritise the most expensive card (the one with the highest interest rate)

Prioritise your debts – If you’ve got several debts and you can’t afford to pay them all it’s important to prioritise them. Your rent, mortgage, council tax and energy bills should be paid first because the consequences can be more serious if you don’t pay

Get advice – If you’re struggling to pay your debts month after month it’s important you get advice as soon as possible, before they build up even further.

Groups like Citizens Advice, Money Advice Trust or StepChange can also help you prioritise and negotiate with your creditors to offer you more affordable repayment plans.

2. Old Help to Buy extension deadline

Homebuyers using the “old” Help to Buy scheme were given longer to complete sales so they didn’t miss out on savings worth thousands of pounds.

The deadline for completing is now May 31 for buyers already in the process of purchasing their new build home under the scheme, to make up for delays caused by coronavirus.

The scheme deadline was extended three times because of the pandemic, which held back new house builds.

The old Help to Buy Equity Loan scheme let buyers purchase a new build home with a 5% deposit.

Buyers could borrow up to 20% of the property value – or 40% in London – to make the mortgage smaller to give those on smaller salaries a step up on the property ladder.

The loan scheme changed from in April, tightening the lending criteria.

What help is out there for first-time buyers?

GETTING on the property ladder can feel like a daunting task but there are schemes out there to help first-time buyers have their own home.

Help to Buy Isa – It’s a tax-free savings account where for every £200 you save, the Government will add an extra £50. But there’s a maximum limit of £3,000 which is paid to your solicitor when you move. These accounts have now closed to new applicants but those who already hold one have until November 2029 to use it.

Help to Buy equity loan – The Government will lend you up to 20% of the home’s value – or 40% in London – after you’ve put down a 5% deposit. The loan is on top of a normal mortgage but it can only be used to buy a new build property.

Lifetime Isa – This is another Government scheme that gives anyone aged 18 to 39 the chance to save tax-free and get a bonus of up to £32,000 towards their first home. You can save up to £4,000 a year and the Government will add 25% on top.

Shared ownership – Co-owning with a housing association means you can buy a part of the property and pay rent on the remaining amount. You can buy anything from 25% to 75% of the property but you’re restricted to specific ones.

Mortgage guarantee scheme – The scheme opens to new 95% mortgages from April 19 2021. Applicants can buy their first home with a 5% deposit, it’s eligible for homes up to £600,000.

3. Stamp Duty holiday ending

A temporary holiday on Stamp Duty was first announced last year by the government to boost the housing market.

The stamp duty holiday on homes worth up to £500,000 is due to come to an end on June 30 2021.

It will then be reduced in two stages “to smooth the transition back to normal” Chancellor Rishi Sunak said in his Budget speech in March.

From July, the tax-free threshold will drop for home buyers to £250,000 until September

Then it will return to its normal limit at £125,000 from October.

What is stamp duty?

STAMP duty land tax (SDLT) is a lump sum payment anyone buying a property or piece of land over a certain price has to pay.

Up until July 8 2020, most house-buyers in England and Northern Ireland had to pay stamp duty on properties over £125,000.

This was temporarily increased to £500,000 until March 31, 2021 in the government’s mini-Budget in July 2020.

The Chancellor extended the help until September 2021 in his Spring Budget.

The holiday will last in full until June, before being reduced to £250,000 from July.

The rate a buyer has to fork out varies depending on the price and type of property.

Rates are different depending on whether it is residential, a second home or buy-to-let, or whether you’re a first-time buyer.

The usual system in England for residential properties means:

First-time buyers pay nothing on properties below £300,000 (and relief available on properties of up to £500,000)
You pay nothing if the property costs below £125,000
You pay 2% if it is worth between £125,001 and £250,000
You pay 5% if between £250,001 and up to £925,000
You pay 10% if it is between £925,001 and £1.5million
You pay 12% on anything over £1.5million

For second homes or buy to let properties:

3% on purchases up to 125,000
5% on purchases between £125,001 and £250,000
8% on purchases above £250,001 and £925,000
13% on purchases above £925,001 and £1.5 million
15% on purchases above £1.5 million

Stamp duty rates are different in Scotland and Wales.

4. More cash for cladding

More cash has been promised to help those affected by the cladding scandal.

Flats which have the highly flammable cladding which has been blamed for the devastating Grenfell fire.

A new £3.5bn pot of cash has been made available to give out to buildings over 18m high to rip dangerous cladding off.

But anyone living in a building smaller than that will have to take out a loan to do the same thing

Those loans will be capped at £50 a month, or £600 a year – but it will be slapped onto the home and is likely to make them harder to sell.

5. Pet-friendly rentals

Anyone renting a new place will now find new rules that make properties more friendly for pets.

Landlords can’t automatically ban tenants from having pets in rented homes.

There is now a new standard tenancy agreement template, which is the recommended contract that landlords should use.

Introduced by the government at the start of the year, it stops landlords issuing blanket bans on their tenants having pets.

Instead, landlords will have to object in writing within 28 days of a written pet request from a tenant and provide a good reason for not allowing a pet, such as in smaller properties or flats where owning a pet could be impractical.

6. Renters protected from dangerous homes

From now on, landlords who fail to carry out electrical safety tests on properties they rent out could be fined up to £30,000, as part of a government crackdown.

Qualified electricians must check all wires and sockets in properties before a tenancy begins.

And landlords need to make sure electrics continue to be inspected at least once every five years.

This new rules came in just last month and applies to all existing rental agreements from April 1 this year.

It applies to new tenancies too and has done since July 1 last year.

Beyond 2021

There are further changes coming that will affect renters and homeowners, after plans for new laws were announced in the Queen’s Speech.

Creating legislation that changes rules can take time, as they have to pass through a number of stages before becoming law and this can sometimes be a slow process.