Sadiq Khan has called the failure to pass the Renters (Reform) Bill “a huge betrayal” to renters.
What happens to the Renters’ Reform Bill?
Parliament ended on the 30th May, so any incomplete legislation will be abandoned after this point. Due to the time pressure, ministers have confirmed that the Renters’ Reform Bill will not be passed before the general election.
If the Conservative Party returns to power, the Bill will have to go through the whole process again, as it cannot be carried over to a ‘new’ Government. Likewise, if a new Government is voted in, the legislation cannot be transferred to them, even if they supported it.
As a result, it’s essential to stay up to date on what the other Parties have planned for the Private Rental Sector (PRS) and to see whether the Conservatives make any amendments or further announcements to the Bill as part of their election campaign manifesto.
The Conservative vs Labour Policies: What to expect
At this stage, we only have key policies for the Private Rental Sector from the Conservatives and the Labour Party. The Conservative Renters’ Reform Bill and Labour’s Renters’ Charter are similar, but there are a few differences to be aware of.
To help, we’ve put the below guide together to show what each Party could introduce:
The London Mayor reveals the number of no-fault eviction claims against private renters in London increased by 52% in the past year, which is more than five times the increase seen in the rest of England and Wales.
The Renters Reform Bill failed to pass before the general election.
According to City Hall, in London alone, more than 30,000 renting households have faced a no-fault eviction claim since the government pledged to abolish them in 2019. Mr Khan, says "renters are struggling to find a place to live. The government’s failure to pass the Renters (Reform) Bill before the dissolution of Parliament today is a huge betrayal of London’s 2.7m private renters, who are left with the threat of eviction hanging over their heads. These latest statistics from City Hall are shocking and the unacceptable delay to this vital Bill will leave even more renters in the capital at unnecessary risk of housing insecurity and homelessness. I’m doing all I can to build a better, fairer London for everyone by supporting tenants, but I cannot act alone. Renters rights must be a national priority and no-fault evictions banned for good.”
Law needs to be strengthened in favour of tenants
The Mayor of London vows to protect tenants despite having no formal powers over renting. Mr Khan has rolled out several initiatives, including the Rogue Landlord and Agent Checker, Property Licence Checker, and the Report a Rogue Landlord and Letting Agent tool. He also has implemented new rules in which Met police officers operate on a presumption against evicting tenants when they are called out to landlord-tenant eviction disputes.
Mr Khan believes the law needs to be strengthened in favour of tenants and is urging the next elected government to make abolishing Section 21 a first-day priority.
Pass Renters Reform legislation immediately
The Shadow Minister for Housing and Planning, Matthew Pennycook says "Labour will protect renters and abolish Section 21 immediately if they win the general election. The Tories promised renters in 2019 they would scrap section 21 evictions. Sadiq Khan is right to call out their failure to honour that commitment. Labour will deliver where the Tories have failed and pass renters reform legislation immediately abolishing ‘no-fault’ evictions.”
Other than Ben Beadle, are there any landlords who will be mourning the demise of the Renters (Reform) Bill?
It was unwanted by landlords and agents; it would have brought destruction and the big issue I warned about when the final version began its rocky route through Parliament didn’t come to pass. That’s the effective handing of control from the property owner to the tenant. Absolutely outrageous, and from a Conservative government too.
But wait! We still have to endure what the political parties have planned for the private rented sector when they unveil their manifestos.
I’m sure none of it will be pretty – especially the offering from Labour.
What they would do if elected
None of them have even hinted as to what they would do if elected – and I’m guessing there’s a good reason for that.
On the horizon, we have the ‘delight’ of Labour’s intentions which might include the long-held promise to abolish section 21 ‘on day 1’.
But will they put this into a campaign promise?
Here we are looking at a General Election when Labour must make itself look electable. That means no more sixth-form politics and no spouting off when there’s no comeback – one of the joys of having ‘luxury’ opinions when they don’t affect you.
However, Labour now faces a real test after years of slagging landlords off and it’s the prospect of landlords selling up once we see what they might have in store for us, so they might think twice.
Landlords haven’t had a voice
Until Rishi fired the starter gun, landlords haven’t had a voice, but we’ve been handed a great hand of cards and we can be influential over the coming weeks.
But it means that we must tell tenants that a proposal to prevent landlords from gaining possession will have consequences and the notion that tenants might have should Labour get in that they can’t be evicted needs nipping in the bud. Just like in lockdown when a rent cap/holiday was mooted, and some tenants thought they could live rent free.
However, it’s one thing for Labour to criticise a sitting government – it’s something else to explain how you would do things differently. The end of the RRB means Labour can’t now blame the Tories for what happens next and there’s an opportunity to make clear what they will do.
A promise to end the housing crisis? An eviction ban? A nationwide rent cap?
Angela Rayner’s nonsense about house building and getting rid of section 21 will be shown to be the idiocy it always was – soundbites for the sake of it. Let’s be honest too, the Tories need to be careful with its manifesto after ignoring landlords in the RRB when announcing their housing plans. I still find it difficult to understand how the Conservatives had an 80-seat majority to deliver change and squandered it.
It doesn’t help that the NRLA says it was ‘hugely disappointed’ that the RRB bit the dust. I’m disappointed in the NRLA, but not surprised.
In the election countdown, we’ll need a strong body representing landlords to spell out clearly what the problems in the PRS are – and why Labour will make them (much) worse.
That’s because I fear that Labour has spoken to Shelter, Acorn and Generation Rent and is taking their ideas on board.
Capture the tenants’ vote
Can you imagine the wish list those organisations have, and Labour might be sweet-talked into believing this is a way to capture the tenants’ vote.
The term ‘housing emergency’ will be bandied about without any explanation of what it is – or why it has come about. So, we should expect an evictions ban, the end of section 21 and a rent cap.
If that does happen, landlords can’t rely on the likes of the NRLA to speak out.
What Labour’s plans mean
We all need to write to our tenants and explain – in detail – what Labour’s plans mean and why it’s likely we will have to sell, and the tenant will have to find somewhere else to live. In a market where lots of landlords are getting out early in a bid to beat the crusher.
Labour will talk about tenants’ rights but not the 160+ laws landlords have to follow. Labour will talk about the cost-of-living crisis and controlling rents, not about the rising costs facing landlords. Labour will talk about empowering tenants and making their tenancy secure because it is ‘their home’, ignoring property owner’s rights.
But they – and the Conservatives – won’t talk about landlord rights or levelling the playing field so we end up being treated with respect in the provision of homes.
'A muted win' – leasehold reform bill passes
The Leasehold and Freehold Reform Bill was the final piece of legislation to pass before Parliament closed ahead of the General Election on July 4.
It has been described as a “muted win” as while the law introduces more transparency on charges and a ban on leasehold houses, there wasn’t enough time to include a cap on existing ground rents. Proposals to include agency regulations as part of the legislation also failed.
Founder of the National Leasehold Campaign Katie Kendrick said it was a “real missed opportunity” that the Government did not manage to introduce a cap on ground rents, something they repeatedly promised but failed to deliver.
Co-founder Cath Williams, added “there is lots to celebrate in the bill, most notably the removal of marriage value. This will save leaseholders with less than 80 years on their lease thousands of pounds in lease extension fees. We have had lots of comments in our campaign group who are crying with joy. This is truly life-changing for leaseholders with short leases.”
There is a chance that secondary legislation could be introduced to bring in a ground rent cap and improve the law but that will depend on the new Government’s priorities.
Linz Darlington, managing director of leasehold extensions specialists, Homehold, said "this limited bill is a muted win for leaseholders. While the legislation is not without merit, leaseholders must see it as a step in a journey rather than the destination itself. The bill does not contain many of the important provisions that were promised by the Government. The commitment to remove ground rent for existing leaseholders, or even cap it at £250, has not been included. Another notable omission from the bill is the prevention of forfeiture, a draconian measure that allows a freeholder to repossess a flat for a debt of just £350. Frustratingly, most of the changes which have been included will not come into effect immediately or even within a specified timeline. These included-but-delayed changes include banning leasehold houses, and also abolishing marriage value which could make it cheaper for leaseholders with fewer than 80 years left to extend their leases.”
Timothy Douglas, head of policy and campaigns at Propertymark, added “the recently passed leasehold legislation is far from perfect, but it is the start of reform to outdated legislation that was not fit for purpose. Once implemented the new laws will make it more commonplace to extend a lease and information about leasehold property will be made more transparent, which will make buying, selling and renting leasehold property easier. However, the legislation is a missed opportunity to tackle some key issues. Propertymark argued that the legislation needed to go further to incorporate the recommendations for the Regulation of Property Agents. At a time where building safety regulations have increased and become more complex, it is shortsighted that policy makers were unwilling to see the benefit to consumers of qualifying and licensing the competency of those who work in the property sector."
Landlords on the fence ahead of general election
More than 40% of landlords are still undecided on who to vote for in the upcoming general election, according to a new survey.
A report by Landbay, reveals, 41% of landlords haven’t made up their minds. Among those who have, 31% back the Conservatives, while a mere 12% support Labour. The Liberal Democrats barely register at just over 5%, and 10% are opting for ‘Other’. The survey also found that nearly half of landlords (48%) have concerns about a potential change of government.
Everyone is anti-landlord
Respondents in the survey criticised Labour as “anti-landlord” and a potential government offering “too many unknowns”, with many of the policies of the two main parties seeming closely aligned. Others said that their vote will go to the party that will reduce the heavy tax burden facing landlords.
One landlord said “a Labour government will be traditionally landlord unfriendly. Conservative policies of recent years have also been far too punitive to landlords.”
Another landlord expressed frustration saying “everyone is anti-landlord. With a lack of affordable housing, we are the scapegoats. They have increased our tax and compliance burden. The left is making it worse.”
UK needs a strong private rental sector
John Goodall, founder and CEO of Landbay, says "Labour needs a clear plan to support landlords and the private rented sector. Now that the election has been called, it is clear that landlords still need further reassurance from Labour about their plans for government and their policy for the sector. The UK needs a strong private rental sector that can support investment and has the ability to scale in order to provide housing to millions of households. We therefore urge Sir Keir Starmer to make clear his plans on housing and how his party will recognise the critical role of landlords and the private rental sector in the UK’s housing mix.”
Political parties need to engage with landlords
Rob Stanton, sales and distribution director at Landbay, adds all political parties need to take action to support the private rented sector.
He said “with a large proportion of landlords still undecided, these findings show the huge opportunity that is out there for all parties to engage with landlords, address their concerns and give them a reason to vote for their party. Given that much of recent politics from all sides has been anti-landlord, this would be a welcome change.”
Buy to Let Under the General Election
While many landlords will be relieved by this Renters’ Reform Bill news, it is nonetheless frustrating that so much time (and resources) went into creating it, only to be shelved at the last moment. It also prolongs the uncertainty around what legislation is coming to help professionalise the PRS, good and bad.
A joint survey from NRLA and Goodlord shows that almost half of landlords (45%) have already decided how they will vote, and 73% are looking at the specific policies relating to the PRS to help them decide.
The prospect of a new government and new legislation means that it’s essential to be confident in the performance of your property investments.