The UKs Renters reform Bill was bad enough and saw landlords sell up in droves. According to Rightmove houses available to rent are down 43% since 2019 while rent referrals are up 173%.
Labour Abolishing S21 (commonly called no fault evictions) will mean landlords can not regain vacant possession unless they have a bad tenant, and perhaps not even then with what else Labour intend. It begs the question, what landlord is going to take on tenants that were previously some other landlords tenant? I think more landlords will sell up while they can before Labour force them to sell their property discounted to their tenant. So finding a home to rent is going to get even harder and more expensive because of a shortage of small landlords amid an increase in demand. Government interference in the private rental sector (largely supported by tenants) has already spectacularly backfired and will continue to do so with Labour policy. Already, in my area, people cant find property to rent, while on the other hand we have thousands of new builds being built (on greenbelt and agricultural land) to buy.
In the grand scheme of things there are not enough small private landlords providing homes for those that cant get a mortgage, or just dont want to buy and prefer to rent, or for students, cabin crew, posted workers and seasonal workers to live.
There are currently no details of the content of Renters Reform bill. The government has commissioned a report which came up with a number of proposals, some of which were in the Conservative bill. The government is not required to enact any, or all, of these proposals in law.
As a landlord I support the widespread end of No fault evictions, as long as there are caveats. eg landlord selling a property. Where there is problematic behaviour it will still be possible to evict. As someone who works in the court system, I know that it had been run into the ground prior to Covid, delay is an issue that needs to be addressed but there will not be a quick fix because of all the competing demands on the national budget.
Rent caps benefit all of society, because excessive rent rises increase inflation. Housing benefit subsidises greedy landlords at a cost to all taxpayers.
I have little sympathy for landlords who mortgage themselves to the hilt without understanding that mortgage rates go up and down as part of the economic cycle.
As a responsible landlord I donât think itâs unreasonable to rent out a property that is properly maintained and energy efficient. Then again, I wouldnât rent out a property that I wouldnât live in myself.
I look on here at some people who have become landlords and am shocked by their lack of understanding of their responsibilities. No wonder there is a proposal for a national register of landlords. And itâs not unreasonable that prospective tenants should be able to check that a property is safe, with evidence that a landlord complies with legislation.
I also believe that turning homes in to short-term lets and Air BnBs has had a negative impact on the rental market and often on the local community, with a whole generation being priced out of decent accommodation.
And yes, Labour may change CGT. Letâs not forget that the last government cut the allowance from over ÂŁ12,300 to ÂŁ3,000 in one year.
My personal view is that this is scaremongering. Any decent landlord should not be evicting people for no reason, and a competent landlord should not need to increase rents excessively if they review them every year.
Scaremongering is unhelpful, but by all means rush out and put your properties on the market if you canât be a responsible landlord.But donât delay, an excess of supply will have an impact on the housing market, and your profit margin will quickly disappear!! Then property prices will come down and may allow people who canât afford to buy a property at the moment to get on the housing ladder. Generation Rent voted this government in for a number of reasons, there will be changes, and some landlords will come to realise that eventually you reap what you sow.
Or at least, I am writing to you from Spain, where a socialist government has been running things for quite a long time now and has enacted various laws around rent control and making evictions ever more difficult.
So by describing how things are here at the moment, I will be describing a version of what the UK might look like in future (possible after two consecutive Labour terms):
Rent controls limit rent increases to the official inflation index. But if inflation is running high, the government will step in and stop you from increasing rent past a nominal value (they did this the last two years).
As a landlord, you cannot agree a one year contract and then retake the property at the end of the year, like you can in UK. If you sign a new one year contract you are really signing a 5 year contract. At each anniversary date for those 5 years you can only increase the rent by the inflation index.
Due to socialist legislation focused on tenant interests only, there is now a very large problem of squatters (so called âOkupasâ in Spain). In takes, on average, 23 months to evict a tenant who refuses to pay rent (it was 12 months when the socialists took power). You have little to no hope of recovering lost rent. During this time you have to continue paying any utility bills that are in your name. If you stop, you risk jail (they donât take 23 months to put you there). If tenants stop paying rent and declare themselves âvulnerableâ, they are sorted for 23 months of free rent. Organised crime has taken notice and monitors properties so they can identify empty second homes, then they break in, change the locks, and rent it out. All of the above has been going on for years is widespread, and is now worse than ever. The socialist government calls it âFake Newsâ while not providing any meaningful statistics.
Occasionally some newspapers profile landlords who have suffer from the squatter problem. The last one I read was about a landlord who now lives in his car as he cannot afford to pay rent.
Surveys show people are terrified of getting squatters in their second property so more and more are not renting it out in the standard way. They might do Airbnb, they might let family live in it, or just leave it empty. Many are offering terms lower than 12 months to get around the law. But they will close that loophole soon.
End result for the rental market : prices have skyrocketed. Young Spaniards are living at home to a later age than ever. As always, the socialist intervention just donât work.
Would you also condone âmilk capsâ, âfish & chip capsâ, and âwindow cleaner capsâ? If those businesses should not have their prices capped for the service they provide, why should Landlords?
The Market increases rents. Its called âSupply & Demandâ, and is a very basic economic theory. The Landlord merely sets their rent within the limits of those market prices. In my view, itâs not sensible business for a Landlord not to increase the rent in line with the market, whilst maybe allowing the benefit of some price discount to long term and/or loyal tenants.
