New Government Policies Affect Landlords by Heather Hilder on July 18, 2024 New Government policies affect Landlords Policies affecting Landlords With Labour now celebrating its landslide victory in the general election, you might be wondering how the new government and its policies will impact your property rental business. The sector has seen soaring prices as demand has increased. As a result, many prospective buyers have turned to renting instead of buying. They are waiting for the property market to settle and interest and mortgage rates to decrease. Such price rises are likely to continue while supply remains restricted. So what is Labour planning and how will it impact you as a landlord? Labour’s version of the Renters (Reform) Bill One of the main impacts for landlords will be what Labour does with its version of the Renters (Reform) Bill. The Bill had been a key strategy for the previous prime minister Rishi Sunak. However, at the same time as the general election was announced, the Bill’s 12 amendments were being presented in the House of Lords. As we now know, Sunak failed to make the Bill law before the dissolution of Parliament. ‘Immediate’ abolition of Section 21 Rental reform is still inevitable, however. Labour has already pledged to end no-fault evictions by abolishing Section 21 of the 1988 Housing Act. Section 21 enables no-fault evictions by landlords. This was also one of the biggest changes to the rental market proposed in the original Bill, although it soon became apparent its timescale would slip as objections were raised. The new Labour government has been more forthright. It has pledged to “immediately” abolish Section 21 to give renters more power against exploitation and discrimination. However, how it will manage the scrapping of Section 21 and what “immediately” means in reality, has not yet been revealed. Legislation will take time. Raising standards Labour has also promised a wider reform of rental standards which will include the extension of ‘Awaab’s Law’ to the private rental sector. Focusing on damp and mould in rented accommodation it requires landlords to fix such health hazards within specified timeframes in the social housing rental sector. For responsible private landlords who keep on top of maintenance and inspections, this should mean little change since you will be looking to fix such issues as a priority anyway. Challenging unreasonable rent rises Another pledge in the Labour manifesto was to give renters greater power to challenge unreasonable rent increases. Tenants can already do this through a tribunal, so the changes Labour has proposed here are not yet clear. Energy efficiency improvements In September 2023, the Conservatives scrapped their plans requiring landlords to improve the energy efficiency of their properties to EPC ‘C’ by 2025 for new tenancies and from 2028 for existing tenancies. However, in their manifesto, the Liberal Democrats adopted the policy with a 2028 target. Labour has committed to meeting minimum energy efficiency standards in the private rented sector by 2030 but has not yet clarified how. With a promise that “nobody will be forced to rip out their boiler”, landlords will be hopeful that changes are less demanding than the Conservatives had originally planned. The coming weeks will bring clarity to Labour’s plans. However, aside from the proposed abolishment of Section 21, the other proposed policies focus on providing improved minimum standards for renters, something that responsible landlords will already be doing. Callaways Estate Agents is here to support landlords along the South Coast, including Falmer, Worthing, and Brighton & Hove. Contact us today to learn how we can help you adapt to new regulations and safeguard your investment. Reach out now for expert advice!
