August, 2024
What the new government will do for the private rented sector remains, currently, a mostly unanswered question.
Looking at the policies and plans announced in Labour’s manifesto ahead of their election victory the focus seems to be more for the benefit of renters than landlords. Quite what landlords will need to do, or how the new government plans to support them, isn’t yet clear. Here’s an outline of what we currently know:
One of the biggest items on the new government’s agenda is the promise of rental reform. This was already underway with the previous government’s Rental (Reform) Bill. The question now is how Labour proposes to manage the reform changes it has already announced and what might come next.
A major point in its election campaign was the abolishment of Section 21, so-called ‘no-fault’ evictions. This had been pledged as an immediate change in the Labour manifesto and as something that the government would instigate on its first day in office at one point. As yet, however, there has been no update on how the change will be imposed.
For renters, the scrapping of Section 21 will provide reassurance that they won’t be forced to leave a property without a clear explanation. But it was landlord objections that led to the previous government’s challenges in bringing it to fruition and the new government could well face the same obstacles.
The ability for renters to better challenge unfair rent rises was also touted in the Labour manifesto. This is alongside improvements in rental standards, with plans to extend the scope of Awaab’s law – under which landlords have strict timeframes to fix mould and damp issues in their properties - from social housing to the private rental sector.
Responsible landlords will already have a clear focus on the latter as part of their maintenance requirements to provide a safe and healthy property for tenants to live. This makes it likely they will welcome this change.
Economically the hope is for greater stability in the wider housing market. In the longer-term, Labour has pledged the building of 1.5 million homes in the next five years. Alongside this is the promise of planning reform to unlock the building process.
Interest rate cuts, widely expected soon, will also prompt a kickstart to the buying and selling of property. However, until Labour’s measures and economic changes improve mortgage affordability, supply remains limited and so increased rental demand will continue. Because of this, rental prices are likely to maintain their upward trajectory with an average 2% increase predicted this year.
Labour’s has also revealed the aim to meet minimum energy efficiency standards in the private rented sector by 2030. Its wider ambition is to cut energy bills by £300 per household by 2030, by investing in more clean renewable energy.
The previous government had attempted to improve energy efficiency standards in the rental sector by raising the base EPC rating for rental properties from E to C by 2025 and 2028, depending on the type of tenancy. This was scrapped last year. Labour is planning a wider investment in wind and solar power plans to improve energy security but says it will not be forcing landlords to rip out old boilers.
