Election results: What we expect for landlords now Labour is in power
The much-anticipated election has now delivered the predicted victory for Labour, so what should landlords expect to happen next? Importantly, will this government’s policies help or hinder landlords’ efforts to provide housing for tenants?
Labour’s victory in the general election marks a significant turning point for the private rented sector. With their ambitious plans for housing reform, it is crucial that the new government addresses the pressing issues facing both landlords and tenants.
The new Deputy Prime Minister, Angela Rayner, is also the new Secretary of State for Levelling up, Housing and Communities and will be heading up Labour’s housing policies. She has been the MP in Ashton-under-Lyne in Greater Manchester since May 2015 and has a very different background to our previous housing Secretary of State, Michael Gove, who was educated at Oxford and president of the Oxford Union debating society.
In contrast, Angela was brought up on a council estate and left her local comprehensive at 16 with no qualifications. She was a care worker, primarily for the elderly, and then, as a trade union rep, became the most senior elected official of UNISON in the North-West of England. So, what effect is this change at the top of the housing department likely to have – and how do Labour’s policies differ from those of the previous Tory government?
The good news for landlords is that Labour does recognise the importance of new housing, promising to build 1.5m homes in the next five years. There is also a recognition of the urgent need for more council/social housing, the lack of which is putting pressure on supply in the PRS. According to our recent Lettings Survey, 41% of landlords and 32% of tenants felt this was one of the top three reasons for driving up demand and therefore rents.
However, it is likely that the new government will favour tenants more than landlords. The most significant pledge from their manifesto that will impact landlords is the introduction of their renters’ charter – Labour’s alternative to the Renters (Reform) Bill, which didn’t manage to complete its progress through Parliament prior to the election being called.
Proposals in the renters’ charter include:
- Ending section 21 ‘no-fault’ evictions
- Ending automatic eviction for rent arrears
- Introducing a four-month notice period for landlords
- Giving renters the right to have pets
- Allowing tenants to make reasonable alterations to a property
- Introducing a mandatory National Landlords Register
- The introduction of the Decent Homes Standard for the PRS
- Stabilising rents by scrapping rent review clauses in tenancy agreements
What we ideally want is for the new government to resurrect the Renters’ Reform Bill in the form that was ready to go prior to the election being announced so progress can be made more swiftly.
In addition, with Labour heavily backing a ‘green’ agenda and pledging to invest £6.6 billion over the next five years into their Warm Homes Plan, it’s also likely that EPCs for rental properties will need to have a minimum C rating in the near future.
From our perspective though, good landlords have little to fear from these changes and if the new government does get to grips with the economy and provide stability, this will support the property market and help make renting much easier and less volatile.
Of course, we are keen to work with the new government to:
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Reassess how good landlords are taxed so, together, we can tackle the undersupply of rental homes in both the social and private sectors
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Give clear and reasonable guidelines on energy efficiency, with realistic and manageable timeframes to create more sustainability
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Create housing policies that provide stability and tackle the real issues in the sector
But it's likely that we will have to wait until the State Opening of Parliament and the King’s Speech on Wednesday 17th July, to find out exactly what the government will prioritise in their first 100 days and beyond.
If you would like to have a chat with our lettings experts about any of the policies Labour have revealed so far, just get in touch with your nearest Leaders branch – we’re always here to help.
Want to know more about the lettings services LRG can offer you? Call us on 01344 753100 and quote that you’re an NRLA member to find out more about the exclusive discount* we can provide.
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Sources:
https://inews.co.uk/news/angela-rayner-labour-first-days-power-2754793
https://www.bbc.co.uk/news/articles/cx00zj59pj8o
