Breaking Property News 12/12/24
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Adam Pigott CEO of tlyfe outlines the possible future landscape of the Private Rented Sector
‘As we head towards the end of the year, the present Renters’ Rights Bill, introduced to Parliament in September 2024, looks to be on the statute book by summer 2025, and whilst its aims are laudable, there may unintended consequences. Bolstering tenants’ rights, the new Act will ban ‘no-fault’ section 21 evictions, and see an end to fixed-term tenancies which will become periodic tenancies, with a two month notice period by tenants. There will be a private rented sector database for all landlords.
It will be illegal for landlords and agents to discriminate against prospective tenants on benefits or who have children, and it will stop offers being made above advertised rents. There will be a Private Rented Sector Landlord Ombudsman for landlords and tenants in England, and a set standard (DHS) for PRS. With Awaab’s Law being adhered to, ensuring damp and other health endangering hazards are dealt.
With only perhaps seven-months to prepare for this seismic shift in the rental sector, my worry is that maybe no-one has thought about, for example the need to change overnight literally millions of the existing tenancy agreements, or that this new raft of legislation may take out a number of rental properties from the sector.
Anecdotally, many sources are reporting an exodus of private Landlords, some of whom were spurred to sell up prior to The Chancellor’s Autumn statement. Others selling in advance of the new Act.
What is clear also is that even if there is a huge building programme, Labour’s proposed flagship of 1.5M new homes in five years, with 50% being a social housing provision; there will still be a huge amount of tenants renting property for the coming decades.
But if the number of private landlords decreases, this could mean that not only will rents will continue to increase, but that tenants may find themselves in a more competitive marketplace needing to be at the front of the queue.
The flipside of the huge amount of Landlords who have bought property to rent out as a hedge against inflation or to top up pension income, now considering other ways to generate capital, is that we may see much larger institutional players coming into the marketplace. Which again will change the shape of things.
What can not be disputed is that tenants need Landlords and Landlords need tenants and whilst everyone should be protected, it is hard to keep both sides of this symbiotic relationship happy. Having spent decades looking after the interests of people in both of these camps, it will be interesting to see how the private residential sector evolves once the full ramifications of the new Act come into place.’
Andrew Stanton Executive Editor – moving property and proptech forward. PropTech-X
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