Concerns that the UK government’s move to enhance private tenant rights might result in a mass exodus of landlords from the sector have been debunked in a recent report by the influential Centre for Social Justice (CSJ). The CSJ welcomes Chancellor Rishi Sunak and his levelling-up secretary, Michael Gove’s, decision to push forward with the Renters (Reform) Bill, a controversial piece of legislation set for a Commons vote today.
The proposed Bill seeks to abolish assured shorthold tenancies and Section 21 evictions, in a bid to establish a more equitable balance between tenants and landlords. According to the CSJ’s comprehensive report, titled “Raising the Roof,” ministers are justified in simultaneously revamping Section 8 of the Housing Act 1988 to bolster the rights of responsible landlords.
The CSJ’s report recommends that there should be more stringent grounds for landlords wanting to reclaim their properties, such as when they intend to sell or allow family members to reside there. The report also advocates for clear statutory guidance to address cases of tenant-induced property damage, anti-social behaviour, and repeated rent arrears.
Andy Cook, Chief Executive of the CSJ, refutes claims of a landlord exodus, stating, “The independent impact assessment for this Bill shows that average net costs to landlords are minimal, at £10 per tenancy. No-fault evictions were ended in Scotland in 2017, and we haven’t seen an exodus. This change in the law will protect some 11 million people from the threat of arbitrary eviction, give them greater security, and reduce homelessness.”
The CSJ’s report highlights various factors suggesting that the proposed Bill will be advantageous for both renters and landlords. Despite higher taxes on landlords, the private rented sector has grown by over 2% in the last four years, with nearly 5 million properties in use. While the number of landlords may have decreased due to smaller buy-to-let owners exiting the market, larger landlords have filled the void.
The CSJ asserts that the removal of Section 21 evictions is counterbalanced by provisions that grant landlords greater rights to reclaim their properties in cases of tenant fault or when they wish to sell. Furthermore, the report calls for the establishment of specialist housing courts to prevent legal system bottlenecks due to potential disputes between landlords and tenants.
The CSJ’s report emphasizes that the proposed changes could increase the workload on already overstretched civil courts, resulting in landlords waiting up to 12 months to regain possession of their properties through Section 8 procedures. It urges the government to create specialized housing courts staffed by judges with expertise in housing matters to expedite the processing of cases.
Additionally, the report commends the government’s decision to introduce a mandatory Ombudsman for private landlords to address complaints and tackle administrative failures. The CSJ underscores the need for improved enforcement to address absentee landlords who neglect properties and mistreat tenants, supporting the government’s proposed mandatory Property Portal.
The report also emphasizes the necessity for professionally managed, high-quality rental options in both the private rented sector (PRS) and social housing. It highlights the increasing number of low-income households under the age of 45 renting privately and the decreasing availability of social housing for young low-income households.
In a foreword to the report, former Housing Minister Eddie Hughes MP supports the Bill, stating that it represents the most comprehensive set of reforms for the sector in a generation. He believes the proposed reforms will deliver fairness, security, and accountability to renters.
CSJ housing expert Sam Bruce adds, “This bill will give confidence to young, low-income households to challenge absentee landlords and seek redress. The vast majority of landlords are good, and reforms to Section 8, the new Property Portal, and an Ombudsman should help to reassure them and drive excellence in the sector. However, our research reveals that poor enforcement could undermine efforts to create a fairer rental market.”
The CSJ’s report highlights the importance of local authorities’ ability to enforce regulations effectively and the need for courts to handle increased cases efficiently. Establishing dedicated housing courts, according to the report, will offer landlords and renters assurance that they will not be mired in legal disputes.