Category: news-blogs

Landlords in the capital’s prime rental sector are facing a stark choice between topping up a rent shortfall or selling up.

Luxury residential property expert, Jo Eccles, reports that highly leveraged landlords are coming under serious cost pressures as fixed rate mortgage deals come to an end. Stress testing by lenders means some are finding they can borrow 30% less than before, forcing them to make up the shortfall or sell.

The founder and MD of Eccord, which manages £1.5 billion worth of residential property in prime central London for portfolio and individual landlords, says: “Those with the financial flexibility are reorganising their finances to pay down debt and raising rents by an average of 15% at renewal, but it isn’t always enough to meet their increased borrowing and service charge costs – which are up 30% in some buildings.”

One landlord has seen his mortgage repayments more than double from £4,000 a month to £9,000 a month and can’t sell due to cladding issues.

Rent increase

“We’ve secured him a significant rent increase of 19% but he has still swung from a monthly surplus to a £2,000 shortfall, which he’s having to personally top up each month.

“This illustrates that the challenges landlords are facing can’t always be resolved with rent increases alone.”

Some now have no choice but to exit the market which will further diminish supply and cause more hardship for tenants, believes Eccord.

“For landlords who are able and committed to remaining in the market long term, we are seeing them review their existing arrangements,” she adds.

“Many are choosing to move away from underperforming letting agents or property managers with high staff turnover, as they recognise the importance of tenant experience now more than ever, if they’re to achieve high rent increases.”

Original Post from  landlordzone.co.uk

Insolvencies rocket as army of small firms – seen as backbone of the sector – struggle with falling demand, rising interest rates and higher costs.

It’s tough out there,” says Steve Midgley, the managing director of Fairgrove Homes. His east Midlands firm, which builds about 50 homes a year, is one of Britain’s army of small housebuilders that are struggling with falling demand, rising interest rates, labour shortages, and high material and wage costs.

“It’s taking longer for people to sell their own house,” says Midgley. “So it’s taking vastly longer to exchange contracts. After the reservation, we’re talking three or four months, whereas at one time we’d have had that down to four to six weeks. And that all puts stress on the working capital, the work in progress and everything.”

Cracks in the housebuilding market – a key barometer of consumer confidence – are growing by the day. Barratt Developments, one of the largest housebuilders in the UK, recently said it would build 20% fewer homes this year. Taylor Wimpey, another big builder, has said the share of its first-time buyers taking on mortgages of more than 36 years has almost quadrupled since 2021 to 27%.

Cameron Homes, a family-owned firm based in Staffordshire, is offering discounts and free extras, such as carpets and upgrades, to persuade hesitant buyers.

“We are having to negotiate with purchasers,” says Kate Tait, the firm’s land and planning director who previously worked at the much bigger builder Persimmon. “People are taking quite a lot longer to commit to the purchase of a house because of the uncertainty around what it’s going to cost on interest rates. Not just for the first two years, but what’s going to happen beyond that.”

The Bank of England’s sharp hike in rates since December 2021’s record lows – increasing them to a 15-year-high of 5.25% last week – has sent shockwaves through the housebuilding industry.

Midgley says: “People are much more risk averse and they want to see a house nearly finished before they commit. In the last few years we’ve been selling plots at a very early build stage and in some cases before they were started and that has been a real shift change.”

House prices across the UK fell at the fastest annual pace in 14 years last month, the Nationwide building society said recently. Prices have declined by 4% since the peak last summer, and economists say they have further to fall. However, a full-blown housing crash – during which prices fall by 20% or more – looks unlikely to happen, with unemployment low and more people on fixed-mortgage deals than during the financial crisis.

The downturn has forced the big housebuilders to drastically scale back their projects and land-buying, and sales and profits have taken a big hit. Barratt is on course for a double-digit fall in annual profits, while Taylor Wimpey’s are expected to halve.

Cameron expects to deliver between 200 and 220 homes this year, down from the 250 to 300 it usually builds in a year. But Tait says newbuilds are still popular as they are cheaper to run, with lower energy bills and fewer home improvements needed than older properties.

Midgley says: “We still have demand. As always, good locations are key and correct pricing.” Fairgrove’s biggest project is at a former brewery site in Kimberley, Nottingham, where a two-bedroom apartment costs £195,000.

According to Aynsley Lammin, a building analyst at the banking and wealth management group Investec, the total number of UK homes completed in 2023 could be down by 25% on last year’s figure of 177,400 before recovering slightly to 135,700 in 2024.

He expects “this downturn to be very painful but not as bad as during the financial crisis of 2007-08”, when housebuilding slumped 40% from peak to trough and prices fell by 20%.

The latest housing downturn will feed into weakness in the wider economy. Housebuilding is worth about 3% of the UK’s economic output and Charlie Campbell, an analyst at stockbrokers Liberum, expects newbuild completions to fall by about 20%, resulting in a 0.6% hit to gross domestic product this year – with smaller firms feeling the pain more than bigger ones.

“The big builders in the UK have got lots of cash on the balance sheet,” he says. “Smaller builders tend to run for debt and they have the problem that debt’s costing them more and more and is probably less and less available. The other problem is that the large ones have lots of land. Therefore, delays are not a huge problem. But for some of the smaller ones planning and other delays really make it pretty difficult.”

While the large builders dominate the headlines, Britain’s 342,000 small and medium-sized construction firms are regarded as the backbone of the industry. The problems are mounting: construction has had more insolvencies than any other sector in the past year and accounted for almost one in five of all business failures in recent months. Between April and June, 1,122 construction firms went bust, the most since spring 2009, according to the Insolvency Service.

The construction industry suffered more insolvencies than any other sector in April-June 2023

Quarterly insolvencies in England and Wales, top five sectors

The effects are being felt at the building materials suppliers Travis Perkins and Marshalls, which have both warned of lower profits in recent months. Marshalls is making further job cuts and is closing a factory.

Nick Roberts, the chief executive of Travis Perkins, says: “We’ve seen some customers hold back because they are concerned about their mortgage rates. They are just not confident to press ‘go’ on a home improvement project.”

The cost of building materials rocketed after Russia’s invasion of Ukraine in February last year, but has eased in recent months. Prices for timber and steel are falling, but those for concrete and related products are still rising.

The number of small housebuilders has plummeted from about 12,000 in the 1980s to just over 1,000 today, according to the Federation of Master Builders. Back then, it took six to eight weeks from submitting a planning application to getting the first spade in the ground, according to Steve Morgan, who founded the housebuilder Redrow as a small firm in the 1980s. Today, it takes months or years until everything is approved.

Jennie Daly, the chief executive of Taylor Wimpey, describes the planning system as “extremely challenging”, saying that while requirements for housebuilders have become more complex, local authority planning resources have more than halved since 2010.

The UK has long had a housing shortage as the population has grown faster than homes have been built, sending rents and house prices soaring. According to the Centre for Cities thinktank, the housing market is missing 4.3m homes that could have been built since the 1950s, but were not because of outdated planning regulations.

Tait thinks the planning system is too politicised. “In the UK, it’s become such a political hot potato, the location of new housing, that we’re simply failing to deliver anywhere near the amount of housing that we need,” she says.

Shortages of bricklayers, plasterers and other construction workers – caused in part by Brexit and an ageing workforce – have also hampered the sector. The government recently added them to its “shortage occupation list”, making it easier for foreign builders to come to Britain.

“It’s a year too late. We needed that a year ago. They’re doing that just as people are slowing down,” says Midgley.

Original Post from theguardian.com

A well-known lettings agency has made the shocking move of asking a landlord to be a guarantor for their own tenants, it has been revealed.

Julie Ford, who is a mediator at PRS Mediation, says a female landlord has been in touch with her to ask her for help with a problem and during the discussions revealed she was named as guarantor for her own tenants.

This highly unusual situation means that, should the tenants stop paying the rent, it will be her who covers their payments.

The landlord was asked by her lettings agency to be the guarantor after it was recommended that she take out rent guarantee insurance as one of the two people renting the property had an insecture job and therefore the insurance company involved asked that they provide a guarantor, paperwork for which Ford has been shown.

The situation came to Ford’s attention after the landlord had requested vacant possession of the property when her circumstnaces changed and she needed to move back in. But her lettings agency had already renewed the rental contract without telling her – which led Ford to look at the paperwork more closely.

The landlord has been advised to seek specialist legal counsel to effect an eviction, and is expected to report the lettings agency to the relevant redress scheme and/or Trading Standards.

Baffled

“I am baffled by this and am don’t even understand how the rent guarantee insurance company could have allowed this to go through,” says Ford in a video that has gone viral. “Someone clearly isn’t looking at the admin.”

She also suggests that using landlords as guarantors for their own tenants may be a new ruse used by some lettings agencies during the cost of living crisis to fill properties when tenants fail referencing or rent guarantees insurance is required but the tenants cannot provide a guarantor.

It’s certainly a loophole – the various industry codes of conduct make no reference to the practice and for example both the PRS redress schemes make it clear in their codes of conduct that guarantors are separate to landlords and tenants, but don’t exclude a landlord being the guarantor.

But as Ford points out, most landlords would not want to end up paying the rent for their own tenants and should refuse such a request.

Original Post from landlordzone.co.uk

If you live in a flat, or are considering buying one, your mortgage lender may ask to see the building’s EWS1 form. Here’s everything you need to know about EWS1 forms, who needs one, how to get one, who pays and the associated issues.

In the wake of the Grenfell Tower fire disaster new fire safety regulations were brought in for cladding on residential buildings. To ensure external wall systems (EWS) were properly assessed for fire safety, the EWS1 form was introduced in 2018.

The form is evidence that a building with potentially combustible cladding has had a fire safety assessment. When first introduced, they were only required for buildings over 18m or six storeys in height. But, in 2020, the rules were changed to include all residential buildings of any height. Then, in August 2021, the rules changed again so an EWS1 is not required for buildings under 18m.

To get an EWS1 certificate, a qualified professional will conduct a fire-risk appraisal of the external wall system, or cladding. They will then sign the EWS1 form. One EWS1 form covers the whole building and is valid for five years in England and Wales. In Scotland, separate EWS1 certificates may be needed for each flat.

The EWS1 form, also known as an EWS1 certificate, was intended to reassure lenders so that mortgages can be offered on flats within a building that has cladding.

The EWS1 form isn’t the same as a fire safety assessment of the building. It is a report for valuers and lenders conducted by a specialist fire engineer of the external wall construction.

Based on that assessment, the building will be assigned one of the following ratings:

Option A – External wall materials are unlikely to support combustion. Split into:

• A1 – There is no cladding that contains significant quantities of combustible material
• A2 – A risk assessment of cladding has taken place and no remedial works are required
• A3 – Cladding is unlikely to support combustion but remedial works may still be needed

Option B – The cladding contains combustible materials. Then your building can be:

• B1 – The fire risk is low enough that remedial works are not required
• B2 – The fire risk is high enough to require remedial work

EWS1 and mortgages – what’s the latest?

Six of the UK’s biggest banks have updated their policies following new guidance published in December 2022 by RICS, which guides valuers on how to take into account any agreed remediation funding and timelines when forming an opinion on the value of properties in blocks of flats with cladding.

The lenders said they would offer mortgages on properties in blocks above 11 metres where there are safety issues providing an agreed remediation plan funded by either the government or a developer is in place. While some lenders may lend to leaseholders who are covered by protections in the Building Safety Act, even where a plan is not in place.

However, there are some variations in banks’ policies. For example, Santander will reportedly consider mortgage applications in England on properties in buildings ‘irrespective of the building’s height or whether remediation work has commenced, provided the correct evidence is shared’. And that it won’t require an EWS1 form ‘unless specifically requested’. While Lloyds Banking Group said it updated its position on 19 December stating it will no longer require an EWS1 form to ‘progress applications’ for properties in England that are in buildings five storeys or higher.

While this is hopefully positive news for some people living or wanting to sell homes that may be affected by this issue, time will tell how it works in practice. And if this does impact you it’s a good idea to chat it through with a fee-free mortgage broker who will be able to give you the run down on each lender’s positions.

My building does not have cladding, do I need an EWS1 form?

If your building doesn’t have cladding, or a wooden balcony, then it should not require an EWS1 form. However, don’t assume you don’t have cladding. Buildings can look as if they are built from traditional materials, but it is actually a brick or stone slip external wall system which is classed as cladding. Even some brick or stone-built properties may need an EWS1 form if they have decorative panels that require a fire assessment.

When do I need an EWS1 form?

If you are the leaseholder or freeholder of a property in a building that requires an EWS1 form, then you may need it when you are dealing with mortgage valuers ie when it comes to selling your home or remortgaging with a new mortgage provider. EWS1 certificates are not a legal requirement but mortgage lenders may require an EWS1 for them to offer a mortgage on properties within that building.

An EWS1 certificate allows valuers to know that your building has undergone a fire safety assessment and helps them to put a value on the property that considers whether remedial works are needed.

Which lenders don’t require an EWS1 form?

Lloyds Banking Group has stated it will no longer require an EWS1 form to ‘progress applications’ for properties in England that are in buildings five storeys or higher. But for the most up to date information on which lender don’t require an EWS1 form it’s a good idea to speak to an expert fee-free mortgage broker.

Who arranges an EWS1 certificate?

It is the building owner’s responsibility to arrange the fire safety assessment and subsequent EWS1 certificate. Leaseholders, valuers and lenders cannot arrange for an EWS1, only the legal owner of the building can do so.

The Fire Safety Act 2021 stipulates that a Fire Risk Assessment of a residential building must now include any cladding. This means if your building’s Fire Risk Assessment is several years old it won’t have included the external wall system. It is the owner of the building’s legal duty to have an up-to-date Fire Risk Assessment.

If the freeholder of your building is refusing to arrange everything for an EWS1 form, your first step should be to get together with other leaseholders in your building and write to the owner as a group. That will add additional pressure and hopefully resolve the problem. If not, you can approach your local council for assistance.

How do I get hold of my building’s EWS1 form?

If your building has an EWS1 form, you should be able to get it from the owner of your building. Alternatively, you may be able to find it on the Building Safety Information Portal, but there have been delays in getting all existing EWS1 forms uploaded onto the website.

How much does an EWS1 form cost?

The cost of the initial fire risk assessment (needed before an EWS1 certificate is produced) varies depending on the size of your building and the amount of cladding that needs to be assessed. Typically, it costs at least £6,000 but can rise to over £20,000 if the situation is particularly complex.

It is the freeholder’s responsibility to pay the bill, but they could pass a portion of those costs onto the leaseholders. It will typically depend on the terms of the lease between the building owner (the freeholder) and the leaseholders as to who pays for specific maintenance or safety works.

If there is no specific mention of fire risk assessments in the lease, the freeholder may still be able to use other wording in the lease (for example, in a ‘sweeping up’ clause) to justify passing on the cost to leaseholders.

If leaseholders are asked to pay, the cost is usually included in the annual service charge.

It shouldn’t cost you anything to get hold of a copy of your building’s EWS1 form.

Do I need an EWS1 to remortgage?

If the property you want to remortgage is in a building with cladding your lender may ask to see the EWS1 form – but this varies by lender and also on factors like how tall your building is and how much of it is covered in cladding. 

If there is unsafe cladding on my building what then?

If your building has unsafe cladding it will be marked on the EWS1 form as either B1 or B2. B1 means that the risk isn’t significant to require remedial work. B2 means the cladding needs remedial work to make it safe.

If your building is over 11m tall, the government will pay for the unsafe cladding to be removed. The cost is being covered by a fund which major housing developers are paying into.

A new Residential Property Developers Tax was announced in February 2021 to raise funds to help cover the cost of making cladding safe.

At present, it is still the leaseholders who will foot the bill for remedial works on buildings that are under 11m in height. However, the government has announced that it doesn’t want leaseholders to be liable and is working on plans to help residents of lower-rise buildings.

Original Post from hoa.org.uk

Michael Gove has slammed one of Britain’s biggest social landlords for letting tenants down.

The housing secretary told L&Q: “You have failed your residents”. He also called the chief executive of housing provider to a meeting after the housing ombudsman ordered the landlord to pay tenants more than £140,000 in compensation.

The move follows a special investigation revealed it was “dismissive” of tenants and found “severe maladministration”, including in tackling disrepair and antisocial behaviour.

L&Q, which rents out more than 105,000 homes in England, primarily in London, the south-east and the north-west, “failed to consistently identify damp and mould” as a key problem, disregarded its own antisocial behaviour policy and presided over “a period of significant failure” as a landlord, said Richard Blakeway, the housing ombudsman.

Responses to complaints were marked by “a lack of listening” and were “overtly dismissive, heavy handed and lacking in respect” in some cases, the ombudsman said. There was a “repeated failure to respond fairly to vulnerable residents, especially where the resident had a disability or mental health problems”.

Blakeway said his special investigation into L&Q found that “resident concerns were repeatedly dismissed or poorly handled, without the respect they or their issues deserved. Crucially, the needs of vulnerable residents were not always identified, and too often this caused serious detriment and risk to them”.

He said: “The landlord consistently failed to take sufficient action on its own monitoring and warning signs that were evident in its complaints and independent reviews – leading to a prolonged period of decline, especially in areas like repairs and complaints handling. Rather than address the core issues, the landlord continued to firefight individual issues.”

In a letter to Fiona Fletcher-Smith, the chief executive of the association, Gove said he was “deeply shocked and disappointed” to discover the landlord’s failings had caused residents

“unacceptable” and “prolonged periods of distress”.

“This is unacceptable,” he said. “You have stopped listening to your residents’ voices, and failed to deliver the service that they should expect … in some cases you were described as having been ‘heavy handed’, ‘dismissive’ and even ‘callous’ and ‘confrontational’ … You must take immediate action to remedy these severe failings.”

Fletcher-Smith said: “My senior leadership colleagues and I are personally contacting the residents whose complaints the ombudsman judged to have involved service failure or maladministration on our part. We have apologised for the completely unacceptable service they have received. L&Q has let them down, and I’m truly sorry for that.”

Original Post from propertyindustryeye.com

LONDON, July 24 (Reuters) – British Prime Minister Rishi Sunak recommitted on Monday to promises to boost homebuilding by the next election to tackle a lack of housing stock that has alienated many younger voters who pay high rents and are unable to buy.

With a national election expected next year, Sunak’s governing Conservatives have witnessed a collapse of support among younger voters, who are frustrated at being priced out of owning their own homes and are struggling with high childcare costs.

Housing has long been a contentious area for the Conservatives. Some of its lawmakers in rural areas do not want to see an increase in building while those in more urban regions want more homes built quickly.

Sunak and his housing minister Michael Gove said they would concentrate new house building in urban areas while protecting the countryside.

“Today I can confirm that we will meet our manifesto commitment to build 1 million homes over this parliament,” Sunak told reporters, using a term that refers to the time between the 2019 election and the next vote.

“We won’t do that by concreting over the countryside – our plan is to build the right homes where there is the most need and where there is local support, in the heart of Britain’s great cities.”

Earlier this month, a parliamentary committee said the government was on track to deliver 1 million new homes by the next election, but was not forecast to deliver another promise to build 300,000 net new homes per year by the mid-2020s, largely because of uncertainty over planning policy reform.

Housing secretary Michael Gove wants the government to ‘relax the pace’ of EPC reforms expected from private landlords.

In a Sunday Telegraph interview yesterday, following the Uxbridge by-election, Gove indicated that the timetable for changing minimum energy efficiency standards for private rented housing would be altered.

In January 2021 the government closed its consultation on minimum energy efficiency standards for private rented housing. It proposed that by April 2025 all new tenancies would need to be for properties with an energy performance rating of C or better and applied to all private rented housing by April 2028.

It also proposed a national cap on the amount landlords would need to contribute to improvements of £10,000.

But in a write up of an interview with the Housing Secretary, the Sunday Telegraph writes: “In his own policy area, Gove wants to relax the current rules that will ban landlords from renting out their homes unless they pay to increase the Energy Performance Certificate rating of their properties by 2028, which could include spending thousands on fitting a heat pump, insulation or solar panels.

“My own strong view is that we’re asking too much too quickly. We do want to move towards greater energy efficiency, but just at this point, when landlords face so much, I think that we should relax the pace that’s been set for people in the private rented sector, particularly because many of them are currently facing a big capital outlay in order to improve that efficiency.”

Responding to comments by Gove, suggesting a delay to energy efficiency proposals for the private renter sector, Ben Beadle, chief executive of the National Residential Landlords Association, expressed concern.

He commented: “It is over two years since the government completed its consultation on energy efficiency standards in rented homes. As a result of the delay in responding to this, there was never any hope of meeting the originally proposed deadlines, as we told the Minister earlier this month.

“The NRLA wants to see properties as energy efficient as possible, but the sector needs certainty about how and when this will happen. Ministers need to develop a proper plan that includes a fair financial package to support improvements in the private rented sector. We will continue to work with all parties to develop pragmatic and workable proposals.”

propertyindustryeye.com

Housing secretary’s plans aim to address the housing crisis as he says country must make ‘better use’ of buildings

Michael Gove is planning to change planning laws to pave the way for more home extensions and conversions of shops into houses in England in efforts to address the housing crisis.

As part of plans due to be announced on Monday, the housing secretary said new rules will be drawn up to give greater freedoms to carry out property extensions and to open up lofts.

Officials said the proposals will allow families to expand their home as their family grows while still ensuring neighbours’ interests are protected.

New flexibilities will be introduced to allow shops, takeaways and betting shops to be turned into living spaces, with Gove arguing that Britain must “make better use of the buildings we already have”.

The Department for Levelling Up, Housing and Communities said the proposals to relax rules around the use of retail space is designed to help rejuvenate high streets and provide greater density of housing in inner cities, rather than encouraging urban sprawl.

Lisa Nandy, Labour’s shadow housing secretary, said the announcement was a “drop in the ocean” that failed to address the scale of the housing shortage.

Gove, in a speech in London on reforming national permitted development rights, is also expected to announce that the Conservative government will cut rules limiting barn conversions and the repurposing of agricultural buildings.

Before his speech, Gove said: “Britain needs more homes to fulfil more dreams of home ownership and increase choice for renters.

“But they must be of the right type and targeted in the right places.

“So we must build more in the places that make sense – in our inner cities so that we protect our countryside.

“And we must make better use of the buildings we already have – empty shops or offices cannot be gathering dust while we have an urgent need for more homes.

“That is why we are reviewing the rules around permitted development rights to make sure we can regenerate, build and grow.”

The announcement comes only two weeks after a cross-party panel of MPs warned that Tory ministers are unlikely to deliver 300,000 new homes each year after making the target advisory rather than mandatory.

The prime minister, Rishi Sunak, decided in December to downgrade the target’s status to see off a brewing Conservative backbench rebellion.

The Levelling Up, Housing and Communities committee, in a report published earlier this month, said its inquiry into the policy change had seen it told that the six-figure target would be “impossible to achieve” by the mid-2020s.

Clive Betts, the Labour committee chair, said Sunak’s decision was “already having a damaging impact on efforts to increase the building of new homes”.

Labour’s Nandy has already announced plans to make it easier to build on unsightly parts of the greenbelt if Keir Starmer is elected prime minister at the next election, expected to be held in 2024.

Responding to Gove’s announcement, Nandy said: “Britain desperately needs more homes, but another review is a drop in the ocean compared [with] what is needed to fix the housing crisis.

“We don’t need more reviews or press releases, we need bold action to get Britain building.

“That’s why Labour has set out plans to reform the planning system to build the homes we need.

“We will restore housing targets, reform compulsory purchase rules and take the tough choices to back the builders, not the blockers.”

Original post from  www.theguardian.com

Labour has scrapped a pledge to introduce rent controls if it wins the next general election – after endorsing the policy last year.

Lisa Nandy said last September that she wanted to give local authorities the power to freeze rents, telling the party conference: “Doing nothing is not an option.”

But speaking yesterday, the shadow communities secretary described the approach as a “sticking plaster” and claimed it would increase homelessness.

“When housebuilding is falling off a cliff and buy to let landlords are leaving the market, rent controls that cut rents for some, will almost certainly leave others homeless,” she told the Chartered Institute of Housing’s 2023 gathering of industry professionals.

Abandoning the policy represents a major shift in thinking for Labour, which has promised the regulation of rents in all its manifestos since Ed Miliband was leader.

Responding to the confirmation from the shadow housing secretary that Labour has rejected calls for rent controls, which has prompted an outcry from Labour’s left, with campaign group Momentum accusing the party leadership of being “allergic to good, popular policy”, Ben Beadle, chief executive of the National Residential Landlords Association, welcome the announcement.

He said: “We agree with Labour that rent controls would do nothing to address the rental supply crisis that tenants across the country now face.

“What renters need is a proper plan to boost the supply of homes for private rent alongside all other tenures. Housing benefit rates should also be unfrozen without delay to support vulnerable tenants who are struggling to access the rental market.”

Original Post from propertyindustryeye.com

Eleven million tenants across England will benefit from safer, fairer and higher quality homes thanks to a once-in-a-generation overhaul of housing laws.

The Renters’ (Reform) Bill, introduced to Parliament today (17 May 2023), delivers the government’s 2019 manifesto commitment to abolish Section 21 ‘no fault’ evictions which will empower renters to challenge poor landlords without fear of losing their home.

The new Bill also protects over 2 million landlords, making it easier for them to recover properties when they need to – so they can sell their property if they want to, move in a close family member, or when tenants wilfully do not pay rent. Notice periods will also be reduced where tenants have been irresponsible – for example breaching their tenancy agreement or causing damage to the property.

This builds on the strong progress this government has already made over the last decade to increase protections for tenants, including giving councils stronger powers to drive criminal landlords out of the market by introducing Banning Orders through the Housing and Planning Act 2016; and shielding tenants from excessive deposits and fees through the Tenant Fees Act 2019.

The reforms will strengthen powers to evict anti-social tenants, broadening the disruptive and harmful activities that can lead to eviction and making it quicker to evict a tenant acting anti-socially.

To ensure the new tenancy systems works for landlords and tenants, it will be introduced alongside a reformed courts process. For the minority of evictions that do end up in the courts, more of the process will be digitised – reducing delays.

A new Ombudsman will provide quicker and cheaper resolutions to disputes, while a new digital Property Portal will enable landlords to understand their obligations and help tenants make better decisions when signing a new tenancy agreement. This will give confidence to good landlords, while driving the criminal minority out of business.

Housing Secretary Michael Gove said:

Too many renters are living in damp, unsafe, cold homes, powerless to put things right, and with the threat of sudden eviction hanging over them.

This government is determined to tackle these injustices by offering a new deal to those living in the private rented sector; one with quality, affordability, and fairness at its heart.

Our new laws introduced to Parliament today will support the vast majority of responsible landlords who provide quality homes to their tenants, while delivering our manifesto commitment to abolish Section 21 ‘no-fault’ evictions.

This will ensure that everyone can live somewhere which is decent, safe and secure – a place they’re truly proud to call home.

Tenants will also be given the legal right to request a pet in their home, which the landlord must consider and cannot unreasonably refuse. Landlords will be able to require pet insurance to cover any damage to their property.

The government will also bring forward legislation as part of the Bill to:

• Apply the Decent Homes Standard to the private rented sector for the first time, giving renters safer, higher quality homes and remove the blight of poor-quality homes in local communities. This will help deliver the government’s Levelling Up mission to halve the number of non-decent rented homes by 2030.
• Make it illegal for landlords and agents to have blanket bans on renting to tenants in receipt of benefits or with children – ensuring no family is unjustly discriminated against when looking for a place to live.
• Strengthen councils’ enforcement powers and introduce a new requirement for councils to report on enforcement activity – to help target criminal landlords.

The Bill is a key part of the government’s mission to level up across the country and follows the wider housing reforms in the Social Housing Regulation Bill and Building Safety Act. These address the systemic issues identified following the Grenfell Tower tragedy on improving the safety and quality of social housing and how tenants are treated by their landlords.

Martin Lewis, founder of MoneySavingExpert.com said:

We have long needed a statutory single private rental Ombudsman – so I’m pleased to see it in the legislative plans. After all, disputes are often between two individuals – landlord and tenant – rather than between companies, so it can be very personal and difficult to sort. Crucially, it won’t be voluntary, all private landlords will be required to join the Ombudsman, and it will have legal authority to compel apologies, take remedial action and pay compensation.

Dan Wilson Craw, Acting Director, Generation Rent, said:

The Renters’ Reform Bill is a huge opportunity to improve the lives of the 11 million people who now rent from private landlords in England. Arbitrary Section 21 evictions make it impossible for tenants to put down roots and report problems about their home with confidence. Abolishing them will take away much of the stress of renting and improve communication and trust between tenants and landlords. The new Property Portal and Ombudsman have the potential to make it much harder for criminal landlords to operate.

These reforms wouldn’t be happening without the tireless campaigning of members of the Renters Reform Coalition and thousands of renters over many years. We look forward to reading the Bill and working with ministers and parliamentarians to make sure the legislation achieves what it sets out to do.

Ben Beadle, Chief Executive of the National Residential Landlords Association, said:

We welcome the government’s pledge to ensure landlords can swiftly recover properties from anti-social tenants and those failing to pay their rent. Plans to digitise court hearings will also improve the speed at which legitimate possession cases are processed.

The NRLA will continue to work with the government to ensure the detail of the Bill is fair for responsible landlords and tenants alike.

Michael Webb, Head of Policy & Public Affairs, Battersea Cats & Dogs Home, said:

Tenants being unable to find anywhere to rent with their pet is sadly one of the most common reasons people bring their animals to Battersea. Not only will this Bill bring us one step closer to significantly reducing the number of dogs and cats we see being needlessly separated from their owners, it will also open up the many joys of pet ownership to millions of renters in the future. As this Bill now begins its journey through Parliament, we look forward to continuing to work with the Housing department, tenants and landlords to help ensure a fairer rental sector for pets and people alike.

Timothy Douglas, Head of Policy and Campaigns, Propertymark said:

Reforms to the private rented sector in England have been long awaited and the Bill will bring much needed clarity to letting agents, their landlords and tenants. Propertymark will support the UK government to ensure the specific details work in practice for those on the ground, whilst providing both security and fairness for both parties of the rental agreement. It is also important implementation is well planned and managed as these reforms are significant for the sector.

Original Post from gov.uk