The Renters (Reform) Bill was one of the main casualties of Rishi Sunak’s early General Election call. It left insufficient parliamentary time to put the Bill to bed in a way that overcame the practical difficulties of balancing the interests of landlords and tenants, without a host of unintended consequences.

Political Consensus

But given the progress that was made and – more fundamentally – how the demands on the private rented sector have expanded over the past 25 years, it was no great surprise that most of the political parties included proposals for reform of the private rented sector in their manifestos, as they chased the younger person’s vote.  

That resulted in common ground between Labour, the Conservatives and the Liberal Democrats in plans to bring to an end Assured Shorthold Tenancies. 

And Points Of Difference

What differed between the parties was the nature and pace of proposed implementation, with Labour leading the charge to get it done as swiftly as possible.  For example, though Labour have acknowledged a need to look at court processes, the rhetoric suggests this is unlikely to result in a significant delay in implementation. 

Instead, once Labour have finalised their position, a new Bill will need to be produced, put before parliament and go through the normal legislative process of scrutiny and debate in both the Commons and the Lords, giving landlords time to work out what it means for them in practice.

Of course, most investors have known it was only a matter of time before so-called “no-fault evictions” bit the dust. But attention has now turned to how Labour’s version of rental reform may differ to what has gone before, given an expectation that it is more likely to be weighted towards tenants’ interests.  

What Might Labour Do?

In this respect, a desire to get things done quickly suggests that wholesale changes are unlikely.

A proposal for a new Renters’ Rights Bill was included in the 2024 King’s Speech (which sets out the new government’s legislative programme in the forthcoming parliamentary session). That suggests evolution rather than revolution of previous proposals, without prescribing exactly what it will contain.

However, some clues may be gleaned from the amendments to the Renters (Reform) Bill that were proposed by Labour during its tortuous path through the House of Commons. These included measures to give tenants both more occupational certainty and flexibility, as well as others to limit the ability of wealthier tenants to outbid others with less financial clout.

– A longer minimum term of occupation before which landlords could serve notice to recover possession on grounds of an intention to sell or occupy the property (i.e. more than 6 months, perhaps as much as two years; though too long a period would risk choking off important supply from so called accidental landlords).

– A shorter minimum term of occupation where tenants wish to give up occupation of the property (i.e. less than 6 months).

– Measures to prevent agents from encouraging bids exceeding a property’s asking rent.

– Measures to prevent rents being set above levels proposed by the landlord at rent review, where dispute caused it to be referred to First Tier Tribunal.

– A maximum up front rental payment of 5 to 6 weeks rent.

The background briefing document that accompanied the King’s Speech appears to pave the way for such measures, though often in a fairly generic manner. It also accommodates other manifesto commitments such as bringing a Decent Homes Standard to the private rented sector.

Further rent control unlikely 

The biggest fear for many landlords has been the potential for more aggressive forms of rent control. However, the experience of measures in Scotland to limit rental increases, both during and between tenancies, has been a reminder that such measures carry a high risk of being counterproductive.

While the Labour party’s manifesto was quiet on the issue, it hinted that any form of control would be light touch, containing nothing more than references to tenants being better empowered to challenge unreasonable rent increases.

And subsequent reports suggest that any further rent controls are off the table.

Instead, the briefing document that accompanied the King’s Speech makes reference to empowering tenants to challenge rental increases designed to “force them out through the back door”, while also supporting much needed quicker, cheaper dispute resolution.

* Lucian Cook is Savills director of residential research *