London’s Labour Mayor Sadiq Khan has claimed credit for many of the measures contained in the government’s Fairer Private Rented Sector White Paper - and made it clear he wants the new Prime Minister to give him more power.
Speaking in a debate about the White Paper at the London Assembly, Khan suggests the government has copied his ideas for the scrapping of Section 21 eviction powers, reform to possession grounds, open-ended tenancies, a landlord register and a property portal aimed at the rental sector.
He advocated such measures as far back as 2019, he claimed.
But he wants the new Prime Minister, to be named next month, to go further, with landlords being obliged to pay tenants’ moving costs if an eviction takes place for the convenience of the property owner.
He also wants extended notice periods and to be given the power to freeze rents for two years.
Khan told the assembly: “Crucial elements are missing from the White Paper proposals if all renters, particularly those who are the most vulnerable and households with children, are to truly see the benefit of these reforms.
“These include extended notice periods, tenant relocation payments and freezing rent for the next two years, particularly during this cost-of-living crisis.
“It is really important whoever becomes the next Conservative Leader and therefore our Prime Minister commits to deliver on these as soon as possible.”
Khan and other Labour Mayors have no powers to controls rents in the private sector, but the London Mayor has repeatedly called for additional responsibility in this way.
And he told the assembly: “Give those in charge of the Londons, the Manchesters, the Bristols, Oxford and Cambridgeshire, where there are all issues around the cost of living, particularly in relation to private rents, the power to do more in this area in relation to freezing rents, rent controls, the quality of housing and so forth.”
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The dangers with rent controls are multiple.
Landlords who wouldn't normally increase rents would increase them before controls came in on the basis they might not be able to later.
Landlords face various costs that are beyond their control such as interest rate rises, licensing scheme fees, insurance costs, repair bills. Surely the price cap in the utility industry should serve as a warning as to what happens when an industry is unable to charge enough to cover costs that are beyond their control.
Imposing rent controls isn't going to help tenants if it causes landlords to go bankrupt or be unable to afford to maintain the buildings or persuades even more to sell up and exit the PRS.
It is not currently Government policy to introduce rent controls.
Ellie... Dosent tabolishment of Section 21 mean there has to be rent controls? Section 21 is merely enforcing expiry of a fixed term contract. Without section 21 and without rent controls.. A LL can gain vacant possession by doubling or tripling rent... There is a case for reform of periodic tenancies.. Say...chsnging to roll over tenancies with only one time expiring section 21 per contract period. IE a landlord must really want and enforce Section 21 or have a roll over tenancy..
Peter Yednell,
Not sure what you mean by your post. Landlords cannot double or triple the rent. They must be at 'market rates'. And the fairer rent white paper has proposals to restrict what landlords can charge.
Peter -
The White Paper abolishes fixed terms and therefore also automatic rent increases in a contract. If landlords want to raise the rent they must use Section 13 notices, a maximum of once a year, which can be challenged at tribunal. Tenants will get two months’ notice of a rent rise and while the tribunal will use the going market rent as the basis for their decision, the tenant will not be asked to pay more than what the landlord has asked for.
Generation Rent states on this issue that "with Section 21 gone, it follows that tenants can challenge Section 13 notices or negotiate with their landlord with less of a threat of eviction hanging over them. Two months’ notice of a rent increase (up from one) will give tenants more time to challenge it and while the tribunal can’t award more than what the landlord wants, this may encourage landlords to ask for as much as they think they can get away with – an unintended consequence."
Generation Rent wants rent rises to be based on affordability - and they want restrictions on when landlords can serve Section 13 notices. They say if landlords fail any form of compliance they should be unable to raise the rent.
Affordability would be a form of rent control and prevent landlords seeking to raise their rents to market levels at a tribunal.
Personally I never raise rents for existing tenants, and generally don't raise rents when there are new tenants either, even if market rents have gone up a great deal. This is because I don't want to take too big a percentage of tenants' income from them. I try to be fair, particularly with utility bills increasing.
However, I do draw the line at handing over my flats for life to tenants, and that is why I won't let under the regime proposed in the White paper.
Peter - if what you are saying is that there should be a limited fixed term tenancy allowed where Section 21 can be used, then that would be better than the current reforms, but I can't see that being proposed anywhere.
Generation Rent only wants changes to the White Paper so that it is even more onerous for landlords e.g. the two months compensation if the landlord wants vacant possession to sell or move a family member into the property. That is what they are asking for now.
Nobody pays for my own moving costs? The government hasn’t stopped interest rates going up yesterday increase costs for my home and BTLs.
Will landlords now also be expected to pay say £100 per week to their tenants for their food? What if they are old or lazy like my tenants? Will I have to do their shopping for them and deliver it all for free?
Perhaps landlords will be expected to wipe their tenants bottoms for them whenever required shortly.
They can add all that to their rental reforms bill. I’m out of here!
Umm I dont know what to say, your customers might be older, how you know they are lazy though I have no idea, if the state is paying then its the state buying you a house isnt it, if they work sadly their work buys you a house. Im sure you will be passing interest rises on in any case, I guess its a good job they pay the rent as it sounds like you cant afford the properties if they dont.
DE
Another idiotic comment from you.
Virtually all landlords couldn't afford to keep properties indefinitely if tenants dodge paying the agreed rent, just as virtually all businesses can't provide goods or services for free.
The huge raft of energy companies going bust last year proves that market forces are the only way to run any business but I wouldn't expect you to understand that.
Such crass comments do nothing to help the vast majority of decent hard working rent paying tenants and all taxpayers.
Comedy 🎭 Gold just before the weekend 😂. This is a taste of what we will get if Labour get in, in 2024 😱😱….be afraid, be very afraid.
Rent controls like most politicians don’t work in the real world
I'm not sure how the following should be interpreted exactly: landlords being obliged to pay tenants’ moving costs if an eviction takes place for the convenience of the property owner.
With a slight tweak to the wording it would be fairer: landlords being obliged to pay 2 months rent towards tenants moving costs if an eviction takes place for the convenience of the property owner and the tenant has adhered 100% to the terms of their tenancy for its entire duration.
I could see that as being mutually acceptable. It would give tenants a strong incentive to adhere to their tenancy agreements so should cut rent arrears. Any fault based evictions would be unaffected. It's a cost landlords would only ever face a maximum of once per property.
Professional landlords don't evict good tenants unless they really have no other option. The requirement to pay 2 months rent as compensation would clearly indicate there really was no other option.
Sorry Jo. That's still nonsense. In what world is that remotely ok? Why on Earth should a landlord ever have to pay compensation to get back their own asset???
I agree Chris, but it is what Generation Rent is asking the Government for after Section 21 is abolished and if landlords want to sell or move family back in. They want it incorporated in the Renters Reform Bill.
Generation Rent states that if "Landlords are selling or moving in, we want to see four-month notice periods, a longer period of protection from no-fault eviction, and relocation payments worth 2 months’ rent to help tenants move."
Jo is saying much the same thing about the two months' compensation.
I will not pay for my tenants moving costs. In theory some of what you write above is okay. But you try as a landlord PROVING your own case. It's all in favour of the tenant these days. Typically any spurious claims for repairs will come out. Many costing you a fortune. Even last minute repairs just so you pay their moving costs.
You are right Nick, the tenants definitely have a great deal of power at the moment.
I agree Jo. What incentive do tenants have to adhere to the rental agreement? With all the power on the tenants side, they can do whatever they want.
Or put another way he’d like to see the rental housing stock plummet further! I note he’s not taking credit for the lack of rental homes largely caused by the relentless attacks on LL’s. Utter nonsense!!
He is a popularist... He is far too intelligent not to know that post war rent controls destroyed the PRS.. It progressively reduced supply. But sitting tenants think it will help them.. And for some it will.. Until they have to move fur work or a larger family.. The young and immigrants will suffer and decent landlords will sell up to Rachmans who can make a profit by neglecting their properties... But Khan is just a cynicial vote seeking popularist... He doesn't care abt the housing market in 20 years... He only cares abt himself and getting Re-elected.
They’ll impose them that’ll destroy what’s left of the prs
The government and their masters will own everything and you’ll be happy or else
I think there is some merit, when the landlord has initiated the tenant move through a TRUE tenant no fault request, in the landlord making a contribution towards the tenants moving costs. However a landlord should not be expected to pay for removal costs from, say, London to Sydney. Maybe a contribution equivalent to packing up the van.
When the landlord is: selling the property with vacant possession; wishing to move in to use as their/their family’s home;etc, then Landlord pays for van loading.
If it’s a tenant exit, under the guise of a S21 or not, due to: not paying rent, antisocial behaviour etc then the move out is really initiated by the tenant’s behaviour and so all their removal costs should be borne by the tenant.
Ok. Is there any merit in the idea that a tenant should pay for any void until a replacement tenant is found? These 'no fault leaving' requests can be quite painful for landlords.
Maybe all leaving tenants should automatically have to pay for a full redecoration as well as its not fair that landlords should have to pay.
Our day to day lives are full of this 'fairness' bullsh1t where anything that is not a positive for someone is deemed unfair.
Ultimately you're advocating indefinite tenancies which are skewed so far in the tenants favour it's just not true.
If Councils promote tenants remaining in let accommodation until a court order has been obtained and eviction enacted, then the council should pay the landlord’s legal fees, disbursements, rent arrears, refurbishment costs and lost rent whilst refurbishing.
Wishful thinking on our behalf- if only!
Yes you are right, they should!!
If it were not just stupid it would be unenforceable! How much would LLs pay - how long is a piece of string! If you wanted to do this then tying it to a weeks rent, a months rent etc would be better, but why is he even worried S21 - his idea!- is being removed. Why waste time on legislation that will be defunct in 1 years time?
It may be that he is thinking of the Section 8 ground where a landlord wants possession if he wants to sell the house.
This is what Generation Rent wants after Section 21 goes.
It says on their website:
Where landlords are selling or moving family in, we want to see four-month notice periods, a longer period of protection from no-fault eviction, and relocation payments worth 2 months’ rent to help tenants move
next thing, they will want the LL to pay the rent as well !
And moving in costs because it’s convenient for us there renting the property.
They’ll soon be suggesting us LLs should “gift” our BTL to the less fortunate tenant!
Another ludicrous notion - would any of us have ever thought our business could be hijacked so relentlessly.
Are Labour so stupid that they don’t realise this would result in even more landlords selling up, and in turn the shortage of available rental properties would get far worse? I know they don’t always think things through, but this is so obvious they absolutely have to be aware what the impact of policies like this would be.
They are either stupid or wilfully ignorant - I’m not sure which is worse.
Absolutely right Steve. All the proposed policies punish landlords hard. Obviously people seek to avoid punishment and that, in the case of private rental sector, means selling up before you are hit even more.
I am sure that they are aware of what post WW2 controls did to the PRS... It's all abt with the winning votes from tenants who think the controls will help them. Such controls might help them.. Until they have to move fir work or famaily growth reasons.. The young and immigrants differ as supply dries up.. Long term its a stupid damaging policy...But what politician cares abt the long term..
I have had of enough. I am selling off one 3 bed family home this year and another next year. I will have 6 left then. They all home good tenants who have been renting from me for many years. However if any of those current tenants leave those houses will be up for sale to. Generation Rent will be responsible for forcing many happy tenants on to the streets or into temporary accommodation when LL sell up en masses.
You are not alone in what you are doing, Wendy.
I saw a stat a couple of days ago:
This time 2 years ago there were 375,000 properties available for rent in the UK, now there are under 125,000. A two thirds reduction in properties available to rent in 2 years and it’s only going to get worse.
And still, they carry on doing more of what has caused this. SMH
The policies are irrational and ill thought out. They say that they want a smaller private rental sector, but now desperately need private landlords to house the homeless that are resulting from their policies.
It’s such a big shame for LLs such as yourself Wendy being forced into this position because of the governments sheer stupidity and ignorance for the PRS LLs.
Steve, not only that but over the same last 2 years there will have been an increase in rental population of over 1/2m, possibly more. So fresh supply is down by 67% and demand is up by 15-20%. And get the government wants to destroy the suppliers. Utter madness
Is it April the First 😂😂😂
I had my fingers burnt back in the 1970s crackdown when all landlords were branded Rachman Landlords and like what happened back then, within 12 months of the outlawing of section 21 which will be shortly followed by rent controls, all private tenants will be secure lifetime plus sitting tenants as per the 1970s. After which the value of landlords property will plummet by at least 50% with the only potential buyer being the sitting tenant. Like back then properties to let will be as rare as rocking horse droppings and homeless figures will go into orbit before the penny drops and the then government alters course.
I think you are right, David. I remember exactly what the letting was like in the 1970s, too- and how landlords that remained in the private rental sector would only let to companies or foreign visitors.
Yes you are correct. In the 70s landlords were monstered by some clever propaganda, showing a clock to king on a mantelpiece,vsayimg and now your grandmother will be safe. We had some nurssrs trying to fit us up by rigging the property with a type of boobytrap probably trying to prove we were Rachman type landlords.
Landlords have been - and are now - treated like criminals. Edwin, I can imagine that your tenants had been brainwashed into thinking that they could do anything to you.
The notion that anything goes when creating legislation concerning landlords is clearly there now. Our rights to ownership and to contract freely are being taken away.
House prices in London mean that the return is the same as a high yield savings account. One's capital in the property may not be safe at all in the future, so letting property is a high risk investment and there isn't a high return in London to justify taking that risk. Sadiq Kahn should, just for one minute, think of the business element to letting property and he might have a better perspective on the situation and realise that many London landlords are on the verge of finishing with private letting altogether.
EPC C, the requirement to file tax returns four times a year etc. provide further incentives to leave. The loss of Section 21 is the red line though for many.
Groups like Generation Rent who want to grab even more benefits like requiring large sums of money from landlords if they ever have to move, are very selfish and deluded, too- they are making people homeless as they push even more landlords to sell up in the near future.
Unfortunately David that’s part 1
Part 2 is when they start to compulsory purchase everything… at rock bottom prices due to the epc targets being unattainable and causing most property to be virtually worthless
George, that's basically what a business is saying that wants to buy rented property that doesn't meet the insulation requirements and they would bring them up to c !
Edwin, that’s very noble of them when they have bought them on the cheap.
First introduce the legalisation to force price reduction (Band C). Then here comes the do gooders to make a killing.
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