No longer in limbo perhaps, but there remain a few unanswered questions for agents following the long-awaited release of the White Paper titled ‘A Fairer Private Rented Sector’, with uncertainty lingering until the reforms actually make it into law.
Nick Lyons, CEO of No Letting Go, said the release of the White Paper after a number of years of delay and fervent speculation was merely the first step in what will continue to be a slow and complex journey.
Lyons said: “The proposals outlined in the meaty 86-page policy paper will now inform what is included in the version of the Bill that will be brought forward to Parliament. That is likely to still take some time as intense lobbying and opposition goes on behind the scenes.
“The devil will be in the detail, which is lacking at the moment. For example, many landlords do not accept pets so there will be particular opposition to the idea of tenants finding it much easier to keep pets in their rental homes unless they have some means to protect themselves against extra cleaning, excessive wear or damage at end of tenancy. There is every chance this could be watered down to appease frustrated landlords by the time it gets to Parliament.”
Lyons also points to the Tenant Fees Act 2019, which took a considerable amount of time to pass into law and faced plenty of opposition along the way.
The latest reforms are even more sweeping – the biggest changes to the private rented sector in a generation – so are likely to face even more scrutiny and wrangling.
He adds: “I’d be very surprised if the Bill’s path to Royal Assent and becoming law is an easy, smooth and swift one. We all saw the difficulties the Tenant Fees legislation faced in reaching law, and I imagine something similar will occur here. There are still numerous things distracting the government – from by-elections and partygate to the cost-of-living crisis, the war in Ukraine and high-profile strikes – which are likely to keep parliamentary time to a premium.”
Lyons says much engagement has already been had on the issue of rental reform, but it’s likely that more consultation and feedback will be sought before the final version of the Bill is presented to Parliament.
Lyons continues: “Propertymark were noticeably stronger than usual in their reaction to the White Paper. There was a very informative video piece for Propertymark members by Valerie Bannister, which I thought was a very balanced view, particularly with regards the likely impact to lettings agents and property managers. Propertymark can be a very powerful lobbying force, especially when combined with other similar organisations, who also want to push back against the reforms.”
He argued that there are elements of the reforms that most people will get behind – such as the extension of the Decent Homes Standard to the PRS, and the concept of making it easier for landlords and tenants to resolve disputes without going to the courts, with lower costs attached.
Meanwhile, the scrapping of Section 21 has been baked in for some time and is something that most landlords and agents seem to have reluctantly accepted as inevitable.
However, other parts of the reforms are likely to prove more controversial – for example tenants being the ones to decide when a tenancy ends and what constitutes a valid reason for landlords to end a tenancy and reclaim possession of their property.
Lyons explains: “These are the things that are likely to be the subject of fierce lobbying over the next few months. We still don’t know exactly when the Bill will be brought to Parliament. This government has a habit of announcing major things out of the blue when no one’s expecting it, so that could happen again, but equally, we waited a long, long time for the White Paper and there’s no guarantee that the production of the Bill will be any quicker.
“Given we’re already in June, I’d be surprised if rental reforms were introduced before the end of the year, so 2023 seems far more likely.”
He concluded: “There isn’t that chronic sense of limbo anymore – which is welcome – but equally there’s going to be a few more months of uncertainty yet for agents to tolerate. Fortunately, the market remains buoyant despite this, which bodes well for coping with the disruption that rental reform would likely cause.”