Private landlords should hold fire on plans to quit the private rental sector and give the government a chance to incentivise buy to let.
That’s the view of James Gwynne, lettings manager at regional agency Nicol & Co.
He says: “The message for now to landlords across the sector from us is essentially, don’t fret. There are still huge benefits in letting your property and when a change like this occurs, a new normal will be established. The best advice I can give is that now is a good time to communicate with your local managing agent with any queries.”
Gwynne says the controversial Renters Reform Bill, introduced to Parliament last week by Housing Secretary Michael Gove, is only a First Reading stage, and there will be a Second Reading next month where more details are likely to be revealed and debated.
He adds: “There is a concern among agents and landlords alike that certain areas of the Bill will result in more landlords leaving the sector due to tighter regulations and more complications on ending an unwelcome tenancy. While I don’t completely agree with the proposals, ultimately the government will need to add some incentives in at some point to keep landlords in the market.
“They do not currently have an alternative solution to social housing and if more landlords leave the sector, it will negatively impact tenants - the opposite of the government’s intentions.”
And he stresses that the benefits contained in the Bill should not be overlooked.
“As long as the strengthening of the Section 8 notice is made relatively straightforward and the court application process is not too legislatively complicated, then landlords should still be able to take comfort if needing to give notice for the more obvious reasons, for example, if they need to sell or move back in.
“The new ombudsman process should make the resolution of disputes easier, plus having a regulating body to listen to arguments on both sides might give the government a better overall view of the sector, resulting in better, more refined and balanced legislation for the sector in the long run.
“Having a ‘Decent Homes Standard’ will help to reward landlords who look after their tenants and provide well-run properties. This should also help to ease the bad ones out of the system.”
“Landlords need to take a long-term view, which includes not only rental which, according to figures from JLL Predict, could see cumulative growth in rental values of 15.9% in five years to 2027, but also increased capital gain over the long term.
“We believe that the government still needs to look at how to incentivise landlords but landlords also need to look at the benefits of remaining in the market.”
He insists: “Landlords need to take a long-term view, which includes not only rental which, according to figures from JLL Predict, could see cumulative growth in rental values of 15.9 per cent in five years to 2027, but also increased capital gain over the long term.
“We believe that the government still needs to look at how to incentivise landlords but landlords also need to look at the benefits of remaining in the market.”
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Haha haha please don’t let all of our business dry up over night 😭
He mentioned benefits twice but failed to elaborate on them.
Because he has no idea... Bit like Gove
I am still looking for the benefits too. I think the 3 strikes rule with late payments that avoids the current situation of paying down before the court decision counts. But they still make up repairs etc...
James, are you missing the landlords that quit already damaging your business.
We need an Ombudsman like a hole in the head, not less arguments but more someone else to run to with spurious allegations, piggy in the middle, more bureaucracy not less.
He’s fearing for his Job no props to manage etc.😁
Running 🏃♀️ scared 😂😂 they can see the end of the gravy 🚂 train …. Section 8 for ASB will be a total disaster 😱 at the moment a s21 is simply a case of getting the paperwork right and hey presto… not going forward, you will need evidence 👮🏻♀️ that is a whole different matter, try to get a Police prosecution or statements from neighbours 🙄 nope, this is very very bad.
They say now just evidence. It was prosecution I believe so they have lowered the bar (so it is supposed to appear :)) ). But I don't trust any of this. How can I get evidence for a court (in writing) for late night loud music for example. It's the same situation as now - No one will talk and go into writing. I don't really see any change here. A massive worry. It's all window dressing (or BS from Gove).
To late Estate agents. You fought back against change of legislation in the sales side and was left with EPC, you failed to fight against S21, so reap the benefits of loss of business. With the rise of internet based advertising, you’re letting business will continue to dwindle.
The good news for you is more build to rent businesses and so you can continue to make money there.
The new MEES Bill is already speeding its way through Parliament. The Minimum Energy Performance of Buildings Bill 2022-23 had its first reading in March this year and the second reading is in November this year. According to my local MP the Bill met with complete cross party support a few weeks ago. The 8 million+ voters living in fuel poverty and the £29 billion Government subsidy paid directly to fossil fuel energy producers (which could have paid for the NHS or tax cuts) has focussed the politicians' minds. The Bill confirms the timetable that all energy wasteful EPC Grade D and Grade E rental houses and flats must be upgraded to Grade C by 2028, at the latest. So that gives domestic landlords a full 5 years to insulate the walls, loft or roof and install lower running cost heating systems into their rental units. It would seem a sensible hedge to invest in an All Electric heating systems (within the well insulated property) because CO2 pollution tax and price rises are clearly on the horizon as we decarbonise the UK Electricity Grid at pace and scale (25% of our nation's electricity demand already met by renewables after 23 years of ringing the British Isles in the world's largest wind farms).
Landlords need to get an up-to-date draft 'as is' EPC and then a draft 'predicated' EPC showing the best pathway to reach EPC Grade C. All very simple and easy to do when the unit is vacant and in-between tenancies. Landlords have 5 years to improve their assets and stop energy waste. I wonder how many will get on with this essential work and how many will be moaning and bleating in January 2028 when they realise that they've done nothing over the next 5 years. Of course, they will blame the Greta, Just Stop Oil, the Government, the Opposition, their customer tenants, their managing agent - in fact everyone except themselves.
Have a day off.....
There will be very few private landlords by 2028 because of the abolition of Section 21.
Must you keep copy and pasting this over and over. You're boring.
Get lost!!!!!
He has an undiagnosed mental health issue 🏥💊
Pat. Build 2 Rent big boys will probably have their own in-house Management.
Martin, my friend I think you’ll have to get rid of that auld piece of plastic covering the window.
Many of us know exactly what the letting situation and problems were pre Section 21. A major problem was that once you let to a tenant you had said goodbye to your house or flat. It became theirs. The majority of landlords were not prepared to allow that to happen and either sold up or sought a form of letting outside the legislation. The new regime will be no different and will probably increase tenants' rights as time goes on, watering down the Section 8 reasons for a landlord to gain possession.
This is my worry. These reforms are one big trap to stop landlords leaving so easily. After I fear even worse nonsense down the road from Gove or Labour.
Students will leave after 2 or 3 years but letting to young families will no longer make any sense - wonder when the penny will drop on those young families evicted when the landlord sells but who can't find any other landlord to take them on?
It's still not dropped in Scotland but landlords have realised they can ask for rents undreamt of a few years ago!
My rental on one flat has been
£500 per month from 1998 to 2004, no increase but healthy capital growth.
£750 when the HMO legislation came into force in 2004, rising to £1000 over 5 years.
£1250 when lounge turned into 4th bedroom in 2011, rising to £1600 over next 5 years.
£2100 in 2018 after SNP anti PRS legislation in December 2017, kept the same until 2022, partly due to Civid, rent freeze and rent controls.
£2800 from 4 Students in May 2023, volunteered by one group desperate to secure a flat when they realised how many groups were chasing so few flats.
Landlords don't have much to fear if they choose tenants wisely and forget about being generous and get the highest possible rents from tenants who will move on and have solvent property owning guarantors.
Tenants who are no longer ideal will find they're the collateral damage from the tirade of hatred and venom aimed at landlords but actually hurting decent tenants.
Shelter will have nothing to do as their rogue tenants clients will become extinct through natural selection.
Robert - you seem to be managing extremely well. However, I am not a risk taker myself.
Nick - I am worried as you are. I won't let unless there is a valid fixed term contract - not sure if it will still be possible to let on a short fixed term contract to people who have their main residence elsewhere. You thought of asylum seekers before in a hotel situation; may be possible to let private flats via a housing association on a fixed term contract for a couple of years. The rules are not made yet in relation to short term letting etc.
I agree Ellie. I already have a block of flats rented to a Council. I haven't tried to get that back yet. I don't fancy any additional exposure. I have read about one company who won't vacate and are making the landlord go to court. Someone begging with B (can't remember who).
I don't want any more risk. I see the government turning PRIVATE PROPERTY into Public. No way am I being involved with that!
It's not just the Renters Reform Bill. Look at the whole picture: Add to it section 24 of the finance act, increasing mortgage interest rates, EPC changes with conflicting carbon emissions, the threat of a labour party, the ageing landlord democratic and a growing anti landlord rhetoric why would you stay in the PRS??
How about a 33% increase in rent volunteered by a group of students desperate for the flat who won't stay long term?
Gibbons
You know absolutely nothing about energy
I have been in the energy industry for a v v long time, pie in the sky and witchcraft is being peddled. Their is no such thing as renewable energy, it's a contradiction of Bernoulli's theorem. You obviously have connections to the legal profession and slavering over the fees you will make think h honest, small landlords. Further build to let has taken a big tumble !!!
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