Labour has long been the champion of the hard-done by tenant and if its manifesto, pre-election rhetoric and post-election announcements are anything to go by, landlords will find life in lettings increasingly tougher.
If you err on the pessimistic side, the possible changes outlined below may feel like a thunderous storm rolling in fast, rather than a dark cloud on the horizon. LandlordBuyer is here to offer advice and asset disposal expertise if the new Government has galvanised your exit plans.
- A ban of Section 21 evictions
A Labour win seals the fate of Section 21 eviction notices. While Angela Rayner’s wish for an immediate ban didn’t come true, Sections 21s are on borrowed time. Anecdotal evidence suggests there has already been a post-election flurry of landlords serving notice. Selling a buy to let property with tenants to cash house buyers, including LandlordBuyer, is an alternative. - Stricter EPC requirements
Landlords who breathed a sigh of relief when former Prime Minister Rishi Sunak scrapped the requirement for private rentals to have a mandatory C-rated EPC should look away now. Labour wants to reintroduce the mandate, with the current benchmark of E revising to C by 2030. At LandlordBuyer, we buy any property from investors, including those with D and E EPC ratings. This is a great exit strategy for landlords who don’t have the money required to make energy efficient improvements. - Landlords’ Register
It appears Labour believes many landlords are rogue and therefore it wants to introduce a mandatory National Landlord Register. This is being billed as a way to enforce better standards in the private rental sector (PRS), with landlords required to register properties and demonstrate compliance. It’s widely believed landlords will have to pay a fee to register, with an independent body carrying out compliance checks. - Decent Homes Standard
Part of a refreshed compliance code will see landlords adhering to a new, annually updated ‘PRS Decent Homes Standard’. This will run in addition to the existing requirements, putting greater pressure on landlords to ensure properties conform with a multitude of rules and red tape. - Awaab’s Law extended
Sir Keir Starmer made it clear earlier this year that if Labour were in power, it would extend Awaab’s Law to the PRS as part of its deal to raise standards. When implemented, private landlords will need to investigate and fix health hazards, including damp and mould, within strict new time limits. - Limited upfront rent payments
Labour is looking to revise down the amount of upfront rent a landlord can take from a tenant to secure a property, in addition to a deposit. Currently, 1 to 2 months’ rent in advance is common but there is no indication of what this figure could reduce to. - An end to bidding for properties
Landlords have long been able to capitalise on tenant demand but that will be a thing of the past under Labour. The party wants to outlaw the practice of landlord/agents initiating bids and counter bids between interested tenants. Instead, the desired rent should be stated on all advertising. - Rights to alter rented properties
Tenancy agreements are essential when it comes to protecting a landlord’s property, with clauses about DIY and cosmetic changes, but their validity could be undermined. Labour has intimated that it wants tenants to be able to alter their homes more freely with a new ‘right’. - Pets in lets
In the same vein as altering a rented property, Labour wants to make it easier for renters to keep domestic animals in properties they rent. What’s not clear at this stage is whether landlords will have any right to refuse, whether they can take an additional ‘pet’ deposit or whether they can insist the tenant takes out a specific pet insurance policy. - A doubling of the notice period
Evidence suggests Labour will double the amount of notice a landlord must give tenants if they want to end the tenancy. Currently, landlords must give at least 2 months written ‘notice to quit’ but this could increase to 4 months. - No automatic eviction for rent arrears
Nothing hurts the pocket more than unpaid rent but a landlord’s right to remove tenants who don’t pay up looks set to be challenged. Although not spoken about after the election result, chatter at this year’s Labour Party Conference suggested there could be an end to automatic evictions for rent arrears. - A restriction on rent rises
Labour wants tenants to have a fairer deal when it comes to the cost of renting and a 2023 report commissioned by the party outlined how this could be achieved. If the ideas are implemented, landlords will be confined to raising the rent just once a year and only during the tenancy, not between tenants. They would also be required to give four months’ notice of a rise, and rent review clauses would be banned from tenancy agreements. It’s even possible that rent rises could only move in line with wage and inflation growth. - A ban on buying new builds
Landlords have long been fans of new builds, as they offer low maintenance, energy efficient and desirable properties but property investors may find themselves ousted from this territory. Labour’s intention is to give first-time buyers ‘first dibs’ at new housing development. - An emboldened Build to Rent sector
The Build to Rent sector has slowly been growing in strength but since Labour publicly pledged to build 1.5 million new homes during its lifetime in Parliament, it sees a chance to expand and attract more tenants. The fall-out may be less renters choosing private landlords. - Restricting side-ways movement
Although many of Labour’s initiatives are punitive, it does want to keep private landlords in the long-term, traditional PRS to ensure supply meets demand. As such, there are rumours that the party could prevent landlords from moving sideways to the Airbnb, short term and holiday let markets. If introduced, this initiative would trap landlords if the PRS tanked.
“While LandlordBuyer fully supports any drive to improve standards in the PRS, we can’t help but think an eviction nightmare is on the cards,” says the company’s Jason Harris.
“We’re here to prove that selling a buy to let property with tenants in situ is the best alternative to serving notice. There’s no need for landlords to go through the stressful eviction process, and no need for tenants to lose their home. LandlordBuyer will take over the tenancy, and look after all current and incoming compliance matters.”
Speaking of the future, Jason adds: “Having the option to sell with tenants to a cash buyer will become more critical – and maybe the only viable option - once Section 21s are banned. With Labour in charge, we will see this happen sooner rather than later.”
Whether you are troubled by one or all of the above, our team of cash house buyers is here to help. Contact us to talk about a fast exit from buy-to-let. We buy any property from landlords and specialise in making offers if you’re selling a tenanted property.