The Renters Reform Bill was mentioned in the Queens speech. It is one of the top white papers the Government are pushing hard to get through in this parliament.
The full details of the Renters Reform Bill has changed on many occasions. We have already outlined in previous articles what may actually finish in the white paper itself.
However, what was concerning two Government ministers have used certain terms in parliamentary questions to point out specific measures. This may empower tenants to challenge the rents in future.
This has never been mentioned before and it might be the rabbit out the hat that the Government often use as a headline. This is in order to draw in tenants to vote for them in future.
What is not well known is that there is already rent controls in place. The rents can be referred to the rent officer at any time by a tenant but nobody ever uses it. Obviously, with the market extremely buoyant at this moment in time and rents increasing dramatically. It is no surprise that they are looking at some form of rent control.
The white paper is still being put together by Michael Gove’s Department. To include levelling up, housing and communities and is intended to be published very shortly.
A question was put towards the Government by the opposition recently regarding what would be in the white paper.
Shadow housing minister Matthew Pennycook asked Michael Gove in the House. “We know that rent tribunals are not an effective safeguard against punitive rent rises, and that the risk of such rises is likely only to increase when section 21 no-fault evictions are finally scrapped.
“Will the Secretary of State therefore tell the House why his planned renters reform Bill appears to be completely silent on protections for tenants against unaffordable rent rises?”
The secretary for State, Michael Gove then replied “Our Renters Reform Bill will specifically ensure that people in the private rented sector are protected, and I look forward to working with the honourable gentlemen to ensure the Bill satisfies the needs of the hour”.
This can only mean that the Government are looking to put some form of rent controls in the new Renters Reform Bill.
They are looking to remove the Section 21 notices whereby landlords can give a tenant notice to quit. Then give them a new contract at a higher rent. They are going to use the removal of the section 21 to inform landlords that they have to give a reason why they are asking the tenants to leave.
In written answers to parliamentary questions, housing minister Eddie Hughes was asked by Catherine West, shadow minister for foreign and common worth affairs. “What step he has taken to enhance private renters security in the contest of increases in the cost of living”.
The housing minister replied;
“This Government is committed to easing cost of living pressures and increasing security and stability for tenants.
“I was very pleased to announce last week that we are bringing forward legislation to scrap Section 21 evictions.
This will prevent tenants from being unfairly evicted and empower them to challenge unreasonable rent rises – as well as saving money on the costs of frequent house moves.”
This is clearly a step by the Government to bring in some form of silent rent control without people realising. It is agreed that the current process of challenging unfair rents is complexed, cumbersome and impractical. However, by simply abolishing section 21 evictions does not make the process any easier. Potentially could make it more challenging.
The property industry has been asking questions of the ministers and specifically on their recent comments. There has been no clarification or contradiction from recent misters.
All the spokesperson has recently said was “We’re delivering a better deal for renters. The Renters’ Reform Bill announced in this week’s [sic] Queen’s Speech will bring forward measures to abolish Section 21 no-fault evictions, giving tenants greater security and empowering them to challenge unreasonable rent rises without the fear of retaliatory evictions.” Unfortunately, the Government do have a tendency to hide small issues in white papers to make big changes.
It has to be fair for everybody, landlords and tenants as well without compromising the commerciality of being a landlord.
The Government are trying to bring in legalisation where in reality they should leave it to the market. You cannot rent control a tenant market or ultimately you will end up loosing landlords. Rents will only then be pushed further up.