Landlord exodus looms as Renters’ Reform Bill rattles the sector

Landlord exodus looms as Renters’ Reform Bill rattles the sector

0:01 AM, 31st May 2023, About 6 months ago 3

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Lettings agents in The Guild of Property Professionals are sounding the alarm bells, claiming that the Renters’ Reform Bill could be the knockout punch that forces countless landlords out of the private rented sector (PRS).

One agent has dubbed the proposed legislation as the ‘straw that broke the camel’s back’ because the proposed ban on Section 21 ‘no-fault’ evictions is sending shockwaves through the industry.

Graham Wood, a seasoned landlord with 20 years’ experience and managing director at Home Sales and Lettings, warns: “The long-awaited Renters’ Reform Bill has successfully spooked numerous landlords into selling their rental properties.

“It feels like landlords have been under constant attack for the past five years.

“First, the income tax advantages were stripped away, and now we face the grim reality of Section 21’s abolition.”

Surge in rental properties hitting the market

According to Mr Wood, this relentless assault on landlords has triggered a surge in rental properties hitting the market, as fearful landlords scramble to cash in.

He said: “At our agency, tenants seeking new listings often cite their landlords’ intentions to sell as the primary reason.

“In the last 18 months alone, around 10% of our managed properties have been sold, and we anticipate this figure climbing to 15% by the end of 2023.”

He added: “This trend isn’t unique to us – it’s widespread across the UK.

“As available properties dwindle, the law of supply and demand kicks in, causing rents to skyrocket. Once again, tenants bear the brunt of ill-conceived legislation.”

Boon for tenants and a bane for landlords

Simon Davies, a branch manager at Norman F Brown, believes the Bill has been presented as a boon for tenants and a bane for landlords.

However, he cautions that the devil lies in the details yet to be revealed, leaving landlords on edge.

Mr Davies argues: “While the scrapping of Section 21 appears daunting, there will still be avenues for swift possession, such as property sales, addressing anti-social behaviour or a landlord’s intention to reclaim their own property.

“But without prompt clarification from the government, some landlords may succumb to uncertainty and sell up.

“This reduced supply will only drive rents higher due to market forces.”

Focused on the banning of Section 21

Alex Umut Sevinc, the head of operations at Filey Properties, reveals that many landlords he has spoken to view the Renters’ Reform Bill as primarily focused on the banning of Section 21.

He said: “Landlords fear they won’t be able to regain control of their properties when needed.

“Some even worry that tenants might have the power to buy the property from them.

“While these claims remain speculative, they’ve sparked panic among landlords.”

‘Landlords are anxious about the potential freeze on rent’

He adds: “Moreover, many landlords are anxious about the potential freeze on rent or limitations on rental increases.

“With rising interest rates, maintenance costs, and tax implications, it’s another burden they can ill afford.”

Mr Sevinc highlights landlords’ major concern: the prolonged process of tenant removal, particularly the ‘accelerated possession’ route, which often takes up to nine months.

The apprehension stems from uncertainty surrounding the new eviction process and the grounds on which it can be executed.

He also says that the introduction of the new Property Portal for landlords is seen by many as yet another burden to deal with – and many fear the portal will be another punishment for those who comply with regulations, pushing them to the brink.

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Michael Johnson - Amzac Estates

10:39 AM, 31st May 2023, About 6 months ago

So many mistaken assumptions.
Firstly they weren’t ‘tax advantages’ they were legitimate business expenses that every business had including the huge multinationals
Secondly the removal of our right to reclaim our property will slowly become the main factor in landlords leaving this sector.
The ones that remain ( both legal and illegal) will be ruthless in the execution of the profitability of their business operations and this will only the problems that tenants face.
Watching the landlords supposed representatives and housing ministers is like watching the incompetent talking to the stupid

York student landlord

22:05 PM, 31st May 2023, About 6 months ago

Michael I was going to make exactly the same comment. I’m sick of section 24 being referred to in the media and by politicians as a “tax break” or “tax advantage”. Finance interest is neither of those things- it is a rightful business expense that EVERY other business can offset against their trading income. I have no idea how this wasn’t challenged in court (although our total lack of professional and effective representation goes some way to explain it). I’m surprised that the experienced landlord and agent quoted in this article also uses the term “tax advantage”.


8:23 AM, 3rd June 2023, About 6 months ago

Reply to the comment left by York student landlord at 31/05/2023 - 22:05
It was challenged in court, but not by the landlords associations. I watched Cherie Blair present the landlords case and was nearly evicted from court for applauding her efforts.

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