Tag Archives: rent freeze

Greens demand rent freeze and eviction ban Landlord News, Latest Articles, Property News

An immediate cap on rent increases and a ban on no-fault evictions until at least the end of March 2023 are being demanded by the Green Party.

The party says the government must urgently bring forward its promised Renters Reform Bill in time to stave off ‘a winter of evictions and homelessness’.

And, they say, the government’s reforms must include an immediate ban on evictions and rent rises.

Landlords issuing no-fault eviction notices

The party’s call comes after it was revealed that thousands of tenants are at risk of homelessness after a 76% rise in the number of landlords issuing no-fault eviction notices.

The data from the Ministry of Housing, Communities and Local Government reveals that 5,940 households in England are at risk after being handed a Section 21 eviction notice between April and June.

That’s up from 3,380 in the same period in 2021.

‘Bill must include an immediate cap on rent increases’

Carla Denyer, co-leader of the Green Party of England and Wales, said: “The Bill must include an immediate cap on rent increases until at least the end of March 2023, as well as a ban on no-fault evictions over the same period to prevent landlords evicting tenants in order to raise rents.”

In Scotland, where the Scottish Greens are in government with the SNP, similar measures have already become law.

The party also points to average rental prices outside London becoming an issue for renters after they hit a high of £1,162 a month, jumping 11% in the past year.

The legislation is still a ‘priority’

The UK government produced a White Paper in June and housing minister Andrew Stephenson told Parliament in October the legislation is still a ‘priority’.

Ms Denyer said: “Knowing that you have a secure home over winter is vital for both physical and mental health.

“Households already face soaring energy and food costs; the last thing they need, on top of everything else they have to contend with, is unaffordable rent rises and the fear of being evicted.”

‘Rising private rents and increasing evictions’

She added: “Rising private rents and increasing evictions have also been cited as major causes of a dramatic increase in homelessness in London and other cities.

“The number of people sleeping rough on the capital’s streets has jumped by a shocking 24% in the past year.

“We are calling on the government to introduce an immediate freeze on rent rises and a ban on evictions by landlords who simply want to increase rents between tenancies.

“The Scottish government has introduced legislation to safeguard tenants this winter. We want to see the housing minister introduce similar measures in England, and for the Senedd to use its devolved powers to do so in Wales.”

Why a rent freeze in England just took a giant step forwards Landlord News, Latest Articles, Property News

Where to begin? With the media buzzwords? With various organisations calling for a rent cap in England? Or the real reason a rent freeze is coming which was revealed on Thursday (which I will come to)?

Leaving aside that there is a perfect storm brewing, is there really a private landlord anywhere in England who doesn’t believe that a rent freeze is on its way? And with it, a moratorium on evictions too.

Scotland led the way with an ill-thought-out scheme before finalising the legislation which was full of holes.

Wales tried to follow with Plaid Cymru saying that rents should be frozen this winter, and not people. That’s a clever turn of phrase and surprisingly, the Labour Party refused to impose a rent freeze saying that their Scottish friends are fearing that landlords will leave the sector – which will push rents up because there will be fewer homes to rent.

And then we come to England.

Groups stamping their feet demanding a rent freeze

We’ve had all the usual groups stamping their feet demanding a rent freeze to help deal with the cost-of-living crisis. There’s never any mention of landlords struggling financially, it is always focused on the tenants.

That’s why I was taken by a report from Crisis, which I read on Property118 about the choice of housing for those on housing benefit.

The homeless charity says that just 11% of one-bedroom homes in England are affordable to those in receipt of HB. That’s down from 17% in April.

There’s no doubt that the gap between the actual cost of renting and housing benefit rates is an issue and, according to Crisis, has grown by more than 40% in just five months.

That means there are naturally fewer homes for people on housing benefit to choose from with the situation being compounded by the fact that lots of landlords (or their lender) are not interested in dealing with those on benefits.

So, having accepted that there is a growing issue, particularly in London, with people struggling to afford to pay rent, it’s worth noting that the government looks set to impose a rent cap on social housing from next April.

There’s been a consultation to see whether it should be set at 3%, 5% or 7%.

Protect the most vulnerable households

The councils and social housing landlords have flagged up the problems that will come with this, but the government seems intent on implementing it – they say it will protect the most vulnerable households in exceptional circumstances during the year ahead.

But there’s no doubt that if it’s good enough for social housing tenants, then it must be good enough for private rental sector tenants too?

And I can’t see the government waiting until April before the rent cap is brought in for social housing tenants – I think it will come in sooner. And it will be set at 0%.

Persuaded to introduce a rent freeze in the PRS

I also think the government may well be persuaded to introduce a rent freeze in the PRS because this will play well for people on low incomes.

And, let’s face it, every landlord knows the Conservatives have not been a friend to us for many years.

We often see in the media various buzzwords like the cost-of-living crisis being splashed regularly when referring to escalating prices for food and energy and that people should prioritise these things rather than paying rent.

Well, I don’t believe they should. I think they should pay.

The government is now working on a timescale

I mentioned at the beginning that there is a perfect storm brewing, and you need to focus on what I’m about to say by understanding that the government is now working on a timescale – and that timescale is dictated by the last date on which they can hold a General Election.

That means there are some issues they need to deal with and a few supertankers they need to turn around.

Having Michael Gove back in government – he’s certainly not a friend of landlords – means that there may be some unpalatable decisions being taken that will leave landlords out of pocket.

This brings me to a perfect storm and it’s one that will leave landlords well and truly drenched.

This came to me on Thursday when I read the Bank of England statement about why they were putting the base rate up. It’s no surprise that the base rate is now 3%.

Landlords will be paying more for a new mortgage

The knock-on effect means that landlords will be paying more for a new mortgage – if they pass the ever-stricter stress testing being imposed.

That means rents will rise and they will probably increase substantially so this will become a political hot potato.

The government could put some cash into the situation to help pay rent, which has already been hinted at, but I don’t think that is what they will do.

That’s because the Bank of England statement makes clear that we are about to head into a prolonged period of recession which may see the number of unemployed people doubling and businesses going broke. This recession will end at, or near, when the next General Election must be held.

A simple solution, and one that will save the government billions of pounds, is to introduce a rent freeze in the New Year for all tenants in England, including those in social housing.

If this happens, then it is the starting gun for an election campaign and landlords will be paying the heaviest of prices for it.

Expect the rent freeze to last at least six months, if not longer.

Bound to be a moratorium on evictions

In addition, there’s bound to be a moratorium on evictions which will cause chaos in the PRS because lots of tenants will realise that they don’t have to pay rent and it could be years (I’m not joking here) before a landlord gets possession of their property.

As I said, it’s a perfect storm of rising interest rates and mortgages, fewer homes to rent and a recession that landlords can do little to avoid and all we can do is hope the government doesn’t decide that a rent freeze will be the simplest of solutions to a very tricky housing problem.

If you see me in this storm – it isn’t the rain or floodwater that I’m covered in. It’s the tears of fed-up landlords wondering what they did wrong to have such opprobrium poured over them.

Until next time,

The Landlord Crusader

Northern Ireland report rejects rent controls Landlord News, Latest Articles, Northern Ireland, Property Investment News

The Northern Ireland Assembly has published independent research on what a rent decrease of up to 10% and/or a rent freeze for up to four years will do the private rental sector.

Under the Private Tenancies Act (Northern Ireland) 2022, section 7 amended the Private Tenancies (Northern Ireland) Order 2006, so that the frequency of rent increases would be restricted to once every 12 months.

Now a report by the Chartered Institute of Housing (CIH) reveals that there is no evidence that further rent control is required in Northern Ireland.

The report reveals that tenants have said it is ‘neither easy nor difficult’ to be able to afford their rent, and the most recent data on market rents quoted in the report shows affordability is improving.

Affordability issues for low-income households

However, the CIH’s analysis shows affordability issues for low-income households because of the social security system, such as freezes in local housing allowance rates.

However, the report predicts that up to 60% of landlords could exit the private rental market in Northern Ireland if either a rent decrease or rent freeze were adopted.

The CIH reports says that a rent freeze or decrease would largely benefit existing tenants who remain in their homes and whose landlords do not sell or repurpose their properties.

The report highlights that should such a move be brought in, some rental properties may be sold to landlords, keeping the property within the sector, but some landlords may decide to leave the sector or opt for the short-term holiday let market.

With a shortage of privately rented accommodation and social housing, plus the increased demand for privately rented homes, the best way of relieving pressure on rent prices is by having enough housing supply, the report says.

‘The biggest reason landlords are giving for selling rental properties’

Timothy Douglas, the head of policy and campaigns at Propertymark said: “Our own polling and research shows the biggest reason landlords are giving for selling rental properties is rising costs.

“This will be exacerbated if their rental income is cut or frozen. We also know that as many as half of the properties sold do not return to the rental market.”

He added: “The report acknowledges what we’ve been saying all along, that the best way to maintain affordability is to have enough homes to rent, privately and in the social sector.

“The new Northern Ireland Assembly must therefore ditch this rent control agenda and focus its efforts on delivering the quota of new housing across all tenures that was promised in the ambitious Housing Supply Strategy.”

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