Following the Labour Party’s victory at the General Election, there is set to be a raft of legislative changes across the legal sector. An area where there is likely to be a host of changes is the private rental sector.
Below, we have outlined the potential changes and considered their impact on both landlords and tenants.
Abolition of Section 21 evictions
Labour’s manifesto states their intention to put an end to Section 21 ‘no fault’ evictions immediately. The Party’s full Renters’ Charter aims to “prevent private renters being exploited and discriminated against, empower them to challenge unreasonable rent increases, and take steps to decisively raise standards.”
Section 21 is known for permitting landlords to remove tenants without stating a particular ground.
During the parliamentary discussions of the Renters (Reform) Bill at its second reading in October 2023, the Conservative Party argued that substantial judicial reforms would be necessary before the repeal of Section 21 could take place, resulting in uncertain future schedules.
Regarding Labour’s schedule, Angela Rayner, the Deputy Leader of the Labour Party and the shadow secretary for housing, has previously stated that the Party intends to abolish Section 21 right from their initial day in office.
Extension of ‘Awaab’s Law’
The Labour Party has also said that it will be enhancing the quality of privately rented residences by extending Awaab’s Law across the private renting domain.
This legislation was initially enacted in the social housing sector in July 2023, following the tragic death of one-year-old, Awaab Ishak, who succumbed to “a serious respiratory illness caused by extended exposure to mould in his living space”.
At present, the statute obligates landlords in the social sector to:
- Examine potential dangers within 14 days.
- Issue a documented summary of the said examination.
- Initiate remedial actions within 7 days should the risk pose a considerable threat to the occupant’s health or safety.
- Finalise the necessary repairs within an ‘acceptable duration’.
- Address urgent repair needs within a timeframe of 24 hours.
- Maintain a transparent record of all communications with tenants and service providers.
- The spectrum of health and safety risks encompasses issues like moisture and mould, extreme temperatures, and the presence of carbon monoxide or other harmful combustion byproducts.
Energy efficiency standards
Labour has pledged to achieve the minimum standards for energy efficiency by the year 2030, although their manifesto does not specify the target rating they are aiming for.
The Conservative’s initial strategy was focused solely on the private rental market, setting a goal for all properties to attain an EPC rating of band C by the year 2035. Properties newly available for rent were given precedence, with a target set for an EPC rating of band C by 2025, and the aim to include all rental agreements by 2028. Nonetheless, in September 2023, Rishi Sunak proposed a dilution of these objectives.
Furthermore, the Labour Party’s Warm Homes Plan is set to allocate an additional investment of £6.6 billion in the forthcoming parliamentary term. This funding is intended to enhance five million homes, thereby reducing household expenses.
The Party has also said that it plans to collaborate with the private sector, including financial institutions, to secure private funding that will expedite the improvement of homes and the adoption of eco-friendly heating solutions.
Leasehold reform
Labour plans to end the ‘feudal leasehold system’, which could significantly impact property ownership structures.
New housing initiatives:
- Development of new towns
- Updated National Planning Policy Framework
- Increased social and affordable housing
Implications for landlords and tenants
While these proposals aim to improve tenant rights, there is a need for a balanced approach. It is important that landlords can rely on robust grounds for possessions in legitimate circumstances.
While enhancing tenant protections is crucial, it’s equally important to safeguard the interests of responsible landlords. The success of these reforms will depend on:
- Clear and fair grounds for possession for landlords
- An efficient Court system to handle possession claims
- A reasonable transition period for the sector to adapt
We anticipate that these changes, if implemented, could lead to:
- Increased litigation in landlord-tenant disputes
- A need for landlords to review and update their practices
- Potential shifts in the buy-to-let market
How can we help?
Paula Haverkamp is a Senior Associate and Litigation Executive in our Dispute Resolution team, specialising in landlord and tenant matters and property disputes.
For further information in relation to the subjects discussed in this article, please contact Paula or another member of our team in Derby, Leicester, or Nottingham on 0800 024 1976 or via our online form.
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