Labour Pledges Better Private Renting

abandoned-1220973

Which party is best placed to fix the ‘broken’ housing market?

Parliament has prorogued and will dissolve on Wednesday 3rd May 2017 ahead of polling day in June, but we are yet to see what the parties vying for our votes has to say about the majority of issues which will decide the election.

Manifestos will likely be published in the next 10 days or so, but Jeremy Corbyn has fired the first shot (not literally, we know that he is a deeply committed pacifist) on the housing battlefield by announcing his plans for the private rented sector.

Mr Corbyn is no stranger to PRS policy, he regularly promoted a private members bill seeking to regulate various aspects of landlords’ businesses. Likewise the Labour Party spokesman on housing, John Healey, has a strong track record as a former housing minister (prior to the 2010 general election).

As such it is no surprise that renters’ rights would be at the forefront of opposition policy. Although curiously we are yet to see any suggestions of their approach to rent control, registration or taxation. The manifesto will no-doubt be an interesting read.

So what would a Labour Government do?

Taken directly from their announcement, Labour’s five point consumer rights for renters plan is as follows:

  1. New legal minimum standards to ensure that all homes are at least ‘fit for human habitation’ and to allow private tenants to report private landlords that  rent homes that are unsafe, or in very poor condition.
  2. New powers for councils to license landlords in their area without central government say-so.
  3. New tough fines of up to £100,000 for landlords who fail to meet minimum standards, with a proportion retained by local authorities to fund environmental health and enforcement work.
  4. A hotline for tenants and landlords to give free advice on their rights and responsibilities.
  5. New ‘private rented sector renewal’ loan fund through the Homes and Communities Agency to help private landlords bring their properties up to scratch and for councils to compulsory purchase sub-standard private rented properties as a last resort.

And what does this mean for letting agents?

Well, there’s no direct reference to letting agents in the press release but there is plenty that would impact their businesses. All in all the proposals are a bit of a mixed-bag.

The good?

A legal minimum standard would be no bad thing. In practical terms there are plenty of standards underpinned by the Landlord and Tenant Act 1985 and the Housing Health and Safety Rating System, but clarifying exactly what constitutes ‘fit for human habitation’ could be useful when tackling poor landlords and letting agents.

Likewise increased fines for landlords convicted of bad practice is difficult to argue with – although there are plenty of areas already served by really significant and/or unlimited fines, so the change would likely be fairly minimal.

The bad?

Licensing is more problematic. It was during John Healey’s time at DCLG that the requirement for central approval for licensing schemes was removed, so it is no surprise that the Party wants to see a reversion. However, there has never been a comprehensive argument for the benefits of blanket licensing, and the costs to landlords and tenants alike are plain to see.

The worthy?

As for the final two pledges, these could be described as well meaning, even worthy, but there seems to be little indication of how they would be funded. As a trade association, UKALA is only too aware of the complexities and cost of providing an advice service. It is not simple or cheap – and that’s only dealing with one side of the equation.

I’d suggest it would be wise to leave this to those with experience and practical know-how.  In many instances this will be the lettings agents.

In a similar vein, renewal loans could be a genuinely positive move to help bring properties up to a decent standard. My only reservation is that it sounds expensive, and (potentially) a little ‘Green Deal-ish’ which was fraught with complexity and failed to deliver on a great deal of promise.

The same goes for compulsory purchase. Councils have the powers today to impose a management order on a poorly maintained or managed properties – but there simply isn’t the incentive or funding to them to take action.

So…….?

All in all, wider, less targeted licensing of landlords could be damaging, and very costly to landlords, letting agents and tenants, but some of these pledges could have the potential to deal with a few persistent problems.

However, if we are to take these policies seriously we need a little more substance, and a lot more detail about where the money is going to be found to properly fund these proposals.

The last thing we need is yet more ill-planned regulation without the money to make sure that it can be effectively enforced – irrespective of which party suggests it.

This entry was posted in Blog, Politics, Regulation and tagged , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s