Reform UK has announced plans to repeal the Renters’ Rights Act through a proposed ‘Great Repeal Bill’ if the party wins the next General Election, describing the legislation as a “disaster” for tenants.
The party, which gained ground in recent English council elections, told The Negotiator it would scrap the Act, which came into force at the start of this month, as part of broader measures aimed at the private rental market.
Industry response
Property industry professionals have responded to the proposal with caution, suggesting that reversing the legislation would require more comprehensive solutions than a simple repeal.
Jeremy Leaf, north London estate agent and former RICS residential chairman, highlighted the challenge of replacing elements of the legislation, particularly Section 21 no-fault evictions. “There was a general consensus across the political divide that Section 21 no-fault evictions had probably run their course,” he said.
Leaf noted that the political divide centred on how to replace Section 21 and whether the under-resourced courts system could cope with changes. “On the ground, we found that the latter in particular has persuaded landlords to sell,” he added.
He pointed to a broader issue affecting the rental market: “Another often overlooked problem is that it is not just that landlords are leaving but there are not enough younger-breed investors coming in to replace them or expand existing portfolios.”
Regulatory history
Mark Harris, chief executive of mortgage broker SPF Private Clients, noted that regulatory pressure on landlords predates the current government. He referenced measures introduced by former Chancellor George Osborne, including the phasing out of mortgage interest relief against rental income and the introduction of a 3% stamp duty surcharge on rental property purchases.
“The Renters’ Rights Act adds another level of regulation and uncertainty for landlords, which has resulted in some leaving the sector,” Harris said. He added that the legislation has led to an increase in landlords purchasing properties via company structures rather than in their own names.
Harris questioned whether the legislation could be simply unwound, though he acknowledged that repealing tax changes on mortgage interest deductions might appeal to smaller-scale landlords. “Although one wonders how many of those will be left by then,” he said, adding that there was no detail on how Reform would address any resulting revenue shortfall.
Market implications
A Reform UK spokesperson stated the party would introduce the Great Repeal Bill “to ditch daft regulations such as the Renters’ Rights Act in order to drive growth and investment, as well as bring down bills and ease the cost of living for consumers.”
The spokesperson claimed the Act was “driving landlords to sell up in droves, slashing rental supply and pushing up rental prices.”
Harris advised against making investment decisions based on potential political changes, recommending that landlords seek professional independent advice “that will see you through all manner of political and economic ups and downs.”
The rental market has experienced significant shifts in recent months, with estate agency activity showing modest growth despite regulatory uncertainty. The debate over rental market regulation continues as political parties position themselves ahead of the next General Election.