A lack of choice for private renters over where they can live will undermine plans by many of Britain’s main political parties to reform the rental market.
This is the warning from the National Residential Landlords Association (NRLA), as the Conservatives, Labour, Liberal Democrats and Green Party all propose to end section 21 ‘without explanation’ repossessions.
The NRLA emphasizes that neither party is adequately addressing the most urgent and fundamental problem for tenants – namely the chronic shortage of privately rented housing. According to recent research, an average of 15 tenants are chasing every available property, causing rents to rise across the market.
Without bold action from the next government, the situation for tenants will worsen, the NRLA claims. The association’s concerns come as Savills warns that up to a million new private rented homes will be needed across England and Wales by 2031 to meet demand.
Uncertainty about the regulation of the sector, coupled with the persistent problem of rising costs, are the main causes of the supply crisis. This includes tax increases since 2015, which the Institute for Fiscal Studies notes have hampered market growth and led to higher rents.
The NRLA calls for certainty about the regulation of the rental market. When Section 21 repossessions end, this must be replaced by a system that delivers on the Shadow Housing Secretary’s belief that: “Landlords need robust grounds for holdings in legitimate circumstances, and the system must work quickly if that is the case.”
In addition, research by Capital Economics shows that removing the 3% levy on the purchase of additional homes would ensure that almost 900,000 new long-term homes become available for rental over the next ten years. This would lead to a £10 billion boost in state revenues from higher income and corporation tax revenues.
The NRLA is calling for the abolition of stamp duty with landlords putting one of the more than a quarter of a million long-term vacant properties back into use.
NRLA chief executive Ben Beadle said: “Renters are being let down by the repeated failure to tackle the rental housing supply crisis.
“The lack of choice only leads to rents rising and, given the shortage of alternative accommodation to move to, makes it harder for tenants to hold rogue and criminal landlords to account.
He added: “We will work with the next government to ensure the replacement of section 21 works for the sector as a whole. However, greater security for tenants will mean nothing if they cannot find a rental home in the first place.”