A lettings and sales agency says the new Labour government will be facing a possible clash between economical improbability and political desires when reforming Renters Bill into its own vision.

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Tom Bill, head of residential research at agency, says: “The risk for the lettings market is the introduction of policies that make it too financially punitive to become or remain a landlord, which could result in more owners selling up and higher rents.

“The Labour Party will revive the abandoned Renter’s Reform Bill in some form and had previously said it would end no-fault evictions on its first day in power. In an encouraging sign the party understands the picture is more nuanced, Angela Rayner recently told LBC: ‘That’s a simplistic way of looking at it.’

The agency also contends that the courts system has to be upgraded so it can cope when Section 21 evictions are banned.

He continues: “Labour has also pledged to end so-called bidding wars, a policy based on the assumption that high demand and low supply is a permanent feature of the lettings market. As we are currently seeing at the higher-value end of the London market, rising supply means asking rents are rarely met at the moment.

“Labour also appears to be adopting a more pragmatic approach to leasehold reform, rowing back on earlier plans to abolish the leasehold system in its first 100 days. How far and fast it goes will be dictated by how much of a priority the issue is.”

Bill also warns that Labour’s pre-election claims on tax changes it will not increase or lower does not include one big tax ‘sore’.

He says: “Capital Gains Tax (CGT) is one they have not ruled out increasing, in a potential further deterrent for landlords. However, they have said they will not apply CGT to primary residences. Some expect to see CGT changes in the first Labour Budget, but others don’t.”