29^th Apr 2019

According to a legal firm, the government's recent flurry of activity with its reforms for the private rented sector including open-ended tenancies reducing landlords' abilities to evict tenants, will cause many to leave the market, however there will be a longer term negative effect on the sector.

The firm believes the government's anti-landlord stance will cause many property and institutional landlords to stop any further investment in the PRS.

The law firm is only too aware of the fact that the reduction in mortgage interest tax relief, the banning of letting fees and the dilution of Section 21's powers is making it increasingly challenging for landlords.

Paul Henson, a partner in the real estate litigation team of the firm, said: “The Government has a Dickensian view of private landlords offering substandard homes for extortionate rents. Whilst the market is far from perfect, this view is outdated. Private landlords want tenants in their homes, and most tenancies are in fact ended by the tenants themselves.

“The demand for rented homes continues to grow, particularly in London and the South East. The market is attracting considerable investment from financial institutions with smart and professional build to rent offers. This professionalisation of the rental market is needed and desirable.

“Government reform must focus both on the needs of the tenant and the landlord. Any reform that makes the market less desirable for private and institutional landlords could leave tenants in a much weaker position in the longer run."

He added: “We wait to see the full detail of the government’s reforms and particularly the suggested amendments to section 8 (fault based) procedures and how they intend to expedite the court possession process.”


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