The King’s Speech has introduced 35 bills that Labour plans to get through the next parliament including two key ones that will directly affect the working lives and businesses of the property industry.
This includes a Renters’ Rights Bill, which is Labour’s version of the Tory’s Renters (Reform) Bill and a Planning and Infrastructure Bill, which – Labour hopes – will see a building boom across England via a shake-up in planning rules including those governing the green belt, which has recently been branded the ‘grey belt’ approach.
The Planning and Infrastructure Bill will include modernising the planning committee system in England and increase local planning authority capacity to speed up decision making.
Economic growth
Labour’s plans reveal that: “Reforming the planning system is key to unlocking our country’s economic growth – enabling us to deliver both the housing and critical infrastructure that communities need.
“The Bill will speed up and streamline the planning process to build more homes of all tenures and accelerate the delivery of major infrastructure projects in alignment with our industrial, energy, and transport strategies.”
Simon Brown, Landmark Information Group’s CEO, says: “Labour has the opportunity to address the complexities and fragmentation in the UK’s planning system.
“Systemic issues such as poor information sharing and overburdened professionals currently slow down the market.
“Leveraging the relevant data can identify demand hotspots and streamline development; building homes in the places people want to live and work, with the necessary infrastructure to support them.
“Landmark looks forward to collaborating with policymakers to support these initiatives and contribute to a more efficient and effective planning process.
“By utilising data and encouraging cross-industry communication, together we can meet our new Government’s ambition to build 1.5 million homes under this parliament.”
Renting reforms
But for letting agents the Renters’ Rights Bill is the most contentious legislation within the speech. Details published this morning by Labour, say: “The Government is determined to address the insecurity and injustice that far too many renters experience by fundamentally reforming the private rented sector and improving the quality of housing in it.
“We value the contribution made by responsible landlords who provide quality homes to their tenants and believe they must enjoy robust grounds for possession where there is good reason to take their property back.
Determined
“However, the Government is determined to level decisively the playing field between landlord and tenant by providing renters with greater security, rights and protections and cracking down on the minority of unscrupulous landlords who exploit, mistreat or discriminate against tenants with bad practices such as unfair rent increases intended to force tenants out, and pitting renters against each other in bidding wars.
“The Renters’ Rights Bill delivers our manifesto commitment to transform the experience of private renting, including by ending Section 21 ‘no fault’ evictions – we will take action where the previous Government has failed.
“The Bill will give renters much greater security and stability so they can stay in their homes for longer, build lives in their communities, and avoid the risk of homelessness.”
The detail of the Bill include:
– Abolishing no-fault evictions;
– Empowering tenants to challenge rent increases designed to force them out ‘by the back door’;
– Stopping agents and landlords encouraging bidding wars;
– Giving renters the right to request a pet but enabling landlords to request tenants take out pet damage insurance;
– Applying a ‘decent homes standard’ to the PRS;
– Applying Awaab’s law to the sector – i.e. punishing agents or landlords who don’t fix damp and mould problems quickly;
– Creating a digital national database of landlords and their properties.
On a less property-related issue, the speech revealed a planned Employment Rights Bill, which will among other things enable employees to claim unfair dismissal and other rights as soon as they join a company instead of having to wait two years.
Employees of estate agencies and property management firms regularly take their employers to tribunals over matters such as sex discrimination, unfair dismissal and deductions from wages but often fail because they have not worked at the firms for the mandatory two-year period.
Brakes off
Prime Minister Keir Starmer says: “Now is the time to take the brakes off Britain. For too long people have been held back, their paths determined by where they came from – not their talents and hard work.
“Today’s new laws will take back control and lay the foundations of real change that this country is crying out for, creating wealth in every community and making people better off – supporting their ambitions, hopes and dreams.”
Read the King’s Speech in full.
Reaction
Isobel Thomson, chief executive of safeagent
“Today in the King’s Speech the new Government has set out ambitious plans for reform in the Private Rented Sector and we fully support its aspirations to raise standards,” she says.
“While welcoming the Government’s commitment to strengthening local councils’ enforcement powers, we highlight the need to ensure enforcement activity is properly resourced if these measures are to achieve the desired outcome.
“We would urge Government while seeking to “level the playing field between landlords and tenants” not to alienate landlords and to recognise the vital role of landlords and agents in underpinning a safe and secure PRS for the majority of tenants.
“We look forward to more detail on the contents of the Bill and will be happy to work with Government.”
Richard Donnell, Executive Director at Zoopla
“Rental reforms have been on the cards for several years and it’s welcome news that this bill will push through key changes like ending section 21 no-fault evictions,” he says
“Finding a balance to ensure we don’t see more landlords selling up and putting more pressure on supply is crucial, however, the bill outline strikes the right balance.
“It’s also welcome news that the Government has avoided implementing rent controls. The focus on growing supply across all tenures is the correct long-term solution but it will take time for this to feed through and positively impact buyers and renters.”
Chris Norris, Policy Director for the National Residential Landlords Association
“With an average of 15 households chasing every available home to rent it is vital that rental reform does not make an already serious supply crisis in the private rented sector worse,” he says.
“The system that replaces Section 21 needs to be fair, workable and sustainable for both responsible landlords and renters. That means fixing a broken justice system which too often fails those reliant upon it.
“The Housing Minister has rightly noted that landlords need the courts to operate quickly where they have a good reason to repossess a property. This includes cases of tenant anti-social behaviour and serious rent arrears, which currently take almost seven months to process. This is far too long.
“Tenants are no better served by delays, which increase hardship, stress, and uncertainty. We need action from the Government, alongside the Bill, to ensure all are able to access justice in a timely fashion when they need to do so. We will work constructively with the Government as it continues to work on the detail of its plans.”
Sián Hemming-Metcalfe at Inventory Base
“Any initiative introduced to better tenant welfare by improving living standards and offering greater protection is, of course, a positive,” she says.
“However, the King’s speech is unlikely to have spurred enthusiasm amongst the nation’s landlords. The announced initiatives remain predominantly tenant focussed, with little consideration for those providing the rental accommodation we so sorely need.
“As a result, the vast majority of landlords will feel left out in the cold, having already weathered a raft of legislative changes designed to dent the profitability of their investment.
“At the same time, a capital gains tax incentive is only likely to tempt more to exit the sector, reducing the supply of suitable homes and inadvertently exacerbating the current rental crisis.
“The next steps the government takes are crucial to ensuring that they support landlords so that they remain committed and invested in the PRS. Without them, I fear we risk further destabilising an already fragile market.”
David Cox, Rightmove’s legal expert
“As expected, the new Labour government has introduced its own Renters’ Rights Bill, which contains similar details to the previous Renters’ Reform Bill. It is designed to abolish no-fault evictions and reform grounds for possession and increase tenant rights,” he says.
“With parliament expected to break for recess at the end of the month, it is unlikely we’ll see anything come to fruition until October at the earliest.”
Anthony Codling of RBD Capital Markets
“No surprises, but no details either. The King said that his government would Get Britain building through planning reform as they seek to accelerate the delivery of high quality infrastructure and housing through a Planning and Infrastructure Bill,” he says.
“There was no mention of targets, no 1.5 million homes, and no mention of social housing ‘percentages’, suggesting that Labour will take a pragmatic approach to social and affordable housing supply.
“However, we expect that Labour will push ahead with its plan to build 1.5 million homes over the next 5 years and do all it can to the planning system to help get Britain building.
“We expect the housebuilders shares to re-rate as the Labour Policies move from manifesto pledges to policy action. Renters will be happy that no fault evictions will be banned, and homeowners will welcome the plans to reform leasehold and commonholds.”
Adam Jennings, head of lettings at Chestertons
“Labour promised to scrap Section 21 ‘no fault’ evictions on day one of the new government and fulfilled this promise today,” he says.
“After the Renters (Reform) Bill was abandoned when a snap General Election was called, tenants were left in the dark about their future rights so today’s announcement brings some relief and clarity.
“Particularly in London, a city with one of the world’s most competitive rental markets, tenants will likely appreciate Labour’s move to improve tenant rights.
“It’s worth noting, however, that Labour’s announcement comes during the busiest season for the lettings market and could lead to an additional boost in tenant demand. We therefore advise tenants to prepare for competitive market conditions and start their search as early as possible.”