Letting agencies and landlords in England are in something of a tizzy as a result of the Conservative government’s proposals to follow Scotland and prevent “no-fault” evictions south of the Border – effectively giving security of tenure to people who rent their homes privately for as long as they wish, assuming rent is paid timeously and they behave in a responsible manner.
I can understand this angst because when our SNP-led government decided to introduce related legislation, many professionals in our sector expressed fear it would mean the end of buy to let as it had been known for the past three decades. Sure enough, the legislation did for some of the “here today, gone tomorrow” pop-up letting agencies but those with the know-how and experience managed to adapt to the new circumstances by working with what was good about the legislation while quietly, and calmly, managing those aspects which were considered detrimental.
Perhaps what particularly concerns our English colleagues is the fact that proposals similar to what has already been enacted in Scotland have come from a Conservative government. Few north of the Border were really surprised by the raft of “tenant-friendly” laws from a left-of-centre SNP, now dependent on the much more left-radical Greens to get laws passed. However it is surprising to find the Tories effectively tearing up time-limited contracts – in this case an agreement between landlord and tenant in which the latter arranges to pay to occupy property owned by the former for a period of months (or years) agreed in advance between the two. Can you imagine, for example, a hire-purchase agreement in which the renter is permitted to pay for the goods not over the usual two or three years, but over an indefinite period of his choosing?
James Brokenshire, the Westminster housing minister, has justified the move on the grounds that it would end insecurity for tenants. True, there certainly is an issue in England (as there was until recently in Scotland) whereby completely respectable and responsible tenants had to move home against their will. This is what comes when there is an imbalance in the law of supply and demand in the private rental market. If this balance was more equitable then I cannot think of any landlord who would wish to get rid of responsible, good-paying tenants unless he or she wished to sell up.
As for various trade bodies in England, the response was unsurprisingly hostile with some claiming the proposals will further discourage responsible citizens from investing in buy to let, leading to a further drop in rental property availability.
“Whilst the Rental Landlords Association recognises the pressure being placed on government for change, there are serious dangers of getting such reforms wrong. With the demand for private rented homes continuing to increase, we need the majority of good landlords to have confidence to invest in new homes” said David Smith, policy director at the association.
“For all the talk of greater security for tenants, that will be nothing if the homes to rent are not there in the first place. We call on the government to act with caution.”
Who am I to argue when Mr Brokenshire says the proposals are to protect responsible tenants. However, something inside me suggests it is also down to something else – ie a politically-motivated “populist” move designed to make the Tories look as “caring” as Labour, thus helping to spike the guns of Jeremy Corbyn, whose own popularity almost did for the May government at the last general election.
My message to English colleagues would be to stand fast because our experience in Scotland shows the mainstream lettings sector adapting to the new circumstances. However, as well as being “pro-tenant”, the Conservatives’ proposals do have an element of “anti-business” therefore a sense of betrayal in some quarters is understandable.
- David Alexander is MD of DJ Alexander