With just a week before the general election on 4th July, the UK’s political parties fighting for leadership have revealed their party manifestos, promising extensive initiatives for the country.
Each party manifesto lists dozens of plans to improve the UK, from measures to enhance the health and education systems, all the way to strategies to boost economic growth and housing delivery.
While some landlords have shown concern about a potential change of government, recent data from Goodlord and the NRLA revealed that party policies relating to the PRS will influence landlords’ vote — but what do the parties actually have in store for the rental market?
The Conservative Party manifesto — named ‘Clear plan, bold action, secure future’ — promises several measures for landlords, including court reforms necessary to fully abolish section 21 evictions.
The party also plans to pass the Renters Reform Bill in a form that “will deliver fairness in the rental market for landlords and renters alike”.
In addition, the manifesto outlines plans to strengthen other ground for landlords to evict private tenants guilty of anti-social behaviour, and mentions the introduction of a ‘three strikes and you’re out’ system to evict social housing tenants whose behaviour is disruptive to the community and neighbours.
Moreover, the party plans to strengthen council’s powers to manage ‘uncontrolled growth’ of holiday lets.
Similarly to its competition, Labour’s ‘Change’ manifesto promises the abolition of section 21 evictions to protect tenants from arbitrary evictions.
The document also outlines the party’s intention to raise standards for the PRS, which it aims to achieve through the implementation of Awaab’s Law to private tenure, and reintroducing minimum energy efficiency requirements for private rented homes to be implemented by 2030.
Moreover, Labour promises to prevent private renters from being exploited and discriminated against, and give tenants more power to contest ‘unreasonable rent increases’ — however, no specific measures were outlined in the manifesto.
The Lib Dem’s manifesto — titled ‘For a fair deal’ — outlines several initiatives aimed at the PRS, including making three-year tenancies the default, and creating a national register of licenced landlords.
Once again, plans to immediately ban section 21 eviction was mentioned in the document, similarly to other parties’ manifestos.
In addition, the Lib Dems promise to bring out a new Rent to Own model for social housing, where rent payments give tenants an increasing stake in the property, and allowing them to own the dwelling outright after 30 years.
The party also promises to protect the rights of social renters by enforcing clear standards for social rental homes — including strict time limits for repairs — and by recognising tenant panels so renters “can have a voice in landlord governance”.
Moreover, the Lib Dems intend to give local authorities new powers to control second homes and short-term lets in their areas by allowing them to increase council tax by up to 500% for second homes, with a surcharge on overseas residents purchasing such properties.
The Green Party’s ‘A new hope for all’ manifesto is also pushing for the abolition of section 21 evictions, and the creating of a new stable rental tenancy.
In addition, it aims to introduce rent controls to allow local authorities to control rents if the market is unaffordable for many people, and to introduce a tenant’s right to demand energy efficiency improvements.
The Green Party also promises to bring forth private residential tenancy boards to provide an “informal, cheap and speedy” forum for resolving disputes before they reach a tribunal.
Reform UK’s ‘Our contract with you’ manifesto lists several initiatives, such as scrapping section 24, which would allow landlords to deduct finance costs and mortgage interest from tax on rental income.
Unlike the Conservative Party, Reform UK promises to abolish the Renters Reform Bill — including the proposed ban on no-fault evictions — claiming that the legislation was inadequate to address bad practices.
Instead, the party plans to boost the monitoring, appeals and enforcement process for renters with grievances.
Overall, industry experts did not reach a consensus on which manifesto would be the most beneficial for the PRS, particularly as there is uncertainty that the parties would actually implement these measures if elected.
Several experts said Labour’s plans are catering more towards tenants rather than landlords, which some claim could harm the PRS.
“One critical area that seems to be lacking in Labour’s manifesto is a meaningful plan to address the undersupply in the PRS while the 1.5 million homes the party proposes are being built. The manifesto is thin on the ground here, and without addressing this gap in the short term, we risk exacerbating existing housing issues,” added Allison Thompson, national lettings managing director at Leaders Romans Group.
“Comprehensive strategies for the PRS are essential to ensure that all aspects of the housing crisis are tackled effectively.
“Lastly, having some clear commitments on capital gains tax (CGT), which are ambiguous at present, will allow homeowners to plan and prevent any knee-jerk reactions towards plans for their assets.”
When asked about her views on the Conservative manifesto, Allison stated that implementing the CGT relief for landlords selling to tenants would be more difficult than anticipated, as few tenants would be in a position to buy their rented properties.
“Instead of facilitating sale through CGT relief for landlords selling to tenants, policy should focus on attracting and retaining good landlords to balance supply and demand. Abolishing the unfair section 24 tax would incentivise investment in the PRS and stabilise rents,” she added.
While several experts believe that Reform UK’s manifesto could be beneficial for the PRS on paper, they have questioned the likelihood of this being implemented and the execution of the party in delivering these promises.
“The Reform UK party seems to be against any register or licencing and would look at reversing section 24 and abolish section 21 which all sounds great for landlords, but what would the reality be if these all occurred? I would envisage that there wouldn’t be much change in reality with Reform Party if by some miracle they did get into power,” said Howard Levy, director of SPF Private Clients.
Commenting on Lib Dem’s manifesto, Allison believes it falls short of addressing the housing crisis completely.
“The solitary focus on renters’ rights, essentially a phoenix of the unpassed Renters Reform Bill with a twist of mandating three-year tenancies, misses a significant opportunity. More robust and diverse housing policies are crucial to genuinely tackle the pressing issues faced by millions in need of affordable and secure housing,” she elaborated.
Hiten Ganatra, managing director of Visionary Finance, commented: “Among the main political parties, it is unsurprising that Labour, the Lib Dems, and the Green Party are looking to impose further regulations on landlords.
“I believe this will lead to more landlords exiting the sector. Imposing rent controls will only worsen the situation for tenants, as seen in Edinburgh where such measures were implemented.”
There is one thing that all BTL finance experts agree on: that the manifestos still have room for improvement. Interviewees have said that all manifestos are missing several initiatives that could benefit the PRS, such as balanced tax policies, and additional support for landlords, particularly for smaller property investors.
Jason Berry, group sales director at Crystal Specialist Finance, also suggested increasing funding and resources for local authorities to enforce existing regulation effectively, thus ensuring standards without overburdening landlords with additional red tape.
“It’s astonishing to me that neither of the main parties have looked to amend assured shorthold tenancy agreement terms. Allowing longer terms as other countries enjoy, with built in break clauses and rent increase provisions would seem to me to solve the problems that the Renter Reform Bill seeks to,” commented Jonathan Samuels, CEO at Octane Capital.
“I also believe that we must restore section 24 tax relief on maintenance and mortgage costs and incentivise landlords rather than demonising them. Without more landlord stock there will be a continuing shortage of properties for tenants, especially in the demographic where housing benefit is prevalent.
“The parties need to be more landlord-friendly or face a growing housing crisis.”
Howard added: “Ideally, a reversal of the 3% additional surcharge on stamp duty, or possibly making this not payable on houses of multiple occupations or multi-unit blocks along with larger BTL properties, would help the PRS sector.
“These properties were not ever bought by first-time buyers looking for a home for themselves and so the 3% surcharge seems to have only been a way of raising further tax from landlords, rather than levelling the playing field between first-time buyers and landlords.
“It would also be useful to offer landlords a clear way to incorporate their portfolios, as this is a complicated and a niche area for both accountants and mortgage brokers. It would help the government as they would see how many property companies there are (so easily traceable for licencing and registration purposes) and also help the landlord who, through no fault of their own, might have much larger tax bills to pay due to the tax changes.
“Obviously, the other option is to revert back to allowing offsetable costs for sole trader landlords.”
Regardless of which political party wins, BTL expert Roger Morris stated that any changes to the PRS should be made with careful consideration and thoughtful deliberation, to ensure they are beneficial for both landlords and tenants.
“Whoever is elected to government, if they keep poking the PRS with a stick, property providers will turn to other investment assets instead,” claimed Jonathan.
