Government admits no impact assessment of Renters’ Rights Act on supply

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Government admits no impact assessment of Renters’ Rights Act on supply

The government admits it has not carried out an impact assessment on how the abolition of fixed-term tenancies will affect rental supply.

In a written question, Liberal Democrat MP Dr Roz Savage asked what assessment had been made of removing fixed-term tenancies under the Renters’ Rights Act, including the impact on certainty for landlords seeking to sell or recover possession and the potential effect on rental supply.

However, Housing Minister Matthew Pennycook claimed no such assessment has been carried out.

Abolition of fixed-term tenancies will cause chaos

Mr Pennycook pointed to the Renters’ Rights Act impact assessment, which claims the abolition of fixed-term tenancies and replacing them with periodic tenancies will “result in fewer voluntary household moves as tenants will no longer need to plan to move at the end of a fixed term period.”

The assessment looks at the English Housing Survey, which says approximately 6.3% of tenants who moved in the previous 12 months listed the end of the fixed term as the sole reason for moving.

The assessment claims: “These are voluntary moves from tenants that are solely due to the existence of fixed terms, this may be in situations where tenants are unable to commit to another term of at least 12 months.”

However, as previously reported by Property118, many industry experts have warned the abolition of fixed-term tenancies will cause chaos, particularly for the student rental market.

ARLA Propertymark regional executive for Cornwall, Sophie Lang, told Property118: “The student rental market runs in a very set cycle. We know when the term times are and when the year ends. It was very easy to have a fixed-term tenancy, which gave everyone peace of mind that they had their housing sorted.

“Removing fixed-term tenancies will cause uncertainty for landlords and tenants because it means that fixed-term tenancies are no longer there as a protection.”

A survey by agency software firm Alto reveals more than a third (34%) of agents predict the end of fixed-term contracts could devastate the student letting system.

Landlords selling

Dr Savage also asked whether the Renters’ Rights Act could affect the frequency of tenant displacement caused by landlords selling properties, and trends in repeated forced moves for compliant tenants.

Mr Pennycook again confirmed that no assessment had been carried out on this.

The Renters’ Rights Act impact assessment claims the reforms are expected to result in only a small number of landlords exiting the market.

The assessment said: “There is a risk that costs from the legislation may result in some landlords leaving the sector. This is difficult to estimate precisely, though we would expect it to be substantially mitigated by the additional cost per rented property being a very small fraction of average annual rent and asset value.

“The available evidence to date does not suggest that similar reforms to abolish section 21 in Scotland have negatively impacted supply, nor changes introduced by the 2019 Tenant Fees Act, despite concerns they would.”

However, a study by the Scottish Association of Landlords shows a reduction of 22,000 rental properties in Scotland in just one year due to government policies and anti-landlord rhetoric.

A survey by the National Residential Landlords Association (NRLA) found that 41% of landlords plan to sell properties within the next 12 months, compared to only 6% who intend to buy.

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Council plans tougher fines for landlords housing vulnerable tenants

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Council plans tougher fines for landlords housing vulnerable tenants

A council has been accused of setting a “worrying precedent” over plans to propose large fines for rule-breaking landlords housing vulnerable tenants, a story in The Telegraph claims.

Bristol City Council has proposed in a consultation that landlords who breach safety standards when housing vulnerable tenants would face a 20% premium added to the financial penalty, meaning landlords would be forced to pay £14,400.

The news comes after the Green-controlled council consultation is also asking renters to help decide how much it will fine landlords who breach rules under the Renters’ Rights Act.

Endless escalation of fines

According to The Telegraph, the council claims the definition of a vulnerable tenant will be non-exhaustive and will include young adults and children, people with drug or alcohol addictions, those whose first language is not English, asylum seekers, and people on a low income.

The council also plans to fine landlords an additional 10% if they charge rent above the level set by the Local Housing Allowance (LHA).

The Telegraph reports that under the council’s plans, a landlord who failed to fix a roof causing damp and mould by a specified deadline would face a £13,000 penalty. However, if they charged tenants above LHA rates, they would be required to pay £14,300.

However, industry experts have warned the council’s plans could create chaos for landlords and cause a lack of supply.

Paul Shamplina, founder of Landlord Action, told The Telegraph: “Landlords must comply with safety and licensing laws, but the penalty premium would create an endless escalation of fines.

“Measures like this could further reduce the supply of landlords willing to accommodate vulnerable tenants, particularly in cities such as Bristol, where homelessness levels are already high and social housing is in short supply. It sets a worrying precedent.”

Criminalise landlords unnecessarily

Sean Hooker, of dispute adjudicator Property Redress, said fining landlords was not the answer.

He told The Telegraph: “If penalties are seen as excessive, we are likely to see more appeals, leading to delay and additional cost for enforcement bodies.

“The purpose of these powers is to raise standards and ensure compliance, not to criminalise landlords unnecessarily.

“In many cases, working with a landlord and encouraging investment to upgrade a property will deliver a better outcome for tenants than simply imposing the maximum fine.”

Under the Renters’ Rights Act, councils now have the power to carry out surprise inspections, including entering premises where tenancy records are kept with or without a warrant.

Councils can also compel landlords, letting agents, and third parties (e.g., prop tech companies, banks, accountants, contractors) to provide documents and information related to housing compliance.

Councils will also be able to issue fines of up to £40,000, and the government has released new civil penalty tables. These include a £12,000 fine for operating a property in a selective licensing area without the correct licence.

Property118 has approached Bristol city council for comment.

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John Lewis exits Build-to-Rent housing projects

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John Lewis exits Build-to-Rent housing projects

John Lewis is shutting down its housebuilding arm and abandoning plans to deliver 1,000 rental homes across three sites.

The firm is blaming higher borrowing and construction costs since the venture was launched in 2020.

The employee-owned retailer said the decision also covers an exit from property management when four residential building contracts expire.

Resources will instead be redirected towards its core retail brands, John Lewis and Waitrose, as the partnership looks to simplify operations and reinforce its balance sheet.

BtR scheme ends

A spokesperson for the John Lewis Partnership said: “Our rental property ambition was based on a very different financial environment: one with more stable investment returns, lower borrowing costs and more affordable costs to build homes.

“Unfortunately, the current climate – higher interest rates, inflationary pressures and a more cautious property market – has meant the model no longer meets the Partnership’s investment criteria.”

Its move ends a £500m build-to-rent initiative spanning Bromley, Reading and West Ealing, where schemes had been designed to deliver large-scale rental housing.

John Lewis homes plans

The withdrawal follows several years of repositioning inside the partnership’s retail estate, including job reductions and store closures.

Five years ago, the partnership outlined proposals to build as many as 10,000 rental homes, targeting 40% of profits from non-retail activity by 2030.

Development pipelines included construction above Waitrose supermarkets and regeneration of underused land.

Planning consent had been secured in principle across the three current schemes.

However, the Bromley proposals ran into difficulty after affordable housing numbers fell short of early expectations.

Also, the Reading project drew objections from residents concerned about pressure on local infrastructure.

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