More than two years after its comprehensive election win, the Boris Johnson administration has finally released a White Paper on Levelling Up – its flagship policy designed to narrow the current inequalities between different regions of the UK.
The White Paper, announced by Michael Gove, the Secretary of State of the Department for Levelling Up, Housing and Communities, includes several radical reforms to the private rented sector, seeking to change the lettings landscape in various ways.
As the industry waits for the White Paper on Rental Reform, which will inform the final version of the Renters’ Reform Bill, the White Paper on Levelling Up brought confirmation that the Government still plans to scrap Section 21 evictions. This long-term pledge had been called into doubt when junior housing minister Eddie Hughes refused to confirm the scrapping at last year’s Conservative Party conference.
There was speculation that the plans to abolish Section 21 would be watered down or reversed to appease concerned landlords, but the Government has now confirmed its intention to change the evictions process for good.
Gove – who’s in charge of enacting the Government’s levelling up agenda – said the scrapping of Section 21 will ‘end the unfair situation where renters can be kicked out of their homes for no reason’.
The White Paper also said that all homes in the private rented sector will have to meet a minimum standard, known as the Decent Homes Standard. It also pledged to consult on introducing a landlord register – as is already the case in Scotland – in addition to setting out plans for a crackdown on rogue operators. This clampdown will aim to make sure fines and bans’ stop repeat offenders leaving renters in terrible conditions’.
It wasn’t just the private rented sector that got a mention; the White Paper also repeated the Government’s aim to boost homeownership through a new £1.5 billion Levelling Up Building Fund, providing loans to small and medium-sized developers and also supporting the Government’s wider regeneration agenda in areas considered a priority for levelling up.
Furthermore, the Government committed itself to building what it calls ‘more genuinely affordable social housing’. Meanwhile, a new Social Housing Regulation Bill will be introduced following the Grenfell fire tragedy in June 2017, which led to a national debate about fire safety and the quality of social housing.
The far-reaching document also outlined that the ’80/20 rule’ – which leads to 80% of government funding for housing supply being directed at ‘maximum affordability areas’ (in reality, London and the South East) – will be scrapped. Instead, much of the £1.8 billion brownfield funding will be diverted to transforming brownfield sites in the North and Midlands, with metro mayors handed £120 million of this funding.
How did the industry react?
The industry’s initial reaction to the White Paper was mixed. Whilst it is positive that tenants will have more access to safer homes,
In response to the proposals in the Government’s Levelling Up White Paper that private rented homes will be required to meet the Decent Homes Standard, Ben Beadle, chief executive of the National Residential Landlords Association (NRLA), said: “Every tenant should have the right to expect properties to be safe and secure. The existing Decent Homes Standard, however, is not the right vehicle with which to achieve this important goal.”
He added: “At present, this standard, designed for the social rented sector, does not reflect many of the differences between it and the private rented sector. This includes the types and age of properties in each.”
He went on: “We will work with the Government to ensure whatever standards expected of the sector are proportionate, fit for purpose and can be properly enforced. Without this, criminal landlords will continue to undermine the reputation of the vast majority of responsible landlords doing the right thing.”
Timothy Douglas, head of policy and campaigns at fellow trade body Propertymark, said: “Everyone wants to see a crackdown on rogue landlords and safe and secure private rented homes, but additional standards are meaningless unless they are enforced. What’s key for ‘levelling up’ the private rented sector is ensuring that local authorities have the staff and resources needed to actively go out, inspect properties and prosecute.”
He added: “Abolishing Section 21 has been talked about for a while now by the UK Government but what agents want to know is what will replace it to maintain confidence in the market for landlords. Propertymark believes the only workable alternative is to strengthen all grounds for possession and make them all mandatory – this is in keeping with the spirit of the UK Government’s intentions as tenant’s won’t be evicted unless they have been provided with good reason to do so.”
He continued: “We await further details, but additional commitments from the UK Government to build more genuinely affordable social housing is important because the long-term solution to address the lack of affordability in the private rented sector is to ensure that more social housing is built to reduce housing need.”
These rental reforms are expected to be firmed up and fleshed out in the White Paper on rental reform – likely to appear in the spring – but after some speculation that major rental reform was going to be kicked down the road for good, this is a significant step forward in the PRS being changed forever.
Whether the changes are good and beneficial for the market as a whole will, without doubt, remain a topic of fierce debate.