Renters’ Reform Bill: Landlords panic and are selling up

One firm says it has been seeing landlords panic and sell up over the prospect of what the Renters’ Reform Bill means for them.

The eviction and housing law specialists Landlord Action says April was its busiest month for 23 years.

It also says that the serving of section 21 notices has rocketed by 91% since last April 2022.

‘Landlords started making plans to sell’

Paul Shamplina, the founder of Landlord Action, said: “The Renters’ Reform Bill is, as expected, amongst other things abolishing Section 21, and therefore will come as little surprise to landlords, some of whom have already started making plans to sell in anticipation.

“April was Landlord Action’s busiest month in 23 years, with a 91% year on year increase in the number of step two section 21 notices being served.”

‘More landlords will start to panic’

He added: “I have no doubt that as the date for the end of section 21 nears, more landlords will start to panic, which will lead to more good tenants having to leave their homes.

“The Government has made reference to digitising more of the process for those evictions which do end up in court, by way of speeding up the process.

“Whilst this is positive, greater reform of the court system will be required if landlords are to have confidence to remain in the market.”

Landlords selling up and leaving the PRS

The growing trend of landlords selling up and leaving the PRS is also underlined by Oli Sherlock, a director at rental market expert Goodlord.

He said: “Right now, all the anecdotal evidence points to a rising number of landlords deciding to sell up.

“This, combined with a chronic lack of new rental homes being built, is creating a supply and demand issue that is driving up rental prices, creating despair for tenants seeking new homes, and resulting in market conditions which this Bill hasn’t been designed to fix.

“I think there are also valid concerns around whether the courts will be able to cope with the rise in cases this Bill will likely create, even with increased digitisation.”

‘Line of urgent changes that are needed’

Mr Sherlock continued: “The Government should not see the publication of this legislation as a job done. It should be the first step in a longer line of urgent changes that are needed.

“A healthy rental market requires empowered, protected tenants as well as fair-minded, incentivised landlords in order to function.

“Any legislation that addresses one without the other won’t make the difference it needs to.”

Landlords deciding to vote with their feet and leave

Laura Southgate, a partner in the property disputes team at Cripps also believes that the Renters’ Reform Bill will see landlords deciding to vote with their feet and leave the PRS.

She said: “On the whole, this bill is a positive development as it seeks to tackle the housing crisis – but the uncertainty it has created for landlords must be addressed by the government.

“Otherwise, it may have the opposite effect: landlords leaving the sector, and consequently, a greater shortage of housing.

“Landlords are generally receptive to change and can see the benefit in offering tenants a greater degree of security.

“However, it’s unclear whether the courts can keep up with the changes: there will always be tenants who don’t comply with the tenancy agreement, and landlords want to be sure that, should this happen, they will be able to recover possession.”

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