Friday, 19 July 2019

The Disappearing Homes Conundrum

... is trotted out again by the National Landlords Association:

The NLA is opposed to the abolition of Section 21

To highlight the short-sightedness of this policy to Government, we’re launching a postcard campaign to tell the Prime Minister directly the impact this will have on the market...

Without Section 21, many landlords will leave the market. This will have a negative impact, both for landlords – many of whom have invested in property as a pension alternative – and for tenants, who will face lower supply, higher rents and increased personal and credit referencing requirements.

Richard Lambert, CEO of the NLA, says:

“Landlords currently have little choice but to use Section 21. They have no confidence in the ability or the capacity of the courts to deal with possession claims quickly and surely, regardless of the strength of the landlord’s case. England’s model of tenancy was always intended to operate in a sector where Section 21 exists. This change makes the fixed term meaningless, and so creates a new system of indefinite tenancies by the back door."

I wouldn't call it "by the back door", this is exactly what is intended. Indirectly, it is the government's aim to prise some landlords out of the market, because one fewer potential Labour-voting tenant means one more potential Tory-voting owner-occupier*. It will be the higher earning tenants who make the leap, so the average income of - and rent paid by - the remaining smaller pool of tenants will be lower, not higher. Which is the opposite of what The Disappearing Homes Conundrum predicts.

* There is an upper limit to Home-Owner-Ism in a democracy as you need a majority of households to be owner-occupiers to vote for this bullshit. Without this natural brake, the ultimate stage of Home-Owner-Ism would be a handful of people owning all the housing and everybody else would be paying them rent.


James Higham said...

LVT sounds the answer.

Mark Wadsworth said...

JH, of course. A tax cut for tenants is better than a rent cap, but we must be thankful for small mercies.