Post-election new government housing policy explainer

As Labour settles into power, property managers and landlords are likely to be concerned about the changes their new government housing policy announcements will bring. Their manifesto promised change by kickstarting economic growth and breaking down barriers to opportunity. A solid understanding of what this means will help letting agents, property managers and landlords prepare well for the future. Had the Tories returned to power, the Rental Reform Bill was expected to be pushed through parliament later this year.

Over the coming weeks and months, the impact and details of the new government’s housing policy promises will become clearer.

Angela Rayner was appointed minister for the Department for Levelling Up, Housing and Communities on July 5th. Her department has since been renamed the Ministry of Housing, Communities and Local Government (MHCLG).

These changes come as no surprise. Labour’s manifesto noted plans to reform the planning system, and release and prioritise ‘grey belt’ land for the development of housing. Intentions to build 1.5 million new homes over the life of the government were also shared.

As Labour continue to provide more detail on the housing elements of their manifesto, we can expect to receive announcements about the end of no-fault evictions, regulation of the private rental sector, extensions of Awaab’s Law and improvements to housing standards.

The Labour manifesto and what it means for lettings and the property sector

A closer look at crucial elements of Labour’s manifesto will help letting agents, developers and others in the property sector anticipate changes.

Regulation of the private rental sector

Labour’s intention to “break down the barriers to opportunity” involves taking steps to confront poverty and protect renters.

Renters will be empowered to challenge unreasonable rent increases. In an interview with Money Saving Expert, Sir Kier Starmer provided further detail on how this would be done. Rental bidding will become unlawful and the amount of upfront payments would be capped.

To reduce fuel poverty, private rental sector landlords will need to ensure their homes meet minimum energy efficiency standards by 2030. The Labour Party's Warm Homes Plan investment of £6.6 billion over the next five years will provide a map to upgrading five million homes to EPC standard C.

Work with the private sector, banks and private finance is also expected to help landlords accelerate their home upgrades and low-carbon heating.

No more no-fault evictions - Section 21

Labour has made no secret of their intention to abolish Section 21 no-fault evictions. Although Angela Rayner expressed her desire to do this within her first days of becoming Secretary of State for Housing, Communities and Local Government, at the time of writing it is still in place. Kier Starmer’s speech to the King confirmed this will be included in the Renters’ Rights Bill.

Once Labour moves ahead on this promise, a transitional period allowing existing notices and court proceedings is expected. This will enable existing notices to proceed through the courts while disallowing new notices to be served.

Section 21 is likely to be replaced with a renewed and strengthened Section 8 framework. Landlords will be supported with a revision to the grounds for anti-social behaviour, repeated serious arrears and sale of the property.

Extension of Awaab’s Law

Awaab’s Law, introduced in 2023 as part of the Social Housing Regulation Act by the Tory government will be extended to the private rental sector by Labour.

The landmark law came about after the tragic death of two-year-old Awaab Ishak from a respiratory condition linked to mould in his social housing residence. Awaab's parents campaigned for a law to stop a similar situation from happening again.

The law provides specific timescales for landlords to respond to complaints of mould and damp, giving renters a safer and healthier home. Currently, the law requires social landlords to:

Investigate hazards within 14 calendar days of receiving a complaint
Provide a written report of the findings
Begin repairs within 7 calendar days (if the hazard has the potential for significant risk to the health or safety of the tenants)
Complete repair work within a reasonable time frame
Complete emergency repairs within 24 hours
Maintain clear records of correspondence with residents and contractors

Once Labour extends this law to the private rental sector, private landlords will have a finite amount of time to review, respond and repair properties suffering from mould and dampness.

Improving housing standards

Building safety is a priority for the new Labour government. They will tighten regulations to ensure tenants in tower blocks are never again at risk as they were with the Grenfell fire.

It’s unclear exactly how this will be done aside from the intention for a renewed focus on ensuring those responsible for the building safety crisis pay to correct it. Most likely, fire risk assessments and effective preventative maintenance schedules will become a greater priority for building managers and landlords.

Planning Reform

As already announced by the new chancellor, mandatory housing targets are back. Local authorities will be given funding for additional planning officers. These will be paid for through increasing the rate of the stamp duty surcharge paid by non-UK residents.

This is a leap toward ‘getting Britain building again’. Labour are committing to 1.5 million new homes over the life of their Parliament, the biggest increase in social and affordable house building for a generation. Both the English Devolution Bill and the Planning and Infrastructure Bill will support these aspirations.

A permanent, comprehensive mortgage guarantee scheme, to support first-time buyers who cannot afford large deposits has also been promised.

Labour is committed to preserving the Green Belt and instead is prioritising building on brownfield sites along with releasing grey-belt land where necessary. New towns alongside urban extensions and regeneration projects are also planned. Solutions for unlocking the building of homes affected by nutrient neutrality without weakening environmental protections have been proposed but so far, no detail about how this will be done has been given.

Nutrient neutrality guidance aims to stop new housing developments from adding nutrient pollution to the environment. Human actions often increase nitrogen and phosphorous levels—natural nutrients for plants and animals. However, when these reach excessive levels in streams and other bodies of water they cause algal blooms and kill fish.

No more leasehold tenures

Labour has said it will enact all recommendations of the Law Commission in its reports on leasehold enfranchisement, right to manage and commonhold. Commonhold will become the default tenure. Additionally, homeowners will be given new protections from rent charges and Labour has committed to enhancing protections for leaseholders in multi-family buildings.

A possible change to short-term lets?

Labour have also expressed their desire to ensure that local homes go to local people and prevent off-plan sales to international buyers. They also expressed an interest in bringing in a licensing system for holiday lets to preserve the “spirit” of coastal and rural communities.

Wales has a similar system in place already. In Scotland, all short-term lets are to be licenced by the end of July 2024.

When will we see the Labour government housing policy in full?

The changes Labour intends to bring about for the housing sector - both social and private - will need time for consultation, review and parliamentary process. Announcements around many of these changes will happen between now and mid-October.

More clarity is already being provided around national planning policy frameworks, guidance and the release of brownfield and grey-belt land for development. Full details are expected to be available by the end of July 2024.

What does this mean for letting agents?

It appears that regulation of the private sector will come with opportunities for landlords to access assistance for improving their properties. Renters will benefit from more secure leasing agreements and clarity on the repercussions of not meeting their obligations and responsibilities.

The imminent removal of Section 21 should prompt letting agents and property managers to refamiliarise themselves with Section 8 and acceptable grounds for evicting tenants. Similarly, familiarisation with Awaab’s Law and the wider Social Housing Regulation Act will stand agents in the private sector in good stead.

Improvements to housing standards and building safety, and how these will be legislated are unlikely to be clear until the final report on the Grenfell Tower fire is published on September 4th 2024.

Planning reforms, changes to leasehold tenures and the possible licensing of short-term lets in coastal regions will have less impact on most letting agents. These changes are likely to be announced periodically over the first 100 days of government with full clarity given by mid-October.

Disclaimer: Nothing on this site constitutes legal advice. Specialist legal advice should be taken in relation to specific circumstances. The contents of this site are for general information purposes only no warranty, express or implied, is given as to its accuracy and we do not accept any liability for error or omission. We shall not be liable for any damage (including, without limitation, damage for loss of business or loss of profits) arising in contract, tort or otherwise from the use of, or inability to use, this site or any material contained in it, or from any action or decision taken as a result of using this site or any such material. Some of the material on this site may have been prepared some time ago so it may not reflect the up-to-date position of any relevant law.

Post-election new government housing policy explainer guide

What is the Labour Party’s housing policy?

The Labour manifesto and what it means for lettings and the property sector

Regulation of the private rental sector

No more no-fault evictions - Section 21