Three key Queen’s Speech commitments
Landlords take note!
Housing featured prominently in the Queen’s Speech on 10 May, with social housing, rental reform and leasehold reform all part of the government’s priorities in the coming twelve months. significant ones relating to housing: the Social Housing Regulation Bill, the Renters’ Reform Bill and the Leasehold Reform (Ground Rent) Act.
The Social Housing Regulation Bill
First, the Social Housing Regulation Bill promises to give tenants more rights with regards to the quality and safety of their homes. Five years after the Grenfell Tower tragedy, the proposed legislation will give more power to the regulator to inspect homes, order emergency repairs, issue limitless fines and intervene in badly managed organisations. Standing in for his mother, Prince Charles affirmed the government’s commitment to “improve the regulation of social housing, strengthen the rights of tenants and ensure better quality safer homes.”
The Renters’ Reform Bill
Second, the Renters’ Reform Bill promises to abolish Section 21 evictions and strengthen landlords’ rights of possession. A Section 21 notice, commonly known as a ‘no-fault eviction’, gives tenants just two months to move out – without the landlord having to give any reason for the eviction. The Bill is expected to include widespread reforms to the private rented sector, including a national register of landlords. For now, however, details remain scarce; the government is expected to produce a White Paper later this year.
The Leasehold Reform (Ground Rent) Act 2022
Third, the Leasehold Reform (Ground Rent) Act 2022 is the most advanced proposal, with the legislation set to come into force on 30 June 2022. The Act will end ground rents for new, qualifying long residential leasehold properties in England and Wales by limiting the lease to no more than ‘one peppercorn per year’. It will also ban freeholders from charging administration fees for collecting this peppercorn rent.
Housing market outlook
For now, at least, despite the current economic uncertainty, the strong increases we’ve seen in house prices show little sign of abating. Demand in the housing market remains firm and mortgage servicing costs are relatively stable with fixed-rate deals making up around 80% of mortgages on homes across the industry, protecting many households from the effects of rate rises so far. However, the headwinds facing the wider economy cannot be ignored.