After years of delay, the newly enhanced fresh rebranded tenant rights bill is running through Congress.
The law is expected to become law by the end of spring and is in effect by autumn.
But as we walk into the weeds of legislative details, a series of confusion and anxiety remains. And now it's an unintended consequence of the bill that keeps agents and landlords at night. 
An important habit that appears to be overlooked is the potential surge in landlord rental prices “Gazandering.” This is due to the goodwill provisions of the bill prohibiting the “war of bidding.”
However, like most efforts to tinker with the market, this provision risks more harm than good.
Quite naturally, the landlord begins to “elevate” his own lett. Place the property in the market at a slightly higher price, assuming that the tenants will negotiate. In reality, the listed rent is ono. “Or nearest offer.”
This response is very logical. Give the landlord a cushion to secure market rates and allow a little wiggling room when making choices between tenants.
So, while tenants may escape the stress of a bidding war, they present a whole new problem. This is a distortion in rental market data.
Across the market, most rental trackers (unlike us who report confirmed rents) measure trends and averages based on advertising prices. These trackers and numbers will affect the overall market. From agents and landlords to tenants.
So, if a rental property starts to get promoted for example 10% price bumps to hedges, then all of a sudden we are all at sea.
The tenants are hit hard. We can't measure what the “fair” price in their area. And the agent is pressured to advise exactly how the landlord should go.
Also, landlords who are trying to resist practice are opening themselves below market rental bids. The desire for accurate data increases, and in order to keep things accurate, more organizations may shift to using confirmed prices instead of advertised prices.
Urier Market
When it comes to averages and indexes, the need to “game” prices and operate in many woollier markets also makes the landlord community even more uneasy.
According to our latest State of the Lettings Industry Report, by the fourth quarter of 2024, almost half of the landlords said they had sold the previous year or were planning to do so next year.
Additionally, 66% of agents believe this will lead to a decrease in rental properties that will make the tenant rights bill available.
The entire landlord's cohort is already wobbling at the edge and witnessing the ejector button. Every time they let go of the property, being drawn into the reverse bid battle could be some pushes that need to jump. This is the last thing the market needs at a time of unprecedented demand.
Pricing distortion
Government intervention in pricing rarely ends well. Despite the desire to protect tenants at the heart of the bidding war ban, unconsciously encouraging pricing distortions in already pressurized markets only exacerbate the problem.
The best approach is to allow the market to determine fair rental prices through genuine supply and demand, rather than leading to artificial restrictions that can actually be very backfired. Of course, in the long run, more rental homes need to be built to stop costs that have become out of control for ordinary renters. But in the meantime, this loophole in the law could lead to tightening screws and tying tenants.
The window for the government to act to address this unintended consequence is rapidly closing. If not, expect those “on paper” prices to start spiraling sooner than later.
William Reeve is the CEO of Goodlord.
Read more: Tory Housing Minister Noages “hurried” rights bill for “renters”
