The final bill to become law has been decided: tenancy reform passed, tenancy reform rejected – what does this mean for London property owners, buyers and renters?
Chancellor Rishi Sunak suddenly set the election date for July 4th, giving Parliament a very short time to decide whether outstanding legislation would be passed or rejected outright. The past few days of parliamentary activity, known as the “wash-up”, have seen winners and losers in the property sector.
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Tenant Reform | Leasehold and Freehold Reform 
Rental housing reform bill shelved
The highly anticipated Rental Reform Bill has been formally rejected. First published in May 2023, the Bill promised to bring the most dramatic changes to the private rented sector in a generation. Most notably, it banned fixed-term tenancies and banned no-fault evictions. It also included a series of further measures to encourage higher standards in the rented sector.
What's next for rental reform?
If a bill doesn't make it through debate, it fails, so if the next administration wants to reintroduce it, they'll have to start from scratch.
That's what happened to the rental housing reform bill, which is now just a pile of paper gathering dust in Parliament until a new administration picks up the baton.
So what will the new tenancy reform bill look like and when can we expect further action on tenancy reform?
Angela Rayner, deputy leader and shadow minister for equality, housing and communities, has previously said that a Labour government (if elected) would ban no-fault evictions from day one in power (I News), but this came at a time when the bill was still before Parliament and everyone thought an election wouldn't be held until autumn 2024 (October at the latest), giving the bill plenty of time to become law.
On 21 May, in a speech to the UK Property Investment and Infrastructure Forum (UKREiiF), Rayner reiterated the party's commitment to abolish no-fault evictions, but made no mention of a first date. (Full speech on housing today.) This seems like the clearest indication of the party's timeline, but housing was not included in Labour's “big six” policy pledges.
Future outlook
The Bill contained several key ideas to improve renting in the UK, including ensuring the health and safety of tenants and promoting higher standards within the industry.
Renting laws are changing rapidly. Read what landlords are doing to keep up.
The new government could, in theory, use the lessons learned from this bill to fast-track reforms, and it could also learn from the debate that took place in the House of Lords just before the bill was killed.
We look forward to the next administration reviewing this bill and working with industry to enact valuable new legislation in the future.
If you need help understanding the intricacies of rental laws to ensure your rental property is always in good condition, contact Foxtons Property Management.
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Land lease reform becomes law
The Leasehold and Freehold Reform Bill, which received Royal Assent on 24 May, will strengthen existing rights and introduce new rights for leaseholders.
What leasehold reform means for you
This legislation should make owning leasehold property more affordable and accessible to more Londoners.
And as it can be difficult to sell properties with short leases, any legislative measures that make it easier to extend leases should increase the value of leasehold properties. If you want to sell your property better under the new law, book a free valuation to see how Foxtons can help you.
• Longer lease terms, more security: You can now extend your lease for up to 990 years (90 years for apartments and 50 years for houses), meaning you have much more security over your tenure as a homeowner.
• Easier and faster lease extensions: Thinking of extending your lease? This law makes the process quicker and more affordable. Plus, you can now extend your lease (or buy the freehold) as soon as you buy the property – no need to wait two years.
• Clearer service charges: Not sure what you're paying for in service charges? We're making bills for the maintenance of common areas and building amenities that aren't owned or shared by everyone (like balconies) more transparent and understandable.
• Power to remedy: If you are unhappy with the freeholder, the law makes it easier to hold them to account. You have a clearer way to challenge poor practice and get a fair resolution. The law also removes the presumption that you (the leaseholder) will bear the costs in these types of cases.
• Greater control over the building: It will be easier for you and other tenants to take over management of the building or appoint a managing agent of your choice.
The bill did not pass without a hitch: there was bipartisan criticism of the final version, and it is possible that the bill would have turned out differently had there not been a last-minute rush to pass it – for example, the rent cap would not have been included in the law.
Labour's Matthew Pennycook said the bill went too far and vowed to abolish the leasehold system altogether, calling it “outdated and unfair” (BBC).
Read: Why choose Foxtons for your leasehold property valuation.
The new Leasehold Reform Bill could benefit your property values and may also make selling your property easier. Want to find out more? Book a free Foxtons valuation with one of our experts.
If you're looking for a home, this law may mean more properties become available to you. Browse properties for sale, or if you'd like us to help you find your ideal home, let us know what you're looking for.
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Conclusion
Regardless of which party is declared the winner on July 5, there will be a lot of unfinished business to be resolved when it comes to real estate law.
At Foxtons we have real estate law experts who are constantly monitoring all changes in real estate law to give you the best options and opportunities – if you have any questions please contact our experts via email.
