Firstly, please let me be very clear; this is not a party political broadcast. Frankly, I don’t really like politics, on the whole I don’t really like politicians, and I would certainly never seek to influence anyone’s political persuasions or voting choices, because it’s not my place to do so and I would never seek to engage in politically based argument.
However, it would be remiss of me not to place on record with you now my concerns about the future of the lettings industry should the Labour party accede to power on 7th May.
We, at FleetMilne Property, are not alone in voicing our concerns; many respected competitors and industry bodies, including the National Landlords Association and even tenants’ lobby group Generation Rent, are presently doing the same, as there is a collective need and desire to speak now or risk suffering in silence.
Here is my concern: depending on who you listen to there are currently between 9 and 11 million people in privately rented accommodation; more than at any other time before. This is a large chunk of the electorate and, where housing and property is concerned, one that is disillusioned and prime for targeting for votes. This is precisely what all parties are doing, in various forms.
Specifically looking at the lettings industry, a winning Labour government would seek to abolish all fees paid by tenants, and impose inflation-linked caps on rents along with longer initial term tenancy agreements of 3 years.
At first glance, this may seem quite appealing to tenants and this is precisely what Labour are hoping for. However, I would urge people to look behind the headlines and explore the wider implications of such a policy, as it is my belief that it could well end up adversely affecting the very people that it is purporting to help.
The other glaring issue with the Labour proposals is their plan to enforce 3-year tenancies. They claim that this can be broken with appropriate notices, but have not defined this further. Part of the appeal of the lettings market is the flexibility to move home. We move because we have had a pay rise, because we have moved jobs, because we are relocating to a different town or city, because we don’t like our neighbours or simply because we fancy a change of scenery.
Is the ability to make these choices going to be taken away from us? What if a landlord is not obliged to relet the property, under these proposals, and a tenant is committed to paying rent for the full 3 year term, even if they have to move?
These Labour proposals are not just counter-productive to the lettings industry but also to business in general and the housing crisis specifically; it would be highly likely that such changes would lead to a contraction in the private rented sector as landlords sell their properties to liquidate their assets and reinvest the money in less restrictive and potentially more profitable arenas.
This will simply fuel the fire of rental increases by way of a shortage of available property; something which is already a problem today. Early predictions claim that as many as 40% of landlords may sell up. Where are the tenants, ousted from these properties, expected to live?
As I hope I have stressed already, I am not here to tell people which way to vote, nor am I imploring you not to vote Labour. Nor am I writing out of concern for our revenues versus our competitors; this would impact the entire industry and a large majority of the industry is speaking out as one against these plans.
But I am asking you kindly to think carefully about the promises which are being made by all parties, and what they might really mean. I can only comment on the part of their manifestos on which I have any kind of authority but what the Labour Party have proposed for the property industry appears to be nothing more than smoke, mirrors and major, major pitfalls.
In the meantime, enjoy the circus that surrounds the election itself – may the best party win, whoever that may be…
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