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The potential impact of rent controls for landlords and the intermediary market
Rent controls and legislative change, such as the removal of Section 21 (no fault evictions), are hot topics in the current UK buy-to-let market as they hold potentially significant implications for both landlords and the intermediary market.
According to the latest Pegasus Insight Landlord Trends research report for Q2 2024, a substantial 55% of landlords said that rent controls would have a huge impact on their commitment to renting property, with 1 in 3 landlords saying that they would consider selling their rental properties if it were introduced.
This potential exodus could significantly reduce the supply of rental homes, exacerbating housing shortages and driving up rents for tenants in an unintended consequence of the policy. The removal of Section 21 further compounds these concerns, as it reduces landlords' flexibility in managing their properties and tenant relationships.
Interestingly, the report highlights that landlords are less concerned about other potential regulatory changes. Measures such as outlawing bans on specific tenant types, introducing compulsory licensing, or abolishing fixed-term contracts in favour of rolling contracts were viewed as less likely to negatively affect landlords' willingness to remain in the rental market.
These are certainly areas that advisers should be keeping an eye on in the coming months, especially following the recent change in government, to help landlord clients to successfully navigate any further bumps in the BTL road.
For intermediaries only
