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British Property Federation responds to rental housing review

The British Property Federation has reacted to the Rugg Review of private rented housing, published today in York, welcoming certain aspects and calling for government help to create a branded rental housing sector mirroring that of the USA and Germany.

Ian Fletcher, director for residential policy, said:

“Overall the review provides more positives than negatives and is something we broadly welcome.

“Whilst the review does not explicitly support investment from institutions (pension or life funds), Rugg does support the diversity of the sector and we are pleased she recommends tax changes to support greater institutional investment. Overall, her recommendations will require support across government for a more business-like sector and we hope that will be secured.”

Tax breaks:

“We are glad that the review has recognised that if you want landlords to act like businesses you have to treat them more like businesses. Addressing those properties which fail the decent homes standard will not be achieved by regulation alone, neither will raising management standards. The incentives being suggested are an important part of package, which will help deliver a better private rented sector.”

Institutional Investment:

“It has been the long standing desire of the BPF to see greater investment in the rented sector from cash rich institutions, like pension or life funds. While the review does not explicitly call for greater institutional investment, it makes a strong case for the need to grow the sector in general. The methods it proposes on doing so, is through revisions to stamp duty and capital gains tax and amendments to the current real estate investment trust (Reit) regime.

“Although we are disappointed that the value of institutional investment has not been fully recognised, we welcome any proposals to reduce the burden of these measures on landlords which will enable corporate and institutional investors to grow their residential portfolios.”

Retaliatory eviction:

“Landlords will breathe a collective sigh of relief that the industry’s arguments against the proposals for restrictions on section 21 notices – the means by which they can evict tenants - have been supported by the review. No one wants to see retaliatory eviction succeed, but what was being proposed was totally disproportionate. We therefore support the review’s proposal to create a framework that will lead to the removal of poor landlords from the sector rather than the removal of a landlord’s ability to serve an section 21 notice.”

Studentification:

“The review rightly concludes that planning interventions to prevent so called ‘studentification’ could do more harm than good. As the recent report by Ecotec illustrates there are a range of ‘good practice’ initiatives that can help at a local level without the unintended consequences that would result from such blunt instrument of planning constraints. Government should now work with landlords and the National Union of Students to put these into practice. As it plans the latest round of university expansion it should also give more careful consideration to how students will be accommodated to maximise the benefit and minimise the impact on local communities.”

Accreditation:

“The review recognises the scope of local authority accreditation schemes for landlords, and in the need to provide a more structured framework for their future development. They can be an excellent way of building a relationship between local landlords and local authorities, and assist well-meaning landlords who want to follow good standards”.

Regulation of letting agents:

“The BPF has consistently called for tighter regulation of letting agents. We are encouraged to see the review put forward the need for tighter regulation of the industry and we would be happy to work with government to bring this about”

AST:

“Assured Shorthold Tenancy agreements are a foundation to the success of the sector by providing flexibility to both landlords and tenants. We are pleased the review recognises the value of Assured Shorthold Tenancies to the industry and calls for existing tenancy frameworks to remain in place.”

Statistics:

“The BPF has been actively campaigning on the need for a sound statistical evidence base for the sector. We are pleased to see that the Review has taken on board the need for a firm understanding of the sector to inform policy development at the national and local level. We therefore fully support the recommendation to review the statistical information collected on the PRS and we look forward to working with government to bring this about.”

Ends.

For more information please contact Maddie Williams on 020 7802 0364 / mwilliams@bpf.org.uk