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‘Nothing to fear’ from rental market reform

A property litigation lawyer has reassured landlords that they have nothing to fear from proposals put forward by Labour leader Ed Miliband to reform the housing rental market.

Ed Miliband has announced plans for longer tenancy agreements which also make it harder to evict tenants as a quick way op increasing rent, caps on rental increases, and a ban on letting agents charging their tenants high fees.

These changes are designed to help those living in rented homes, as part of a pledge by the Labour Party to tackle the ‘cost of living crisis.’

According to figures quoted by Mr Miliband, nine million people are living in rented homes in the UK – including more than one million families and two million children.

Iain Wharton, head of Litigation at Lancashire law firm Napthens, said: “These proposals are controversial and have been hit with claims that they go too far.

“However, I don’t think landlords have much to fear. The practice of terminating tenancies to increase rent is not as prevalent as Mr Miliband suggests. In reality, terminating a tenancy more often than not leads to an empty property and periods without a rental income at all.

“The proposals may actually result in increased levels of rent. Landlords always attempt to set rent based on their assessment of the market over the term of the tenancy. In a period of increasing levels of rent, the longer the term, the higher the rent is likely to be set at the outset.

“Similarly, attempting to cut a letting agent’s fee as has been suggested, simply means that the fee will be incorporated into the rent over the term, so the tenants will ultimately still pay the fee.”