Monday, 1 September 2008

A Bigger Threat to Landlords than the Credit Crunch

If campaigners from the Citizens Advice Bureau get their way Buy-to-Let could face it’s biggest challenge since Assured Shorthold Tenancies came into being in the 1980s.

When the Housing Act 1988 came into being it gave landlords the right to obtain vacant possession of their property under Section 21. The ability to obtain vacant possession automatically was crucial to lenders entering the Buy-to-Let market and was the key to the huge rise in the number of landlords.

The Citizens Advice Bureau (CAB) along with others like some MPs, Shelter, the Chartered Institute of Environmental Health and tenants associations are now pressurising Government to significantly water down Section 21.

Debbie Crew from CAB Merseyside, who won the Sheila McKechnie campaigning award for Consumer Action for her work on retaliatory eviction, said “we want a change in the law ….by putting restrictions on the use of Section 21”.

David Harker, Chief Executive CAB, offered support saying “a change in the law would end the misery endured by many vulnerable people”.

Adam Sampson, Chief Executive of Shelter, added his weight saying “Shelter strongly supports this campaign”.

The Citizens Advice Bureau claims to have spoken to 198 local authority environmental health officers and have arrived at the conclusion that “98% of those questioned said they agreed that legislative changes concerning Section 21 needed to be made”. A Chartered Institute of Environmental Health statement said “(the CIEH) is happy to support the recommendations”.

Since the CAB campaign started they have been joined by some political heavyweights. South Shields MP David Miliband and his Jarrow counterpart Stephen Hepburn have offered their support to the campaign. They are both writing to Housing Minister Evette Cooper and Hazel Blairs, Secretary of State for Communities and Local Government, to raise their concerns.

The reality is that this campaign is gaining strength and landlords ignore it at their peril. We believe that if Section 21 is in any way weakened then lenders will start to pull out of the market. The result of that will be that landlords will start to sell and the number of rented properties will drop significantly. Landlords may find that they are trying to sell property in a depressed market and it could cost them a fortune.

If that happens it is not difficult to imagine a situation where the whole Buy-to-Let market could implode with thousands of landlords trying desperately to sell their properties.

Those who say it will never happen probably said the same thing about HMO licensing, tenant deposit schemes and Energy Performance Certificates. All of these changes came about because of pressure from organisations like CAB and Shelter. The fact is that the CAB and Shelter are highly skilled at campaigning. Can the same be said of landlords?

There are over 800,000 private landlords in the UK and probably less than 30,000 belong to any landlords organisation. The fact is that landlords struggle to compete with the organisational and campaigning skills of Citizens Advice, Shelter and similar bodies.

We believe that landlords must take a stand – in fact we believe that a change in Section 21 will affect the whole industry, landlords, letting agents and tenants alike. has started an on-line petition against any negative changes to Section 21. We strongly urge everyone in the lettings industry to join us and sign this petition now.

Act now, sign the petition and help us in this fight to protect the fundamental right of landlords to own and manage their own property.