Sean Hooker: What will government throw at landlords in 2021?

The first thing to say is that landlords and property investors will still be a target for tax.

The sector has for a while been treated as not paying their fair share of the tax burden and therefore expect the Chancellor to come hunting when the cost of Covid comes to be paid.

The Stamp Duty cliff edge may be softened, but not for property investors, and CGT changes will occur, albeit may be tapered. Expect higher council tax and more local licencing.

The big elephant in the room however is what has happened to the Renters Reform Bill.

The legislation promises the reform of the eviction process, lifetime deposits and of course the question is whether Section 21 will be gone in 2021.

Can kicked

At the start of the pandemic and when the Government’s legislative programme was thrown in turmoil, I would have said the reforms had been the can kicked down the road.

But the measures taken in the last months to curtail possessions and evictions for the Covid period, lead me to believe that these measures will persist beyond the 31^st March end date and may well meld in permanent change.

In effect fulfilling the objective of Government policy and seeing the end of no fault evictions. Deposit reform is a little way away but again expect the unexpected.

An area close to my heart is regulation and the Government has the opportunity to act on this and in the form of ROPA, have the blue print to implement a reform package, which could be in place within two years.

Ball rolling

They have to start the ball rolling in 2021, as the pressures on the market will mean without effective rules and enforcement, the less savoury parts of the sector will see an opportunity and seek to fill the void.

The Government will also need ensure they address the gaps and ensure things like mandatory redress for tenants from the landlords is in place and the private rent to rent model is brought into the scope of regulation.

A lot therefore on the Government’s plate and this is not taking into consideration, the cladding issue, leasehold reform, environmental standards of rental properties and what will happen to tenants from the EU after the transition period ends.

Political pressure

What is certain is that political pressures on the market, will only increase in 2021 and the year will be as stormy as this one. On the other hand, with job uncertainty, lending being restricted and confidence low, demand for renting will remain high as people remain in or enter the rental market during these periods.

Yes some landlords will decide, enough is enough and try and bail out, however a whole fresh generation of investors are waiting in the wings, unencumbered by the legacy of the past and ready to enter the fray with the optimism and innovation needed for a thriving sector.

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