Renter Reform Bill penalising tenants

 The renter Reform Bill isn't even law and it is already  penalising tenants.

This story caught my eye https://www.lbc.co.uk/news/cost-living/single-mother-landed-with-rent-increase-calls-for-rent-controls/

Basically a woman in Darlington is demanding rent controls because her landlord increased her rent by 20%. Ok that's a headline.

However this biased anti landlord story has another angle. If you read the article her rent increased by £100 per month which equated to 20%

So that means her rent before the increase was £500.

It says she is a mother so she is renting at least a 2 bedroom house.

A quick search on Rightmove shows that the absolute cheapest rent for a 2 bed house in Darlington  is nearly £600. So the landlord has increased her to rent to the absolute lowest market rent.  She may well have a 3 bed hous in which case she has a bargain basement rent  but is complaining about it.

The article says she cannot move because the rents are so high - so in other words her rent was cheap and with the increase it's still cheap because she cant find anything else for less money than the new rent.

Council house rent increased by 8% this year yet the article calls for a rent cap of inflation.... So councils can have inflation busting rent increases but private landlords can't.

So why has the landlord increased the rent by 20%?

Well the answer is the Renter Reform Bill caps rent increases. 

So if you are a landlord and haven't increased your rents you will be capped on increases when it becomes law. If fact if you want to evict them the court can rule that they can stay simply because there are no properties to rent at the current rent.

Measurement drives behaviour 

Landlords therefore are being incentivised to increase rents to the market rate before the Renter Reform Bill becomes law and prohibits increases except under controlled situations.

When landlords have in the past not increased rents because they have "good tenants" it means they are creating a situation in the future where you have tenants that will be impossible to get rid of.

So landlords will now have to increase rents annually regardless and increase rents now to.ensure they align with market rates before the Renter Reform Bill becomes law. Failing to increase the rent annually means that future increases need to be bigger to stop falling behind the market norm. However the rent controls mean.you can't increase the rent enough to accommodate this and you end up in a spiral of rent controls. 

Landlords will now increase rents annually regardless.  So much for rewarding good tenants with a lower rent.

The Renter Reform Bill is flawed before it has even become law.

So returning to our poor renter. OK I sympathise that her rent has increased and she probably cant afford the increase.  Labour have increased her energy bills by nearly £300 since they have been in power so she is probably financially streteched.

Darlington has also introduced selective licensing of private landlords at a cost of £565.  The landlord will pass this cost on to the tenant. 

The landlord is not a charity.  Looking at the local housing allowance tables, the council will pay housing allowance of  £448 per month for a 2 bed house and £528 for a 3 bed house in Darlington.  Either way the housing allowance doesn't cover her new £600 rent.

However councils have increased council tenant rents by nearly 8% in the last year yet councils (or the government)  have NOT increased the housing allowance at all - zero percent increase.  Private rents have increased by 9% (because of the renter reform bill,  insurance increasing by 20% etc). So it's not a surprise that rents have gone up and affordability has got worse. Factor in Darlingon's  selective licence fee charged by the council  and I think her landlord has been more than fair with a £100 increase.

The  government must think landlords are stupid....