Leader of the Libertarian Party UK, Adam Brown, questions the logic of more government legislation
Whilst many are welcoming the decision to prevent “no fault” evictions, this great step forward in renters’ rights is missing a crucial element, one that affects nearly all government legislation, yet one that is still never considered: the law of unintended consequences. This change, it is claimed, will give renters more security and prevent landlords from being able to evict tenants for making complaints or for even asking for basic up keep of their properties. However, what I find most interesting is that in each conversation I have seen in the media there is one thing that is brought up time and time again: unaffordable rents. Clearly, this issue is so important to tenants that even when the topic has nothing to do with affordability, it keeps coming up; this would lead me to believe it is probably the main issue facing renters.
Now whether you believe rent is too high or not will depend on many factors including your own personal circumstances, but what is an economic certainty is that prices are elevated when demand outstrips supply. And this brings me to these unexpected consequences. Whilst I don’t doubt there are some unscrupulous landlords out there who do treat tenants unfairly -they are few and far between. In fact 90% of all tenancies are cancelled by the tenant rather than the landlord, so this is not an issue in the vast majority of cases, and no one is suggesting that the horror stories disclosed by various media outlets make up the majority of the other 10% either. What seems certain is that these policies will reduce the supply of properties as there are some people who will now be unable to add their property to the shrinking pool of available rental properties. I myself am an example of this, whilst out of the country working I let my house; I was very clear upfront that at some time in the future I would need to return. When we knew that we were returning to the UK, we told our tenants and worked with them to ensure they were able to relocate to a new house in a timescale that worked for everyone. If I were unsure that we could end the tenancy like adults, I would not have been able to let my property and instead it would have sat there empty. I am not alone in doing this and therefore this legislation risks reducing a supply that is already struggling to keep up with increasing demand. The inevitable outcome will be rents increasing even higher, something Labour have said they will prevent with rent caps. Again, this will only reduce the available supply even further.
What is most annoying is that the answer to both bad landlords and high prices is the same solution. It is less legislation, not more. By removing legislation which makes letting properties difficult, you will get more properties available, with more properties – rents will reduce due to competition. Therefore, unscrupulous landlords will no longer be able to trap tenants in poor conditions, as they will benefit from more choice. It is government interference which distorts the market and limits renters’ choices. Clearly, the answer to bad legislation is never more legislation; you’ll only get the unintended consequences of less rental properties and higher rents!