The letting agent and landlord community is still coming to terms with the news that Labour wants councils to have the power to ban buy-to-let investors purchasing new-builds in what the party is to designate as ‘housing growth areas’.
The announcement, made by party leader Ed Miliband yesterday, follows on four already-announced Labour policies aimed at what it calls ‘reforming’ the private rental sector – the introduction of rent controls, mandatory longer-term tenancies, restrictions on tenant evictions and a compulsory register of landlords.
Many individual landlords and private rental sector analysts have clogged social media with complaints that the new buy to let ‘ban’ would drive investors into the second hand market, causing exactly the same pressures as with new builds and so making them less affordable for local owner-occupier purchasers.
Other agents and landlords say the Labour ban would effectively reduce the quality of the private rental sector at a stroke, by obliging any expansion of the stock to take place through existing homes – many of which are less suitable and less attractive to tenants than new-builds.
The Residential Landlords’ Association says the ban on BTL investors purchasing new-build homes will “choke off investment in the only housing tenure that has been growing” and is driven too much by concerns about the level of international off-plan purchasing of new homes in central London.
Meanwhile the National Landlords’ Association says Labour has failed to understand the difference between ‘buy to let’ and ‘buy to leave’.
“It’s only large scale investors who buy properties and leave them empty: not landlords.” says NLA chief executive officer Richard Lambert.