The Queens speech 2017 – What does it mean for the property sector?
The Queen’s Speech, which was delivered on 21 June 2017, set out information on legislation which the government intends to carry over into, or introduce, over the course of the next year.
Below are a few key points worth noting for the property sector.
New Bills of interest
(1) Draft Tenant’s Fees Bill
This proposed new bill, which was part of the pledge made by the Government in the autumn statement, will impose a ban on letting agents charging upfront fees to tenants on residential lettings fees. It is proposed that the Bill, once introduced, will ban landlords and agents from requiring tenants to pay letting fees as a condition of their tenancy, and will introduce measures to enforce the Bill with a provision allowing tenants to recover unlawfully charged fees. The ban would not include rent, a capped refundable security deposit and/or holding deposit and tenant default fees. Holding deposits would be capped at one week’s rent and security deposits at no more than one month’s rent. The aim of the Bill is to increase competition in the private rental sector, to reduce upfront costs for tenants, and to deliver on the manifesto commitment made by the Government to ban letting agent fees and make renting fairer and more affordable for millions of tenants. The ban would apply to England only, however it will include some minor amendments to the Consumer Rights Act 2015 which may apply to England and Wales.
Whilst this will be welcome news for tenants, it will undoubtedly cause concern amongst both landlords and letting agents, and will inevitably result in increased litigation in an already heavily litigated area.
(2) High Speed Rail (West Midlands – Crewe) Bill
A new bill, the High Speed Rail (West Midlands – Crewe) Bill, will be brought forward to provide the powers to build and operate the next stage of the HS2 railway line from the end of the Phase One Route at Fradley to a junction with the West Coast Main Line just south of Crewe. The main benefits of the Bill will be to allow cities in the north of England and Scotland to enjoy the increased capacity, improved connections, economic benefits and reduced journey times sooner by accelerating the building of a connection to Crewe, to free up space on our existing rail lines and generate jobs, and to fulfil the manifesto commitment to “continue our programme of strategic national investments”. The extension is scheduled to open in 2027 at a cost of £3.5 billion.
Other relevant proposals:
The speech included a pledge to build more homes in the right places to help tackle the increasing lack of affordability, slow the rise in housing costs relative to the rise in wages and help “ordinary working families” to buy an affordable home and bring the cost of renting down. This came off the back of the Housing White Paper published in February 2017 which proposed end-to-end action across the whole housing system
The speech highlighted the latest figures for leasehold properties, and signified an intention on the part of the Government to launch a consultation on leasehold reform, and to work with stakeholders to promote transparency and fairness for leaseholders. The focus of the reform will be on ground rent and the sale of leasehold property.
Grenfell Tower Fire
On 15 June 2017 the Prime Minister announced a full public inquiry into the circumstances behind the fire which broke out in Grenfell Tower. The speech provided specific details regarding this inquiry, including how it will be conducted, the individuals who will be consulted and the details of publication.