Section 21 Evictions

Rachael Maskell Excerpts

Tuesday 25th October 2022 Westminster Hall

[Kevin Hollinrake]

Like the hon. Gentleman, I have seen that briefing. That means that in effect somewhere between 20% and 30% of supply might go overnight, or go very quickly, and we have seen that in Scotland—[Interruption.] The hon. Gentleman can shake his head, but it is a reality. We have seen in Scotland a reduction in supply on the back of the abolition of section 21, followed by rent controls.

Back in York in the mid-1980s, what the Government are saying will happen is—

[Rachael Maskell (York Central) (Lab/Co-op)]

On a point of order, Ms Nokes. I do not mean this with any malice, but I think that the hon. Gentleman should refer to his entry in the Register of Members’ Financial Interests.

[Kevin Hollinrake]

I appreciate that. The hon. Lady could have made an intervention and I would have responded, but she is absolutely right, and I draw Members’ attention to my entry in the Register of Members’ Financial Interests. For many years, I owned an estate agency lettings business, which I do not own any more. I have, I think, four private rented properties in the private rented sector, but I absolutely do not speak on my own behalf; if anything, I speak on behalf of tenants, because I think that the measures being advocated would lead to a reduction in supply, which would ultimately be massively counterproductive for tenants. That is the conversation we should be having: one about whether or not this idea is good for tenants.

If the hon. Member for Liverpool, Walton will just indulge me for a second in terms of responding to his points—he is shaking his head, but if he just listened to my points, it might be useful. Rent controls applied back then. It was not as if rent controls were set according to market value, because there is no market value at that point. As soon as we introduce rent controls, we effectively get rid of market values. That is what happens. Back then the rent offices would compare a property only with other properties that had been rented out, none of which were accessible by the open market. Rent controls take us away from a free market completely.

The Government are also saying that if a landlord needs to reoccupy a property or wants to sell it, they will allow them to do that and ask the tenant to leave on that basis, but that loophole was closed then and it will be closed again. Back then, if someone wanted to ask a tenant to leave, they had to find another house for them. They had to be provided with another house, because the Government did not want that to be used as a back door to getting that tenant out.

--- Later in debate ---

[Rachael Maskell (York Central) (Lab/Co-op)]

It is a pleasure to see you in the Chair this afternoon, Ms Nokes. I congratulate my hon. Friend the Member for Liverpool, Walton (Dan Carden) on his excellent introduction to the debate.

For far too long, housing has been an investment as opposed to a human right. That is why it is so important that we start turning the equation around and ensuring that everybody has access to housing. The reality is that few people want to live in the private rented sector. They aspire to have a home that they can call their own, but as rents increase, they are unable to save up to live the dream. It is important that we build the housing stock required to meet need now and in the future.

[Dan Carden]

There has been discussion about who exactly is in the private rented sector. People may not wish to live long term in the private rented sector, but too many of our constituents are trapped there. The travesty of this Government is that their economic chaos has probably led hundreds of thousands of people in areas such as mine, who would have wanted to get on the housing ladder in the next couple of months and years, to rethink their plans and stay put.

[Rachael Maskell]

My hon. Friend is absolutely right. Many people saved up for that much-wanted mortgage, and events in recent days have meant their sales disappearing before their very eyes. Demand for property is outstripping supply, which means that the availability of property is such that hope is fading fast for so many people.

This issue is about power and control—about who has wealth and who has none in our country. More and more is being extracted from people who are desperate just to have a level playing field. That is why this debate is so important. If a Government have given their word to the electorate, they should keep it—not least when we are dealing with a significant housing crisis. York so exemplifies a place where there is housing chaos and challenge that I would invite the Minister—if he remains in his place this afternoon—to visit us and see what is really happening.

[Wera Hobhouse]

Will the hon. Member give way?

[Rachael Maskell]

I will continue my speech for the moment, if I may. My hon. Friend the Member for Liverpool, Walton highlighted the sudden 52% increase in the number of evictions this year. There is a reason for that, and the hon. Member for Thirsk and Malton (Kevin Hollinrake) referred to it: section 24 of the Finance (No. 2) Act 2015.

We have to look at cause and effect in relation to evictions. In came legislation to curb the advantages of the buy-to-let market, meaning that landlords did not get the tax advantages they had previously had. As a result, they are in negative equity, and are therefore looking at how they can derive a profit. I see that happening in two ways in my constituency: first, landlords putting up rents significantly so that they can break even on their investment; and, secondly, landlords evicting tenants, either to put up rents—that is rare—or to flip the house over to become an Airbnb.

In my constituency, we have seen a sharp increase in the short-term holiday let market. The statistics for whole properties show that back in January 2018 there were 973. Now there are 2,118. That decreases the supply of available housing even more, so if more demand is placed on the market, up go the rents again. People in York are pulling their children out of school, giving notice on their jobs and moving out of the area. That has skewed the local economy. We cannot recruit to our public services, and we are in rapid decline, because those 2,000 homes were built to be residential. With a council that is not building, the market is rapidly becoming overheated; it is broken. When someone can make £700 over a weekend on a property—a party house, as we see in the Airbnb market in York—or £945 on rent every month, why would they hang around and not flip their property? That is how the section 21 notices are being used in the residential areas of York. It is breaking communities and harming the market. It also shows how broken the whole market is.

On top of that, the local housing allowance does not meet the levels required, for people who would much prefer to be in social housing. We have to look at the broad rental market area, which is far too large. When there is a heated-up housing market, people who cannot get into social housing also cannot get into private housing, and they have nowhere to go.

[Kevin Hollinrake]

The hon. Lady is making a good point about holiday homes. Does she concede that section 24, which limits mortgage interest for people who provide homes to the private rented sector but does not apply to holiday homes, is one incentive to make a property a holiday home? If section 21 were abolished, there would be at least two reasons to provide a holiday home, rather than a property to the private rented sector.

[Rachael Maskell]

The hon. Member makes a point, but it is not an either/or scenario. I appreciate that it is a mess, but the Government have to mop up that mess, as it is of their own making. The fact we have seen landlords rapidly flip their properties demonstrates the urgency of addressing the issue.

I hope hon. Members will support my private Member’s Bill—the Short-term and Holiday-let Accommodation (Licensing) Bill—which is due to have its Second Reading on 9 December. I am looking to license the short-term holiday let market to provide security and allow local authorities the control to prevent some of that flipping. We have to get to the source of the problems. I trust the Minister will address that today.