From interest rates to the general election, here’s everything your agency needs to know in june 2024

3 June 2024

With the run-up to the general election, letting agents should know what to expect in the upcoming weeks. Here’s a list of what's coming up in June.

In the run-up to an exciting July, agents and landlords still need to be aware of what's coming up in June. From the end of Multiple Dwellings Relief to the possible decrease in interest rates, there are a lot of changes on the horizon for the private rental sector. Here is everything agents should know.

What to look out for in April 2024:

And don't forget, you can download newsletter templates for your landlords to inform them of big changes ahead. 

A recap of the past three months:

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End of Multiple Dwellings Relief

Originally introduced in 2011, Multiple Dwellings Relief (MDR) was created to encourage investments in residential property and boost the housing supply within the private rental sector.

MDR meant that if someone was purchasing two or more properties in a transaction, “Stamp Duty Land Tax (SDLT) was reduced by a relief”.

Buyers could claim tax breaks through the MDR scheme, with a minimum of 1% of the amount paid for the dwelling.

However, as announced in the Spring Budget earlier this year, MDR would end on 1 June. This was encouraged by HMRC who created consultations and reports on whether this relief was encouraging housing supply in the private rental sector. 

For landlords in the sector, the end of this policy could create higher costs associated when increasing their portfolio. For letting agents, this could also impact the housing supply within the sector. 

Any purchases made or not finished after 1 June 2024 will therefore not receive any relief.

Preparation for the General Election

On the 20 May, Prime Minister Rishi Sunak announced the UK General Election for the 4 July. Throughout June, there are key dates letting agents should be aware of that will help prepare before July.

The deadline to register to vote is on 18 June. If you cannot vote on the day, you must also register for a postal vote by 19 June. You can also to register vote by proxy, meaning that someone can vote on your behalf, by the 26 June.

You can check if you need to register to vote by visiting your local council’s website.

The political parties' complete manifestos are expected to be released in June. While there is no set date on when manifestos must be released, the Institute for Government explained “Labour and Conservative manifestos have been launched between 18 and 29 days before the election. That means they will likely launch between 5 and 16 June.”

The first debate for the general election between the leader of the Conservative Party, Rishi Sunak, and the leader of the Labour Party, Sir Kier Starmer, will take place on 4 June at 9pm.

If this feels like a lot to keep up with, subscribe to Goodlord’s newsletter and we’ll keep you up-to-date with everything about the general election.

A possible decrease in interest rates

Interest rates determine “how high the cost of borrowing is, or high the rewards are for saving”. This is determined by inflation rates, the increase in the price of something over time.

In May, the Bank of England held interest rates at 5.25%, which is currently the highest rates have been for the last 16 years. As of April 2024, the inflation rate for the UK is at 2.3%.

However, for interest rates to drop further, Bank of England’s Governor Andrew Bailey said he needs to “see more evidence" in inflation rates reducing before interest rates can then be lowered.

But what does this mean for June? The next interest rate announcement will be on 20 June, following the inflation figures being released on 19 June. If the inflation rate is close to the 2% target, the interest rates should also be lowered.

However, despite the promising decrease in inflation rates over the past months, the general election could affect them in the future.

For letting agents, having an understanding of interest rates is key, as they affect mortgage rates as well as saving or credit card rates, which could affect their landlords.

Renters (Reform) Bill: your simple guide

May 2024 - lettings recap

1. Scottish committees launch consultation on new Housing Bill

Following the closure of Scotland’s rent caps at the end of March 2024, the Government has introduced new proposals and regulations for the private rental sector, with the Housing (Scotland) Bill.

Originally introduced in April, the Bill is divided into six parts focusing on elements such as rent control, eviction procedures, tenant rights, and homelessness prevention.

The Scottish Goverment has launched a public consultation on the Bill and some key areas of focus, which will close on 17 May. These key areas are:

  • Rent control mechanisms and affordability measures
  • Tenants right for pets in lets and modify a property
  • How local authorities can proactively prevent homelessness
  • Enhancement of eviction procedures and tenant protections

You can submit your views on the Bill before 17 May here

2. Leasehold and Freehold (Reform) Bill and Renters (Reform) Bill enters the House of Lords

Two integral bills for the private housing sector have entered the House of Lords in April and will be debated this month. 

The Leasehold and Freehold Bill is currently in the Report stage of the House of Lords process, with only one more reading to go before it enters the final two stages. 

This bill will help landlords and tenants and aims to improve and promote fairness for the growing number of leaseholders in England and Wales. 

The Renters (Reform) Bill entered its second reading on 1 May, with three more stages left to go in the House of Lords.

First introduced in May 2023, this bill will affect letting agents, landlords and tenants strengthen and reform the private rental sector.  

Once both Bills have passed in the House of Lords, there will need to be a consideration of any amendments made to the Bill, before it can achieve Royal Assent and become law.

While it is not clear how long it will take for both Bills to be passed through the House of Lords, it is going significantly quicker than its time in the House of Commons. Letting agents should be aware of both bills and when they will become law, as it’ll cause major ripples in the private rental sector.

3. Local and mayoral elections

On 2 May, local authorities around the United Kingdom will be holding elections for their Government. This will be the most accurate snapshot of what the UK population thinks of their local and general government before a possible General Election in 2024.

Some of the elections include:

  • Local Government Elections in England
  • Local authority mayoral elections
  • Combined authority mayoral elections
  • Greater London Authority elections

With 388 local councils in England and about 20,000 councillors, the local government has control over housing, council tax and transport in their local community.

Find out more on Conservatives and Labour’s housing proposals and plans

April 2024 - lettings recap

1. Local Housing Allowance

Local Housing Allowance (LHA) is used to calculate housing benefits for tenants from private landlords.

This is dictated by the Department for Work and Pensions and is based on the private market rents being paid by tenants in a Broad Rental Market Area (BRMA).

From the start of April 2024, the government plans to raise LHA which will benefit some of the poorest families on universal credit or housing benefit and will gain around £800 a year.

The amount of local housing allowance is dependent on the area where the property is based. You can find out the rates by postcode or local authority here.

2. Capital gains tax is reducing

From 6 April 2024, landlords who own properties in their name will have a smaller Capital Gains Tax.

Capital Gains Tax applies when someone makes a profit from selling a property that isn’t their main home. This includes selling buy-to-let properties, business premises, land, and inherited properties.

As mentioned in the Spring Budget, the tax will be reduced from 28% to 24%. This means that if landlords are really selling up, they will be charged less by this tax. 

Find out the five key letting agents should know from the Spring Budget

3. VAT Registration Threshold for short-term lets

Residential properties are exempt from VAT. However, an increase in the VAT registration threshold may soon affect landlords with holiday accommodation and short-term lets.

As announced in the Spring Budget this year, the VAT threshold will increase from £85,000 a year to £90,000, starting on 1 April 2024.

This means that any landlords earning under the £90,000 threshold will not have to register for VAT, and can earn more without being taxed.

4. The Leasehold and Freehold Bill enters the Committee Stage

The Leasehold and Freehold Bill will enter the committee stage in April. Since being unveiled in November 2023, this bill has caused a lot of controversy within the private rental sector.

In March 2024, it was reported, following a consultation, it was reported that Michael Gove, Secretary of State for Levelling Up, Housing and Communities, may abolish the introduction of "peppercorn" rates, a key element of the Leasehold and Freehold Bill.

The Committee stage of the Bill should iron out the current issue on ground rents and how transparent service charges will be in the future. 

Find out more about the Leasehold and Freehold Reform Bill

March 2024 - lettings recap

1. Scotland rent caps lift

On 6 September 2022, a rent freeze and moratorium on evictions was introduced to all private rental properties in Scotland as a way to stabilise the housing market following the pandemic. At the end of March, this rent cap and moratorium will be changing.

As part of the Cost of Living (Tenant Protection) (Scotland) Bill 2022, the Scottish Government capped rent increases at 3%, or 6% if the landlord has requested a higher increase for additional costs.

From 1st April 2024, private landlords can start to propose a rent increase between 6% to 12%, only in cases where the current rent is below the open market rent. If the tenants believe the increase is too high, they can apply to Rent Service Scotland (RSS) for them to decide what the rent should be.

Download our poster of key upcoming dates in Scotland for 2024 

2. Spring Budget 2024

In the lead-up to what will be a big year for UK politics, the Chancellor of the Exchequer will be presenting his spring budget to parliament on 6 March.

Jeremy Hunt, Chancellor of the Exchequer, will present the Conservative’s key policy announcements, as well as the Office for Budget Responsibility (OBR) forecasts.

As part of the background research for the budget, the House of Commons Library has reported that fixed-rate mortgages started to increase in February 2024, meaning “that financial markets are not expecting as many rate reductions from the Bank of England in 2024 as previously thought”, affecting rental increases.

Find out the key takeaways from the Autumn Budget 2023

3. Welsh Labour Leadership Elections

With the news that Mark Drakeford stepped down as the Welsh Labour leader in December 2023, an election will start in February to determine the new leader of the Labour Party.

In December, two candidates received enough nominations to get on the membership ballot, Vaughan Gething MS and Jeremy Miles MS, and are now in the running to be the new leader of the Welsh Labour Party. 

Jeremy Miles is currently serving as Minister for Education and Welsh Language, and Vaughan Gething is acting as Minister for the Economy of Wales.

Ballots will open on February 16, and close on March 14, with the new Labour Leader to be announced on March 16.  

3. Further Industry and Regulators Committee Evidence sessions

The House of Lords Industry and Regulations Committee began its inquiry to determine whether there should be a new industry regulator in February of this year.

A further session will resume on 5 March and will include evidence from The Property Institute, Propertymark, The Property Ombudsman and National Trading Standards.

In February’s session, the Industry and Regulators Committee discussed conflicts between tenants and agents, and the current issues for leasehold and freehold within England. 

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Further reading