Conservative MPs are preparing to force the Government to toughen up its planned tenancy reforms in England and Wales, with Downing Street expected to bring forward a bill that fails to meet campaigners’ demands.
Conservative backbenchers say they are ready to make amendments to the long-awaited tenancy reform bill, which will be a centerpiece of next week’s King’s Speech but which will not end the leases on the majority of properties.
The package has long been promised by Michael Gove, the housing secretary, who has promised to end what he calls the “feudal” system whereby landowners retain control of properties.
However, although the bill is expected to include a ban on developers selling new rental homes, government sources told the Guardian it would not extend the ban to apartments, which make up around 70% of all housing. rental properties.
Several senior Conservatives said they wanted the government to end leases for new houses and apartments, and were prepared to make their own amendments to the bill if it failed to do so. With Labor’s support for these MPs, they could even force the government into a U-turn or defeat.
Peter Bottomley, the most senior MP in the House of Commons, said: “If the Government has not included things in the Bill that are clearly needed, the Lords and Commons will improve it. If something is not included in the bill, it can and will be improved. »
An unnamed Tory MP, who is helping to organize resistance to the government’s plans, said: “If this bill doesn’t include apartments, I will absolutely seek to change it.” If you’re buying an apartment in a 50-apartment building, there has to be a way to do that so people can still own their own property and not be at the mercy of a landowner.”
Matthew Pennycook, the shadow housing minister, said Labor would support attempts to ban the rental of new apartments.
“It is deeply disappointing that the Government appears determined to only legislate for new homes to be sold freehold, leaving those buying apartments stuck in an archaic home ownership system,” he said.
“Labour believes that shared ownership should be the default tenure arrangement for all new properties, with a completely revamped system so that existing tenants can buy collectively more easily and move to shared ownership if they wish.”
Gove has long promised to end the leasehold system, telling the Sunday Times this year: “It is an outdated feudal system which must disappear. »
Tenants have been complaining for years about a range of practices by some landowners and managing agents. Many say they have been charged exorbitant fees to make repairs or extend a lease, or that property management companies continue to impose service fees for no reason.
The problem emerged following the Grenfell fire, after which thousands of tenants found themselves facing bills worth tens of thousands of pounds to replace combustible cladding on their buildings. The government has since insisted that developers foot the bill for the taller towers, but much of the replacement work has still not been carried out.
On Tuesday, the government will use the king’s speech to introduce what is likely to be its final package of laws before next year’s general election, including the tenancy reform bill.
Sources say the bill will include a ban on developers selling new rental homes – a measure ministers have been promising for six years. It will also cap ground rents for new and existing properties and set the default duration of leases at 990 years, instead of 99.
Behind the scenes, Gove has been fighting for a wider package of proposals that would also include measures to end leases on newly built apartments. Sources told the Guardian, however, that he was unsuccessful in that battle, with Downing Street fearing he would face opposition from Tory developers and landowners.
Other Conservative MPs, most of whose constituencies have large numbers of apartments, have supported more substantial reforms.
Nickie Aiken, MP for the Cities of London and Westminster and vice-chair of the Conservative Party, said: “I want to see what the bill says, but other countries have ended apartment leases and we need to learn how it worked. in practice. I would not be surprised if amendments were made on this subject.
Bob Blackman, who represents Harrow East, said: “Selling strata properties (a replacement for tenancy where owners collectively own their buildings) makes a lot of sense going forward. »
Harry Scoffin, co-founder of campaign group Commonhold Now, said: “Failing to ban leases on new apartments would be a betrayal of everything the government has promised since 2017. It would cost the Treasury nothing and, crucially, , preventing even more unsuspecting apartment buyers from being drawn into the rental debt trap.
A spokesperson for the Ministry of Upgrades, Housing and Communities said: “We have already made significant improvements to leases – ending ground rents for most new residential leases, and we will make it easier and less expensive for tenants to extend their lease or purchase their freehold. .
“The Secretary of State has made it clear that we will introduce legislation to protect tenants as soon as possible.”