Renters' Reform pushing landlords to short term lets

Conservative MPs have expressed concerns to the Housing Secretary Michael Gove about the potential consequences of his Renters' Reform Bill which they believe could cause private landlords to abandon long-term rentals in favour of unregulated holiday homes.
Among the Bill's aims is to abolish section 21 'no-fault' evictions but critics warn that not giving landlords a route to repossess when necessary and avoid going to court will see landlords switch to short-term lets.
One unnamed Tory MP, who is also a member of the Levelling Up, Communities and Housing Committee, told the i newspaper that around 30 backbench Conservative MPs are troubled by the Bill since it 'addresses one issue but gives rise to another'.
'Private sector landlords are dropping out of the market’
The MP reportedly said: "We've already seen private sector landlords are dropping out of the market and then going into Airbnb because they can make more money there and don't have all the conditions on how they run their own properties."
He warned that should the Bill become law there would be fewer homes to rent with landlords leaving the private rented sector - and rents would rise.
The MP told the newspaper that there was a need for more tenant protection and the country needed more affordable homes to rent and buy.
Doesn't just appeal to landlords in the PRS
But the prospect of becoming a holiday let landlord doesn't just appeal to landlords in the PRS - but also to a quarter of Brits wanting to earn extra income from UK staycations, research reveals.
A study conducted by mortgage provider Together reveals that 24% of respondents are contemplating the idea of owning a holiday rental, a number that jumps to 51% among those aged 18 to 34.
Financial gains serve as the primary incentive for these aspiring holiday let owners, and almost half (48%) view short-term holiday rentals as an opportunity to boost their earnings.
This motivation holds even greater significance for those aged 55 and above, with nearly two-thirds (65%) seeking an extra revenue stream.
Together's Marc Goldberg said: "Staycations have been in extreme demand and their popularity looks like it's here for the foreseeable future.
"As our research shows, many potential investors are looking to short-term lettings as a way of generating more profit, and this comes at a time when rising mortgage costs are making the traditional buy-to-let market less attractive."
Proposed law might have unintended adverse effects
Surprisingly, even organisations that campaign for tenants point out that the proposed law might have unintended adverse effects on tenants.
One lobby group, Generation Rent, says that average rental costs in popular tourist destinations like Scotland, coastal regions of Wales, Devon, and Cornwall have surged by nearly 25% over the past two years.
They claim that landlords are displacing their tenants to convert properties into holiday lets or AirBnBs due to the higher profitability.
Also, some holiday-let landlords can benefit from tax breaks through small business rates relief - which is a perk that residential private landlords cannot enjoy.
The rise in holiday let numbers could be controlled
However, tougher holiday let laws could be on the way after Michael Gove warned that the rise in holiday let numbers could be controlled by giving councils the power to impose planning permission to restrict them.
He said: "Tourism brings many benefits to our economy, but in too many communities, we have seen local people pushed out of cherished towns, cities and villages by huge numbers of short-term lets.
"I'm determined that we ensure that more people have access to local homes at affordable prices and that we prioritise families desperate to rent or buy a home of their own close to where they work.
"I have listened to representations from MPs in tourist hot spots and am pleased to launch this consultation to introduce a requirement for planning permissions for short-term lets."
‘Landlords looking at the short-term rental sector’
The managing director of Accommodation for Students, Simon Thompson, said: "There is undoubtedly growing interest in landlords looking at the short-term rental sector.
"They can enjoy higher profits, but the properties need more work to maintain.
"But the landlord will know that a tenant will be leaving and there won't be any trouble getting the rent paid since the tenant will pre-pay."
He added: "That's an attractive proposition for many PRS landlords who are looking at the proposed Renters Reform Bill and the rights tenants will get - especially making it more difficult to get a property back.
"The government really does need to consult more and understand what the unintended consequences are for the PRS if the Bill becomes law."