Listening to the new Prime Minister speeches and interviews at the Labour Party conference has convinced me we have a sincere, well-intentioned and rational new leader. Certainly I endorse his views that house prices and rents are too high. And share his belief that these problems cannot be solved by the time of the next general election in 2029. His experience as mayor of Manchester for many years also builds my confidence in his ability to deliver. But when it comes to plans for leasehold reform, my hopes and more are replaced by fears and doubts.
He wants to make rents affordable , in the same way he considers house prices are too high. Which I understand. Burnham therefore proposes regulation of estate agents, letting agents and managing agents.And taking action to stop leaseholders being ripped off. The snag is interfering with open marker rental supply, by placing barriers in front of existing and would-be landlords and their agents will limit supply and push rents upwards. On the other hand, I see there is a lot of tenant based anger which is justified too. The unfortunate truth is that since the start of the pandemic in early 2020 building and repair costs have gone up by about 40%. Professional costs for residential landlords in the same period have gone up by about 50%. Tax increases are another new burden. In the same period, comparing like for like property portfolios of residential landlords, after doing some ChatGPT research residential landlords tax bills have increased since 2020 by 40% to over 200%, described by ChatGPT when soaring interest rates are included ‘has massively increased the tax burden on identical rental incomes.’.
These financial shifts change the minds of fluid investors. It is also worth bearing in mind that for owner occupiers their annual running and repair costs have gone through the roof too-except this big new liability is better concealed!
There is another rental aspect too, which is largely ignored by the media, political leaders and the tenants, The hidden benefits that well run residential estates bring to their occupiers and their local communities. One or two supportive comments of London’s landed estates in the FT produced vitriolic anger. This is what I said
”Besides the obvious fact that someone must invest their time in doing the management job decade after decade, there may be another overlooked penalty. London’s landed estates have shown an ability to create premium values over long time scales. This valuation premium will drain away if anti- social occupiers become free to act in an anti-social manner. Value takes a long time to build but do not need many visible errors to float away. Look at the impact in the values of London flats in less than a decade caused by the fall-out of the tragic Grenfell Tower fire. “.
Once the market for flats knows that long established ownership assumptions can no longer be taken for granted, massive market uncertainty will arrive. With this uncertainty the sale value of flats will decline. The supply of private rented flats will also diminish. The current unaffordability problem will worsen. Is this what Andy Burnham wants?
The answer? Just like the answer to make house prices affordable,it needs a big increase in the supply of private rental homes, with local support. Introducing more regulations in the meantime, will make the problem worse.
Ian Campbell
3 October 2026
