As you know, I like to write regular blog articles to provide you some weekend reading and keep you up to speed about the world of HMO lettings and management, especially where it affects the market here in Ipswich.
Sometimes it’s plain sailing, sometimes it’s choppy waters – but it seems there is always something to bring you, even when it feels like a slow news day…
Then again, sometimes, in some weeks, the stories almost write themselves.
Rushanara Ali and the i paper exposé
This week, one story that has risen to the fore is not so much limited to the HMO market, but is rather one than affects the lettings industry, and in a sense the whole housing industry, in general.
Rushanara Ali has resigned from her role as the Homelessness Minister after journalistVicky Spratt claimed in an article in the i paper that Ali had issued a Section 21 Notice to her tenants, on the basis that she wished to sell the property, then hiked the asking rent on the East London townhouse by a staggering £700 per month just a few months later when she relisted the property as a rental.
It marked a 21% increase on the rent, in the middle of a housing crisis, by a sitting government minister responsible for tackling homelessness. It might seem comical – but it also flies in the face of several core themes set to be reversed, abolished or prevented once the forthcoming Renters’ Rights Bill passes through parliament to become enshrined in law.
What has Rushanara Ali said?
In her resignation letter, Ali said she didn’t want to distract from the “ambitious work of this government.”
But of course, the damage was already done.
Conservative Party Chair, Kevin Hollinrake, who had been the Shadow Secretary of State for Levelling Up, Housing and Communities until July 22, has labelled her actions “staggering hypocrisy”.
A political attack, of course, but it is hard to disagree, when the government she serves is pushing through rental reform that will prevent at least two of those three core issues listed above from happening – at least in isolation:
- No more Section 21 (with a couple of exceptions – including, for example, situations where a landlord wishes to sell the property; which brings us to…)
- Prohibited from re-listing your property to let for 12 months if you try to sell it
And then the grey-area:
- No ability to hike rent (note: technically this was not a rent hike as the tenants chose to leave… but, if the tenants were staying, while landlords will be able to set rent increases, tenants will be able to challenge them at tribunal).
The Bill has captured the public imagination, although not always (in fact not often) fully comprehended – a snippet of a podcast I listened to featuring Lily Allen this week showed that a little knowledge is a dangerous thing, with her grasp of the implications of the Bill being lacking, unfortunately – even if her intentions were good. Not a problem necessarily, unless you are broadcasting your views on it to an audience of thousands or millions… perhaps that is a blog topic for another day.
In the meantime, suffice to say it looks set to be pushed through perhaps as soon as this Autumn, with a narrative being pushed that these things listed above – S21, Rent Hikes etc – are essentially a blight on the rented sector; that such things that we have become used to, are actually obscene.
The reason that claims of hypocrisy come into it is that the voting pattern in parliament, particularly in the House of Commons and particularly amongst Labour MPs and Ministers, has been starkly in favour of the proposals put forward that will prevent these things from happening.
When the very people drafting the policies are found engaging in those things that their policies are trying to close off, it can’t help but seem disingenuous, at the very least.
Let’s take a better look at the above points in more detail:
Three key proposals in the Renters Rights Bill that Rushanara Ali has flown in the face of:
- It will be far more difficult to justify extreme rent increases.
Under the new regime, rent rises will need to be proportionate and evidence-based, with tenants given a clear route to challenge excessive hikes via tribunal. In short, landlords won’t be able to stick an extra £700 a month on the rent without scrutiny or consequence. In this case, the tenants had chosen to leave – but only after a Section 21 Notice to regain possession was issued. - You can’t flip a property from rental to sales and back again.
One of the most overlooked but, for many landlords, most worrying clause in the Renters Rights Bill is that which prevents landlords from re-letting a property for 12 months after attempting to sell it. That’s to stop insincere ‘back and forth’ tactics where landlords evict tenants under the guise of selling, only to slap it back on the rental market (in this case, the accusation is, at a higher price). Section 21 and a rent hike by the back door. - The end of Section 21.
The infamous ‘no-fault’ eviction will be abolished. That means landlords will need a legitimate reason to ask tenants to leave, and raising the rent to unaffordable levels to push them out, or simply wanting new tenants who’ll pay more, won’t cut it. Ali will no doubt argue that her intention was to sell the property. It is impossible, really, to prove or disprove that genuine intent. The deterrent in the Bill will be to prevent it for 12 months; Ali has been on the market since November – just 9 months.
The proposals put forward in the Renters Rights Bill, now reaching its latter stages in parliament, are designed to restore balance and fairness in the private rental sector. When a government minister, not least Homelessness Minister, and someone meant to be delivering these reforms to bring fairness to the system, gets caught exploiting the very system they’re trying to change, it sends all the wrong messages… to tenants, to landlords, to agents, to the industry – to the nation as a whole.
It reinforces the worst stereotypes. It undermines the work of good landlords who keep rents fair, maintain their properties properly, and treat tenants with respect. It chips away at the trust that does still exist between renters and landlords in this country.
And the trouble is… it’s not even surprising – and that’s not a party-political observation. It is statement, really, that says: ‘we told you this sort of thing would happen’.
Why we care enough to write about it
This isn’t about politics. It’s about principles and it’s about common sense.
If we want a healthier rental market, we do need rules that protect tenants; we recognise that. We also need a culture of integrity amongst landlords who believe in playing fair, and who find the old-school view that tenants are just a cashflow solution to be entirely alien.
It’s easy to see this story and feel that little satisfying flicker of schadenfreude. A minister hoisted by her own petard! But the trouble is, whilst we might all cry foul, it is believable that a landlord might wish to issue notice to their tenants in order to sell it, as is Rushanara Ali’s claim; it is believable in this market that the property might fail to sell; it can seem reasonable then that the property should be able to be relet – rather than be left to stand empty, depriving renters of a housing option. And when it comes to rent, if it can achieve £700 more, is that not fair? After all, who is the arbiter of what rent should really be – surely that old maxim, ‘a property is worth what someone is willing to pay for it’, comes into play? Is that not a reflection of the market? Nobody forces tenants to pay more, after all…
These are hypothetical points, by the way – but they bear thinking about, and the trouble with the Bill in its current form, the reason that the industry, landlords and landlord associations have reservations, is that these conflictions seem apparent and obvious to us.
Many people will think there was something distasteful about Rushanara Ali’s actions. Others will read this last section of this article in a considered way and think, actually, if that’s the order that things happened, where is the outrage?
I think from our point of view it is the sniff of hypocrisy that makes this a story – and the lingering doubt – impossible to prove – that her actions may have been cynically taken to put her rental (and rent achieved) in the best position it could be before the reforms kick in.
Ultimately it is probably inevitable that she has had to resign. The question is, how many other MPs and Ministers might be in a similar boat, undertaking similar actions, for ‘reasons unknown’.
Well… it isn’t just ‘reasons unknown’, is it? It is ‘cases unknown’ – and I’m sure we will never know.
Frequently Asked Questions
Q1. Why did Rushanara Ali resign as homelessness minister?
Ali stepped down after accusations that she ended her tenants’ fixed‑term tenancy and then re‑listed the property at £700 a month more just a few months’ later. She said staying in post would be a distraction, though she insists she followed the law.
Q2. What did she do that was seen as hypocritical?
She issued notice to tenants to sell the property, but when it didn’t sell she re‑listed it for rent at a significantly higher price – the kind of practice Labour’s Renters’ Rights Bill aims to curb.
Q3. What changes does the Renters’ Rights Bill propose?
Key measures include abolishing Section 21 “no‑fault” evictions, giving tenants the right to challenge rent hikes and banning landlords from re‑letting a property for twelve months after ending a tenancy to sell (a proposed amendment may reduce this time to six months, we await confirmation during the ping pong phase in parliament, beginning September 2025).
Q4. Why is this issue politically significant?
Labour came to power pledging stronger protections for renters. Allegations that a minister exploited existing rules undermine public trust and highlight how new legislation could affect landlords and tenants alike.