The government has launched a consultation regarding the extension of Awaab’s Law to the private rented sector (PRS). An accompanying impact assessment indicates that this extension could have financial implications for landlords, potentially causing some to exit the market.
The impact assessment estimates the changes will cost businesses £422.4 million in net present value, with an equivalent annual net direct cost to business of £42.2 million. This equates to an average cost of £8.17 per property per year for landlords, with a range from £5.64 to £10.69.
The government's assessment suggests that landlords offering poorer-quality accommodation might be most affected and could leave the PRS. Their departure could create opportunities for more professional landlords, potentially improving overall standards in the sector.
The government states that intervention through Awaab’s Law is necessary to address a power imbalance between landlords and tenants, as market forces do not always incentivise landlords to provide high-quality homes.