On May 1, 2026, one of Margaret Thatcher’s key legacies will be rewritten. “Assured shorthold tenancies,” the default form of tenancy for renters in England, will be abolished as part of the Renters’ Rights Act.
This means that “no fault” evictions — where a landlord can end a tenancy for no reason other than the current tenancy period coming to an end — will also be abolished. Instead, all current and future tenancies will be open-ended, only terminating if the tenant hands in notice or the landlord has valid grounds to regain control of the property.
In addition, up-front payments of rent will be capped at one month, renters will have stronger rights to keep pets, and “rental bidding” will be banned. However, another critical legacy of Thatcherism, the end of rent controls, will remain in place.
Landlords will also still have grounds to evict a renter who has abided by their rental agreement — for example, if the landlord wishes to return to living in a property that used to be their home, if they have decided to sell up, or if the tenant is in rent arrears.
By replacing insecure tenancies with long-term tenancies and strengthening renters’ rights in a series of areas, the new piece of legislation will represent the biggest change for renters since the 1980s. As such, it represents a partial break with the way in which private rented housing has been organized under neoliberalism in Britain (due to devolution, Scotland has had comparable reforms since 2017, while more limited reforms were enacted in Wales in 2016).
It may even mark the beginning of the end of a period where the living standards of renters and homeowners have significantly diverged. After nearly a decade of campaigning from renters’ unions and groups, pressure has yielded a whole suite of reforms.
At the same time, the level of progress should not be overstated. The affordability of private rents, already close to being the worst in Europe, remains barely addressed. The Renters’ Rights Act, though more ambitious than the previous Conservative government’s attempt at reform, was watered down from the original “Renters’ Charter” that Labour proposed when still in opposition in 2022.
Calls to give courts more discretion to block evictions never really made it into the discussion. Nor can rental reforms do much to change the underlying dynamic of the private rented sector, where homes serve above all as a financial asset.
The new Renters’ Act represents the centerpiece of the government’s more progressive achievements on housing, but not its whole strategy for the housing system. Labour’s flagship goal has been to deliver 1.5 million new homes, the highest level of house building since 1973, and thereby boost the supply of housing.
Alongside this, the government has sought to expand England’s Affordable Homes Programme (now renamed the Social and Affordable Homes Programme) to increase social and low-cost housing and to reform the leasehold system, in which homes are bought and owned for only time-limited periods.
On house building, Labour has mainly relied so far on planning reforms in an effort to speed up local approvals for housing developments, and it has lagged behind targets. While new housing starts have risen modestly, planning applications have fallen. Official figures suggest the government will only build around two-thirds of the homes needed to hit the target — similar to the figure claimed by the Conservatives in their final term.
Developers are now calling for government action to stimulate house building by increasing demand subsidies. This is a strategy that critics have accused of inflating house prices and doubling the amount of profit per home in the 2010s.
The last time England successfully built as many homes as the current target, council homes comprised roughly half of all new homes. Levels of new private development only reached that level in the period before World War II. This model of public housing development at scale is the tried and tested route in the UK.
Elsewhere in Europe, where house building is typically higher than in Britain, countries rely more on public-sector development or social house building, in cases like France, Austria, and the Netherlands, or on private house building with a more diverse base of developers (Germany), or on a bigger role for the public sector in parceling together land for “assembly” as new housing.
While the Starmer government has increased funding for affordable housing, much of its strategy so far has relied on loosening planning rules and fiscal incentives for private developers to build more. So far, this strategy looks unlikely to yield serious results.
While government ministers have emphasized the need for supply and the growth benefits of construction, they have often been more circumspect on the possible impact on house prices. Housing Secretary Steve Reed recently argued that this would depend on building “the right kinds of homes in the right kind of places.”
There are good reasons for this. Previous attempts at economic modeling have suggested that large-scale building would have a sizable impact on house prices but not a massive one.
While housing supply does have an impact on prices, financial factors, including the supply of mortgage finance, play a bigger role. Solutions based on supply are therefore unlikely to be enough to defeat the affordability crisis. Addressing the dominance of finance in the housing market, or expanding nonmarket options such as public housing, is critical.
In addition to reform of the private rented sector, the Starmer government points to its Social and Affordable Homes Programme to argue that it is delivering positive social reform on this front. The new funding program for social and affordable housing, beginning in 2026, will consist of £39 billion of grants for social housing providers over a ten-year period.
The program will begin with modest, above-inflation increases in this parliamentary term, with larger increases from 2029–30 onward. However, it will not reach the levels of the previous Labour government in the late 2010s, when social housing investment was a critical part of Gordon Brown’s post-recession stimulus package, let alone match the scale of council housing investment before Thatcher.
While Labour presented the program as a transformative package, and it does represent a real increase, the Institute of Fiscal Studies sounded a more cautious note:
Upon closer inspection the promise of £39bn over 10 years is less generous than on first appearance. The small print suggests spending of about £3bn a year over the next three years, which is not a million miles away from what is currently spent.
The government expects the increased funding to deliver eighteen thousand new social rented homes a year. This should be compared to calls for ninety thousand a year from housing charities and for more than one hundred fifty thousand from renters’ groups.
The distribution of the funding matters, too. Like its predecessor, the new program is open to for-profit social housing providers, many of which are owned by asset management firms. The program is effectively ownership-blind, with neither housing associations (privately owned nonprofits), nor local councils, nor profit-making providers taking precedence.
This risks perpetuating a situation where local government is no better placed to win public grants for housing than a for-profit provider owned by an investment fund. It also leaves the country in a worse position for rebuilding the public housing stock, which has been cut by roughly four-fifths since the 1980s.
More recently, Keir Starmer’s government has announced its long-term strategy for tackling homelessness, with new funding and measures to enable better coordination across the public sector. With figures for rough sleeping rising from levels that were already extremely high, and more people languishing in temporary accommodation than other wealthy countries, action is urgently needed. However, the declared aim to halve long-term rough sleeping falls well short of cross-party pledges in the last parliamentary term to end rough sleeping altogether.
While the Renters’ Rights Act does represent a real step away from the way housing has operated since the Thatcher era, the act has its own limits and flaws. Reforms in other parts of the housing system could do much more to address the housing emergency, particularly in terms of affordability.
Increasing funding for the Affordable Homes Programme and spending more of the allocated funding in the next few years could go some way toward making housing more affordable. Giving local councils a duty to provide public housing would help ensure that more of this new housing is publicly owned.
Public investment in the planned “New Towns”’ program could be delivered at scale, making the program itself more feasible. The launch of public development corporations with substantial powers would make it possible for that process to be planned and properly coordinated. These first steps would begin to shift the housing system in a different direction.
While renters’ rights legislation will improve prospects for tenants, rent controls remain the missing link. In their absence, renters will remain vulnerable and continue paying out an average of 36 percent of their income to landlords (42 percent in London).
Of course, Britain’s housing system needs more than ameliorative changes. Deeper structural reforms are needed to ensure that everyone can access a good, secure, and truly affordable home. A publicly owned master developer capable of coordinating the process of delivering homes from top to bottom would be just one such change, reshaping how housing operates.
Ultimately, we need a vision of public housing luxury, where such housing is exceptional in terms of quality, truly affordable, and democratically run, turning homes into places to live and thrive rather than financial investments.
Great Job Adam Peggs & the Team @ Jacobin Source link for sharing this story.
