Ahead of the Liberal Democrat Party conference, Peer and housing spokesman Lord Shipley shared details of the four reforms the party believes are vital to the future of the PRS in RLA members’ magazine Residential Property Investor. He said:
“One of my friends, who is a private landlord, recently asked me why so many politicians referred to him as a ‘rogue’.
He owns a few properties to provide a pension when he retires, and they are clearly of high quality.
I had to point out that politicians weren’t talking about him and that it was a statutory term for those landlords who had been convicted of an offence in relation to the management of their properties or who were letting out unsafe or substandard accommodation.
Guilt by association
He had been unaware of this detail but said that there was guilt by association for many landlords. I accept there is a degree of truth in this. So, spare a thought for our politicians.
They’re either too much on the side of landlords or too much on the side of tenants, depending on your point of view.
Their job is to strike a balance between the right of landlords to security of income and property and the right of tenants to protection against unscrupulous landlords seeking maximum profit for minimum outlay.
That said, successive governments have legislated too slowly to combat rogue landlords and lettings agents and have proved poor at addressing supply-side failures in house building. Constant changes of housing ministers haven’t helped.
The result has been a failure to provide enough homes which are genuinely affordable for those on mid-to-low incomes.
There are now huge pressures on the housing market. We have built two million too few homes over the past twenty years which has led to escalating housing costs.
Coupled with a failure of successive governments to build enough social homes for rent, the private rented sector has become the only option for large numbers of people.
Twenty years ago, 10% of households had tenancies in the private rented sector. Today that figure has grown to 20%.
Two conclusions can be drawn from this.
- First, the private rented sector performs an essential role in providing accommodation that is flexible for those needing a short- term let for work reasons, for those saving to buy their own home, or for those who are unable to access social housing.
- Secondly, an increase in the size of the sector has inevitably led to large numbers of poorer quality homes; nearly 30% of homes in the private rented sector today don’t meet the decent homes standard.
Problems to address
That we should need to pass the Homes (Fitness for Human Habitation) Act and the Tenant Fees Act in recent months is evidence enough of the problems we have had to address.
At the same time, unaffordable rents in some towns and cities have priced housing benefit claimants out of them.
That’s bad for social inclusion but housing benefit costs are very high at over £20 billion a year.
If only the Treasury would commit to building many more social homes for rent thereby reducing the housing benefit bill.
In the meantime, four reforms would help:
- A national landlord registration scheme operating alongside local authority selective licensing schemes and linked to a publicly accessible database of rogue landlords and letting agents. It’s a lot of work to establish but it is most certainly in the public interest to do so and it is partly done anyway.
- Reforms to increase security of tenure for tenants with the abolition of Section 21 ‘no fault’ evictions and longer tenancies where these are wanted.
- An independent regulator to monitor the work of letting and managing agents
- A specialist housing court to speed up decision making for tenants and landlords; it can currently take several months for cases to be heard
At the Liberal Democrat Conference in Bournemouth, Section 21 will be debated.
The movers of the motion will point out the housing crisis has left many renters at the mercy of their landlords and that Section 21 notices have allowed landlords to evict tenants without good reason. Reform is clearly needed.
However, landlords must be able to secure repossession in circumstances where, for example, tenants are building up substantial rent arrears, are guilty of anti-social behaviour or where the landlord wants to sell the property – though a system of ‘first right to buy’should apply to sitting tenants.
Given recent research by Citizen’s Advice which showed that many landlords in the private rented sector don’t understand their legal obligations and that many renters aren’t aware of their rights either, it would help if any new system introduced in relation to Section 21 was very well publicised.
Finally, let me just add a word of thanks to the RLA. Their briefings to parliamentarians are of the highest standard.
We may not agree on everything (though we often do agree) but what matters is the quality of their representation and their research. It is excellent.