Wednesday 16th October 2019
PRS Rents Continue to Increase by Less Than Inflation
The Office for National Statistics has published the latest Index of Private Housing Rental Prices for the UK for September 2019. It can be accessed here. It reports that:
- Private rental prices paid by tenants in the UK rose by 1.3% in the 12 months to September 2019, unchanged since May 2019.
- In England, private rental prices grew by 1.3%, Wales experienced growth of 1.2%, while in Scotland private rental prices increased by 0.8% in the 12 months to September 2019.
- London private rental prices rose by 0.9% in the 12 months to September 2019.
Over the same period (12 months to September 2019), inflation was:
- 1.7% as measured by CPI(H) (includes owner occupiers’ housing costs).
- 1.7% as measured by CPI.
- 2.4% as measured by RPI.
The ONS has also published the latest analysis comparing growth in the Index of Private Housing Rental Prices (IPHRP) with other measures of private rental growth for the period July to September 2019. This can be accessed here.
Renting Becoming More Affordable Says Zoopla
The online site Zoopla is reporting that renting is becoming more affordable with costs rising at half of the level of earnings growth during the past year.
Average rents increased by 2% to stand at £876 in the 12 months to the end of September. By contrast average weekly earnings climbed by 4% during the same period.
As a result, the typical renter now spends 31.8% of their earnings on rent, down from a peak of 33.3% in 2016, according to Zoopla’s inaugural Rental Market Report, which records trends in the private rented sector.
But despite the overall improvement in affordability, the rate at which rents are rising has accelerated from 1.3% a year earlier to reach a three-year high of 2%, although it still remains below the 10-year average of annual growth of 2.3%
Zoopla’s director of research and insights, Richard Donnell, said: “Renting is more affordable today than the 10-year average. This follows weak rental growth over the last three years, and an acceleration in the growth of average earnings.”
Commons Library Publishes Paper on Households in Temporary Accommodation
The House of Commons Library has published a paper on households in temporary accommodation in England. It can be accessed here. The paper includes a section on the use of private rented housing for such purposes.
Commons Library Note on Homelessness Cites RLA Research
The Commons Library has also published a report on statutory homelessness in England. This is available here. Of note, it says:
“2010 onwards saw a substantial increase in homelessness where the applicant’s last settled home was an assured shorthold tenancy (AST). This is the standard type of tenancy used in the private rented sector (PRS). Briefly, section 21 of the Housing Act 1988 enables private landlords to repossess properties let under an AST without having to establish fault on the part of the tenant.
“The trend can be seen in statistics on the reason for homelessness amongst households that were owed a duty to secure accommodation by their local authority. In 2010/11, the end of an AST was given as a reason in 15% of cases, rising to a peak of 31% in 2016/17. In 2017/18, the figure was 27%. In the period from January to March 2019, 21% of households owed a prevention or relief duty were homeless or at risk of homelessness due to the end of an AST. 21 4,840 households were owed a prevention duty due to the service of a section 21 notice.”
It goes on to note:
“The Residential Landlords Association (RLA) disputes the charge that section 21 is a cause of homelessness. The organisation has published several pieces of research to demonstrate that the rise in homelessness from the PRS is linked more closely to rent arrears caused by welfare reform, such as restrictions in the Local Housing Allowance and the rollout of Universal Credit.”