The government has published a Renters Reform Bill aiming for a fairer private rented sector. Liz Emerson, IF co-founder, weighs up whether these reforms are good news for younger generations.
The government has unveiled plans to provide greater legal protections to the millions of renters in England and it has been rather amusing watching private sector landlords announce the imminent collapse of the private rented sector. Stropping straight onto social media platforms, landlords have been making apocalyptic pronouncements about the end of the private rented sector as they threaten to sell. Methinks the landlords doth protest too much!
Landlords selling up would of course be good news for those younger people who are able to afford a deposit and meet stringent mortgage affordability criteria, but does little to help the millions of young people and families who have no other option but to rent. This Bill therefore goes a long way to helping tenants by making landlords: maintain their properties better; have to justify rent increases; give tenants more security; and/or face fines for bad landlord behaviour – such as serving notice wrongly or renting out dangerous, unhealthy and/or dirty homes.
Renters have been failed for too long
According to the Bill, just under three million renters (a fifth of all private tenants) live in homes that are not fit for the 21st Century, yet they are still expected to pay high rents, have few legal protections, and can be turfed out of their homes at the whim of landlords.
The power imbalance between tenants and landlords has been too great for too long, so this proposed legislation is a welcome attempt to provide tenants with more stability, longer tenancies, safer homes, and more rights. What’s not to like? Surely, it is in the interests of landlords to have long-term, regular-paying tenants who look after their rental property as they would their own home?
Furthermore, thanks to the housing crisis, private renters spend more than a third of their household income on rent – that’s more than social renters (around 27%) or homeowners with mortgages (18%). They deserve, at the very least, safe, decent homes, and a mechanism to allow them to claw back rent paid if shoddy landlords do not keep the homes they rent out well-maintained.
At the heart of the Bill are plans to abolish Section 21 non-fault evictions which currently allow landlords to give 2-months’ notice to remove tenants from their properties without reason. If the Bill is passed, landlords will be required to provide proper grounds for eviction. Tenancies will become indefinite unless tenants give 2 months’ notice. How the new system will be policed is yet to be seen but the introduction of a Housing Ombudsman service, which would avoid the need for costly court cases, would seek to settle disputes between tenants and landlords.
Renter groups, such as Generation Rent, have concerns that, “there is a risk that if it is too easy to use no-fault grounds, such as selling-up, unscrupulous landlords could abuse this, creating Section 21 by the back door.” But, the banning of no-fault evictions is a step in the right direction and decent landlords may well give the 4-month notice period Generation Rent is calling for.
Young families can put down roots
With no sign of house prices going south for the foreseeable future, it means that many young families are increasingly likely to have to rent for longer, so the announcement that tenants can have peace of mind through longer tenancies should be good news.
It should also be particularly helpful for parents with young children, because by knowing that they will be able to stay in one place for longer, parents can put down roots and invest more time and effort in their local communities: children can have a more stable education; local friendships can last longer; and parents can better invest in how their local community runs, all of which improves social cohesion.
Removing the threat of eviction is also a win for local services such as: local councils, which have to provide school places by statute; schools, which can plan better and have less churn in pupil arrivals and departures; and health centres, which can better plan their services based on more stable local demographics.
A long-running frustration has been the lack of a collective memory among renters. Each new tenant that arrives at a property has no idea of how the previous tenant fared. Was the landlord fair or financially predatory? Did the landlord fix things quickly or did they intimidate the tenants into not complaining?
Renters will alsobe able to rate their landlords with new “satisfaction measures” but how a national register is to be organised, run or monitored, is yet to be seen.
And finally, pets. Yes, landlords will no longer be able to refuse tenants who have pets. This is good news for tenants who have had to deal with two years of COVID-related loneliness.
Build our way to better renting
Much of this Bill constitutes a step in the right direction, but it won’t address what is perhaps the worst aspect of the rental market: the steep price rises and the lack of supply. The only way to address that issue is to stabilise the price of renting a house and to make it more affordable for tenants to rent (and, therefore, to be safe) is to build more homes.
And yet, the government still seems to lack the determination to meet its own housebuilding target, with ministers wavering over their proposed reforms to the planning system too. There is much we can do around over-occupation and intergenerational housing that might free up some supply, but there is no getting away from the fact that we must build, build, build millions of new homes over the next few years – failure to do so would be a betrayal.
Reforming renting is good and necessary, but it’s only one step on a longer road to ending the UK’s huge intergenerational housing injustice.
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