Review calls for policies to ‘grow’ the business of letting
Posted on 23 October 2008
The review – The Private Rented Sector: its Contribution and Potential – by Dr Julie Rugg and David Rhodes, of the University’s Centre for Housing Policy, draws conclusions on key issues including retaliatory eviction, poor property condition, institutional investment in renting, and the use of the sector to meet responsibilities to house homeless people.
It was launched at the University of York today, and Parliamentary Under Secretary of State for Communiities and Local Government, Iain Wright MP, attended the launch.
We want to see a new culture of renting, where landlords view themselves as hands-on business people, not hands-off investors
Dr Julie Rugg
Dr Rugg said: "We want to see a new culture of renting, where landlords view themselves very clearly as hands-on business people, not hands-off investors. Too many myths are attached to renting, and have driven policy on the sector for too long. We need a new agenda that reflects sound, independent evidence."
She said that the notion that ‘anyone’ can let property contributed to poor levels of professionalism in parts of the private rented sector: people should think much more seriously about being or becoming a landlord.
Dr Rugg said: "It’s reasonable to ask landlords who let property to apply for a licence. But it will be very easy for them to get one. Nevertheless, landlords who break the law will find themselves losing their licence, and banned from letting property."
The authors suggest that people who need benefit to help them pay the rent should be given help with deposits too, so they can find better quality property. "We want to see the bottom fall out of the slum rental market," Dr Rugg said.
The review calls for policy to help responsible, part-time landlords to increase their portfolios. Entering into the business of letting full-time would encourage small landlords to invest in their own professional development. At the same time, the expansion of larger landlords would, in time, lead to the development of portfolios of sufficient size to attract institutional investment.
The study contains a comprehensive analysis of England’s private rented sector. David Rhodes said: "Our patchwork of smaller and larger landlords needs to be preserved. It means that the market has sufficient flexibility to deal with the varied number of crucial roles that the private rented sector plays."
Some pressure groups argue that private renting is too insecure for low-income families. But it is not the case that households have to move ‘every six months’ as is often supposed.
Fifty-five per cent of renters on assured shorthold tenancies had been at their current address for more than twelve months; 22 per cent of renters on assured shorthold tenancies had been in their current address for three years or more. Even where tenants do move on after a short period, the length of stay often reflects the tenant’s desire for a short-term tenancy.
Property quality is poorer in the private rented sector compared with other tenures and in some parts of the market, accreditation can play a role in helping the sector raise its game. However, there is scope for increasing the role played by managing agents in policing the sector. The Review recommends that managing agents should be subject to mandatory regulation, which would require them to deal only with property in a decent condition.
Responding to long-standing calls for a policy response to ‘retaliatory eviction’, the Review considers that the government should introduce a more effective sanctions regime to pinpoint and remove the kind of landlord that would evict a tenant for complaining about repairs.
Other issues covered by the Review included the use of the private rented sector to accommodate more homeless households, student renting, and changes to the current tenancy framework The Review concluded by calling for better co-operation between government departments on policy that would encourage local authorities to give more priority to managing the private rented sector.
ENDS
Notes to editors:
- The Private Rented Sector: its Contribution and Potential by Julie Rugg and David Rhodes is available at www.york.ac.uk/chp/Projects/PRSreview.htm
- Julie Rugg (Senior Research Fellow) and David Rhodes (Research Fellow) work at the Centre for Housing Policy at the University of York. Since the early 1990s, much of their work has concerned issues relating to the private rented sector.
- The Centre for Housing Policy at the University of York was established in 1990 with the support of the Joseph Rowntree Foundation. More information at www.york.ac.uk/inst/chp/