The private rented sector is broken, the Housing Bill should do more to fix it
Today the Housing and Planning Bill is being debated in the House of Commons. Whilst most of the attention so far has been on changes to social housing, the Bill is also parliament’s opportunity to fix the broken private rented sector. Three key findings from our research for Citizens Advice highlight why this problem can no longer be ignored.
4.4 million households now live in the private rented sector
In the last decade the number of households that rent privately has doubled from 2.2 million households to 4.4 million. Through choice or not, more and more people are living in the private rented sector instead of getting a mortgage.
With 1 in 5 households renting their home from a private landlord it is now more common than renting from the council or a housing association. And our research shows that the characteristics of private tenants has also transformed. It is no longer a niche tenure of young adult sharers. At 1.6 million there are twice as many households with children in the private rented sector than adult sharers (670,000).
Private rented homes are the most expensive and worst quality
Housing costs in the private rented sector are higher than other tenures. The average private rent is £765, almost double the average rent paid to social landlords (£409 per month). Even first time buyers spend less on housing (£702 per month). Overall the average private renter spends 43% of their income on rent.
But despite the higher cost of private rented housing, 17% contain a Category 1 hazard, which are problems that pose a serious threat to the health or safety to occupants’ safety. This compares to 12% of owner-occupied homes and 6% of social rented homes. Overall 700,000 private rented households live in unsafe housing in England.
Rogue landlords are reaping huge rewards for renting unsafe housing
At £650 per month the average cost of unsafe private rented housing is only £70 lower than the average for housing that does meet the minimum standard. And unsafe housing is not always at the lower end the market: over 100,000 households in unsafe homes pay rents of at least £900 per month. In total an estimated £5.4 billion was given in rent to landlords in 2013 for housing that was unsafe to occupy.
The rapid growth in this sector over the last decade, with no corresponding intervention to drive up standards, means that a wide range of households are paying a high price for housing that is unsafe: from low income households to highly-paid professionals and many families with children. Regulation of the private rented sector is currently weak and enforcement is poor. At present it is difficult for a private tenant to do anything about such poor conditions than find somewhere else to live, whilst the landlord can easily charge someone else to live in an unsafe home.
The Housing and Planning Bill 2015 offers a prime opportunity to improve the quality of private rented housing. The proposal in the Bill to enable tenants to seek a refund where their housing fails to meet lawful safety standards is needed and welcome. But the Bill needs to go further to ensure tenants are able to exercise these rights, by, for instance providing local authority backing and help with court fees. It’s time to rebalance the relationship between private renters with few housing options and landlords who are negligent of their tenants’ safety.