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Housing: Private Renters

Volume 823: debated on Wednesday 22 June 2022


Asked by

To ask Her Majesty’s Government, further to their English Housing Survey: a segmentation analysis of private renters, published on 16 June, what plans they have to improve conditions for private renters.

First, I declare my residential and commercial property interests as set out in the register. Our White Paper sets out how we will provide a better deal for renters and our commitment to consult on introducing a decent homes standard in the sector—the first Government ever to do so. This will mean that homes must be free from serious hazards and disrepair, warm and dry, and with decent facilities. We will also provide councils with the powers they need for robust and effective enforcement to drive up standards.

My Lords, by planning to remove Section 21, the Government have rightly recognised that security of tenure is one of the biggest issues for renters. The White Paper talks about the need to protect renters from evictions while also talking about making the eviction process as straight- forward as possible. The Government say:

“After eviction, tenants cannot always find suitable housing nearby, interrupting their employment and children’s education”,

yet the White Paper also says:

“Claim forms for possession will be simplified and streamlined for landlords.”

I ask the Minister for clarification: is it the Government’s aim to make it easy for landlords to get their house back at short notice even if the tenant is not at fault, or is it to give tenants security and to protect them from the cost of unwanted moves?

My Lords, the purpose of this 12-point plan of reforms is to ensure that we balance the interests between landlord and tenant, but first remove the Section 21 no-fault evictions. In doing so, we are enhancing the grounds around Section 8 so that it is easier to remove tenants who disrupt the community and cause persistent anti-social behaviour, while bringing grounds for egregious rent arrears and moving and selling grounds, because landlords have a right to ask the tenant to leave if they need to sell the property. We are making those grounds work for the landlord so that we can remove Section 21. It is all about balancing those interests.

My Lords, I warmly welcome the measures that my noble friend announced on Monday, which will improve the terms of trade for private tenants, particularly against bad landlords. But is there not a risk that these bad landlords see the legislation coming and, before it is enacted, introduce leases that deny tenants that protection? Is it not imperative that this legislation is introduced as soon as possible and, if possible, backdated to the time of its Second Reading?

I always appreciate my noble friend’s eagle eye. We do not want landlords gaming the system, and we want to make it very clear that any abuse of the future system will not be tolerated. We are committed to ensuring that local councils will have the right powers to crack down on any rogue practices such as those that my noble friend has outlined.

My Lords, on Monday, in response to my letter about landlords leaving long-term lettings in favour of the more lucrative Airbnb, particularly at a time of increasing demand, the Minister replied that the English Housing Survey says that we are seeing some landlords leaving but an equal number coming in. Can the Minister tell us the source of the statistics that allow the Government to make that assertion, against mounting evidence to the contrary? I could not find it in the quoted English Housing Survey, nor the Government’s Private Landlord Survey, and the National Landlords Association could not help either. This is a vital piece of data, given what we believe is really happening on the ground.

My Lords, I suppose I should always be very careful about giving data. In response in the other place, the Minister—who was driving forward with the 12-point plan—made it clear that we are seeing as many landlords leaving the sector as we are seeing entering the sector. I will go back and find the data that underpinned my remarks in the debate we had earlier this week.

My Lords, does the Minister agree that part of the problem with the private rental sector is that many people in it would rather be in social housing at a fair rent, and that, because of a shortage in that housing, private landlords are often able to exploit some of the most vulnerable in our society? What could we do about that in the future, to increase social rented?

My Lords, it is important to recognise the balance of having more tenants who cannot afford renting in the private sector having social or affordable homes. That is why we have an £11.5 billion Affordable Homes Programme, and we are seeking to double the amount of social rented homes that we build to 32,000, because clearly, the housing benefit bill has been growing astronomically and we need to contain that over time.

Agreeing as I certainly do with the thrust of the previous four questions, I ask whether the Minister can confirm that in the last 20 years, the proportion of households living in private rented accommodation has doubled, whilst the proportion of owner-occupiers has reduced and the proportion living in social rented accommodation has reduced dramatically. This is despite the fact, as the previous questioner has pointed out, that the private rented sector is often the most expensive and certainly the least popular of the various forms of tenure. Is the Minister satisfied with these trends and is he happy for them to continue, or does he not think that it would be preferable to enable more people to move into the owner-occupied sector or the social rented sector, and stop this huge rise in the private rented sector?

I am not going to glorify one type of tenure over another. The noble Lord is right, however, in the sense that we have seen a doubling of the amount of private rented, but it is approximately the same proportion of the amount of housing stock: it has broadly stayed around 19%. You can look at percentages, or at the absolute amount. One of the benefits of Governments over the last few decades is that the proportion of non-decent private rented sector homes—those with category 1 hazards—has come down dramatically. In 2006, to pick a date at random, it was 46%. It is now down to 21% of homes, which is still too high, but that is why we are bringing in these measures, to drive that down even further. For young people, who are mobile, private renting is often a very good option and I am not going to knock it, but we do recognise that we need to build more homes for sale and have more social homes. I acknowledge that, but let us not put one form of tenure ahead of another.

Can we look at this in a very cautious sort of way? I am glad that the Minister used the word “balance”. I remember the Rent Act 1965, which was so well-intentioned that it led to a 25% fall in the amount of rented accommodation. The reason for that was that they did not keep the balance, and in the private sector, probably more than any other housing sector, we need to keep that balance, so that it looks as though both sides win.

My Lords, I am not sure I detected a question, but I am completely with the noble Lord in spirit, in the sense that it is an important comment. We need to recognise that landlords have a choice. We need to make sure that it works for tenants but also that when landlords have reasonable grounds to recover their property, those conditions are in place. These reforms seek to get that balance right.

My Lords, can the Minister reaffirm the assertion he made that the fundamental problem we have is an overall shortage of accommodation, with a growing population? In those circumstances, what policy do the Government have—any radical turn? Does he not recognise that many people now want to stay at home, do not want to work in offices and do not want to go to retail premises, which are now declining? Waitrose is converting some of its property into homes. When will the Government encourage people to stay at home? Then, we can use offices and retail premises to create more accommodation.

That is a very reasonable point. In a sense, we have to recognise that the world is changing and that there are opportunities to build more homes. We see that in the urban setting, where retail will diminish; people are buying online far more than before. Equally, I talk to my friends who live in the country—I am a city guy—who say that there are also agricultural areas that could easily be rezoned to provide opportunities for growth. We need to look at that, and that is why we are bringing forward the Levelling-up and Regeneration Bill to look at how we reform the planning system so that we get the right use of the right places and grow in the right way.

My Lords, many local authorities borrowed money to invest in commercial property; they were not allowed to borrow money to invest in social housing. I wonder whether the Minister can tell the House how much money those local authorities that invested in commercial property have now lost, and how much they might have bettered themselves and the country had they been able to invest in social housing.

My Lords, as someone who was a local authority leader for six years and in local government for 20 years, I know that not all councils invested in commercial property. We have some examples, such as Croydon, that got into that sort of game, but I do not think it was something that most councils did. Most councils have been seeking to get back into the council house building business. In 2018 we removed the cap on the housing revenue account, and I think it is great that this generation of council leaders are building more council homes for their residents. Proper oversight will ensure that the sorts of practices that the noble Baroness mentions are kept to the absolute minimum. If necessary, we will move in to take over control if it gets really bad.