Changes In The Private Rented Sector - Frank Webster, Christmas 2018
The private rented sector (PRS) has grown substantially over the past two decades and plays a much more significant role in housing provision. It is now home to 20 per cent of households (4.7 million). Many more people now expect to live in the sector for longer; this includes 1.7 million households containing nearly three million children many of whom will grow up, go to school and transition into adulthood in homes rented from private landlords.
Millennials (the generation born between 1981 and 2000) are four times more likely to be renting privately at age 30 than baby boomers (the generation born between 1946 and 1965) did at the same age.
Moreover, estimates by PWC based on government data suggest that by 2025 almost a quarter (24 per cent) of all households will be private tenants.
Despite the more significant role that the PRS now plays in the housing market, the regulations which govern the tenure have not kept pace with its growth. A number of reports have been published following in-depth conversations with tenants and landlords across England to understand the lived experience of those in private renting and how they want it to change.
These identified real concerns about the insecurity of private renting, the unaffordability due to rent, fees and deposits, the poor conditions which they too often find themselves in, and the lack of agency and representation that they have in the sector.
Heading 1
Tenants and landlords share some key issues; both feel they lack knowledge on their rights and responsibilities, too often reliant on luck as to whether they could build a good relationship with each other; tenants lacked power in the system overall and landlords at key pressure points; both distrust the ability of the government to reform the sector (no surprise there given current political turmoil).
With private renters now comprising a significant block of voters, particularly in many marginal seats, the future offer that is made to them will be a defining political issue in coming elections.
I’ve been participating in industry forums collaborating with government representatives to move forward to a new offering for both tenants and landlords. One which raises standards for tenants and equips them with better rights, all the while supporting landlords through strategic and well-understood policy that encourages socially responsible landlordism - backed up by a properly regulated industry.
If the PRS is to be a tenure of choice rather than last resort, the current approach to regulation cannot continue. Lessons can be learnt from our European neighbours where private renting plays a more significant role.
Frank has spent his working life in the property industry and now works with a variety of stakeholders and businesses in the UK and overseas focusing on business improvement and growth. If you happen to be in New Zealand in March, you can catch him at a number of property and law seminars - email me for details.