Private rental sector tenants should be able to stay in their homes for as long as they want to and rent rises should be linked to inflation, says think tank Civitas.
These new rights would allow tenants to stay in rental properties and rents staying in line with inflation would be guaranteed, Civitas argued.
It believes that a new regulatory scheme is necessary in the private rental sector to avoid landlords abusing the shortage of housing at tenants and taxpayers expense.
It is predicted that the private rental sector will make up over one third of the UK’s housing stock by 2032. Currently, two fifths (40%) of private tenants’ income is taken up by rent.1
Private Tenants Should be Allowed to Rent for Life
Increasing costs in the market are transitioning into a higher housing benefit bill, revealed the Future of Private Renting report.
The amount of private tenants relying on housing benefit has more than doubled in the last ten years, from 772,000 in 2003-04, to 1.7m in 2013-14.1
This number is expected to hit 1.85m in 2018-19. According to the report, the amount of housing benefit rent subsidies claimed in the sector has more than doubled over the past decade, from £3.9 billion in 2003-04 to £9.5 billion in 2013-14. It is set to reach £10 billion in 2018-19.1
Although this is crucial for low-income households having to rent privately, these figures are creating a vicious cycle by supporting the rent inflation they are supposed to alleviate, the report states.
In places with many claimants, landlords have the opportunity to set rents at unnaturally high levels in line with the local housing allowance.
The report’s author, Daniel Bentley, says that it should be compulsory in the private sector to offer indefinite tenancies “as the norm”. Once a rent price has been settled, index-linked ceilings on increases would offer security to tenants.1