Posts with tag: Generation Rent

Government publishes rental reform White Paper

The Government has published its Fairer Private Rented Sector White Paper, which it claims will “ensure millions of families benefit from living in decent, well looked-after homes as part of the biggest shake up of the private rented sector in 30 years.”

The Government’s plans include:

  • Banning section 21 ‘no-fault’ evictions and extending the Decent Homes Standard to the sector
  • Ending arbitrary rent review clauses, giving tenants stronger powers to challenge poor practice, unjustified rent increases and enabling them to be repaid rent for non-decent homes
  • Making it illegal for landlords or agents to have blanket bans on renting to families with children or those in receipt of benefits
  • Giving all tenants the right to request a pet in their house
  • Moving all tenants onto a single system of periodic tenancies, meaning they can leave poor quality housing without remaining liable for the rent or move more easily when their circumstances change
  • Doubling notice periods for rent increases and give tenants stronger powers to challenge them if they are unjustified

Responding to the publication, Alicia Kennedy, Director of Generation Rent, comments: “It is very welcome to finally have this White Paper. It has been more than three years since the Government first committed to getting rid of Section 21 evictions. 

“Thousands of tenants have lost their homes on their landlord’s say-so in that time and many more will live with uncertainty until this legislation is passed.

“The private renters we represent have been telling the Government it is too easy to find themselves renting from unscrupulous landlords who fail to keep their homes in good condition. So it is positive that the measures include mandatory registration of landlords through a property portal and an Ombudsman to hold landlords to account – hopefully meaning there will be more ways to claim back rent on substandard properties. 

“The Government has also rightly recognised renters need flexibility, which periodic tenancies will provide. Making it illegal to have a blanket bans to protect families with children and people receiving benefits is also very welcome.

“However, we’re disappointed with the detail around the new proposed ‘no fault’ grounds which allow landlords to evict tenants to sell or move family in.

“The Government proposals still mean a renter could be evicted every 8 months due to no fault of their own.

“Renters, especially those with children in local schools, need longer than a few months to pack up and move out. And with every unwanted move costing around £1700 this is too much to pay without compensation when it’s not your choice to move.

“Without proper safeguards we could still see thousands of tenants facing the hardship of unwanted moves, and more staying quiet about disrepair out of fear of a retaliatory eviction. 

“If the Government can get the detail right and give tenants the confidence they need to request improvements and plan for the long term, this legislation has the potential to improve the lives of millions throughout England.”

Ben Beadle, Chief Executive of the National Residential Landlords Association (NRLA), comments: “Whilst headline commitments to strengthening possession grounds, speedier court processes and mediation are helpful, the detail to follow must retain the confidence of responsible landlords, as well as improving tenants’ rights.

“We will be analysing the Government’s plans carefully to ensure they meet this test. A failure to do so will exacerbate the housing crisis at a time when renters are struggling to find the homes they need.

“The eventual legislation needs to recognise that government actions have led to a shortage of supply in the sector at a time of record demand. It is causing landlords to leave the sector and driving up rents when people can least afford it.”

Housing pledges announced in Prime Minister Boris Johnson’s speech

Prime Minister Boris Johnson has announced a number of housing pledges. This includes extending Right to Buy to housing association tenants and allowing housing benefit to cover mortgage payments.

Responding to the announcement, Kiran Ramchandani, Director of Policy and External Affairs at Crisis, comments: “This ill-conceived announcement is the exact opposite of what we need to tackle the mounting housing crisis. For decades our social housing stock has been stripped bare, while over 96,000 people remain trapped in dingy B&Bs having given up all hope of ever moving into a home of their own. The notion that we’ll now sell off what little affordable housing we have left will only serve to make this situation worse.  

“The reality is that with housing benefit currently frozen, it’s barely enabling anyone to rent as it is. To suggest this money can now be used to secure mortgages without a costly investment to the benefits system is an utter fallacy.

“Moreover, it seems the Government is intent on creating a two-tier system where only working households will be able to use their housing benefit towards a mortgage payment, disregarding people with disabilities and those unable to work.    

“The only way to fix our broken housing system is to build more social homes which people can afford – we urge the Government to get on with doing this if we’re ever going to end homelessness for good.” 

Dan Wilson Craw, Deputy Director, Generation Rent, comments: “Ultimately, the Prime Minister failed to set out action to deal with the unaffordable level of house prices and rents.

“Neither the review of low-deposit mortgages, nor extending Right to Buy to housing associations will address the shortage of homes we need in places people most want to live. For that we need a programme of social house building beyond the one-to-one replacement of homes bought under Right to Buy.

“In the pandemic we heard from renters who had to pay rent with their hard-earned savings because they weren’t eligible for Universal Credit. Expanding eligibility to people saving a deposit will restore some fairness to the benefits system, but it’s important to remember that many more people with no savings are struggling to find somewhere to live with current Local Housing Allowance rates.

“Expanding housing benefit to cover mortgage payments is unlikely to help people currently receiving benefits to secure a mortgage when they won’t pass lenders’ affordability tests. However, depending on how lenders respond, it may help first-time buyers in work to get a mortgage. Right now, if you lose your job there is nothing to fall back on and that’s a risk for lenders.”

Marc von Grundherr, Director of Benham and Reeves, comments: “We’ve seen how previous initiatives allowing social tenants to purchase their properties has backfired, as it causes a significant shortage of stock for those most desperately in need of help, while also driving up property values in the process. 

“Of course, this time around it will be different, as they pledge to replace these purchased properties on a one for one basis. Unfortunately, if you believe that, you may also believe that the drunken shenanigans that took place at Downing Street during the pandemic really were innocent, work-related events. 

“The Government’s record of delivering new homes is woeful at best and social housing has long been an area of serious neglect. To allow them to auction off existing housing association stock while also failing miserably to replace it would be a big mistake indeed.”

James Forrester, Managing Director of Barrows and Forrester, comments: “Boris Johnson claims of a significant increase in the number of homes being built, but this simply isn’t true, which will come as little surprise given the fact that he’s lied to the British public time and time again. 

“In fact, the level of new homes reaching the market each year has fallen by fourteen percent and so once again, Boris’s bumblings couldn’t be further from the reality. 

“What’s more, promises to utilise Britain’s brownfield land is nothing more than a weary piece of recycled rhetoric, spouted on numerous occasions to create the illusion of tackling the housing crisis, but without actually following through with it.”

Report finds increasing rent prices are due to shrinking private rented sector

Published On: June 8, 2022 at 9:57 am

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Propertymark has found that rent prices are increasing due to landlords selling up and reducing the available rental stock.

The key findings of its report ‘A shrinking private rented sector?’ state that 53% of buy-to-let properties sold in March 2022 left the private rented sector (PRS).

It also states 84% of respondents reported a decrease in new investors in the PRS over the past three years.

An overall 49% reduction in available rental properties per branch was recorded in March 2022, compared to March 2019.

Nathan Emerson, CEO of Propertymark, states within the report: “Our research presents a worrying picture for private renters. The number of properties available to rent has been diminishing with a large portion of landlords choosing to sell their properties. A lack of property is the root cause for rent increases and rising figures on social housing lists.

“We know from our qualitative research that the most common reasons for landlords to choose to sell their properties and no longer provide homes are around risk, finances and viability.

“Landlords and letting agents have been the subject of extreme legislation changes as the UK Government tries to improve the sector. However, without a middle ground, these changes are actually proving detrimental to those they are supposed to protect. Sadly we do not see this improving as the sector braces itself for more changes within the anticipated Renter’s Reform Bill and upcoming energy efficiency targets.”

In response to the report, Dan Wilson Craw, Deputy Director of campaign group Generation Rent, comments: “Rents are rising and would-be tenants face bidding wars or demands for multiple months’ rent up-front.

“That is a result of large numbers of people moving back to cities since summer 2021 as universities and offices reopened, putting a strain on homes coming to market. We’re seeing similar rent inflation in the US and Australia.

“When landlords sell up, their properties don’t disappear. They continue to be lived in, either by tenants of the new owner, or by an owner-occupier whose old home is now available for a private renter to buy. Supply and demand stay the same so rents are unaffected.

“Reforms to the rental market are necessary to give private tenants better quality, longer term homes. The government has said that landlords will be able to evict in order to sell or move in – though we believe these grounds should come with protections against abuse. If some landlords are unhappy with that, they won’t be missed.

“Government plans aside, rents are too expensive, so we need to build more of every tenure in the places people want to live, to make sure everyone can afford a home.”

Scotland landlords trying to sell up after evicting tenants are struggling

Published On: June 1, 2022 at 10:17 am

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Nearly one third of private landlords who evicted tenants in Scotland to sell the property failed to sell the home more than a year later, Generation Rent has found.

It also found 9% of cases where tenants are being evicted on the grounds of sale saw the home simply sold to another landlord who has re-let the property.

As governments in Scotland and England consider reforms to private tenancies, Generation Rent is calling for extra protections when landlords wish to sell so that tenants do not face expensive and disruptive moves.

It points out that private landlords in Scotland can only end a tenancy that started since 2017 if they have one of 18 legitimate grounds, including an intention to sell the property (ground 1).

If a tenant served with an eviction notice does not leave after the notice period ends, the landlord must apply to the Tribunal to seek possession.

Generation Rent looked at 125 cases between 2018 and 2021 where the landlord was seeking possession on ground 1, and checked whether each property had been sold and was still on the landlord register.

Out of 74 cases where the landlord was awarded possession between 2018 and 2020 based on their intention to sell, 21 (28%) had still not been sold.

Ten of those (14% of the total) were still on the landlord register, suggesting they had simply been re-let.

A further seven homes had been sold but were registered to a different landlord (9%), indicating that the original tenant could have stayed put and the eviction was unnecessary.

53% had both been sold and left the private rented sector, in line with the landlord’s original intention. (9% had been sold but were still on the landlord register in the original landlord’s name.)

For the 33 ground 1 cases heard in 2021, two thirds of homes remained unsold by early 2022.

To prove their intention to sell, landlords must demonstrate that they have appointed a solicitor, estate agent or other professional to prepare the property for listing. Generation Rent says this makes it difficult for tenants to challenge a ground 1 eviction and many will move out before their notice period ends.

Tenants can apply for a Wrongful Termination Order, which, if successful, results in compensation, but none of the cases examined by Generation Rent resulted in one.

Generation Rent is calling for extra protections for tenants who face eviction for reasons beyond their control, including a requirement for landlords who wish to sell to advertise the property with a sitting tenant before seeking eviction, relocation payments to ease the burden of tenants who face eviction, and periods where the landlord cannot evict tenants who have not broken the terms of their tenancy agreement.

Alicia Kennedy, Director of Generation Rent, comments: “These cases represent a minority of evictions in Scotland but the number of properties that are re-let instead of being sold, or are bought by another landlord, indicate that tenants are still getting a raw deal.

“Despite the 2017 reforms, this research suggests it is too easy for landlords to claim a ground for sale yet seemingly abandon plans to sell them. That’s why we’d like to see incentives for landlords to keep the tenant in place.

“The consequences of ground 1 evictions are devastating for the tenant. Unwanted moves cause stress, loss of savings and risk of debt, and disruption to education and work. “Landlords will always need the option to sell, but governments in both Scotland and England must ensure that private renters have the best shot at a long-term home.”

Chancellor announces plan to support cost of living crisis

Chancellor Rishi Sunak has announced a package of support to address the rising cost of energy bills, including a £400 energy grant per household in October.

The Government has pledged:

  • Almost all of the eight million most vulnerable households across the UK will receive support of at least £1,200 this year, including a new one-off £650 cost of living payment
  • Universal support increases to £400, as the October discount on energy bills is doubled and the requirement to repay it over five years is scrapped
  • This new £15 billion support package is targeted towards millions of low-income households and brings the total cost of living support to £37 billion this year
  • New temporary Energy Profits Levy on oil and gas firms will raise around £5 billion over the next year to help with cost of living, with a new investment allowance to encourage firms to invest in oil and gas extraction in the UK

Responding to the announcement, Alicia Kennedy, Director of Generation Rent, comments: “This package is much closer to what people will need to manage rising prices, but one in three tenants have had rent rises this year, so many renters will still face agonising choices between eating, heating and paying rent.

“Tragically, because evictions without reason are still legal, renters have little choice but to cope with a rent hike. 

“Two issues need urgent attention.

“For renters living in homes where energy bills are included in the rent, such as shared houses, it is not clear if the landlord is under any obligation to pass this new support to them through a reduced rent. The government needs to clarify how it will ensure renters receive the package of support as the Chancellor intended.

“While benefits will rise in line with September’s inflation rate, Local Housing Allowance is still frozen at 2019-20 levels.

“We need a freeze on rents, an emergency pause on evictions and increase LHA to cover market rents.”

Matt Downie, Chief Executive of Crisis, comments: “Following today’s (26th May) announcement by the Chancellor households across England will be breathing a collective sigh of relief.

“We know from our frontline services just how desperate things had become, with people unable to keep up with rising rents and spiralling energy and food costs. This targeted support for those on the lowest incomes couldn’t have been more needed and, alongside the commitment to increase benefits in line with inflation next year, will help people to keep a roof over their heads as we weather this cost of living crisis.

“While the Chancellor outlined that today’s intervention was ‘timely, temporary and targeted’, there is also a pressing need for the Government to think long-term. We need a clear plan to deliver the genuinely affordable homes that are so desperately needed so that people are protected from any sudden economic shocks in the future.

“Never again should people be forced to endure the hardship and pain of recent months before Government takes action.”

Marc von Grundherr, Director of Benham and Reeves, comments: “While the monthly cost of a mortgage looks set to keep on climbing, a good number of UK households can breathe a sigh of relief as Rishi Sunak pledges further money to help alleviate the cost of living crisis. 

Over £15bn announced to help mitigate increased energy costs for those on benefits, pensioners and the disabled, will go someway in helping the most financially vulnerable in society and the refreshed reduction in council tax will also help ease monthly living costs, with a £400 reprieve that is no longer required to be repaid.”

James Forrester, Managing Director of Birmingham estate agent Barrows and Forrester, comments: “A step in the right direction but far too little, too late, for many of the worst hit UK households. 

“Quite frankly today’s (26th May) announcements feel like forced rhetoric from a government on the back foot and as we know all too well, the results rarely match the headlining fuelling hot air.”

What about reducing the cost of energy at the pump to make an immediate, meaningful impact?”

Call for freeze as report shows rents rising at record rates

Published On: May 19, 2022 at 9:31 am

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The Index of Private Housing Rental Prices report for April 2022 has been published by the Office for National Statistics (ONS). It shows that rents in the UK have risen by 2.7% in the 12 months to April 2022. This is up from 2.4% in the 12 months to March 2022.

The main points of the report also include:

  • Private rental prices grew by 2.5% in England, 1.7% in Wales, and 2.9% in Scotland in the 12 months to April 2022
  • The East Midlands saw the highest annual growth in private rental prices (4.0%), while London saw the lowest (1.1%)

Generation Rent has commented on the ONS Index of Private Housing Rental Prices, highlighting that it shows UK rents rising at their fastest rate since 2016.

Dan Wilson Craw, Deputy Director of Generation Rent, said: “Rents have been surging since offices and universities opened back up last year, and more people moved back to cities than there were homes available. Now landlords are trying to raise rent on existing tenants knowing that if they can’t afford it, it won’t be hard to find a new tenant.

“This is unsustainable, particularly for the 39% of private renters who rely on Local Housing Allowance which has been frozen. With rising food and energy prices, renters will get ill, go hungry and fall into arrears, risking eviction and homelessness. To avoid this catastrophe, we need a freeze on rents and a pause on evictions for the duration of this emergency, and an increase in Local Housing Allowance.”