By: Hannah Gousy
Published: March 2014
This report sets out the extent of poor conditions in the private rented sector and the case for greater intervention. It looks specifically at the problem of retaliatory eviction as a major barrier for reporting poor conditions and calls on the Government to legislate to protect renters from this practice. The report also sets out why, in a market where the demand for homes outstrips supply, there are often very few financial incentives for landlords to invest in improving and maintaining their homes they let.
Homes in the private rented sector are worse than in any other tenure. A third fail to meet the Government’s Decent Homes Standard. This is particularly concerning considering the increased numbers of families and vulnerable groups relying on the private rented sector as a long-term housing solution. A key reason why renters do not report poor conditions is because they fear retaliatory eviction. In a market where demand often outstrips supply renters lack basic consumer power to bargain for better conditions. It is vital that the government puts restrictions in place to prevent Section 21 Possession Notices being served when renters report disrepair. The vast majority of landlords have the financial resources to pay for repairs and maintenance. The imbalance between demand and supply often means, however, that there are few financial incentives for landlords to invest in their properties in order to attract renters. Moreover, landlords’ decisions about whether or not to invest in the maintenance and repair of their property are more likely to be driven by capital growth than rental incomes, further highlighting the weak relationship between rents and conditions. Securing better standards requires driving out rogue landlords and driving up quality throughout the sector. With demand high and rising, and the imbalance between landlords’ and renters’ market power entrenched, the case for regulatory intervention has become urgent.