We all need a decent place to live. It's a fundamental condition of our wellbeing. There are many different ways in which we may acquire a home, but for more and more people, the private rented sector (PRS) offers a flexible alternative to home ownership or social housing: the number of people renting privately in England and Wales nearly doubled between 2001 and 2011, reaching 3.6 million at the time of the last census.[1]
The PRS looks set to remain an important source of housing for households in the foreseeable future, but the sector is not without its problems. When 35 per cent of the market fails to meet the 'Decent Homes Standard' and one in five is classified as having a serious hazard, you know there is still room for improvement.
This week the LGiU and the Electrical Safety Council published a new report, which clearly shows that local authorities recognise this problem and want to take action. In fact, eight out of ten respondents to our survey of 178 councils said they expected their authority to take a more proactive stance when working with the sector in future.
We set out to investigate the different approaches local authorities are taking to address poor conditions in their local PRS. We found lots of examples of innovative and effective practice, from Newham Council's borough-wide compulsory licensing scheme, to a landlord-led improvement alliance in Southend.
Despite this, councils are still limited in the tools and resources they can use to challenge local problems: rigid legislation determines how they can act and on what grounds, and a chronic lack of access to reliable data prevents them from identifying where private rented properties are in their local area. This all seems fairly incongruous at a time when the rhetoric of localism holds sway.
To challenge some of these barriers to better engagement with the PRS, we have made a series of recommendations for both central and local government. We argue that central government should take action in three main areas.
1. Reduce the red tape that holds local authorities back, recognising that they are best placed to respond to local issues with the PRS.
1.1.Amend the Housing Act (2004) so that local authorities have more flexibility in introducing Selective Licensing and tackling poor standards.
1.2.Allow councils to recoup the costs of enforcement more effectively.
1.3.Give councils the discretion to introduce compulsory accreditation
2. Address the need for better data. Identify ways of supporting councils to access the data they need to work more effectively with the sector. For example, data from the EPC Register and tenant deposit protection schemes could potentially provide a rich source of information in identifying private rented property.
3. Address the gap left by the closure of LACORS and promote the sharing of best practice. Better investment in sector-led guidance would free up local authorities to focus their limited resources on engagement and enforcement.
Of course the PRS is very different from one local area to another, but there are some commonalities and we also recommend that local authorities consider the following actions when working with the sector.
1. Engage with the best landlords to encourage self-regulation. Recognising that the most responsible landlords have an interest in promoting better standards to raise the standing of the whole sector and avoid the need for further regulation, local authorities should better incentivise landlord 'PRS Champions' to work closely in partnership with the council and the wider landlord community.
2. Empower tenants by using a range of communication channels to disseminate information about the rights and responsibilities of tenants and landlords. This may involve publicising information about good landlords who have been accredited, or poor ones who have been recently prosecuted.
3. Make use of resources outside the council, encouraging businesses and local residents to engage with the issue by recognising and reporting suspected instances of criminality, such as 'beds in sheds'.
4. Show strong political leadership by setting out a clear vision. Local political leaders have an important role to play in articulating their willingness to work with responsible landlords, as well as demonstrating that they are prepared to enforce standards in the worst properties.
There is no one-size-fits-all model of engagement with the PRS. Rather, councils should be given the freedom and capacity to respond to the needs of their local area. We hope these recommendations will prompt further discussion and lead to new conversations with the sector. By working together we can address the challenges facing the sector and ensure the PRS provides our communities with the decent housing that everyone needs and deserves.
[1] Office for National Statistics (April 19, 2013) A Century of Home Ownership and Renting in England and Wales (full story)