Ten myths about private rented housing


by Jenny Jones AM    
7:06 pm - February 9th 2012

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A quarter of Londoners live in private rented homes, but the Mayor doesn’t seem to spend a quarter of his housing efforts improving their lot.

I’m a lead member of the Assembly’s Planning & Housing Committee, and we recently conducted an investigation into poor housing conditions in the private rented sector, I was surprised at some of the arguments that were put forward against reforms.

1. People are choosing to rent privately
The Mayor describes private renting as “the first choice” for people who move to London , but for most it’s their only option, and far from their favourite. The Hills review found that 72% of private tenants would rather own their own home, while only 8% would continue renting privately as their first choice. Other research suggests that many more people might prefer to rent if the sector guaranteed a decent home, security and stability, and freedom to change and improve their home , the guarantees that social tenants and home owners enjoy.

2. Most private tenants are happy with their home
The Government and the Mayor like to cite a very general statistic, that “eighty five per cent of private renters are satisfied with their accommodation” . But the British Social Attitudes survey looked in more depth, and found that only a third of private tenants thought they usually enjoy a good standard of housing, compared to almost two-thirds of housing association tenants and over half of council tenants .

3. Tenants like the flexibility
One of the Government’s two cited benefits for private renting is flexibility, which is undoubtedly valued by many who choose not to buy. But you can give people longer and more secure tenancies and still have the flexibility to move at a couple of months’ notice, for those who don’t want to buy. With 28% of private tenant households across the UK in 2008 having children , it seems perverse to leave them exposed to the threat of eviction without cause every 6 months in the name of flexibility.

4. The sector offers affordability in London
The Government’s other argument is that the sector is affordable for those who can’t buy . But London’s rents are twice the national average, the average income is only 40% more than the national average, and the minimum wage is the same. Last year rents for new lettings rose between 6 and 14% while wages only rose 2%. In most London boroughs, the average rent takes up more than half the average income . Too many are trapped, unable to save for a deposit or to find a cheaper rented home.

5. It’s just a problem of rogue landlords
Rogue or slum landlords are undoubtedly the most urgent problem to tackle, but the London Assembly heard that poor conditions, inflation-busting rent rises and a lack of security commonly affect tenants across the board – rich and poor. Landlords’ organisations also recognise the problems faced by “well meaning but ill informed” landlords , who are often reluctantly renting because they can’t sell their home .

6. Landlords don’t want tenancy reform
The Rugg review found that landlords often favour longer tenancies , but that the short insecure tenancies are favoured because of the risk of bad tenants not paying rent or damaging the home. Lettings agents have also called for more regulation . Smart reform that favoured responsible tenants and responsible landlords would surely be better for London than keeping the status quo just because of a few rogue tenants?

7. Any tenancy reforms would be harmful
The Minister for Housing thinks any extra regulation “would have pushed up rents and reduced choice” . But other European countries where more people rent all offer longer, more secure tenancies with more affordable rents in a more tightly regulated sector. The Mayor also often points to the decline in private renting following the introduction of rent controls, but fails to mention that people were moving into the millions of new council homes or buying a home with tax relief. The Irish government introduced smart reforms in 2004, including more secure tenancies and the right for tenants who have lived in their home for 6 months to stay for another 3.5 years.

8. Costs are driven up by benefits
Ministers have tried to turn private renters against each other by suggesting that benefits are driving rents up. This is total myth, something I’ve covered in more detail in a separate report. Most recently, the Prime Minister claimed rents were falling as a result of the caps introduced in April 2011. But landlords and housing experts dismissed this claim, and a snap survey by Inside Housing found that only one in eleven councils asked had negotiated lower rents as a result of the reforms .

9. Institutional investors will save the day
The Mayor has been pinning high hopes on pension funds and other institutional investors since early 2009 . But they only supply small amounts of housing in other countries that lack our housing associations and council homes. Without grants or cheap land, they will offer the same high rents as everyone else, albeit probably with better quality homes and possibly a bit more security . But they aren’t an excuse to leave the rest of the sector alone.

10. The only answer is build more
The Mayor likes to tell me that “we all agree” on this one, but I don’t. Of course we need to build more housing in London to cope with a growing population and a backlog of low delivery, but it isn’t the only answer. It’s also unlikely to work – we’d need to build 44,700 homes per year to stabilise prices , and the Mayor’s ambition is only for 32,210 per year. Even if that were possible, his sustainability advisors have cautioned that current building levels adopting the most green technology could still bust his climate change targets . Other possible answers could include smart reforms of tenancies, landlords, letting and managing agents, and reforms to our taxation system, as the London Assembly has recommended.


The arguments in this briefing form the basis for my scrutiny of the Mayor of London’s Housing Strategy and his delivery on his promises. I am interested in your views and comments, so please get in touch.
This report sets out my individual views as an Assembly Member and not the agreed views of the full Assembly

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About the author
This is a guest post. Jenny Jones is a London Assembly Member, representing the Green Party. She is also leader of the Green Group and Chair of the Planning and Housing Committee.
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Story Filed Under: Blog ,Housing ,London Mayor

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Reader comments


As you have gathered, I can assure that judging from (and recent) horrendous comments on my blog, and emails realting to housing, the Boris ideas are farcical. No: assured short term tenancies (accursed short term travesties) mean that most people have four months of peace. Many people have to move every six months. desposits are still being harshly deducted from, standards of new builds are appalling, we have no rights, and live in someone’s fragile porcelian pension plan rather than a home, as we can’t even paint the walls. Oh: and add ‘No DHSS’ (sic: I know it’s the DWP) to that notoriously no irish/no dogs/noblacks lists from the 60s. Renting is horrible.

There’s usually a rush to comment. I keep saying here (and wherever I write) that nobody cares about housing, especially tenants, and private rented housing. The lack of comments seems to prove me right, and I wish I was wrong.

After WW2, in West Germany, unlike Britain, the massive problem of replacing the houses destroyed by the war was left very largely to the private sector and the market.

One result is that even today, rented housing is relatively far more common in Germany than in Britain, where about 70pc of households are in owner-occupied housing. Another consequence is that there aren’t the large public sector social housing estates, often with instantly recognisable uniform architecture, to be seen in Britain – because the developers building the apartments in West Germany didn’t have the financial resources to build vast estates and besides, it wasn’t considered wise to invest too many financial eggs in one basket.

As the result of the unconstrained credit boom in Britain during the New Labour government, house purchase has become unaffordable for a much larger part of the population. The ratio between the average prices of houses and average earnings reached unprecedent heights as this graph shows:
http://www.housepricecrash.co.uk/graphs-ftb-average-house-price-to-earnings-ratio.php

Try also this from the BBC website on 20 January 2010:

Houses are less affordable than 50 years ago although the quality of homes has improved, according to the Halifax. The lender, now owned by Lloyds Banking Group, said that over the last five decades UK house prices have risen by 2.7% a year, allowing for inflation. This was above the 2% annual increase in real earnings over the same period.

Not sure these can be described as ‘myths’. Excuses for a leaching industry

The only answer is to either move work out of London (is it geographically necessary for so much of the financial or government sectors to be physically present in London?) or replace existing housing with medium and high rise, though housing more people in the capital will place more strain on transport and schools. There’s nothing wrong with high rise except Britain’s experience of it was godawful thanks to rotten architects and corrupt builders.

Private landlords aren’t all evil slumlords tring to subdivide houses into squalid single rooms. Many went into buy to let as their pension prospects were flushed away by Thatcher and Brown and more than a few bought near the top of the market so the vast amount paid in rent goes straight to the banks to pay off mortgages. Rent also has to cover the cost of a letting agent (unless you want to deal with such things yourself), cover times when the property is unoccupied, pay property and other taxes and pay for property upkeep and insurance. Some landlords have bad experiences with DWP tenants – a friend of mine had the central heating system stripped out of one house and another had six months of hell while a family of subhuman vermin were evicted. All the walls had to be replastered and two years on the gardens still smell of animal shit.

The best solution is what works well in some parts of other countries, medium rise with blocks of four to eight units privately owned by a landlord who lives in one and provides on site maintainence. Landlord and tenants get to know each other as people

“(is it geographically necessary for so much of the financial or government sectors to be physically present in London?) ”

Much of civil service is based outside London – only 18 pc works in London and only about 12 pc in central London. Banks and other financial services businesses have been moving back-office functions either to outer London or to other cities.

Btw the total size of the civil service in terms of full-time equivalent posts is about 550,000 so the impact of the 18 pc working in London on the London housing market is relatively small beer.

Great list, all true.

>>>I keep saying here (and wherever I write) that nobody cares about housing, especially tenants, and private rented housing. The lack of comments seems to prove me right, and I wish I was wrong.

It’s really up to us, the private rented sector tenants, to care about ourselves!
The politicians don’t dare to touch the owner occupiers, or even the buy-to-let brigade/rentier class (of both the ‘bricks & mortar pension’ and the real Rachman tycoon types), because those groups kick up a massive stink when any of their subsidies or privileges are threatened. The private tenants haven’t thus far even dreamt of formulating or making any political demands as voters and as a constituency of interest. This is weird, because the majority of activists in NGOs, politics, the readership of LibCon, etc, probably are private renters!

Council tenants make a much better job of sticking up for their interests and making sure political activists represent them (most of whom are probably private renters, as I said).

I hope this will change as the penny drops with a generation of private renters that they are going to be leaving for the happy world of owner occupierdom any time soon.

All credit to Jenny Jones and the Green Party for leading on responding to this issue, and I hope it helps to build the Greens a wider party political base. It’s just a shame to see so many private renters unregistered to vote.

And all credit to you RenterGirl, great blog.

…as the penny drops with a generation of private renters that they are not going to be leaving for the happy world of owner occupierdom any time soon

1 – People would prefer free things to paying their own way.
2 – People who receive subsidised things have a better quality result per pound THEY spend than those who do not receive such subsidy.
3 – You fail to make any point here.
4 – They have the choice, as many of us do, of moving somewhere cheaper, see “flexibility”.
5 – There is a small genuine problem but for God knows what reason you would like to widen the net.
6 – Landlords would like longer tenancies but on their terms. If you asked landlords whether they would like to give up various rights to their property for no compensation I suspect you would get a different answer. The evidence for this is that landlords and tenants are free to make a wide range of agreements, the ones you appear to support are not popular in England.
7 – Rent controls are the best possible way to ensure slum tenancies. The reforms you suggest would certainly be harmful.
8 – I honestly have no idea either way on this.
9 – Somewhat random from my perspective. The problem is one of supply certainly but the restriction on supply is that of planning permission and so that is where things must change if you wish to address this problem.
10 – The obvious answer is that something has to give and if it’s either affordable housing or “climate change targets” then the latter can take a running jump.

Housing cost is simply one symptom – the other obvious ones being school and transport capacity – of the fact that London’s population is ballooning.

@11: “Housing cost is simply one symptom – the other obvious ones being school and transport capacity – of the fact that London’s population is ballooning.”

Yes – one sure sign of that is that London house prices are more buoyant than in other parts of the country:

House prices hit new peak as London leaves the rest of the country behind
http://blogs.telegraph.co.uk/finance/ianmcowie/100014128/house-prices-hit-new-peak-as-london-leaves-the-rest-of-the-country-behind/

Rentagirl, In the terms of local government and the recession, It’s actually fairly Inportant isuue with many A labour councillor, It may not be stylish or somehting that created debates that Even Progressive modeate blogs may entertain, but along with Old folks homes and Sure start and further education, it can be a Top issue.

good article by the way.

15. Robin Levett

@Schmidt #5:

The only answer is to either move work out of London (is it geographically necessary for so much of the financial or government sectors to be physically present in London?)

Research the Abercrombie plan. It was intended to drive jobs and population out of London; it’s a major reason for the housing and transport problems that London still lives with.

London is the capital city of the UK; roll the next 10 cities in the UK together, and you still don’t come close to London. Again, London is the largest industrial centre in the UK by a distance; all this despite the problems caused by previous attempts to “move work out of London”. There are clearly economic incentives in place – maybe something to do with being close to the largest and richest market in the UK?

The problem is LONDON.
It’s a damn crowded city with more and more people flocking to it.

I actually think the rents should be higher still, so that people would move to Newcastle, Birmingham, Cardiff or anywhere else. Not everybody in the world has a right to live in London. Not everybody needs to live in London.

And trust me, there are more beautiful places in the world than London. I left London and I am happy about it: http://andreasmoser.wordpress.com/2011/11/13/leaving-london-moving-to-malta/


Reactions: Twitter, blogs
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