That this House has considered regulation of the private rented sector.
It is a pleasure to serve under your chairmanship, Mr Davies. I am grateful to have secured time for a debate on this matter, which continues to directly affect all our constituents. I pay tribute to my constituents in Liverpool, Walton who continue to be the innocent victims of the UK’s broken housing system, and I commend stakeholders including the Merseyside Law Centre, the Vauxhall Community Law and Information Centre, ACORN Liverpool at the local level, and the excellent Renters Reform Coalition at the national level.
The private rented sector continues to be dominated by insecure tenure, increasingly unaffordable rents, poor housing quality and the ever-present threat of homelessness. No one in this House should underestimate the dislocating and exhausting experience of being removed from one’s home.
I am unsure whether anyone in this House has received a section 21 notice, or has felt unable to complain about damp, mould or other poor conditions for fear of a retaliatory eviction. I am unsure whether anyone in this House has had to endure the stress of having only two months to find a new property in a chaotic and punishing market—or to search for a new school for their children, a new doctor, dental surgery or other basic services that we take for granted—following the receipt of a section 21 notice. What I am sure of is that the Government were absolutely right to ban section 21 evictions, alongside taking other measures in the Renters (Reform) Bill, to correct the power imbalance between landlords and tenants; but we must not forget what the cost of delay and inaction has been. To illustrate that, I will discuss just one of my constituents.
My constituent received a section 21 notice through the post, which gave her two months to vacate the property. The landlord gave two reasons for the eviction: he was looking at increasing rental income and was also looking to sell the property. My constituent has two children, a daughter aged seven and a son aged four, who has a severe learning disability and is non-verbal. Despite that, at the start of June, she and her family will become homeless. I invite the Minister to hear directly from my constituent about the impact of that eviction on her and her family’s mental and physical health. I would be happy for my office to make contact with her office to facilitate that.
The measures in the Renters (Reform) Bill will come too late for that constituent, but we can now work to ensure that no other constituent faces the same crushing uncertainty. Thankfully, after a four-year delay following the announcement of the Renters (Reform) Bill, the Government have finally found time to introduce that important piece of legislation. I stand ready and willing to work with colleagues from across the House to ensure that the Bill makes the private rented sector as fair as possible and gives local authorities resources to enable them to regulate the sector effectively for the benefit of all our constituents.
I congratulate the hon. Gentleman on securing this really important debate; he is making a powerful case. My Brighton constituency is one of the most expensive places to rent outside London, and my constituents are being ripped off daily. Does he agree that there is a big gap in the Renters (Reform) Bill—which is very welcome, if very late—when it comes to more enforcement powers for local authorities to target rogue landlords, and also this outrageous discrimination whereby blanket bans on renting to people with children or those who rely on benefits are still allowed? Those loopholes absolutely must be closed now. It is not good enough for the Minister to say, “We’re going to do it sometime in the future.”
I am grateful for my colleague’s intervention. I will touch on both those points in some detail, and I hope the Minister will respond and that we can work together to see the Bill strengthened over time.
I will use the rest of the time I have available today to cover actions that could be taken to ensure that the reforms were robust enough to provide renters with real security in their homes. I aim to do that in the spirit of genuine co-operation, and there is considerable appetite across the House to make the legislation as effective as possible. I want to cover three primary areas in which policy could be improved: in the Bill itself, on action related to enforcement, and addressing the crisis around affordability.
As I have outlined, the abolition of section 21 evictions is a much welcome step, but the Government must go further to guarantee that private housing providers do not use other routes to subject renters to unfair eviction. Landlords can continue to reclaim possession of their properties in the case of a sale, or if they or a family member wishes to move into a property. However, under the Bill, following an eviction on those grounds, landlords can re-let their properties after three months. That period is too short, and it will not act as a proper deterrent to landlords who seek to exploit the abolition of section 21 evictions. Therefore, the Government must extend the no re-letting period to a minimum of 12 months. If they do not, renters will not feel the assurance and safety that are intended to be at the heart of the reforms.
Further, will the Minister explain what recourse tenants will have if they are evicted unlawfully on those grounds? Can tenants apply for a rent repayment order, for example? If not, what other forms of compensation are available? The proposed two-month notice period and six-month initial protected period leave those evicted on legitimate no-fault grounds in the same position as they are under section 21. The notice period should be extended to four months at an absolute minimum.
It is generous of the hon. Gentleman to give way again; he is making a powerful case. Does he agree that we also need to look at rent controls, which are used in many other countries without a problem? We simply cannot allow rents to spiral out of all control. People will never be able to earn enough to have a mortgage, and they cannot even earn enough now to pay their own bills, so we need something far stronger even that what he is describing.
Absolutely; I would back the hon. Lady’s calls for the Government to look at rent controls and the best international comparisons, because this is an issue not just for our constituents, but for the economy and inflation, and in the end it hurts all of us.
The Minister could also move to increase the local housing allowance. LHA rates have been frozen since 2019. Following the huge increase in inflation and house prices, this freezing means that private tenants face an ever-increasing gap between housing benefit and their actual rent. What discussions are taking place within Government to modify that? Inaction is prolonging and deepening homelessness. Further, there are White Paper commitments missing from the version of the Bill that was recently published. Where are the measures to outlaw blanket bans on renting to those in receipt of housing benefit? The Government have recognised that this discrimination is wrong, but measures to address it are missing from the Bill. I would appreciate some guidance from the Minister on that point in her response.
I will conclude by discussing an important amendment that I intend to table to the Renters (Reform) Bill. Awaab Ishak was a two-year-old boy killed by mould in a social housing flat. Unfortunately, Awaab’s story echoes much of the casework that comes through my office—and, I am sure, the offices of many Members across the House. It followed Awaab’s social landlord repeatedly failing to fix the mould problem in his family’s flat, blaming the problems on his family’s lifestyle.
In response, the Secretary of State moved quickly to table amendments to the Social Housing (Regulation) Bill to impose timeframes on landlords to investigate hazards and make repairs. That was absolutely the right move, and the Government must now put the same protections in place for private renters. As the Citizens Advice report, “Damp, cold and full of mould”, has shown, 2.7 million renting households in this country, including 1.6 million children, are living in damp, cold or mouldy homes. These conditions have a disastrous effect on people’s physical and mental health.
Abena. I thank my hon. Friend for putting forward this important debate. I have a huge number of housing cases that involve constituents of mine who live in damp and mouldy properties, and I have had responses from housing associations saying that that is down to their lifestyle, which is factually incorrect. Constituents are also facing soaring rents. Like my hon. Friend, I want to see a proper ombudsman in place for constituents living in private rented accommodation. Does he agree that the private renters charter will make things a lot fairer for individuals up and down the country?
I am grateful to my hon. Friend for her intervention. I agree with her, and I hope that this Bill is an opportunity for us to ensure that the Government can put more protections in place for our constituents.
The conditions in which people live can have a disastrous effect on their physical and mental health, but tenants are left with little choice than to stay in homes that make them ill, and even kill them. Will the Minister meet with me to discuss how we can bring the private sector in line with the social sector and ensure that landlords deal with serious hazards in privately rented homes in a timely manner? Sadly, as we have witnessed, the cost of failing to do so can be fatal. I will leave the Minister with that, and I look forward to working with her and colleagues on this hugely important area of policy.
I congratulate my hon. Friend the Member for Liverpool, Walton (Dan Carden) on securing this debate. On a more negative note, housing is a constituency issue on which I receive a vast amount of correspondence. I am grateful to several local organisations, including Citizens Advice Stockport, Stockport Tenants Union and Stockport Homes, which do a lot to support tenants who might be struggling and homeless people in our constituency and town. They do a really important job, but the bottom line is that those organisations are a last resort. The Government have failed, and they continue to fail.
It also happens to be the case that when issues arise in the private sector it is always the social housing sector that must pick up the pieces, at a considerable cost in terms of emergency and temporary accommodation. I have cases in my inbox about landlords who are serving section 21 notices because they know they can get more rent from a new tenant. I have cases in which the housing standards are very poor, with damp and mould—my hon. Friend mentioned a couple of such cases in his inbox. People have come to my office who have an informal agreement with their landlord with regard to their tenancy, which offers them zero security and has a negative impact on their physical and mental health.
Members on both sides of the Chamber will be aware of people in their constituency who cannot afford deposits for a tenancy and who can forget about saving up for a deposit for a mortgage because their wages are so low. Rents keep going up, and they keep getting priced out of tenancies, mortgages and secure housing, which I believe is a fundamental human right—I am sure many Members will agree that secure, safe, clean housing is a fundamental human right. People with pets are often disadvantaged when looking for tenancies; I have had several cases on that issue. The local housing allowance simply is not adequate in my borough. The median rent value in Stockport is much higher than the local housing allowance in the two broad rental market areas, so it simply is not good enough.
Does the hon. Member agree that one factor that should be taken into account is Government support for greater availability of good-quality social housing, which would help to suppress the increase in rents? Allied with that, the Bill and the tax regime should pursue bad landlords, support good landlords and protect tenants at the same time.
I agree, although my experience is that Stockport Homes, one of the major local social housing providers, has been struggling to secure properties because their cost has risen significantly. Recent census data shows that Stockport has seen a 48% increase in property values in the past five years, whereas the average in England is 20%. For social housing providers, securing or building new properties, particularly with the rising cost of building materials, is a significant financial commitment that many of them are not able to make. I agree that bad landlords need to be pursued. I do not think the enforcement regime is good enough. Of course, there are good landlords out there—I am not going to dispute that—but they often get tarred with the same brush that bad landlords leave us with.
The Renters (Reform) Bill is a positive step, but there are many loopholes. The rules around section 21, on landlords evicting tenants by claiming to move families in, need to be looked at. There is no provision on rising rents. It is unclear what the penalties will be for landlords who break the rules. There are so many loopholes that we need a serious discussion about how to deliver for people across England.
I have already mentioned the statistics on the average rent values in my constituency. I would like to conclude by making two further points. Owner-occupiers spend 18% of their household income on mortgage payments, while private renters spend 31% of their household income on rent. That is simply unfair, and it is also unsustainable. It is evident from the data for constituencies across England that many—not all—private landlords are making large amounts of money out of the cost of living crisis.
Yesterday, Labour MPs, along with those of several opposition parties, voted to end the unfair leasehold system. Labour is serious about reforming the housing sector; it is not just warm words. I am sorry to say that the Government have failed and continue to let down renters consistently, year after year. In 13-plus years of this Government, we have not seen serious action. I hope the Minister will address these points.
I congratulate the hon. Member for Liverpool, Walton (Dan Carden) on securing this debate and setting the scene so powerfully. May I draw attention to my entry in the Register of Members’ Financial Interests?
My Bath constituency is a special place to live, but that comes at a very high cost. Soaring rents have forced out many who consider Bath home. The average monthly rent in Bath and North East Somerset has risen by more than £200 in the past three years. The Government have consistently failed to stand up for the fifth of UK households who privately rent. Legislation has not kept up with demand.
There are many responsible landlords, but there are also those who are unfit to be part of the sector. They provide a public service and we must regulate them as such. The ban on section 21 evictions was first promised four years ago. Since then, more than 54,000 households in England have been threatened with a no-fault eviction, and almost 17,000 households have been evicted by bailiffs. Research by Shelter and YouGov has found that private renters who complained to their landlords, letting agent or local council were two and half times more likely to be handed an eviction notice in the past three years.
Although I welcome the Government’s decision to introduce a ban on no-fault evictions, I am appalled that it has taken so long. Even now, we do not have a date for the Second Reading of the Renters (Reform) Bill. In passing that Bill, we must not enable no-fault evictions through the back door. I am concerned that the Government will allow evictions for anything that is “capable” of causing nuisance or annoyance. That is clearly open to abuse, and needs further clarification. Tenants will continue to be victimised if robust regulation is not in place.
Liberal Democrats have long fought hard to ban revenge evictions, where rogue landlords evict tenants who make complaints. I ask the Minister to implement provision on the specific set of circumstances in which a landlord can evict a tenant. The law on illegal eviction must be reformed alongside section 21. Court backlogs mean that landlords must wait for a court order and may be tempted to break the law. Landlords have been known to get rid of tenants’ possessions or cut off utilities such as water and heating. That is an awful practice that reflects the contempt in which some landlords hold their tenants.
It is a pleasure to see you in the Chair, Mr Davies. Before I start, I would like to put on record my disappointment and anger at the misnaming of my wonderful colleague and dear friend, my hon. Friend the Member for Erith and Thamesmead (Abena Oppong-Asare). The frequent misnaming of particularly my black women colleagues in this place is not okay and needs to stop.
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Such a proposal is not new to the Government, because in the midst of the covid pandemic, the section 21 notice was extended to four months. I can tell the Minister that the situation in the housing market has deteriorated, not improved, so it is only logical that the Government look at that proposal and seriously consider extending the period again. The benefits are obvious: if tenants were given more time to find somewhere to live, that would spare the taxpayer and tenants the cost of homelessness, which is devastating both financially and mentally.
Organisations including Shelter have expressed concern about the amendments that the Renters (Reform) Bill will make to homelessness legislation. Private renters who receive a possession notice will no longer have the right to immediate help from the council to avoid homelessness. That is because the law will no longer specify when help to prevent homelessness should be available to private renters. Instead, it will leave that to the discretion of local authorities, and that despite the Government knowing that early intervention is paramount in protecting tenants and preventing homelessness. Will the Government move urgently to address that weakness in the Bill, which directly undermines the Homelessness Reduction Act 2017 and the rough sleeping strategy? We should be boosting and improving protections related to homelessness prevention, not weakening them.
I want to speak about enforcement. The property portal and the ombudsman are positive elements of the Bill, but they will help to drive up standards only if the Government arm local authorities with the means to properly investigate and enforce. There is a postcode lottery in the sector, and enforcement action depends on how diligent and well resourced local authorities are. In my local authority area, Liverpool, we have a selective licensing scheme that aims to proactively regulate the private rented sector.
Despite the Government shrinking the area to which the licensing scheme applied in 2020, the team at Liverpool City Council has reported that, out of 2,308 inspections, 917 disrepair matters have been identified, as well as 1,053 breaches of licensing conditions. This is despite the National Residential Landlords Association previously describing the scheme as a “waste of time”. The local authority looks to work in co-operation with licence holders where possible, but unfortunately some enforcement action will always be inevitable. The council describes the number of referrals to the service as “substantial”. It says that resourcing and recruitment remain a challenge. Will the Minister commit to ringfencing resources to ensure that new regulations can be properly enforced through the property portal and ombudsman?
There is a crisis of affordability in the private rented sector, and yet calls continue to be ignored by Government. Research by Rightmove has shown that, in the past year alone, rents have risen at their fastest rate in 16 years, increasing by an average of 11% across Great Britain, yet I have never heard anyone on the Government Benches express concern that rent increases have contributed to inflation. That argument is often made when it comes to pay restraint or welfare payments, but why are landlords never asked to heed the same advice? These price increases represent an emergency, and the Government are moving too slowly to combat these rises.
There have been five housing Ministers in the past year. It seems that private renters are the losers from years of indifference and delay by the Government. Housing generally is already the biggest expense for renters. According to Crisis, private tenants on the lowest 10% of incomes are facing combined rents, food and utility costs that exceed their total incomes by 43%. The impact of further rent increases will be deep. According to Government figures, between January and March 2023, the number of section 21 claims increased by a huge 52%, and there was a 16% rise in non-section 21 evictions, the highest since the data began in 2009. The rent tribunal still continues to allow rents to go higher than the landlord may initially request, which acts as a major disincentive to using it. Will the Minister work with me to increase constituents’ means to challenge rent increases and improve the utility of the rent tribunal? If action is not taken to combat rent increases, landlords will simply evict tenants by pricing them out of staying in the property.
I would like to mention a couple of cases. One constituent said that his son had to enter a bidding war to get his apartment in Stockport—not a house, an apartment—which was advertised at £850 per calendar month. At the end of the bidding war, the agreement was made at £880 per calendar month. I appreciate that £30 a month might not be a lot for some people, but for a lot of people struggling in the current cost of living crisis it is a large amount of money. If we multiply that by 12, it is a significant amount for many people on low wages. Another constituent had his rent increased by a huge £300 per calendar month, and the landlord still refused to undertake essential repairs to the property. That sort of behaviour is simply shameful. I do not see much action from the Government, and I do not see a credible plan to tackle these issues.
I would like to mention one more case, which is that of a single person earning less than £30,000 a year who does not qualify for any help and has lived in a tiny one-bedroom flat of 42 square metres for many years. The property has not been updated in many years. It has dated storage heaters, which are very expensive to run during the daytime, and rent increases annually by 3%. However, the constituent has been told that this year it will increase by 5%. She feels that she has no security and stability. In addition to the rent going up by 5%, she was issued an affordability assessment by the landlord’s estate agent, which implied that if she was not able to meet the threshold, she would be asked to leave. When questioned, the landlord’s agent said that they are
“employed by Landlords to protect their assets and to minimise their risks”.
That sort of behaviour has to be labelled as shameful. Protecting an asset should not be more important than someone having the opportunity to live in safe, clean and secure housing. This person told me that she cannot find alternative affordable accommodation, and she has a cat, which many landlords will not accept. That goes back to my point that many people who have pets are simply excluded from the market.
The average rent in Stockport is £850 per calendar month, which is almost a 9% increase since 2021. Most people in England have not seen their wages go up by 9% since 2021. Increasing rents and the cost of living crisis are adding up. Last year, Citizens Advice reported that rent growth was at its fastest in five years, and one in five expect their rent to rise this year. Additionally, it estimated that 425,000 renters are in arrears, owing an average of £937 each. That is almost £1,000, which is a significant amount of money for anyone.
A point has to be made about the demographics. Young people and people from working-class backgrounds are now losing at least 30% of their monthly income to rent. The Government’s Renters (Reform) Bill is a positive step, but there are lots of loopholes, and there have to be assurances on a number of factors in the Bill.
We have talked quite a lot about the relationship between landlords and tenants. I have drawn attention to my entry in the Register of Members’ Financial Interests because I am a landlord. I believe that the best way to solve the problem is to create an atmosphere in which landlords and tenants treat each other with respect. That scene has to be set by the landlord, who must respect the tenants living in their property rather than holding them in contempt, as many landlords do, and using them for money. Homes that are rented out must be seen as homes for people who live in them, rather than as just a way of making money.
The current illegal eviction law is complex and rarely enforced. Police officers are unaware of their powers to stop illegal evictions and often do not intervene. If section 21 is abolished, we risk some rogue landlords evading the courts and taking matters into their own hands. I hope the Minister will confirm that the Government intend to reform the law on illegal eviction to make it modern, effective and easy to understand. I have met the Under-Secretary of State for Levelling Up, Housing and Communities, the hon. Member for Kensington (Felicity Buchan), and a group of lawyers who have raised concerns about the matter. I hope to hear about some of the Government’s progress in looking at reforming the Bill on illegal eviction at the same time.
Irresponsible landlords cannot be allowed to use rent rises to force out tenants. Many of my constituents have faced rent increases that left them with no choice but to leave their homes. An average couple spend 21% of their income on private rent. A survey by the Department for Levelling Up, Housing and Communities shows that 31% of people in my region of the south-west are already struggling to pay rent. When will the Government address unaffordable rent? People simply cannot cope with arbitrary rent increases, which can be as high as 60%.
We Liberal Democrats would change the default rental period from one year to three years. Rents would only rise with inflation in that period. I accept that more discussions are needed on the student housing market, in which rental periods typically last only a year or two, but the overall policy would give many tenants the thing they are missing the most, which is certainty.
It is not just the price of rent that concerns my constituents. We have already heard about the terrible conditions in many private rental properties. That is an appalling open secret. The UK has some of the oldest and coldest houses in Europe. More than half of tenants had issues with damp or mould last year. It is the same in my Bath constituency: 31% had problems with hot water or heating and 21% of privately rented homes do not meet the decent homes standard. People are trapped in uninhabitable homes. We need tougher inspection and much higher standards.
We Liberal Democrats would introduce a new regulator for all private renters and require all private landlords with more than 25 homes to register with it. The regulator would have the power to subject landlords to regular inspections, and to inspect properties at shorter notice. Everyone should have the right to a safe and secure place to live. It is a national scandal that people are trapped in insecure and uninhabitable homes. The Government must not delay action any more.