Private rented sector

Despite £2.3bn subsidies, property development could stall as developers face severe threats

Retrieved on: 
Thursday, May 12, 2022

1.8 billion has been earmarked for brownfield land development, community regeneration and new affordable housing projects.

Key Points: 
  • 1.8 billion has been earmarked for brownfield land development, community regeneration and new affordable housing projects.
  • This is before developers begin to see further issues with global supply chains due to the Russian invasion of Ukraine.
  • The Government subsidy to develop 1,500 hectares of brownfield land to create 160,000 new homes is an open invitation for developers, says Stephen Clark of Finbri development financebroker.
  • This may include both brownfield sites suitable for development and others where developers can enhance biodiversity as an offset for their projects elsewhere.

Housing and Homelessness (Local Accommodation Duty) Bill

Retrieved on: 
Tuesday, March 9, 2021

A Bill to place a duty on local authorities to ensure that persons for whom a homeless duty has been accepted are accommodated in the local area, including on discharge into private rented accommodation; to require local authorities to publish annual reports on steps relating to housing demand and supply taken or intended to be taken to meet that duty; and for connected purposes.

Key Points: 

A Bill to place a duty on local authorities to ensure that persons for whom a homeless duty has been accepted are accommodated in the local area, including on discharge into private rented accommodation; to require local authorities to publish annual reports on steps relating to housing demand and supply taken or intended to be taken to meet that duty; and for connected purposes.

A new era of social rented housing in England?

Retrieved on: 
Tuesday, July 14, 2020

Why social rented housing? Social rented housing has historically delivered rents at around 50% of market rates along with long-term security of tenure, so it is perhaps inevitable that there are widespread calls for a large-scale delivery programme to revitalise the sector and address housing deprivation.

Key Points: 

Why social rented housing?

    • Social rented housing has historically delivered rents at around 50% of market rates along with long-term security of tenure, so it is perhaps inevitable that there are widespread calls for a large-scale delivery programme to revitalise the sector and address housing deprivation.
    • These calls pre-dated the coronavirus (Covid-19) pandemic but they have been given new impetus with evidence pointing to connections between inadequate housing and poor health outcomes in the context of Covid-19.
    • They are also less likely to own their home, and more likely to be private renting than white households.


    Other arguments advanced in favour of social rented housing include the need to move rising numbers of homeless households out of temporary accommodation; unaffordability in the private rented sector; and the potential to reduce expenditure on housing benefits by moving private renters into social housing. Commentators also argue for a social housing delivery programme to provide an economic stimulus, pointing to housebuilding as a proven form of counter-cyclical investment.

How much social rented housing is needed?

  • Current levels of development are significantly below various estimates of identified need for social rented housing:
    • Shelter’s commission on the future of social housing published A Vision for Social Housing in January 2019 which recommended a total of “3.1 million more social homes” be built over a 20-year period, representing an average of 155,000 new homes per year.
    • Research conducted by Heriot-Watt University, published in 2018, for the National Housing Federation (NHF) and Crisis, called for 340,000 new homes each year up to 2031. This research identified a need for 145,000 affordable homes per year of which 90,000 should be for social rent.
    • The Affordable Housing Commission, which reported in March 2020, called for a rebalancing of provision between the social rented and private rented sectors. Specifically, the Commission endorsed the imperative of providing at least 90,000 homes to let at social rents per year.
    • These organisations recommend increasing the supply of social rented housing as a remedy for unmet housing need, evidenced by increasing numbers of homeless households in temporary accommodation and growing overcrowding in the social and private rented sectors.
    • The social housing sector has declined in size in the long-term.
    • Around 93% of social housing providers stock was let at social rent in 2018/19, compared with 98% in 2012/13.
    • The focus on Affordable Rent and affordable home ownership products has meant that new supply of homes for social rent has declined.
    • This is a sharp decline compared with the period before 2011/12, when social rent made up the majority of affordable housing supply.

Prospects

    • The Government envisioned that lifting the caps would enable councils to build around 10,000 new homes per year.
    • The sector was optimistic, research identified a clear appetite amongst authorities to take advantage of the new borrowing freedoms.
    • This optimism existed despite the existence of other barriers, such as limited grant funding and restrictions on the use of Right to Buy receipts.
    • The March 2020 Budget announced funding over five years from 2021 for the Governments Affordable Homes Programme: an additional 9.5 billion for the Affordable Homes Programme.
    • In total, the programme will allocate 12.2 billion of grant funding from 2021-22 to build affordable homes across England.
    • The Covid-19 outbreak and subsequent lockdown have shifted the landscape in ways that are still becoming apparent.
    • The experience of the post-2008 financial crisis is leading commentators to predict a contraction in the construction industry as the economic downturn takes hold.
    • The NHF has launched a Homes at the Heart campaign which is described as a national campaign and coalition calling for a once-in-a-generation investment in social housing.
    • It seems likely that the housing sector will look towards the forthcoming Comprehensive Spending Review as an opportunity to further press the case for a large-scale social housing delivery programme.

Impact of Covid-19 (coronavirus) on homelessness and the private rented sector inquiry launched

Retrieved on: 
Saturday, April 18, 2020

The Government has also introduced a number of schemes intended to support people in the private rented sector, including halting evictions for 3 months and raising the Local Housing Allowance rate.

Key Points: 
  • The Government has also introduced a number of schemes intended to support people in the private rented sector, including halting evictions for 3 months and raising the Local Housing Allowance rate.
  • There are also concerns about people in the private rented sector who may build up rent arrears over the coming months and still face eviction when the three month ban expires.
  • The inquiry will examine how effective the Government support has been in supporting individuals in the private rented sector or who are homeless.
  • The Committee invites written evidence on the impact of COVID-19 on homelessness, rough sleeping, and the private rented sector, as well as any other connected issues.

Housing conditions in the private rented sector (England)

Retrieved on: 
Wednesday, December 18, 2019

House of Commons Library

Key Points: 
  • House of Commons Library

    This House of Commons Library briefing paper provides an overview of housing conditions in the private rented sector, explains the legislation regulating standards in the sector and identifies some of the key issues with the current legal framework.

  • In recent years the extent and role of the private rented sector (PRS) in the housing market has seen significant changes.
  • The sector has grown considerably; 4.5 million households rented their home from a private landlord in 2017/18, representing 19% of all households in England.
  • The expansion of the PRS has focused attention on the need to improve housing conditions in the sector.

Comparing private rented sector policies in England, Scotland, Wales and Northern Ireland

Retrieved on: 
Friday, March 29, 2019

Thursday, March 28, 2019This briefing paper provides a summary of the different approaches adopted by the Governments in England, Scotland, Wales and Northern Ireland in regard to some key areas of private rented sector policy.

Key Points: 
  • House of Commons Library

    The changing nature of the private rented sector

    The private rented sector (PRS) has overtaken social housing and is now the UKs second largest tenure after owner occupation.

  • Difficulties in accessing home ownership and social rented housing mean that the PRS is now viewed as a longer-term housing option.
  • A greater focus on the private rented sector

    The expansion of the PRS has resulted in greater focus on conditions in the sector.

  • Scotland and Wales have introduced legislation to implement a new framework for the sector both have introduced comprehensive landlord registration schemes.

Tenant Fees Bill: Commons stages

Retrieved on: 
Wednesday, January 23, 2019

Commons examines the Tenant Fees Bill

Key Points: 
  • The House of Lords have returned the Bill to the House of Commons with amendments.
  • Transcripts of proceedings in the House of Commons Chamber are available in Hansard online three hours after they happen.
  • There is currently no cap on the level of fees that letting agents can charge in England, although since 27 May 2015 agents have been required to display a tariff of fees.
  • The Tenant Fees Bill will:
    Ensure that tenants are only required to pay their rent and deposit when securing a property in the private rented sector.

Tenant Fees Bill: Commons stages

Retrieved on: 
Wednesday, January 23, 2019

Commons examines the Tenant Fees Bill

Key Points: 
  • The House of Lords have returned the Bill to the House of Commons with amendments.
  • Transcripts of proceedings in the House of Commons Chamber are available in Hansard online three hours after they happen.
  • There is currently no cap on the level of fees that letting agents can charge in England, although since 27 May 2015 agents have been required to display a tariff of fees.
  • The Tenant Fees Bill will:
    Ensure that tenants are only required to pay their rent and deposit when securing a property in the private rented sector.

Tenant Fees Bill 2017-19: update on progress in Parliament

Retrieved on: 
Friday, December 28, 2018

Friday, December 28, 2018The Tenant Fees Bill will abolish most upfront fees for tenants in England and cap security deposits at the equivalent of five weeks’ rent where the annual rent is less than £50,000. This paper provides background to the Bill, including information on current practice in Scotland, Wales and Northern Ireland. It explains the Bill's provisions and summarises reactions from tenants, landlords and letting agents. This paper has been updated to include issues raised during Public Bill Committee and subsequent Parliamentary stages. Third Reading in the House of Lords is scheduled for 15 January 2019.

Key Points: 


House of Commons Library

Tenant Fees Bill 2017-19: update on progress in Parliament

  • The Tenant Fees Bill will abolish most upfront fees for tenants in England and cap security deposits at the equivalent of five weeks rent where the annual rent is less than 50,000.
  • This paper provides background to the Bill, including information on current practice in Scotland, Wales and Northern Ireland.

Currently no cap on letting agent fees


    There is currently no cap on the level of fees that letting agents can charge in England although consumer protection legislation might apply in certain circumstances. Since 27 May 2015 agents have been required to display a tariff of fees.

The proposal to ban upfront fees

  • Consultation on this proposal opened on 7 April and closed on 2 June 2017.The Conservative Partys 2017 Manifesto said we will shortly ban letting agent fees.
  • November 2017 saw publication of Banning letting fees paid by tenants: government response and the Draft Tenant Fees Bill and explanatory notes.
  • The Bill was considered in Public Bill Committee during five sittings between 5 and 12 June 2018.
  • The first two sittings were taken up with the examination of witnesses on 5 and 7 June (morning).

Context

  • Other action the Government is taking in this area includes:
    • A new requirement for all landlords to be members of a redress scheme to give tenants easier access to dispute resolution;
    • A new requirement for all letting agents to be registered and members of a client money protection scheme;
    • The introduction of banning orders and a database of rogue landlords and agents (in force); and
    • Consultation on the benefits and barriers of longer tenancies in the private rented sector.


    The private rented sector in England is home to 4.7 million households. Letting fees and high deposits are seen as adding to the affordability challenge for tenants seeking to access rented accommodation. The Bill’s provisions sit within the Government’s wider aim of “rebalancing the relationship between tenants and landlords to deliver a fairer, good quality and more affordable private rented sector.”

Reaction

  • These bodies have actively lobbied for the regulation/abolition of letting agent fees.
  • They argue that fees cover essential costs which must be met and that tenants rents will increase because of the ban.

Guidance

MRI Software Announces New Residential Proptech Solution for the U.K.

Retrieved on: 
Wednesday, June 27, 2018

Private Rented Sector

Key Points: 
  • Private Rented Sector
    SOLON, Ohio, June 27, 2018 /PRNewswire/ -- MRI Software LLC ("MRI"), a global leader in real estate software solutions, today announced its industry-leading residential proptech solution is generally available in the U.K. to meet the unique needs of the emerging private rented sector (PRS) market.
  • In bringing its Residential Suite to the U.K., MRI collaborated with U.K. PRS leaders to adapt the software to address the emerging needs of residential managers contending with significant investment and change.
  • MRI's Residential Suite complements perfectly the company's existing offerings for the U.K. residential sector, including those gained through its acquisition of Qube in October 2017.
  • A pioneer of the real estate software industry, MRI develops lasting client relationships based on nearly five decades of expertise and insight.