It is absolutely right that people have a secure and stable home, to provide and anchor and a firm foundation for building a better life. This applies to renters as well as homeowners – so the government’s decision to put an end to no-fault evictions is really good news.
Under the current system, landlords can turf their tenants out without having to give them a reason, sweeping many into uncertainty and insecurity. Moving to open-ended tenancies and requiring landlords to prove ‘grounds’, such as rent arrears or damage to the property, will be a major step forward in reforming the private rented sector for the 4.7 million households who currently call it home.
This move, a more significant reform than anything floated in the communities department’s recent consultation on tenancy length, is a big win for the campaigners, many of them grass roots organisations, think tanks and politicians who have been making the case for reform.
It will be a step change for tenants. Research by Cambridge Centre for Housing and Planning Research found that the rising evictions in the private rented sector have been almost entirely due to the increasing use of ‘no fault’ evictions. This has significant impacts for tenants on low incomes, risking pulling them deeper into poverty. This problem can be seen in homelessness figures, where the end of private rented sector tenancies have swept many into homelessness in recent years, with the number of families being accepted as homeless due to the end of a private rented quadrupling between 2012-13 and 2016-17.
What is more, the end of section 21 will give tenants much greater power in the housing market. Under the current system, tenants are often scared to complain to landlords for fear they might be kicked out as a result. Research by the Citizens Advice Bureau found that tenants who had received a section 21 “no-fault eviction” notice were twice as likely to have complained to their landlord, five times more likely to have gone to their local authority, and eight times more likely to have complained to a redress scheme.
As always though, the true impact of this proposal is to be seen and much will depend on the totality of government’s reforms. Firstly, with Theresa May having stated she will stand down as Prime Minister in the not too distant future, the pressure will be on to ensure that any future party leader adopts this position and sees it through into legislation. Secondly, many are rightly asking for further detail, specifically about how the new rules will work with a court system already thought to be too slow to deal with cases.
It is also important that we acknowledge that insecurity in the private rented sector is not only a product of legal structures. The high cost of rent, which sweeps too many into poverty, is also of significant concern. Government will need to set out how they will deal with in-tenancy rent increases if they are to ensure that their new open-ended tenancies are genuinely secure. If landlords can increase rents frequently without good reason, then these tenancies will not offer the anchor that tenants need to keep them steady in hard times.
It is also essential that the social security system effectively supports people to meet their housing costs. Since 2012, Local Housing Allowance has not been increased in line with local rents, meaning that the benefit designed to support housing costs has been disconnected from the actual cost of renting. Research from the Institute for Fiscal Studies (IFS), supported by the Joseph Rowntree Foundation, shows that, since 2011, the freeze on Housing Benefit means the number of private renters whose financial support does not meet their rent has grown by 200,000 households. Half those households are families with kids.
If the current policy continues, then by 2025 another 200,000 people will face a gap between their rent and the amount of housing benefit they receive. About half of that growth will occur between now and 2020, when the freeze is due to end.
We must recognise that the private rented sector is not always a tenure of choice. For those on low incomes, too many are renting as they cannot access a genuinely affordable home. This is the result of decades of insufficient social house building and the decision to allow local authorities to discharge their homelessness duty into the private rented sector.
If we want to hold back the rising tide of poverty, then we need to ensure this move towards intervention in the housing market is matched by investment in the 90,000 genuinely affordable homes a year we need.
For now, though, this is a big step forward for people swept into poverty and one that we should celebrate.
Darren Baxter works on housing policy at the Joseph Rowntree Foundation. He tweets as @DarrenBaxter.