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  • Property-a-holics

    Centre for Social Justice: PRS & S24 reforms



    New Centre for Social Justice report "Putting Down Roots: Improving security for renting families and private landlords", published today, urges greater housing security for struggling families, abolition of Section 21, and removal of Section 24 tax regime.

    The latest Housing Commission report by the policy powerhouse Centre for Social Justice (CSJ) has shone a light on the problems caused by short-term private tenancies for renting families and the difficulties private landlords face engaging with the housing justice system.
     
    The report comes as the Government is expected to announce major reforms to private renting in England following a Ministry of Housing, Communities and Local Government consultation on longer tenancies in the private rented sector (PRS), which ran until August 2018.
     
    As the CSJ highlights in the report, the decline in homeownership and scarcity of new social housing has seen the private rented sector explode in size. There are now 4.5 million households renting in England, representing one in five of the population.
     
    The CSJ shows that in the decade to 2017 alone, the number of renting households with children increased by just under one million; the number of renters on below average incomes increased by 1.5 million; and the number of older renters (aged 65+) increased by almost 150,000.
     
    Meanwhile, the sector remains governed by rules introduced in the late 1980s when fewer than one in ten households rented privately.
     
    The CSJ argues that this has left thousands of families who could previously rely on the security of a home they own or a social tenancy having to uproot their lives and look for a new home at just two months’ notice once the fixed term of their tenancy has ended. The vast majority of private renters do so on a fixed term of just six to twelve months.
     
    As the Communities Secretary James Brokenshire noted at the launch of the consultation in July 2018, “It is deeply unfair when renters are forced to uproot their lives or find new schools for their children at short notice due to the terms of their rental contract.
     
    “Being able to call your rental property your home is vital to putting down roots and building stronger communities.”
     
    A mother of two in Cheshire, who submitted evidence during the Commission’s inquiry, chaired by Lord Best, made a heartfelt case for reform:
     
    “We made it clear we were looking for five years plus. We were assured by the agent that the house was suitable for a long-term family rent.
     
    “After I reported urgent safety issues with the electrics, gas fire and shower that we discovered on the day we moved in, the landlady now refuses to have any contact with me.
     
    “We now have to move out at the end of January, just six months after moving in. But there’s nothing available in this area that we can afford at the moment.
     
    “We’ve done nothing wrong, and are exemplary tenants who’ve paid up front and just want a quiet family life.
     
    “Our lives have been turned upside down by this nightmare.”
     
    To bring the sector up to date, the CSJ is calling for a new Standard Tenancy with a four year term to be introduced, mirroring the average tenancy length as recorded in the English Housing Survey of 4.1 years, with exemptions for specific markets such as student housing and holiday lets.
     
    Crucially, as part of the proposed four-year Standard Tenancy, tenants would be able to exit the contract with two months’ notice once the initial six months have passed, retaining the private rented sector’s flexibility advantage.
     
    The CSJ is also calling for the abolition of Section 21 of the Housing Act 1988, meaning that families will no longer suffer from the upheaval and anxiety of being evicted at two months’ notice without legitimate grounds being proved. In order to replace Section 21, however, the CSJ proposes new rules equipping landlords with a wider range of legitimate grounds to gain possession of their properties during the fixed term, such as if they want to sell up or move in.
     
    The new Standard Tenancy proposed by the CSJ would end automatically at the end of the four year fixed term, providing clarity to both landlord and tenant. However, landlords would be able to renew further four-year terms if rents are successfully negotiated with the sitting tenant.
     
    In the report the CSJ also calls for better security for landlords who have been ‘let down’ by the housing justice system, supporting the creation of a specialist Housing Court to deal with housing cases more quickly and effectively.
     
    Under the new system, tenants would be allowed greater flexibility in making cosmetic improvements to their private rented homes, such as hanging pictures and altering the wall colours within ‘reasonable’ agreed parameters.
     
    The CSJ also suggests reversing the raid on private landlord tax incentives introduced by George Osborne in 2015 in order to maintain ‘healthy’ levels of investment in the sector as the Government advances on its reforms.
     
    CSJ Housing Commission chairman Lord Best commented:

    “The CSJ is right to stress that while the types of households living in the private rented sector have changed profoundly over the last two decades, the rules governing the sector have not kept apace. 
     
    “As the Commission found, the prevailing culture of insecurity has harmed both private tenants and landlords alike. The recommendations we advance in this report update the sector so that families are able to put down roots and landlords can feel confident that the system will work for them.”
     
    Andy Cook, Chief Executive of the CSJ, said:
     
    “I’ve lost track of how many cases we come across at the CSJ of people struggling to address the serious challenges they face – be that an alcohol or drug addiction, a family in crisis, or a child struggling to thrive at school – because insecurity in the private rented sector prevents them from doing so.
     
    “The Government should be commended for taking the issue of short-term tenancies seriously. We at the CSJ want to help it get these reforms right so that families can put down roots, tackle the root causes of poverty, and build stronger communities.”

    _______________________________

    I would like to ask the CSJ why the woman mentioned in the article did not contact the local authority about her disrepair issues?  It also sounds like a retaliatory eviction on behalf of the landlord, and these are illegal, so this part of the article is misleading imho.

    However, it is good that the CSJ recommends removal of Section 24!  Let us be grateful for small mercies!

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    Excellent news on the CSJ. It’s about time some of these commentators finally got the message and started repeating our narrative on the damage S24 does to EVERYBODY involved. More power to them on that point.   Longer tenancies and the removal of S21 don’t thrill me, but can be coped with as I usually operate to such parameters anyway. Lets get a few more voices raised in objection to S24.

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    I wrote to the author of this report via the press agent to challenge some of the claims:

    I would like to ask him why he didn’t include accurate information in his report!

    The woman cited as an example in the emotive title of the press release had no need to leave her home for two reasons:

    1.  She could have notified the local authority that the landlord was not undertaking repairs and the LA could have forced the landlord to do them.

    2.  Retaliatory evictions are illegal and she did not have to leave her home on this basis.

    https://www.gov.uk/government/publicatio...dance-note 

    So the issue was far more that the tenant did not understand her legal rights than that her tenancy was insecure.  Such emotive and inaccurate stories just serve to muddy the waters and cast all landlords in a bad light.


    The vast majority of landlords in the UK provide a decent standard of accommodation.  Rogue are in the minority and local authorities have far-reaching powers to shut them down, but most don’t due to lack of resources or they don’t have anywhere else to house the tenant.

    I will look forward to Joe’s response on this.

    I received the following response from the author Joe Shalam:

    As we emphasise in the report (and unlike many other organisations calling for tenancy reform!), we agree strongly with you that the vast majority of landlords provide decent homes, and are quite reasonably investing in their families’ futures while also providing a valuable source of housing.

    We make the point in Part 2 that, on the whole, landlords seeking possession do so for very legitimate reasons, but that the appropriate system is not set up to support them, contributing to a culture of shorter fixed terms and insecurity which harms landlords and tenants alike.

    So we emphasise strongly throughout the report that the system must work better for landlords, which is why alongside changes to tenancy, we call for the creation of a specialist housing court, accelerated grounds to gain possession in instances of serious rent arrears, and for the Government to reconsider the tax penalties introduced by George Osborne in 2015.

    As for the case study, here we are merely highlighting the experience one particular mother who’d submitted evidence to us. We do not doubt that the action of the landlord in this case may be illegal. However, the case study exposes the ease with which ‘retaliatory evictions’ continue to take place despite this.

    ​We contend, among others, that a longer tenancy regime would further reduce the risks of this occurring. This is not mutually exclusive with local authorities already having legal powers to intervene.

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