Lime Legal

Muddying the waters

Published 10 March 2024

Progress has been made in improving private renting, but recent government measures could undo the gains . By Vincenzo Rampullo

Election years do not promote good policy making. The government’s recent announcements about the private rented sector are a disappointing return to a ‘two-steps forward, five steps back’ approach to the sector – and could have negative repercussions that go far beyond election day.

During the past couple of years, attempts have been made to recast renting in a different role from that of housing’s ‘ugly sister’. So it is unclear where the government is going in choosing these latest initiatives.

The problems are two-fold. The latest moves will generate mistrust towards the majority of trustworthy landlords, the assumption being that your landlord is ‘dodgy until proven innocent’. They also encourage people to treat private rented homes in the same way as holiday hotels.

In 2008, Dr Julie Rugg’s review put forward the idea of light-touch registration. It was carefully couched, making the process of letting property less ‘casual’ without making landlording more difficult and drastically increasing the costs of renting. The current government proposals are a million miles from that.

While it has taken the welcome step of requiring all tenancies to be written agreements, landlord registration now looks like a circus of administration – bewildering for tenants, frustrating for landlords.

The register seems designed to create more paperwork and do nothing to tackle the small minority of malicious rogue landlords.

Consider what these policies mean for Mr and Mrs Smith, a professional landlording couple, who purchase a three-bedroom house which they want to let to three sharing professionals.

They’ve already made sure they are doing everything they need to do. But under the government’s proposals they will also have to apply and pay for planning permission for their property as three professionals sharing a normal house will be classed as a house of multiple occupation.

If their property is in an area where the local authority has introduced a licensing scheme for rented property, they will also have to apply and pay for a licence and register and pay for their landlord registration, possibly on a yearly basis.

All of these are substantial costs which have to be met before rental payments have even started. This will raise the yearly cost of letting properties and can only mean increases in rents as landlords legitimately seek to cover costs. So everything will cost more, yet none of these policies are guaranteed to improve the renting experience for tenants.

These measures rest on the foundation that tenants will ask the right questions about the property and their landlords in the first place. With the sector’s experience after the introduction of energy performance certificates, these seem like shaky foundations at best.

The government believes the answer lies in comparison websites. Sites such as TripAdvisor help people make better choices about hotels and restaurants for holidays. But there is little value in such a site for tenants or landlords considering tenancies that will typically last 18 months.

It is ridiculous to reduce the relationship between landlord and tenant to a hastily written paragraph and a ‘star rating’. The sector doesn’t have the same volume and churn that hotels and restaurants have, so one bad or malicious experience could ruin a landlord’s ‘rating’ for years.

And if we don’t think rating individual teachers, bank managers or family doctors is sensible, then why does the government feel that your relationship with your landlord should be more like choosing a kettle, holiday package or second-hand car?

The only positive move government has made so far has been to fund more tenant access to housing advice, which is needed.

During the past couple of years we have seen a broad move away from adversarial debate about renting, to a more constructive discussion about how to improve a sector that provides essential housing provision.

That means recognising the important contribution that the majority of landlords make in providing housing and encouraging the best that the sector has to offer. None of what the government has announced will achieve that. Can we afford to go backwards?

Vincenzo Rampulla is public affairs officer at the National Landlords Association.