Landlords have evolved, but the rules protecting renters are stuck in the past

The private rented sector has fundamentally changed over the past decade; yet the rules governing how it functions are rooted in the late 1980s.

After the passing of the 1988 Housing Act the size of the private rented sector stayed roughly the same in London. However, since 2001 it has risen by 75 per cent with one in four Londoners now renting privately.

The people living in the sector has also changed, renting is no longer the preserve of the young and economically mobile who previously welcomed its characteristic short-termism. Homeownership is now an increasingly distant dream for Londoners on better incomes, combined with the hollowing out of social housing this has forced those on lower incomes to rely on the private rented sector as well, often with significant subsidy from the state in the form of housing benefit.

The result is that many – if not most – now live in the sector out of necessity, not choice. We see the evidence of this in the emergence of "Generation Rent" and that 20 per cent of the recent growth in privately renting households has been from families with children.

We have one of the weakest sets of rules and regulations of comparable countries to protect private sector tenants. Yet, we also have one of the worst housing crises. The case for reform is clear; the question is not should we reform, but how we should reform the sector.

This week the London Assembly Housing and Regeneration Committee published its report on London’s private rented sector. The report suggests how we mitigate the worst insecurities of the private rented sector – most notably affordability, security of tenure and poor landlord practices. On rents, the committee wants the Mayor to seek regulations so he can pilot a mechanism for bringing stability and predictability to rent increases. While the committee is open to suggestions of how rent increases can be made more predictable, our starting point is the "second generation" regulations of rents – such as those used in Germany and Switzerland – where rent increases are linked to inflation or interest rates.

We are not proposing caps on rents. The proposal has drawn the scorn of City AM editor Alistar Heath, who described the proposal as “stupid”, “economic illiteracy” and “antiquated, quasi-Victorian class hatred of landlords”. Aside from the lazy mudslinging, Heath clearly hasn’t read our proposal, as he seems to think we’re proposing rent caps.

He presents a false choice between New York style rent caps and – what we proposed – second generation rent stabilisation. The evidence from other western economies, most notably Germany and Switzerland, is that such regulations produce much larger, affordable and better functioning private rented sectors than we currently enjoy in London.

As Mr Heath admits in his article London is currently suffering from a dysfunctional housing market. To put it another way, London’s rental sector is experiencing market failure, a point highlighted by Shelter’s report on rip-off letting agent fees. Given the scale of market failure in London’s housing market and the profitability of the sector for landlords, it is unlikely that a mechanism to stabilise rent (not cap rents) would negatively impact on overall supply – it hasn’t in other countries. We need more houses and flats, but we also need rent stabilisation.

Given that the private rented sector is now a permanent destination for many Londoners, particularly families, it is clear that private renters need to feel stable in their home.

That is why the committee has called for the abolition of a landlord’s right to "no fault eviction".

There are a myriad of legal recourses for landlords to evict tenants if they have a genuine reason for doing so. What is not acceptable is a landlord exercising their right to evict a tenant for absolutely no reason. Throughout the committee’s investigation we heard many cases of tenants evicted from properties for asking for repairs or improvements to a property.

Picture the situation; you are a parent of children who have their GCSEs coming up in two months. The boiler has broken and you have asked for it to be repaired. The landlord then exercises his right to "no fault eviction" to get rid of you, knowing full well other tenants will be in the property soon enough. Is it right that our regulations allow this to happen?

Of course, this report is not all about bashing bad landlords. Most landlords are good landlords, who treat their tenants well and invest in their housing stock. That is why the report has encouraged support for landlords – the Assembly is championing low-cost loans and access to reduced cost services – that will make their stock better and make it cheaper for them to operate.

Bringing sense to rent rises will not result in a catastrophic loss of homes – landlords will not just walk away. Hard-pressed tenants are questioning how other western countries can have better regulated sectors than we do, while also having a much larger, more affordable and better functioning private rented sector.

We must do the same in London, this problem isn’t going away and every day we wait more and more Londoners are being poorly treated and having to put up with poor conditions. We’ve had enough talking, now its time for action.

Photograph: Getty Images

Tom Copley is a Labour member of the London Assembly

Photo: Getty Images
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Why are boundary changes bad for Labour?

New boundaries, a smaller House of Commons and the shift to individual electoral registration all tilt the electoral battlefield further towards the Conservatives. Why?

The government has confirmed it will push ahead with plans to reduce the House of Commons to 600 seats from 650.  Why is that such bad news for the Labour Party? 

The damage is twofold. The switch to individual electoral registration will hurt Labour more than its rivals. . Constituency boundaries in Britain are drawn on registered electors, not by population - the average seat has around 70,000 voters but a population of 90,000, although there are significant variations within that. On the whole, at present, Labour MPs tend to have seats with fewer voters than their Conservative counterparts. These changes were halted by the Liberal Democrats in the coalition years but are now back on course.

The new, 600-member constituencies will all but eliminate those variations on mainland Britain, although the Isle of Wight, and the Scottish island constituencies will remain special cases. The net effect will be to reduce the number of Labour seats - and to make the remaining seats more marginal. (Of the 50 seats that would have been eradicated had the 2013 review taken place, 35 were held by Labour, including deputy leader Tom Watson's seat of West Bromwich East.)

Why will Labour seats become more marginal? For the most part, as seats expand, they will take on increasing numbers of suburban and rural voters, who tend to vote Conservative. The city of Leicester is a good example: currently the city sends three Labour MPs to Westminster, each with large majorities. Under boundary changes, all three could become more marginal as they take on more wards from the surrounding county. Liz Kendall's Leicester West seat is likely to have a particularly large influx of Tory voters, turning the seat - a Labour stronghold since 1945 - into a marginal. 

The pattern is fairly consistent throughout the United Kingdom - Labour safe seats either vanishing or becoming marginal or even Tory seats. On Merseyside, three seats - Frank Field's Birkenhead, a Labour seat since 1950, and two marginal Labour held seats, Wirral South and Wirral West - will become two: a safe Labour seat, and a safe Conservative seat on the Wirral. Lillian Greenwood, the Shadow Transport Secretary, would see her Nottingham seat take more of the Nottinghamshire countryside, becoming a Conservative-held marginal. 

The traffic - at least in the 2013 review - was not entirely one-way. Jane Ellison, the Tory MP for Battersea, would find herself fighting a seat with a notional Labour majority of just under 3,000, as opposed to her current majority of close to 8,000. 

But the net effect of the boundary review and the shrinking of the size of the House of Commons would be to the advantage of the Conservatives. If the 2015 election had been held using the 2013 boundaries, the Tories would have a majority of 22 – and Labour would have just 216 seats against 232 now.

It may be, however, that Labour dodges a bullet – because while the boundary changes would have given the Conservatives a bigger majority, they would have significantly fewer MPs – down to 311 from 330, a loss of 19 members of Parliament. Although the whips are attempting to steady the nerves of backbenchers about the potential loss of their seats, that the number of Conservative MPs who face involuntary retirement due to boundary changes is bigger than the party’s parliamentary majority may force a U-Turn.

That said, Labour’s relatively weak electoral showing may calm jittery Tory MPs. Two months into Ed Miliband’s leadership, Labour averaged 39 per cent in the polls. They got 31 per cent of the vote in 2015. Two months into Tony Blair’s leadership, Labour were on 53 per cent of the vote. They got 43 per cent of the vote. A month and a half into Jeremy Corbyn’s leadership, Labour is on 31 per cent of the vote.  A Blair-style drop of ten points would see the Tories net 388 seats under the new boundaries, with Labour on 131. A smaller Miliband-style drop would give the Conservatives 364, and leave Labour with 153 MPs.  

On Labour’s current trajectory, Tory MPs who lose out due to boundary changes may feel comfortable in their chances of picking up a seat elsewhere. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog. He usually writes about politics.