The private rental sector: misery, stress and poverty

Renting is the new normal, but for many it means no security and a constant risk of exploitation.

Much of the coverage regarding Britain's housing crisis has concentrated on the misery our over reliance on the private rental sector has inflicted on young people seeking to buy their first house. It's valid, but the sector takes a greater toll on those families who end up in its clutches.

For an illustration of this, listen to Paul Smith's story. He's 44, and he works in IT. Back in 2006 Paul was living in Malta with his wife and two children, then aged eight and six. They owned a house on the island, and decided it was time to move back to England. They put their house on the market; due to the discrepancy in property value, it only raised them about £30,000.

The family had no prior banking history in the UK, so they struggled to secure a mortgage. They put up a £7,000 deposit to rent a house in Bracknell. The house was fine, but Paul wanted more security for his family – he wanted them to go some way to having assured tenancy. Upon moving, the owners of the house, a private rental firm, hit Paul and his family with a bill for £1,500 due to alleged damage to the furniture.

(Your correspondent has actually been done over by a similar scheme when renting many years back – the owners of the house I was renting had called in a dodgy survey company to inspect the house at the start and end of my tenancy; being young and naive I'd not had a survey of my own done, so it seemed better to reach a settlement rather than fight it in the small claims court, much as I wanted to.)

The family moved to a run-down cottage in Ironbridge. After two years there, they were told the landlord wanted the place back. The landlord, who was registered through the local council, hit them with a bill for £600, despite the fact that the local council's environmental health team had helped them move (the place even had damp rot around the electrical sockets). The council claimed Paul would be able to get the £600 back: in fact, he was awarded £70 in compensation. For the third time in two years, the family moved – this time to a much more pleasant house in Telford. It was far better, but at the start of 2008 the family were offered a place with the housing association in Ludlow. They snapped it up, despite the fact that Paul had now lost his job in the financial crisis and work would be harder to find there.

The trouble was that the stress of constantly moving, coupled with the ebbing away of their financial situation (their savings were gradually eaten away by the costs of high rents and constant moves) had taken an unbearable toll on Paul's marriage. He and his wife split up last September.

"It was worse for the children," he tells me. "Every move involved finding them a new school, but they struggled to make friends before being dragged away to a new place. They never felt stable. It had a profound effect on my family."

Renting is the new normal. Over the last fifteen years, the number of people who rent their home from a landlord has almost doubled to 8.5 million people, and nearly a third of renters are members of families with children. Typically, these people are on contracts of 12 months or fewer. Paul's family were among the 67 per cent of families in the private rental sector who moved house in the last three years. Last year 310,000 out of 1,017,000 families with children in the sector moved: a shocking 30 per cent of all families. In comparison, 122,000 out of 3,863,000 families with children who own their home moved house last year: just three per cent.

Paul's situation was hardly unusual: as the charity Shelter has revealed, almost half of people who are renting privately say that housing costs are causing stress and depression in their family – a higher rate than any other group. The children of these families are not just suffering because of the constant upheaval - they're suffering because of the effect of parents who are poorer (the charity has also shown showed that 38 per cent of families with children who are renting privately have cut down on buying food to pay their rent), and more prone to arguing.

There are two reasons those in the private rental sector don't feel as if their accommodation is stable – the possibility of eviction with just two months' notice, and constant worries about when rent rises will hit. It's why Shelter is calling for a Stable Rental Contract, which it claims would offer the stability of five year tenancies.

The problem isn't necessarily due to the oft-imagined stereotype of cruel, Rachmanite landlords. In fact, it's often due to the fact that they are reliant on letting agents because they don't feel confident enough to rent the properties themselves – and the agents "add value" by encouraging short-term tenancies. Shelter has cited research by Jones Lang LaSalle, a real estate services firm, which shows that not only would it provide more security for tenants - it makes business sense for landlords, with a steadier, long-term income rising more gently with inflation that could increase their returns.

"I'm now an avid campaigner for affordable house building," Paul tells me. "It's a mystery to me why the Government is looking at spending money on things like HS2 when a comprehensive programme of affordable houses would put people in work and improve the lives of thousands. I wouldn't wish what I've been through on anybody."

 

Nearly a third of renters are members of families with children. Photograph: Getty Images

Alan White's work has appeared in the Observer, Times, Private Eye, The National and the TLS. As John Heale, he is the author of One Blood: Inside Britain's Gang Culture.

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Former Irish premier John Bruton on Brexit: "Britain should pay for our border checks"

The former Taoiseach says Brexit has been interpreted as "a profoundly unfriendly act"

At Kapıkule, on the Turkish border with Bulgaria, the queue of lorries awaiting clearance to enter European Union territory can extend as long as 17km. Despite Turkey’s customs union for goods with the bloc, hauliers can spend up to 30 hours clearing a series of demanding administrative hoops. This is the nightmare keeping former Irish premier John Bruton up at night. Only this time, it's the post-Brexit border between Northern Ireland and the Republic, and it's much, much worse.   

Bruton (pictured below), Taoiseach between 1994 and 1997, is an ardent pro-European and was historically so sympathetic to Britain that, while in office, he was pilloried as "John Unionist" by his rivals. But he believes, should she continue her push for a hard Brexit, that Theresa May's promise for a “seamless, frictionless border” is unattainable. 

"A good example of the sort of thing that might arise is what’s happening on the Turkish-Bulgarian border," the former leader of Ireland's centre-right Fine Gael party told me. “The situation would be more severe in Ireland, because the UK proposes to leave the customs union as well."

The outlook for Ireland looks grim – and a world away from the dynamism of the Celtic Tiger days Bruton’s coalition government helped usher in. “There will be all sorts of problems," he said. "Separate permits for truck drivers operating across two jurisdictions, people having to pay for the right to use foreign roads, and a whole range of other issues.” 

Last week, an anti-Brexit protest on the border in Killeen, County Louth, saw mock customs checks bring traffic to a near standstill. But, so far, the discussion around what the future looks like for the 260 border crossings has focused predominantly on its potential effects on Ulster’s fragile peace. Last week Bruton’s successor as Taoiseach, Bertie Ahern, warned “any sort of physical border” would be “bad for the peace process”. 

Bruton does not disagree, and is concerned by what the UK’s withdrawal from the European Convention on Human Rights might mean for the Good Friday Agreement. But he believes the preoccupation with the legacy of violence has distracted British policymakers from the potentially devastating economic impact of Brexit. “I don’t believe that any serious thought was given to the wider impact on the economy of the two islands as a whole," he said. 

The collapse in the pound has already hit Irish exporters, for whom British sales are worth £15bn. Businesses that work across the border could yet face the crippling expense of duplicating their operations after the UK leaves the customs union and single market. This, he says, will “radically disturb” Ireland’s agriculture and food-processing industries – 55 per cent of whose products are sold to the UK. A transitional deal will "anaesthetise" people to the real impact, he says, but when it comes, it will be a more seismic change than many in London are expecting. He even believes it would be “logical” for the UK to cover the Irish government’s costs as it builds new infrastructure and employs new customs officials to deal with the new reality.

Despite his past support for Britain, the government's push for a hard Brexit has clearly tested Bruton's patience. “We’re attempting to unravel more than 40 years of joint work, joint rule-making, to create the largest multinational market in the world," he said. It is not just Bruton who is frustrated. The British decision to "tear that up", he said, "is regarded, particularly by people in Ireland, as a profoundly unfriendly act towards neighbours".

Nor does he think Leave campaigners, among them the former Northern Ireland secretary Theresa Villiers, gave due attention to the issue during the campaign. “The assurances that were given were of the nature of: ‘Well, it’ll be alright on the night!’," he said. "As if the Brexit advocates were in a position to give any assurances on that point.” 

Indeed, some of the more blimpish elements of the British right believe Ireland, wedded to its low corporate tax rates and east-west trade, would sooner follow its neighbour out of the EU than endure the disruption. Recent polling shows they are likely mistaken: some 80 per cent of Irish voters say they would vote to remain in an EU referendum.

Irexit remains a fringe cause and Bruton believes, post-Brexit, Dublin will have no choice but to align itself more closely with the EU27. “The UK is walking away,” he said. “This shift has been imposed upon us by our neighbour. Ireland will have to do the best it can: any EU without Britain is a more difficult EU for Ireland.” 

May, he says, has exacerbated those difficulties. Her appointment of her ally James Brokenshire as secretary of state for Northern Ireland was interpreted as a sign she understood the role’s strategic importance. But Bruton doubts Ireland has figured much in her biggest decisions on Brexit: “I don’t think serious thought was given to this before her conference speech, which insisted on immigration controls and on no jurisdiction for the European Court of Justice. Those two decisions essentially removed the possibility for Ireland and Britain to work together as part of the EEA or customs union – and were not even necessitated by the referendum decision.”

There are several avenues for Britain if it wants to avert the “voluntary injury” it looks set to inflict to Ireland’s economy and its own. One, which Bruton concedes is unlikely, is staying in the single market. He dismisses as “fanciful” the suggestions that Northern Ireland alone could negotiate European Economic Area membership, while a poll on Irish reunification is "only marginally" more likely. 

The other is a variation on the Remoaners’ favourite - a second referendum should Britain look set to crash out on World Trade Organisation terms without a satisfactory deal. “I don’t think a second referendum is going to be accepted by anybody at this stage. It is going to take a number of years,” he said. “I would like to see the negotiation proceed and for the European Union to keep the option of UK membership on 2015 terms on the table. It would be the best available alternative to an agreed outcome.” 

As things stand, however, Bruton is unambiguous. Brexit means the Northern Irish border will change for the worse. “That’s just inherent in the decision the UK electorate was invited to take, and took – or rather, the UK government took in interpreting the referendum.”