Is this renting’s watershed moment?

The problems of "Generation Rent" seem finally to be getting some political attention, but without more homes being built, renting will continue to boil over.

In a week that a parliamentary inquiry begins into the state of private renting, and official statistics confirm the seismic growth of Generation Rent, it’s starting to look like rental Britain is beginning to get the political attention it deserves.

More than nine million people now rent from a private landlord. With hundreds of thousands priced out of home ownership and unable to access social housing, renting is fast becoming the new normal. And figures this week finally confirmed that for the first time since the 1960s, more people rent their homes from a private landlord than from a council or housing association. More and more of us now understand the frustration of paying hundreds of pounds each month in "dead money" to landlords, for a home that we can’t make our own.

Last week, Shelter’s Rent Trap report painted the latest bleak picture of life for Generation Rent. While wages stagnate, rents are up in 83 per cent of the country; on average, renters are paying out £300 more each year. In some areas, that rises to more than £1,000 a year – and that’s on top of rents that are already higher than mortgage costs.

This is the rent trap: people can’t afford to buy, so are stuck paying high rents, leaving them with little left over for anything else - half have less than £100 after rent and bills. This means they’re not able to save enough for a home of their own - leaving them facing yet another year of renting. As homes remain increasingly unaffordable, this trap sucks in ever more young people who know that the dream of a place of their own is slipping away.  

But the rent trap isn’t just a social issue; it’s an increasingly political one too. Renters are an ever-larger political constituency, with many closely resembling the archetypical middle income voter. And for voters in marginal constituencies, renting is a bigger issue than ever.

Our report found that the cost of renting has increased substantially in a number of key electoral battlegrounds – meaning that prospective MPs will need to become more familiar with the realities of renting if they want to win or keep these seats. Renters in Solihull - a Lib/Con marginal - are paying almost £400 a year more in rent; Lab/Con marginal Thurrock saw rents increase by almost £300; and three way marginal Hampstead and Kilburn rents are up by more than £800. The subject of the newest by-election tussle – Chris Huhne’s Eastleigh seat – saw rents rise by 3.2 per cent over the past year – more than twice as fast as wages. Some might say: does it matter if people rent? It’s commonplace in Germany, and people seem perfectly happy renting there. Should we be worried about this trend?

The trouble is that renting in England isn’t set up to play the kind of role that it plays in Germany and other developed countries. Renting was deregulated in 1989 to provide flexibility for a mobile workforce – the Assured Shorthold Tenancy was introduced and 6-12 month contracts became the norm. Politicians at the time envisaged lots of young people moving around for work before they settled down, bought a home and had kids.

But that’s not the role that renting is playing now. A major part of the growth of renting in recent years has been from families with children – some 1.3 million families now rent. For these families, renting isn’t working. They’ll typically have short contracts, after which they can be asked to leave for any reason, or their rent can be increased with no upper limit. That’s far from ideal when you’re feeling financially squeezed – or when your children are starting a new school year without being sure of where they’ll be living come the summer holidays.

For years, successive governments have tinkered around the edges on renting. Politicians recognise that most don’t want to rent for the long term, so have focused on helping people into homeownership: guaranteeing 95 per cent mortgages, expanding shared ownership schemes. But these schemes aren’t going far enough – and this leaves families stuck in rented homes with no reassurance from government that things will ever improve.

It seems that some politicians are beginning to wake up to the new reality of renting. Boris Johnson has said he intends to pilot longer tenancies in London, and Conservative newcomer Jake Berry has made the case for them too. Meanwhile, Ed Miliband and Labour’s Shadow Housing Minister, Jack Dromey, have spoken about more widespread measures to make longer term contracts the norm, and called an Opposition Day debate on the issue in January.

This week, a Select Committee began sitting for an inquiry into the private rented sector, and Shelter gave oral evidence on Monday, telling the stories of the thousands of people who come to us for help with renting problems.

In the short-term, government needs to tackle the reality of rental Britain, because every indication shows that it’s here to stay. We’ve proposed the Stable Rental Contract: a five-year tenancy with predictable rent increases, which will give renters the certainty they can keep their children in a local school and plan their finances, while also helping reduce the risk of empty periods for landlords.

It’s good news that politicians are beginning to up their game – but they have to translate words into action, as voters will hold them to account. The truth is that the efforts of successive governments have not gone far enough in helping people on ordinary incomes get a decent, stable, affordable home.

The government needs a much bolder plan of action for helping people achieve this basic aspiration. The bottleneck of supply and demand is worsening. Without more homes being built, renting will continue to boil over. Rents will continue to rise; people will struggle even harder to put money aside; the dream of a home of their own will continue to slip away.
 

More than nine million people now rent from a private landlord. Photograph: Getty Images

Robbie de Santos is a policy officer at Shelter.

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Donald Trump vs Barack Obama: How the inauguration speeches compared

We compared the two presidents on trade, foreign affairs and climate change – so you (really, really) don't have to.

After watching Donald Trump's inaugural address, what better way to get rid of the last few dregs of hope than by comparing what he said with Barack Obama's address from 2009? 

Both thanked the previous President, with Trump calling the Obamas "magnificent", and pledged to reform Washington, but the comparison ended there. 

Here is what each of them said: 

On American jobs

Obama:

The state of our economy calls for action, bold and swift.  And we will act, not only to create new jobs, but to lay a new foundation for growth.  We will build the roads and bridges, the electric grids and digital lines that feed our commerce and bind us together.  We'll restore science to its rightful place, and wield technology's wonders to raise health care's quality and lower its cost.  We will harness the sun and the winds and the soil to fuel our cars and run our factories.  And we will transform our schools and colleges and universities to meet the demands of a new age.

Trump:

For many decades we've enriched foreign industry at the expense of American industry, subsidized the armies of other countries while allowing for the very sad depletion of our military.

One by one, the factories shuttered and left our shores with not even a thought about the millions and millions of American workers that were left behind.

Obama had a plan for growth. Trump just blames the rest of the world...

On global warming

Obama:

With old friends and former foes, we'll work tirelessly to lessen the nuclear threat, and roll back the specter of a warming planet.

Trump:

On the Middle East:

Obama:

To the Muslim world, we seek a new way forward, based on mutual interest and mutual respect. To those leaders around the globe who seek to sow conflict, or blame their society's ills on the West, know that your people will judge you on what you can build, not what you destroy. 

Trump:

We will re-enforce old alliances and form new ones and unite the civilized world against radical Islamic terrorism, which we will eradicate completely from the face of the earth.

On “greatness”

Obama:

In reaffirming the greatness of our nation we understand that greatness is never a given. It must be earned.

Trump:

America will start winning again, winning like never before.

 

On trade

Obama:

This is the journey we continue today.  We remain the most prosperous, powerful nation on Earth.  Our workers are no less productive than when this crisis began.  Our minds are no less inventive, our goods and services no less needed than they were last week, or last month, or last year.  Our capacity remains undiminished.  

Trump:

We must protect our borders from the ravages of other countries making our product, stealing our companies and destroying our jobs.

Protection will lead to great prosperity and strength. I will fight for you with every breath in my body, and I will never ever let you down.

Stephanie Boland is digital assistant at the New Statesman. She tweets at @stephanieboland