To add to the abundance of information and material concerning landlords, letting agents and the rental sector, last month the House of Commons issued a new briefing for the lettings sector.
The 30 page document written by Alex Bate, which is intended to update new and existing MPs on the industry, also acts as a useful resource for agents, if not just to see how the sector is currently being viewed by the political elite.
It’s an expansive document, so to help save you time, we’ve compiled a breakdown of the key points raised in the briefing which covers everything from Build to Rent and Buy to Let to Social Tenants and Housing Associations.
The briefing consistently highlights the idea that the Private Rented Sector (PRS) is an industry of growing importance and that a more professional PRS should be the target for all.
To demonstrate this, the document notes how in 2012/2013 private rental became the second largest housing tenure in England, behind owner-occupancy, overtaking social housing.
The report highlights a number of key statistics concerning the rental sector:
- In 2012/2013 there were 9 million tenants in England (18% of the population), renting 4 million properties
- In 2010, 89% of landlords were private individuals, while 92% were part-time
- In the same year, only 2% of landlords had a portfolio of more than 10 properties
- Less than 1% of the UK's institutional real estate investment is held in the residential marketplace
The bulk of the briefing falls under the umbrella title: 'Building a new PRS' and the beginning of this section sets out three specific objectives:
- The potential to offer longer-term rented homes
- A better service to tenants
- Purpose-built accommodation to a high standard of construction
The briefing then goes on to detail what has been done over the past few years to encourage increased supply of rental property.
The first section – which is dedicated the most space – is Build to Rent. The highs, lows and milestones of the £1 billion fund put aside for the development of 10,000 private rental properties are well-documented.
Signed in July 2013, the first Build to Rent contract was for a development of 102 private rental units in Cemetery Quay, Southampton.
Last month, three new Build to Rent-funded developments were announced, all in the capital. This takes the total number of funded homes to well over 4,000.
Build to Rent has been a catalyst for new-builds in the PRS, according to sources cited by the briefing, although many large scale developers pulled out of bidding due to a resurgence of the owner-occupier market around late 2013/early 2014.
After Build to Rent, the document tackles numerous initiatives concerning the rental market including the PRS Task Force, The PRS Housing Guarantee and The National Planning Policy Framework.
Another section of the briefing which concerns letting agents tackles rent controls. The Conservative Government's opposing to rent controls stance is reiterated and the document cites an exchange between David Cameron and current Labour leadership candidate Jeremy Corbyn during Prime Minister's Questions.
Cameron said: “Every time they [rent controls] have been tried, wherever they have been tried in the world, they have failed. That is not just my view; it is also the view of Labour’s own shadow housing Minister, who is on the record as saying that she does not think rent controls will work in practice. Perhaps he might want to have a word with her before coming to me.”
The briefing also has a short passage on Houses in Multiple Occupation (HMO). It confirms that the Government won't be changing rules over HMOs, meaning councils will retain the ability to control the spread of HMOs. Councils can do this by requesting planning applications from owners who are aiming to change the use of their property to an HMO.
Despite a few fleeting references, there is no dedicated section to the success or otherwise of mandatory redress for letting agents, which was introduced in October 2014. There are also no mentions of compulsory fee disclosure, although this was only introduced at the end of May this year.
On the whole, the briefing is detailed and informative and in the wake of last week's Budget announcements, this document acts as a welcome boost for letting agents and landlords as the government clearly places high importance and increasing value on our Private Rented Sector.
If you do have a spare half an hour, you can download and read the full report here: http://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN07094#fullreport