Chris Town: A failed system hits tenants and their landlords

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“IT becomes less and less logical for a private landlord to also be a decent landlord.” This was the poorly-judged recent conclusion by one self-claimed representative of tenants and goes straight to the heart of the problem with debate over the private rented sector.

It is too often polarised as landlords against tenants. The reality is that 85 per cent of tenants are very or fairly satisfied with their accommodation according to the English Housing Survey – a larger proportion than the social sector.

According to the 2011 Census, 16 per cent of all households across Yorkshire and the Humber are in the private rented sector. Looking at our major urban conurbations, that figure increases to 18 per cent in Leeds and Bradford and 20 per cent in Hull. In the Leeds suburb of Headingley where many students live, more than 67 per cent of households are in the private rented sector.

With many young people and families facing difficulty in affording to buy and with access to social housing very limited, the private rented sector has grown significantly in recent years and is now larger than the social rented sector.

This has heightened debate in the run up to the election. The Residential Landlords Association promotes higher standards and is keen for action to root out the criminal landlords that bring the sector into disrepute. We want to provide security for tenants and encourage investment in much needed new homes.

At recent meetings in Leeds with Tory, Labour and Lib Dem MPs, landlords have pressed for an end to populist calls for more regulation such as through a national register and instead for more intelligent policies that would be more effective at tackling the minority of criminal landlords.

There is no shortage of existing regulations covering the sector with over 100 laws, containing over 400 regulations. The problem is one of enforcement.

One landlord at the meetings with MPs told of how he had obtained licenses for his properties as required by Leeds City Council. He then proceeded to explain that on the current timeframe, it would take the council almost 80 years to inspect every one of his properties.

So, landlords in Leeds and many other cities are faced with a licensing scheme that costs them money – a cost that inevitably get passed on to tenants in higher rents – for the privilege of not having their properties inspected. It is little wonder that Ministers have recently dubbed such licensing a “tenant’s tax.”

The reality is that the current system is bust. Tenants are being let down by enforcement that is patchy at best, while landlords are being hammered by an expense that does not achieve anything.

It is time that we got smarter in our thinking, and pursued an intelligence-led approach that better uses finite council resources.

The RLA’s plan is simple – ask the tenants. Current council tax forms do not ask households the tenure of their property and details, where rented, of the landlord. A change to the law could make this a mandatory requirement. Tenants are already legally bound to have their landlord’s details when they sign a new tenancy.

Where a tenant is unable to provide this information, it would sound alarm bells and provide councils with the intelligence they need to investigate. The property owner could be found using the Land Registry database.

Crucially, under this system, the criminals could not avoid scrutiny. They could not simply hide themselves in the shadows, confident that the council is unlikely to have the resources to find them.

But there is something far bigger than just a change to a council tax form that is needed and that is a renewed push to boost the supply of homes to rent.

The reality is that where demand is high and supply is low, rents go up and standards tend to be lower. Boosting supply provides tenants with choice, and promotes the kind of competition that benefits them.

With the majority of landlords being individuals renting out just one or two properties, the next Government needs to do far more to support them in providing more homes to rent while, in many cases, providing security for themselves in retirement.

A key step in this direction would be to end the anomaly that means that while VAT is not charged on new build homes for owner occupation, it is charged on new homes to rent.

The majority of landlords provide a good service with their tenants being happy in the homes they rent. It is time more was done to support the good guys rather than engaging in the ideological bashing that has for too long prevented a serious, evidence-based debate about what really works.

Chris Town is Vice Chair of the Residential Landlords Association and is a landlord in Yorkshire. The RLA tweets @RLA_News