On this day in 1988, the UK’s Housing Act received Royal Assent, deregulating the private rental market and laying the ground for the tenancy system we know today.
It will be a lonely 30th birthday for the legislation. Given the chance, its fellow millennials would not provide a good-natured round of The Bumps. In fact, we’d rather fling it out of the window.
Section 21 of the Act gives landlords the ability to evict tenants without needing a reason. This has made renting both the only option for millions of people – and an inadequate tenure that most are desperate to escape.
By making it easier to empty homes of their tenants, Section 21 made residential property a lot more liquid an asset. As you could cash in when you felt like it. That meant becoming a landlord was no longer a massive commitment, so it became more attractive to amateurs with money to invest. The ensuing buy-to-let boom resulted in the private renter population more than doubling.
Investors effectively outbid would-be first-time buyers, then let out the properties they snapped up to the same people. Since the 1990s, house prices have risen from around four times incomes to eight times, but the desire for home ownership remains; most renters still expect to buy a home in the future.
The reasons for their disloyalty to their current tenure are not hard to fathom. Section 21 means that tenants can comply with their contract to the letter and still be asked to leave with just two months’ notice and no assistance in finding a new home. Nearly two thirds of evictions happen because the landlord wants to sell or use the property, according to the English Housing Survey.
If a council considers an evicted tenant to be unintentionally homeless, and in priority need, it has a duty to rehouse them – but in many cases the only option is to put them up in temporary accommodation, which costs. Such accommodation cost taxpayers nearly £1bn last year.
Even if you never receive a Section 21 notice, the threat of one always looms, so that renters never know where they will live next year. There is none of the confidence about investing time to decorate their homes or get involved in the local community that social tenants and owner-occupiers enjoy. The effect is infantilising, but also leads to the appalling levels of disrepair in private rented homes. One in seven are considered unsafe – if landlords could not credibly threaten an eviction or rent hike if their tenant complains about mould or cold, then that number wouldn’t be nearly so high.
And, not that it’s an excuse, but the private rented sector is no longer dominated by the itinerant and strapping students and young professionals of lore. One in four children now lives in the tenure, while the average age of a private renter is 40. The law that governs the sector fails to reflect its customers’ needs so desperately needs updating. Policymakers’ assumption should be that private tenants need and deserve stable homes as much as any other tenure.
This is why we need to end Section 21. In its place we would have open-ended tenancies that give tenants the flexibility to move out if their circumstances change, but restrict landlords’ ability to evict, by requiring them to prove the grounds to do so.
A list of valid grounds is already set out in Section 8 of the Housing Act. If a landlord needed to repossess from tenants who were not at fault, they would need to make a relocation payment to mitigate the upheaval they faced. And rent rises would be limited to wage inflation to prevent landlords sidestepping new rules by raising it to unaffordable levels.
Amid the unfolding drama of Brexit, the likelihood of a snap election is growing, and contenders for power must offer something to the millions of renters who are the 1988 act’s legacy. To give them some inspiration, the End Unfair Evictions campaign is asking renters on social media to #ReinventYourRent on today’s anniversary. Our bank balances and mental health cannot tolerate any more of this outdated law.
Dan Wilson Craw is director of Generation Rent.
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