I often read on social media and in articles, complaints about the private rented sector.
“Why should” I hear people say “some people make money out of other people by providing something as fundamental as a place to live?”.
Pointing out that if they rent a property from a landlord or share a property as a lodger, they are paying off the landlords mortgage for them and getting nothing in return.
Other than the right to live there for a time and then get kicked out (assuming section 21 remains in its present form) when the landlords want their property (or their room) back.
That’s true – but it’s hard to see how it can be changed.
Changing views on property rights
It’s a fact that people with no property are far more likely to want to challenge property rights. As soon as you own property, you feel differently about it.
Many people who own their own home and maybe a buy to let property or two, would very much resent very much any legislation which took away their rights, for example, to leave their property to their children.
However, those people may feel differently about the millionaires and billionaires who own massive areas of land – and consider that to be unfair and undemocratic..
The billionaires, on the other hand, also resent any attempt to take away their rights.
Billionaires though, by virtue of their ability to bankroll organisations (such as political parties) tend to have a disproportionate influence on affairs.
So I doubt we will be seeing soon any legislation which would, for example, look to break up large estates in the way that we have rules to prevent monopolies in the business world.
The options for housing the populace
Everyone needs a home. So what are the options?
- Home-ownership – either a freehold house or property on a long lease
- Renting from a social landlord
- Renting from a private landlord
- Living in a van or moveable vehicle
This tends to be viewed as the ideal in this country (although less so abroad where housing laws are different).
However, not everyone can afford to buy and many people don’t want to buy. For example, they may not want to be tied down or have the responsibilities and indeed expenses (such as repair and redecoration) which come from owning your own home
Renting from a social landlord
This was an excellent solution to the problem but sadly the greater part of our social housing stock has now been sold off under the right to buy.
Local Authorities and housing associations are in some places trying to increase their housing stock again. However, one wonders whether there is any point to this if they are just going to be forced to sell it off again?
Renting from a private landlord
Often this is the only option for people unable to buy or rent from a social landlord. Although it can be the preferred option for some people, and it is especially important and desirable for short term housing solutions, for example for young single professionals whose jobs require them to move frequently.
One of the reasons the Tory party in the 1980s wanted to encourage the development of a private rented sector (which they did by passing the Housing Act 1988 along with its right to possession under section 21), was because it was considered bad for the economy to have such a small stock of rented homes available (as was the case at that time).
The private rented sector at the moment is mostly owned by landlords who have just one or two properties.
The government would like to encourage larger commercial private sector landlords, but although there are some developments, on the whole, this does not seem to be particularly popular with businesses.
If the government wants to encourage this they will need to do more in the way of financial incentives and tax breaks.
Vans and moveable ‘Tiny Homes’
I have been reading quite a bit about the Tiny Homes movement in Australia and the United States (I wrote about it here) and have been impressed by the quality of many of the tiny homes I have seen. For example, as featured in the Living Big in a Tiny House website.
I think there should be a place for this. Many people find living in a ‘tiny home’ to be a liberating experience and the homes can be designed to be low carbon and even totally self-sufficient in renewable energy. Something we need to encourage with the approaching climate catastrophe.
The problem we seek to avoid.
So do we need a private rented sector?
I think the answer has to be ‘yes. Not everyone can or wants to own their own property. The social housing sector is far too small to satisfy demand and there are no other options other than perhaps the Tiny House solution.
The Government appear rather confused about what they want.
- On the one hand, they seem to want to look to the PRS to replace the social housing sector to house the homeless.
- However, on the other hand, the many recent and proposed legal and tax changes are discouraging investment in the PRS. Which if anything will result in a reduction of the properties available to rent.
Still, I suppose confusion in the housing sector reflects confusion in other areas of government and policy.
My feeling is that they should concentrate, in the short term, on sorting out the Brexit issue and leave housing until that is resolved. Then once we have a stable government and know where we are going Europe wise, proper consideration can be given to housing reform. This will also allow time for the more recent changes to bed down.