11 Jan 2021
A report from the House of Lords has condemned the private rental sector as being ”increasingly unaffordable” as well as being “by far the lowest quality and by far the least popular” housing tenure in the UK.
The report – called Meeting Housing Demand and released this week – says that in 2019/20, the private rented sector accounted for 4.4m or 19 per cent of households in England.
As of 2019/20, private renters had on average lived in their accommodation for 4.3 years, which is considerably shorter than for social renters (12.2 years) or owner-occupiers (17.4 years).
The report says that in 1980, the average working-age family renting privately spent 12 per cent of its income on housing; today it spends almost three times this proportion, 32 per cent, while private renters in London spend an average of 42 per cent of their household income on rent.
The report also quotes an independent housing policy consultant saying: “The private rented sector is by far the most expensive, by far the lowest quality and by far the least popular. It is absolutely the worst possible tenure for almost everybody in it.”
He added “Most people who are private renting would much rather be in something cheaper and higher quality. Who would not be? That means either social renting or owner occupation. It is absolutely the tenure of last resort.”
The report goes on to say: “Those living in the private rented sector are more likely to live in poor quality, overcrowded conditions than owner–occupiers, and often have limited forms of redress. Many tenants who would previously have been in social housing are now living in expensive private rented accommodation, with their rents subsidised by housing benefit, which is costing the government around £23.4 billion per year.
“A transition to spending more on the social housing stock would address this problem over time and help meet the most critical needs.
“We welcome the expansion of ‘Build To Rent’ where it contributes towards a net addition to housing supply.”
Most of the Lords report dedicates itself to planning policies and the lack of social housing. It says:
- The involvement of small and medium sized housebuilders has effectively collapsed so the government should make more small sites available, and increasing access to finance;
- By 2050 one in four people in the UK will be over 65 so more specialist and mainstream housing suitable for the elderly is required;
- Uncertainty and delays to planning reforms have had a ‘chilling effect’ on housebuilding and created uncertainty for housebuilders and planners. There is a need for more up-to-date and simpler local plans;
- There should be more upskilling and reskilling to compensate for a growing skills shortage, with an emphasis on apprentices and green skills;
- The government must change its approach to spending on housing, with money spent on housing benefit invested instead in increasing the social housing stock. Right to Buy schemes are not good value for money: increasing the housing supply would be a more effective use of funding.
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