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Government eyes up renter reform as part of latest round of levelling-up

By Joe Cooper
02 June 2021

By Joe Cooper

One of the more overlooked aspects of the Government’s ‘levelling up’ agenda has been the recently announced reforms to the private rented sector (PRS).

There are 4.4 million households in the private rented sector in England, comprising 19 per cent of total households and making it the largest tenure behind owner-occupiers. In the 2019 general election – and against a backdrop of the Conservative’s considerable majority – Labour still held a significant lead of 12 points and 15 points with voters in the social rented and private rented sectors respectively.

However, planned reforms to renters’ rights could present an opportunity for the Conservatives to chip away at that lead. As young people across the country find it as difficult as ever to take their first step onto the property ladder - and with a new wave of social housing unlikely in the immediate future - this pool of voters in the private rented sector may be one which is increasingly targeted by the government in the build up to the next election.

Announced in the Queen’s Speech, the package of reforms to the sector includes the introduction of a lifetime tenancy deposit model to help renters moving between tenancies, new measures to drive improvements in standards in rented accommodation, and most notably reforms to Section 21 notices.

Section 21 notices, known more commonly known as ‘no fault’ evictions, give landlords the power to serve notice to terminate an assured shorthold tenancy (the most common type of tenancy for those in the PRS) at their own discretion. While there are some criteria which landlords need to meet in order to issue a Section 21 notice, the existence of the clause provides an imbalance of power between renters and landlords, which can contribute to precarious living situations for renters. The government will hope for credit from renters all too familiar with the often slow and arduous process of getting their deposits returned, all adding to the considerable up front financial burden of moving tenancies.

The government is also pushing ahead with plans to improve standards in the PRS, including through the introduction of redress schemes for tenants, and effective enforcement to tackle rogue landlords, such as creating a landlord register to provide tenants with greater confidence.

These announcements come in the wake of what has been an incredibly difficult year for those living in the private rented sector. Research from Shelter and YouGov found that as many as 1.6 million renters had been struggling or had fallen behind on their rent during the pandemic, while poor living conditions and cramped accommodation were also factors in making lockdown even more difficult for many of those in the sector. The National Residential Landlords Association (NRLA) found that up to 22 per cent of landlords had lost income as a result of the pandemic.

While the ban on bailiff-enforced evictions has protected many renters who have fallen into arrears, now that the ban has been lifted, the effects of the arrears will be felt in the coming months.

Estimates from the Joseph Rowntree Foundation suggest that as many as 400,000 renters have either received or are expecting to receive eviction notices, and in the face of this surge in evictions, it is clear that short-term support is needed to support renters.

Yet combining this potential for short-term support with the longer-term reforms for the sector with the wider rhetoric around levelling-up through providing jobs and opportunities for people across the country, reforming the PRS presents a considerable opportunity for the Government to extend its levelling-up agenda further still.