Private Rented Sector

Craig Whittaker Excerpts

Wednesday 23rd January 2013 Commons Chamber

[Graham Jones (Hyndburn) (Lab)]

I draw attention to my entry in the Register of Members’ Financial Interests. It is a little disappointing that Conservative Ministers and the Secretary of State have now left this crucial debate.

I wish to speak in favour of the motion and address standards, value for money, the security offered by the private rented sector and the effect that that is having on our local housing market in Haslingden and Hyndburn. The private rented sector is very large in Hyndburn and the statistics provided by my local authority on standards are of great concern. Across the borough, 49.2% of privately rented homes do not meet the decent homes standard and 29.6% have category 1 hazards. In some wards, 35% of properties are rented out and in some streets and neighbourhoods the figure is about 90%.

[Craig Whittaker (Calder Valley) (Con)]

It is interesting to note that the local authority has the figures on the number of homes that are not up to the required standard. What, therefore, is it doing with the 100-plus regulation powers that it already has to put that right?

[Graham Jones]

That question is easy to answer. My local authority is the third worst hit in terms of revenue grant and it is doing everything it possibly can. If the Government take resources away, they have to accept that it becomes difficult for local authorities to meet their obligations. That is the position in which the local authority finds itself.

I return to the scale of the problem. In the ward of Spring Hill, 71.6 % of houses do not meet the decent homes standard; in contrast, only 17.2% of social housing in the ward does not. In Central ward, 73.6% of houses do not meet the decent homes standard, compared with 32.1% in the social rented sector. That is a damning indictment of the state of the private rented sector in my constituency and the behaviour of some who let those properties. I should say briefly that the housing health and safety rating system is not fit for purpose and is due for an upgrade.

What do Haslingden and Hyndburn constituents get for the privilege of renting a home? Last year, national TV crews came to Hyndburn to see the sorry state of the sector. One house that TV crews visited in my neighbourhood had asbestos, single wooden windows, damp, mould and electrical sockets hanging off the wall with live electrics exposed at a low level. A young mother and a toddler were housed there as there was nowhere else better. The house had innumerable category 1 and 2 hazards, as is common throughout the constituency.

As my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) said, the Government should tackle the dangers of electrical safety, not just by regulating electrical safety certificates but by the mandatory installation of residual-current devices in every rented property.

Nationally, the last English housing survey revealed that the number of people who agreed with the statement “the landlord does not bother with repairs” was twice as high in the private rented sector as in the social rented sector. In Haslingden and Hyndburn, the figure is far higher. At another property in my neighbourhood, I saw a questionable gas fire, which was checked by a gas fitter. It was condemned immediately and removed. For 12 months, the landlord had been asked to look into it. Shockingly, the property was rented by a parent with a two-year-old and four-year-old.

Such stories reflect the chronic state of the private rented sector in Haslingden and Hyndburn. There is a huge problem, not just with rogue landlords, but absent and long-distance ones. Crucially, there are also amateur landlords who know nothing about property maintenance and are simply looking for a quick profit. I ask the Minister to consider this point. Landlords need guidance, and a national register would assist landlords, tenants, neighbours and the local authority to work together.

Recently, a woman suffering from exactly the problems that the Leader of the Opposition has recently identified came into my surgery. She is a single mother with three children. She had been forced to rent a three-bedroom former council house now owned privately through the right to buy. She had been the victim of domestic abuse and her partner had abandoned her and her three children. Her rent is £600 a month, while the rent at the Hyndburn Homes property next door is just £300. The average price of a Hyndburn Homes property is about £64 a week, yet a private rented property costs £108 a week—68% higher.

Then there is the scandal of top-up, which has not been mentioned, whereby landlords raise rents way above housing benefit levels and push families and young, innocent children into the worst poverty imaginable. The lady I mentioned received £425 in housing benefit, so the Department for Work and Pensions was paying £125 more than on the property next door, but that still left her with a £175 shortfall per month that she had to find from the other benefits that she received. Her children were going hungry and she had to be clothed with clothes from the charity shop just to keep a roof over their heads. Moreover, the house was in a terrible state of repair because it had been bought under the right to buy, and the landlord had shown no interest in making good.

When I contacted schools in my local area, they confirmed a rise in the number of poorly clothed and hungry children turning up for school in the morning. My surgery is filled with people desperate for decent housing, all of whom are housed in the private rented sector, while the local authority has a very long waiting list for housing association houses. A recent survey highlighted that Hyndburn has the second highest number in England of people living on the breadline.

I would like to speak for much longer, but time is running out and I will have to conclude my remarks.

--- Later in debate ---

[Craig Whittaker (Calder Valley) (Con)]

I declare my interest in this topic, as reported in the Register of Members’ Financial Interests.

I support the need to take action against letting agents, and I support action taken against rogue landlords, as I support action against any rogue operating in any sector—whether it be builders, window salesmen, car salesmen or any rogue at all. The answer, however, is not further to regulate the whole sector because of what Shelter calls

“the small but dangerous minority of rogue landlords who are making people’s lives a misery”,

but to enforce what is already in place.

There are currently more than 100 pieces of legislation and regulation, containing about 400 individual measures affecting the private rented sector. Figures from Shelter show that only 487 landlords in England were prosecuted last year from a cohort of about 1.2 million. That is low. What is needed is support for local authorities better to enforce existing regulation to root out more effectively the criminal landlords who blight the lives of tenants.

[Jake Berry]

Is it not an example of how regulation will not work that the tenancy deposit scheme can be avoided by rogue landlords simply by taking a rent deposit rather than a breakage deposit? Is that not evidence that regulation will always be avoided by criminals?

[Craig Whittaker]

That is exactly right. In some cases, landlords do not take deposits at all, as I shall explain later.

What is the point of having more legislation and regulation when local authorities are not enforcing what is already in place? Let me point out that a recent English Housing Survey found that 85% of private tenants were either very or fairly satisfied with their landlords, which compares with 81% for social housing tenants.

As an MP, I meet my local landlords association and associations nearby, so I can say that if a stable rental contract that gave renters a five-year term came into force, we would go back to the bad old days of the ’70s and ’80s when landlords advertising their properties would plainly put on the adverts “No DSS”. [Interruption]. It is true. I wonder whether the Opposition Members who proposed this motion ever went out to speak to landlords. If they did, they would find that landlords who rent particularly to the local housing allowance sector often cannot get a bond, let alone four weeks’ rent up front. They have to wait for the local housing allowance payment to come to the tenant before they get paid, and unless they go and collect the rent on the day the tenants are paid, they often find their rents are short.

[Mark Pawsey]

Does my hon. Friend share my concern that if there is too much regulation, landlords will simply exit the sector?

[Craig Whittaker]

My hon. Friend is absolutely right. As I pointed out earlier, we will see landlords refusing to rent to various groups within the sector.

Last week, I spoke to one of my local landlords who has more than 450 homes that he rents out in West Yorkshire. He told me—a story I hear time and again at this time of year—that 40% of his local housing allowance tenants paid short in December and a further 20% did not pay the rent at all, and not because the rents were above the local housing allowance threshold. In one story he told me, the door was answered by the tenant’s young daughter, who was keen to show him the vast array of computers and designer presents she had received for Christmas. He was then told by the tenant, however, that there was not enough money to pay last month’s rent, and he was asked if she could pay it back over the course of this year.

This is not a rogue landlord, but one who maintains all his properties to a high standard—he is actually a very good landlord. What on earth are these landlords going to do when universal credit is introduced later in the year, and the ability to get local housing allowance paid direct when the tenant is in arrears is removed? That is not an issue for today, but I can see those “No DSS” signs coming back as we speak. This will not tackle the problem of rogue landlords, but, sadly, will probably increase their number.

Many vulnerable tenants do not need five-year leases. If we want to do something to help them, let us introduce a support package of budgetary controls and training as part of the wider picture. One of the reasons—and I do mean “one” of the reasons—for the amount of churn in the sector that relies on local housing allowance is the fact that those people simply do not pay their rent, or find themselves in a financial mess.

The motion does not address the real issues, including the issue of rogue landlords. If anything, the measures that it proposes would increase the number of such landlords and push more tenants into their hands. The answer is to help, and force, local authorities to enact and enforce the 100-plus pieces of legislation that already exist, as well as helping vulnerable tenants with such matters as budgetary control.