Housing: Private Rented Sector

Lord McKenzie of Luton Excerpts

Tuesday 14th October 2014 Lords Chamber

Asked by

[Lord McKenzie of Luton]

To ask Her Majesty’s Government what steps they will take to improve housing stability for those renting in the private sector, particularly families.

[Lord McKenzie of Luton (Lab)]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I draw attention to my interest declared in the register.

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Lord Ahmad of Wimbledon) (Con)]

My Lords, the Government are avoiding the excessive red tape which would push up rents and reduce supply. We have recently published a model tenancy agreement to encourage longer, family-friendly tenancies. Our £1 billion Build to Rent fund will deliver up to 10,000 new homes for private rent, and our housing guarantee schemes will attract long-term investors into the market to increase choice, quality and stability for renters. In responding to the Question, I, too, refer the House to my entry in the register of interests.

[Lord McKenzie of Luton]

My Lords, I thank the Minister for his reply. We know that the demographics of those renting privately has been changing, with more families and children in the sector. However, for many, it is not through choice: they are priced out of the private market and cannot secure a social home. We know that it is the most expensive type of tenure and that tenants are nine times more likely to move than in other sectors. Of course, this is especially disruptive to the education of children. While we note from the model tenancy agreement that the Government say that they now see the benefit of longer-term tenancies and some predictability on rent increases, why will they not legislate to give tenants the right to such tenancies? What would the Minister say to a family who want to stay put to have the peace of mind that children can continue at the same school but have been refused a longer-term tenancy on the lines of the Government’s model?

[Lord Ahmad of Wimbledon]

My Lords, first, on the final point, I totally agree with the noble Lord on the need for long-term tenancies to ensure the education of children. As a father of three, that is something to which I can relate personally. However, I take issue with the suggestion about the private rented sector in terms of cost. If we just examine some of the facts, private sector rents have actually fallen in real terms every single year through this Government in England, including in London. If you account for inflation, for example in London they have risen by 1.1%. Average rents are down in real terms: inflation was 1.6% for the year to March, while rents grew by just 1%.

On the issue of length of tenancies, while I hear the point made by the noble Lord that the length of tenancies could be increased through legislation, practice has shown that tenancy lengths have increased by 6%, to about 3.8 years for an average tenancy, and 80% of private renters who have moved in the last three years ended their tenancy because they wished to move to another property.