Private Rented Sector

Debate between Lyn Brown and Mark Prisk

Wednesday 25th June 2014 Commons Chamber

[Lyn Brown (West Ham) (Lab)]

I draw the House’s attention to my quarter share in a residential rental property, as recorded in the Register of Members’ Financial Interests.

We have had a wide-ranging and, at times, very moving debate today on a subject that is at the centre of family life for many households in the country. The unprecedented growth in the private rented sector over recent years takes us into new territory. The politicians and policy makers—and, I think, us collectively—need to update the regulations and the expectations that we have of this sector.

The most insecure sector is the private rented sector, and many tenants in it are among the lowest paid. They are without resources and often face the biggest challenges. In many areas, rents are still rising faster than our pay packets, with some industry estimates indicating that rents have risen more than 10% since 2010. In his well-researched speech, my right hon. Friend the Member for Holborn and St Pancras (Frank Dobson) spoke with real knowledge about the ruinous hikes and much greater than 10% rises in central London. As he rightly said, this is bad for tenants, bad for communities and bad for the key workers on which this city depends.

Almost 4 million households—around 9 million people—now live in the private rented sector, and the majority are let through an agent rather than directly through the landlord. My hon. Friends the Members for Nottingham South (Lilian Greenwood) and for Kingston upon Hull North (Diana Johnson) spoke with great knowledge of the problems caused for students by the letting agents in their areas. I listened with real interest to the action of the Hull student union to counter the difficulties caused by letting agencies and substandard landlords.

As we have heard throughout the debate, the problems associated with letting agents include rip-off fees, and we have heard of Shelter’s survey, which found that 94% of agents charge additional fees on top of rents and deposits—and additional fees can total over £700. That is why, given that the landlord is the client of the letting agent, we propose to ban fees charged to tenants. The lack of safeguards, including no right to a written contract or a guaranteed code of conduct, is another problem, while there is no proper accountability. Despite 8,000 complaints to the ombudsman about letting agents in 2012—50% higher than just four years ago—there have been very few prosecutions.

[Mr Prisk]

Perhaps the hon. Lady could answer the question posed earlier but not answered. In banning fees to tenants, what will Labour do to try to ensure that there are no increases in rent? After all, this can often happen at the beginning of a tenancy. Is Labour going to ban those fees, or not?

[Lyn Brown]

There is no evidence from Scotland that that has happened. I genuinely believe that people out there who are listening to this debate, many of whom will be experiencing these fees, will not understand the hon. Gentleman’s argument today.

Short-term tenancies are now the norm. Shelter’s mystery shopping of letting agents found that 29 out of 30 of them told landlords that they would offer the property on only a six or 12-month assured shorthold tenancy. As a result, 30% of private renters worry about their landlord or letting agent ending the contract before they are ready, and two-thirds would like to have the option to stay in their tenancy longer if they wanted to.

Living in uncertainty and being forced to move on regularly is not just a nuisance and expensive; it has other costs, too. Families are unable to settle or put down roots, and, as my hon. Friends the Members for Islington North (Jeremy Corbyn) and for Hyndburn (Graham Jones) reminded us, children often have to change schools a number of times or face long journeys and they lose any friends they make. They are rootless and their education faces massive disruption. These are the families who are not on doctors’ lists and not accessing preventive health care; it is members of these families who are turning up at A and E and being diagnosed with stage four cancers.

We have heard that families in the private rented sector are nine times more likely to move than those who live in other tenures—and often forcibly through eviction, as movingly described by my hon. Friend the Member for Hayes and Harlington (John McDonnell). That is why Labour has set out our proposals to legislate for longer-term tenancies. As my hon. Friend the Member for Wolverhampton North East (Emma Reynolds) rightly said, Labour’s proposals to make longer-term tenancies the norm and to set a ceiling on rent increases would give families the support and the security they need to budget.