Renters (Reform) Bill (Second sitting)

Nickie Aiken Excerpts

Committee stage
Tuesday 14th November 2023 Public Bill Committees

[Nickie Aiken (Cities of London and Westminster) (Con)]

Q What are your views on the property portal that is being proposed?

Sue James: We think it is a great idea.

[Nickie Aiken]

Good.

Sue James: But it needs more.

Ben Twomey: I would add that it lacks detail at the moment, and we are very keen to see that detail. I mentioned that we are particularly interested in eviction notices and the outcomes of evictions being logged there; otherwise, there is not really much improvement in the way you monitor and enforce against abuse of some of the new no-fault grounds. So eviction notices are really important. Getting the rents charged on there will be really important, and we should think about energy performance certificates going on to the portal so that they can be enforced. When I talk about enforcement, I think it is really important that local authorities are empowered and have the necessary resources to enforce against bad practice—the kind of practice that can lead to people being unsafe in their homes.

It is also about having a place for tenants to access this information, as they have a vested interest in what happens afterwards. The only way to give them a vested interest is to have an incentive, and we think that is through rent repayment orders. We would encourage the portal to be made accessible to tenants. For example, where they can see that no-let periods have been abused, there should be a rent repayment order. If the landlord is not compliant with the portal, there should be a rent repayment order. Also, if the landlord is not compliant with minimum energy efficiency standards, we think that there should be a repayment—you would equalise it in that way. At the moment, where licensing schemes exist, for example, and the local authority pursues landlords for a fine, often that money does not actually get back to the person who has lost out—the tenant. It is important that rent repayment orders go directly to the tenant wherever possible.

Sue James: I totally agree, and I would like to pick up on the issue around the basic requirements of gas safety and stuff. At the moment, that is a huge protection in section 21; a landlord cannot get a possession order unless they have all those protections, and that does not appear in the Bill. We absolutely need to have them included, and the portal could be a place to put them. We would then have transparency; a tenant knows when they are looking in the portal that this is a good landlord and that they have complied with everything. I think that is so fundamental to changing the nature of the private-rented sector.

[Matthew Pennycook]

Q As we have you here and you have unique access to residents and organisations that represent residents, I wonder whether I could push you on some areas that are not covered in the Bill. Some of them were flagged in the White Paper and some were not, but they are a problem for renters every day—at least on the basis of my postbag—and we might deal with them in the Bill. I am thinking of things like guarantors, advanced rent and bidding wars, which we are hearing a lot about at the moment, particularly in the part of London that I represent. Could you speak about some of the potential solutions that we might look to work into the Bill?

Ben Twomey: The question of guarantors is really important. Usually, there would be a guarantor if you are not earning a certain amount to cover the rent—usually, you should have an income that is two and a half times the rent and, if not, you require a guarantor. For younger people, for people on low incomes, that can be quite difficult, so they would need a guarantor.

We have been working with the National Youth Advocacy Service to look at the barriers facing care leavers when they access private rented homes. This has been a major barrier for care leavers. At the moment, 60% of local authorities do not offer people the ability to be a guarantor for care leavers. Local authorities are the corporate parent for care leavers, so they are basically taking on parenting duties. We think that is a big problem. The 40% that offer the guarantor scheme in principle vary in the way that they do so. We think that it is for the Government to step in and say, “If, as a state, you are going to take on parental responsibility, you should be a guarantor to make sure that young people who are care-experienced are not being locked out of rented accommodation, compared with their peers.” That would be a major step forward.

To touch on bidding wars, we have found in our research at Generation Rent that there are seven times more bidding wars than there were just five years ago. We have gone up from 3% of tenants experiencing this to 21%, from our research. I experienced it when I moved down to London relatively recently. I was asked how much more I would want to give and how much longer I would want to stay in the property as a fixed-term tenancy. It is very, very common now. We think that the issue needs to be addressed. There is nothing in the Bill at the moment, but there should be some consideration given to this. When a landlord offers a price for rent, they are almost, by definition, offering a rent that they are comfortable with. Just because of the changes in market forces—that is a change not to their costs, but to the number of people queuing round the block for them—it should not be that they can then increase the rent as they please and encourage others to enter into these kinds of bidding wars, which basically pit tenant against tenant. The only one who is benefiting from this is the landlord.

Sue James: To pick up on that point, this is not in the Bill, but the position of the Renters’ Reform Coalition is that, at the moment, unless you restrict the amount that landlords can put up rents, you potentially have an economic eviction, and we would suggest that you restrict that to the lowest of either inflation or wage growth.

To touch on what is in the Bill, section 14 of the 1988 Act allows the tenant to apply for the tribunal to have a look at the rent. Originally, it was restricted to whatever the landlord was requesting, but in the Bill it is now the market rent. That would potentially have a chilling effect on tenants who want to challenge the rent that has been set. As an adviser, I might say, “It is limited to what your landlord has suggested,” but at the moment, with the way Bill is, that could be the market rent if the landlord has asked for less than that. Does that person then challenge it? That could have a chilling effect. When thinking about rents and, as Ben said, bidding wars, that absolutely needs to change, because it is really difficult. There are queues of people for every tenancy and the protection needs to be there, so thoughts around that would be really welcome.