We will now have a series of quick evidence sessions of 15 minutes each with a series of learned witnesses, the first of whom is Ben Leonard, senior remote organiser and policy and research officer at ACORN, the union. Mr Leonard, will you introduce yourself?
Q As a tenants’ union, you are in a unique position to give us some insight into the broad question of whether the Bill strikes the right balance between the interests of landlords and tenants. Can we open with that?
What my experience working with tenants and addressing their issues has taught me is that there is a massive imbalance of power between landlords and tenants, which leads to tenants being too afraid to speak up about repairs or harassment. The issue of no-fault evictions is central to that imbalance of power. If people know that a landlord can turf them out of their property and potentially make them homeless with just a couple of months’ notice, they will not speak up about things that need to be addressed, such as repairs. I am sure you are all familiar with the terrible condition of a lot of private housing in this country. In the case of harassment, including sexual harassment, we see tenants just grin and bear it because the stress of having to find a new property within two months is too much.
The Bill could be transformative for tenants. It could offer dignity and security to millions of renters who up until now have been denied that. But I am sorry to say that in its current form the Bill fails to address the fundamental problems that renters face. If a landlord can effectively pretend to need to sell or move into their property and turf out the tenants, we will still have no-fault evictions. If landlords can raise rents past what their tenants can afford, in practice we will still have no-fault evictions. If a landlord can send a tenant an eviction notice as little as four months into their tenancy, with just two months to find somewhere new, unfortunately the Bill will fail to give tenants the secure housing that they desperately need.
Q Thank you for your evidence. How do you think the Bill will improve the experience for tenants? We have discussed section 21. Do you think that abolishing section 21 will give tenants more confidence in going for new rental agreements?
As long as the loopholes that I have mentioned are ironed out and the Bill is strengthened in that way, it will massively shift that balance of power and give renters the confidence that they need to come forward. We are a tenants’ union, so we use our strength in numbers to put pressure on a landlord to make repairs and things like that, but it should not have to be that way. A tenant should be able to complain about repairs and get them dealt with in a reasonable timeframe. Often they are just too afraid to complain. I am not saying that every single landlord is a demon, but, as things are at the moment, the system allows bad landlords to treat people horrendously, with very little recourse for tenants. If the changes that I have outlined are made in the Bill, it could be really transformative for tenants.
Q That is what the Bill is trying to do. It is trying to prevent bad landlords, but bad tenants as well. One thing we are planning to introduce is a decent homes standard in the private rented sector. Is that something that you would welcome?
Absolutely. It needs to be robust, free of loopholes and properly enforced. There are two key ways to do that. The first is properly funding local authorities. It would be no use granting the powers to local authorities to enforce a decent homes standard—we all know the state of local authorities and their finances at the moment—if they do not have the resources or a duty to enforce. It just will not happen, with the best will in the world.
The other thing, which has been discussed already, is incentivising tenants to do it: creating an army of enforcers who are properly incentivised to report landlords who are not up to scratch. The property portal can play a big role here. More transparent information inherently gives renters more power to put pressure on and see when their landlord is lying to the authorities. If a landlord says, “We have met these standards” on the property portal, a tenant can look at it and go, “Well, that’s not true, and I can point to all the problems that exist,” and then there is an incentive for them to pursue it. I speak as someone who has pursued a rent repayment order in the past. I won 80% of my rent back, but it was a long, gruelling and difficult process, with no access to legal aid. The financial incentive was quite strong, but there were times when I felt like giving up. There are many ways to solve that problem, but making the process straightforward for tenants and properly incentivising and supporting them in it, alongside local authority enforcement, are important.
Q I have a few points, if I may. You mentioned that the property portal needs to be available to tenants, but their access to it is not explicit in the Bill. Is it your view that it should be available to tenants or to the wider public?
Ideally, it should be publicly available information. You should not have to move into a property to discover that there are issues with it or that there are issues with the landlord; you should be able to check up a property on the portal before you move in. You should be able to see what it has been rented at in the past and compare that to the rent today. Has the landlord just done a massive rent increase, with no real improvement to the property? Do they have a history of improvement notices from the council? I would like to see that on there as well. In fact, any disciplinary action against the landlord should be available there. Nobody, whether they are a family, an elderly person or a student, should have to move into somewhere to find that they have a rogue landlord and a house that is falling to pieces.
Q The power of public pressure and the market might be more than the courts’ in that case. You have raised some of the fears about loopholes in grounds 1 and 1A. What protections could be put into 1 and 1A to make them work? Should there be a payment or other form of redress to the tenant if they are being evicted for no cause whatsoever?
To prevent abuse in the first place, there should be a high bar of evidence so that landlords have to really prove they intend to move into or sell the property in order to evict their tenants, and significant penalties for abusing that as well. We are talking about significant disruption to people’s lives that can have serious, knock-on consequences as well.
I do not want to go on too much of a tangent, but the consequences for children’s entire lives of having to move school frequently are profound; there is a lot of research that shows reduced economic, education and health outcomes for frequent school movers. Landlords need really seriously to prove that they intend to do it, and there should be significant penalties if they abuse the possession grounds, including fines and, for repeat offenders, complete bans. There should also be a no re-let period of 12 months: if a landlord decides that they need to move a family member in, then they do not need to any more, they cannot let the property for 12 months. There needs to be a serious deterrent to abusing those grounds. What was the second part of the question?
Q The second part was about whether there should be some sort of recompense for tenants who are moving out, even if it is legitimate that they are moving out, through no fault of their own.
Definitely. That could take a lot of forms. It could be a simple payment, like a rent repayment, to help with that transition, or it could be that, from the moment the notice is issued, it is illegitimate to collect rent on that property and no further rent needs to be paid. That would go some way to, first, put off rogue landlords from abusing the power and, secondly, make the circumstances of the tenant’s life more liveable. Moving house is a massive hassle, especially if you have dependants, so if that is being foisted on you by an outside force, there is no reason why that outside force should not support you in some way.
Q To explore that final point you made about not charging rent having issued a notice to vacate, when someone has gone through that process, for a landlord that would mean two months of not getting rent from the property plus three months when the property could not be let again through one of the section 8 grounds. In the event that the landlord was intending to sell the property, but was unable to sell it and had to go back to market to re-let it, they will have gone five months without rent. Do you think that is fair? I appreciate that we would both agree that we want to stop bad landlords, but for a good landlord who wanted to sell their property but was unable to, is that fair, to be in the situation where they have five months’ rent withheld?
I think it is fair to place a reasonable barrier to the abuse of those grounds. These things are always a balancing act. Would it be fair for someone to have to continue paying rent while having to uproot their life and sort things out? They are not really getting what they are paying for in those two months, because those two months are spent preparing to leave, moving their children’s schools or saving for a deposit. They need to pay for all those sorts of things.
For the landlord, it comes down to the cost of doing business. Landlords make a hell of a lot of money on those properties, and I think it is reasonable that sometimes there are times when the amount of money they are getting in will dip because of such things. If it is a choice between landlords’ profits coming down for a series of months and tenants potentially being impoverished, I would choose the former.
Q I want to ask you about the decision not to proceed with the proposal in the “A fairer private rented sector” White Paper on limiting the amount of rent that the landlord can ask for in advance. Is that an experience you found with the people you work with? You talked about frequent moves being very inconvenient, as well as extremely expensive.
Yes, absolutely. The limit on deposits was a huge step forward, but they are going by the back door, so not much has changed, because people ask for rent in advance. I can speak from my own experience: I had to pay six months’ rent in advance before moving to my current flat. A lot of the people I know and work with do, and often they are borrowing money to do it, because not a lot of people have that kind of money lying around. In a way, it is often discrimination—it is a way of saying, “Well, you might be able to afford the rent, but we don’t like the look of you. Let’s see if you can stump up this much cash up front.” It is totally unjust, basically. If you are earning enough income to pay the rent, the property should be available to you. That is the bottom line; extra barriers should not be put in the way, such as rent up front.
Bidding wars are a big thing as well. Something should be done about landlords pitting tenants against each other to drive up rents. If a landlord wants more rent for a property than it is on the market for, they should have listed it as that in the first place, because again tenants end up chasing properties for months at a time, because everything they think they can afford suddenly goes up £300 or £400 a month by the time they can actually let something. It is an absolute nightmare. Imagine you have been evicted, then you are put in a situation of rent in advance and all that. It just doesn’t work. It is a broken system.
Q I appreciate the evidence that you have given today. Do you have any concerns that some of the measures that you are talking about could potentially reduce the supply of homes? Therefore, the very people you want to protect, whom we all want to protect, tenants, would not be able to rent their homes.
The first point to make is that these reforms are reasonable, and if a landlord is not willing to deal with reasonable reforms, they have no business renting to someone in the first place—it shows that you are not of good enough character to supply someone’s home.
Secondly, the evidence does not show an exodus from the market. The reforms were announced four years ago, and there are more landlords now than there were then. From the evidence that I have seen, it seems that mainly smaller landlords are selling up to bigger landlords, which from the point of view of the tenant can be a step forward. Many tenants have a better experience dealing with corporate landlords than with one-man bands, who do not know the regulations, cut corners and will take advantage of vulnerable people. Generally, you do not get that with corporates. From the point of view of tenants, it is better to deal with larger, more professional organisations.
The other thing is that that provides an opportunity for first-time buyers to get in the property market. We would like to see a situation in which most people in private renting are either in council or social housing, or are homeowners. If landlords were selling up, first, first-time buyers could get on the property market—
Order. I am sorry. I feel I have to interrupt you, it being three o’clock. As Big Ben strikes, you have to stop speaking. I apologise for that. Mr Leonard, thank you very much for your evidence, which has been useful to the Committee and will be useful in the discussions that lie ahead.