Private Rented Sector — [Andrew Rosindell in the Chair]

Part of the debate – in Westminster Hall at 1:49 pm on 29th November 2018.

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Photo of Mark Prisk Mark Prisk Conservative, Hertford and Stortford 1:49 pm, 29th November 2018

It is a great pleasure to follow the Chair of our Committee, Mr Betts. When I was a Housing Minister, I looked at the issue of crooks running beds in sheds and, often, human trafficking alongside. I entirely agree: seize the asset, take the money off them and make them pay for what they are doing.

On the broader issue, the hon. Gentleman made a very good set of recommendations about the Committee’s report. Six months on from the report’s publication and the Government’s response, this is a good time to step back and look at where the Government have got to and at the market as a whole. As the Chair of the Committee pointed out, one in five households lives in rented accommodation. There are many reasons for that—some economic, some demographic and some social. Although many people would clearly prefer to own their homes, we should not ignore the fact that, certainly in my experience, an increasing number of young people prefer to rent. Theirs is a generation that expects to have two or three careers, never mind jobs. It is a generation that rents its music rather than buying it as old fogies—I nearly said the wrong word—like me did. Their expectations are different. When we form policy, we need to think about that generation, too.

As the Chair of the Committee said, the vast majority of tenants said during the inquiry that they were satisfied. We should not overlook that. However, the gap between the majority of homes and the very worst has increased, so I have no hesitation in supporting the Homes (Fitness for Human Habitation) Bill, introduced by Ms Buck. That will help us to root out the worst offenders.

Put simply, reform of the sector is needed, but it should be focused. We should not be tempted into pretending that every landlord is out to exploit their tenants. That helps no one. We need a consumer-led—tenant-led, so to speak—rental market. That means we need clarity about services and charges, fair dispute and redress arrangements for when things go wrong, greater choice and a more modern housing stock. It means we should encourage the building of more homes for rent and the rectification of substandard homes. It also means—this addresses the point made by Stephen Timms—that local authority enforcement needs overhauling so it is consistent and effective. I will come to that in a moment.

One of the report’s key themes was the respective rights of landlords and tenants. One of the main benefits of the Tenant Fees Bill is that it will help to clarify the role of landlords and letting agents. Alongside reforms to money laundering, that will help the market and improve the way it works for people. Our report also sought clarification of the law concerning people’s rights and obligations, including those of tenants. I welcome the reference in the Government’s response to publishing easy-to-understand “how to” guides for tenants. That is good, but we may also need consolidation. We need the law itself, not just the words that describe it, to be made simpler.

Equally, we legislators should all recognise that laws and regulations are sometimes limited in what they can achieve. They certainly stop bad practice, but they are not good at changing the culture of a business sector or promoting best practice. For that, we need people in the sector themselves to change—we need the practitioners to raise their game. That means we need qualified letting and managing agents who are committed to high standards.

What needs to happen? First, we should require anyone working in lettings and property management to be qualified. Members of the public might be amazed that that is not the case already. Secondly, the scope of those qualifications should not be imposed by the Government but should be agreed jointly with the industry and consumer representative bodies—I think of the Consumers Association as a good example—and forged with professional bodies such as the Institute of Residential Property Management and the Royal Institution of Chartered Surveyors, of which I am a fellow.

We should also grandfather across existing qualifications and ensure that they are part of the new process. We cannot afford to create a new barrier for people who have already committed to being professional. Indeed, there is a shortage of good, qualified people in residential property management for some of the blocks our constituents live in. We do not want to create a problem there, so grandfathering across existing qualifications would be sensible.

Thirdly, qualifications need to recognise not only different roles and levels but the different demands of the private rented sector and the social housing sector. Essentially, what matters is that people are competent to perform their roles financially, technically and of course legally. I also want a culture of continuous professional development to be adopted in the sector so that people keep up to date. Together, those elements, which build on the report, would help to change not only who works in the sector but the standards they maintain. I would be grateful if the Minister specifically addressed those points.

We heard about the standard of buildings and the housing stock, which is a big challenge. It is right that we rectify and improve the bad buildings we have now, but we need to do more than that—we need to build more modern homes to rent. That is why in 2012-13, when I was Housing Minister, I actively promoted a new model—the build-to-rent market. Having attracted billions from pension funds and long-term institutions, that market has blossomed in the past five years. More than 117,000 homes—modern, purpose-built homes that are available on long-term leases and provide services to tenants—are under construction or available to let. As it matures, that market will offer an even broader range of homes and rents, and provide greater choice for tenants seeking an alternative to the old housing stock. I hope the Minister confirms that the Government are committed to continuing to support the build-to-rent sector.

The Committee’s report also highlighted the need for effective enforcement by local authorities, which was touched on earlier. We received evidence—it was some of the most concerning we received—that there is not only a low level of enforcement but huge variability between councils in similar areas. For example, the Residential Landlords Association told us that in 2016-17, although more than 105,000 complaints were made by tenants, councils prosecuted just 467 people. That is less than one tenth of 1%. I appreciate, as Members said, that prosecution is not the sole enforcement action, but it is a pretty good indicator. At less than one tenth of 1%, something is not working.

Enforcement is hugely variable, too. There are 32 London boroughs. One of them—Newham—is responsible for 60% of prosecutions. The Committee heard that six out of 10 councils did not prosecute a single landlord in 2016. David Cox from ARLA Propertymark told us—this is in the report—that laws are passed but they are just not enforced. Part of the problem is a lack of money. That is why we asked the Government to ensure that councils have the money to enforce both current and future regulations.

However, as the hon. Member for Sheffield South East highlighted, this is not just about money; clearly, it is also about local political priorities and political leadership. That is why I strongly support the Committee’s suggestion that there should be a benchmarking scheme. That should be introduced, funded and run by the Government and managed through the Local Government Association. Councils should publish data about the number of complaints they receive, how they are resolved and prosecutions so all of us—our constituents included—can compare the enforcement levels of councils in similar areas. Will the Minister update us on what progress has been made with the LGA on that issue?