‘Piecemeal’ rental housing policy fails tenants, warns UK watchdog

Government efforts to help tenants living in unsuitable or substandard properties are falling short because ministers lack an overall strategy for the rental sector in England, a report has found.

The National Audit Office, the independent public spending watchdog, said the Department for Levelling Up, Housing and Communities had yet to formulate a detailed plan for reform of the rental market. Instead it had adopted “piecemeal” measures that failed to ensure the sector was “consistently fair” for tenants or that their housing was safe and secure.

The report, published on Friday, cited individual government initiatives such as a ban on letting agents charging tenants fees, a temporary ban on evictions over the pandemic, and mandatory redress schemes for letting agency work — but said the department had not evaluated their impact on the market, nor had it imposed a similar mandatory redress scheme on landlords.

The government still “lacked a strategy for what it wants the regulation of the sector to look like”, it said. Those representing tenants and the industry told the NAO that regulation was fragmented and overly complex.

With an estimated 4.4m people living in privately rented households in England, rental homes are more likely than other types of housing to fail safety rules and be classed as “non-decent”. 

Some 13 per cent of private rented homes had at least one hazard classified as a serious threat to health and safety, compared with 10 per cent of owner-occupied homes and 5 per cent of social housing, the report said, adding that the associated costs to the NHS of poor rental housing were estimated at an annual £340m.

Gareth Davies, head of the NAO, said: “The proportion of private renters living in properties that are unsafe or fail the standards for a decent home is concerning. The government relies on these tenants being able to enforce their own rights, but they face significant barriers to doing so.”

The report said the government collected evidence of property conditions and tenant finances but had no robust figures on harassment, evictions, unaddressed disrepair, or the full costs to landlords of meeting their obligations. “The department told us it aimed to collect better data as part of its planned reforms, but it has not yet developed a plan to do so,” the NAO said.

The Department for Levelling Up, Housing and Communities said it welcomed the NAO report. It has said it will produce a white paper in 2022 — after its autumn 2021 publication was delayed — that will set out plans for reform, including the delayed abolition of “no-fault” evictions and strengthened protections for tenants.

“Conditions in the private rented sector are not good enough and we need stronger regulation and reform to ensure everyone has a safe and decent place to live. We are taking action to raise standards by driving out rogue landlords and strengthening councils’ enforcement powers, but we must go further,” the department said in response to the report.

Alicia Kennedy, director of tenants’ campaign group Generation Rent, said the government should require all landlords to register their properties. “This would help the government and councils gather better data about the sector, improve enforcement of the law and give renters better access to redress when things go wrong, which would meet many of the NAO’s recommendations.

Landlord groups voiced support for many of the NAO’s suggestions. Ben Beadle, chief executive of the National Residential Landlords Association, said regulation had “too often” been piecemeal, leading to “a proliferation of initiatives such as licensing, banning orders and a rogue landlord database, with little evidence to show they are working”.

“There is a pressing need for a better evidence base to ensure the system focuses on rooting out criminal and rogue landlords who bring the sector into disrepute. Too often, councils focus much of their time regulating compliant landlords who are easy to find.”

The Local Government Association said councils in England, which have a legal duty to take enforcement action if they find hazardous conditions in properties, would be in a better position to drive improvements in the sector if they were given more powers to set up landlord licensing schemes.