Is a new report telling us anything we don’t already know
The private rental sector is failing to serve tenants and landlords alike, says Which? as it issues a report on 20th July 2018 calling for a “fundamental reform of the sector” to ensure it reaches the standards “required for the 21st century”.
The report recommends that “all landlords should be registered with local authorities, with information logged on a publicly available database linked to the existing register of rogue landlords and agents established in April 2018.”
The survey is taken from the consumers’ perspective, and claims to be a “comprehensive look at the experiences” across the customer journey, from the property search stage to the process of moving out. 2,500 tenants were surveyed for the report, plus an additional 1,000 private landlords.
Common themes arising from the survey, are flagged as:
- low standards of accommodation;
- a lack of understanding of responsibilities and rights;
- unnecessarily complex or unfair contractual arrangements;
- a lack of security from some groups of tenants;
- the frustration and stress experienced when searching for a property with time or budget constraints;
- anxiety caused by unresolved maintenance issues and unresponsive agents or landlords.
Further to the findings, Which? outlines a number of recommendations, including:
- The creation of an independent regulator for lettings and management agents with a mandatory, legally binding code of practice and strong penalties for rogue operators.
- The government must introduce reforms to improve tenure security and review eviction procedures to reduce unnecessary delays for landlords when repossession is justified.
- A review of tenancy agreements used by letting agents to establish how widespread use of unfair, inaccurate or misleading terms and conditions is – and if further action, for example an investigation by the Competition and Markets Authority, is required.
- The government must provide consumers with an effective and accountable alternative dispute resolution scheme, review the current deposit adjudication schemes and consider options to avoid tenants being forced to cover multiple deposits at the same time.
The observations and recommendations Which? raises in the full report are valuable, but it’s a long running discussion – suggestions given on individual issues surrounding the housing sector, but how can the dots be joined to create an effectual through-the-line strategy. Will yet more regulation make rogue landlords and agents drop further underground and resort to threatening behaviour to ensure they’re not reported to the authorities.
For example, to provide better and more regulated standards, the Rent Smart Wales initiative legally requires landlords and agents operating in Wales to join a register for a £33.50 fee (if registering online) and obtain a licence in order to comply with the Housing (Wales) Act 2014. But how is registration enforced when the landlords that really need to be identified may simply drop further out of sight. Empowering tenants with greater whistleblowing rights and protection from landlord retribution, i.e. Section 21 or worse, could be one way to crack down on sub-standard and unethical rentals.
With around 75% of property in the PRS being self-managed, there is a definite need for clamping down on rogue landlords and bad practice across the board, which is highly publicised already. Petitions are being raised and requests made. Most recently, the London Assembly jumped into the argument in July 2018, as it called upon the Mayor of London to back a campaign to abolish Section 21, and to lobby the Government for a change in the law. In addition, a petition making controversial claims while demanding the abolition of Section 21 by the group Generation Rent, reaches 20,000 signatures at time of writing.
The Which? report challenges the “current institutional framework” of the PRS and calls for a “step change in the quality and choice of accommodation available”, as well as an improvement in the service given by lettings agents and to “drive negligent agents out of the market”. An independent regulator, be-it an ombudsman or governing body, and publicly available national database of landlords and agents may indeed help mastermind a crack down on substandard housing and practice. Lettings agents already have a requirement to join an approved redress scheme, and they must make it known to consumers which scheme they belong to.
Which? does agree that the government and policy makers “have recognised the increasing need to resolve problems in the PRS”, but claims that the report “highlights the piecemeal nature of reforms to date” and “the absence of a strategy for the sector as a whole”.
Interestingly, the Which? report comes just a week after the Government issues an updated version of its ‘How to Rent’ guide, which is specifically aimed at informing both tenants and landlords of the rights and responsibilities on both sides of the fence, as well as offering guidance on how to navigate the end-to-end process of searching for property to moving out and dealing with possible disputes.
Only 31% of the tenants surveyed said they had received a copy of the guide, however, and only 21% of landlords correctly understood their legal responsibilities. So how does the government therefore address the proliferation of the information and get it into the hands of those that need it most?
For the sector of course, these findings are nothing new. The issue of rogue landlords and lettings agents, as well as the need for a cohesive and stable overarching strategy from government, has been an ever growing thorn since the buy-to-let boom circa 2005 as an influx of amateur landlords dived into the market space. The following rise of ‘rogue landlords’ making headlines has then tarred the sector with a very ugly brush. While the Which? report could bring greater awareness and perhaps empowerment to the consumer if they choose to plough through the 60-page document, the report is yet another voice adding to the cacophony of those highlighting problems, the need for change, and the “inability” to identify the perpetrators of bad practice in this never-ending echo chamber.
The full Which? consumer report can be read here: