Call for a property MOT for the private rented sector in the UK

Millions of private sector tenants in the UK have been failed over the past decade through poor policy making and a lack of strategy, a major new academic review says.

The paper, from researchers from the University of York calls for the introduction of a property MOT, operating in a similar manner to the system for cars whereby homes are checked on an annual basis.

The review, funded by charity the Nationwide Foundation, is a detailed, independent analysis of who lives in private rented housing, how their needs are being met and the impact of policy interventions over the last 10 years.

It comes a decade after Dr Julie Rugg and David Rhodes, from York’s Centre for Housing Policy, published their original review of the private rented sector, the first to look in detail at how it functioned.

The new report says that current regulation of the sector is ‘confused and contradictory’ and ‘failing at multiple levels’. Opportunities for linkage and simplification are being missed, with tenants and landlords unsure of their rights and responsibilities.

It also says that poor conditions are a problem at both ends of the market and conditions get worse the longer tenants are in their property, indicating that poor property management rather than old housing stock is the root cause.

And it points out that policy interventions are increasingly focused on helping higher and middle income renters priced out of ownership, with little or no help for those on low incomes.

The review concludes that no Government has been clear on the function of renting within the housing market and as a result, interventions have been piecemeal and poorly targeted.

‘Since our first review was published, declining home ownership and a shortage of social rented homes have led to a surge in the number of people privately renting, particularly families with young children,’ said Rugg.

‘Unfortunately, in its current form the private rental market isn’t providing a suitable alternative, and in the absence of an overarching vision from Government we’ve seen reams of policies and regulations to address problems in the sector which are not joined up or thought through,’ she explained.

‘We need to see a fundamental rethink of the role renting plays in our housing market and a comprehensive strategy to ensure it meets the needs of all those who live there,’ she added.

According to Leigh Pearce, chief executive of the Nationwide Foundation, politicians have ignored the needs of private renters for years, resulting in a market that all too often fails to provide decent, secure and affordable homes, particularly for those on low incomes.

‘It’s time Government started to take this problem seriously. Instead of more tinkering round the edges, we need fundamental reform and a clear strategy to fix renting. We hope this review will be the start of a cross-party conversation to make that happen,’ added Pearce.

The research suggests that a property MOT could bring together current requirements such as electrical and gas safety certificates and energy efficiency reports, but also include a new assessment according to a basic minimum standard. It would be conducted by independent inspectors and would be a tax-deductible business cost for landlords.

‘Unbelievably, there is currently no minimum standard that properties have to meet before they are let and as a result, millions of renters have to put up with damp, disrepair and sometimes life-threatening hazards,’ said Rugg.

‘A property MO’ would give people confidence before they sign a tenancy that the property is well managed and that standards won’t lapse in the future, while for landlords, it offers greater clarity and protection against prosecution. This proposal is just one way in which existing legislation can be simplified to make the sector work better for everyone,’ she concluded.

However, the Chartered Institute of Environmental Health (CIEH) warned there are risks associated with the idea of property MOT. It suggests that there would have to be more details such as who would regulate it, what actual power it would have and how it would be checked before it can be taken seriously.

‘Whilst an MOT style scheme sounds like a simple solution which could bring big improvements to rented housing, it also comes with some serious risks attached. One of these is local authorities being left with few resources to investigate any corruption or fraud within such a system,’ said Tamara Sandoul, CIEH housing manager.

‘The environmental health profession would support more private rented housing being inspected regularly, but we need to ensure that the people doing the inspections are fully qualified to make this kind of assessment. Getting the incentives right for any private contractors is also critical, as landlords would be paying for a service and expecting a certificate at the end,’ she pointed out.

‘The licensing or registration of all landlords is particularly important and is a recommendation we fully support, providing someone with a safe home requires knowledge and responsibility. Unfortunately, most landlords are currently operating anonymously. Bringing this profession out into the open is key to instilling a sense of duty and care that landlords owe to their tenants,’ she added.