Our private rented sector is broken and needs comprehensive reform

The private rented sector is fundamentally broken, trapping people in insecurity. It is one of the biggest challenges we face.

Rental housing

Ben Cooper (@BenCooper1995) is a senior researcher at the Fabian Society

The cost-of-living crisis affects us all, but especially those who rent privately. Last month, the Office for National Statistics reported that in 2021 the cost of renting rose by 2%, the fastest pace for five years.

In coastal and rural areas, MPs have warned that a boom in holiday lettings and second homes is forcing renters out of their local community. The cost of renting is likely to increase further over the course of this year, with demand for properties outstripping supply. This will add to the pressures of the unprecedented spike in energy prices. 

Rapid rent rises will exacerbate the deep sense of insecurity and anxiety that many private renters already feel. Renters can be evicted at any time for no reason whatsoever, and at only two months’ notice. When you add in the prevalence of poor conditions, landlord exploitation, tenant powerlessness, and a lack of transparency, it is clear that the private rented sector is broken. 

One of the biggest challenges we face

Indeed, the state of the private rented sector is now one of the biggest challenges we face. Private renters are no longer in a small minority: the sector provides homes for 11 million people – or one in five households – including 2 million children, 1 million disabled people, and 745,000 older people.  

And it is children, disabled people, and seniors, who can experience the most severe effects of insecure housing. It means disrupted schooling for children and disabled people unable to access adaptations to enable them to live independently. Meanwhile the loss of a tenancy is a major cause in rising homelessness in older people. All these groups are likely to become even more dependent on the private rented sector in future. Urgent change is needed to protect them and everyone who rents. 

Comprehensive reform is required

Reforming the private rented sector will be challenging and requires comprehensive reform.

We spoke to private renters themselves for the Fabian Society project Beyond Affordability, and found that they wanted politicians to be honest about the solutions required and the time it will take to change things. There is little demand for claims about ‘silver bullets’ or quick fixes.  

There are, however, practical options immediately available.

To start, the government must follow through its promise to abolish Section 21 notices and ‘no-fault’ evictions. We cannot have a situation that allows landlords to evict tenants at any time, with just two months’ notice. the Scottish government has already done it – Westminster should now follow Holyrood’s example. The government first promised a Renters’ Reform Bill in 2019 to propose to do just this. But there have been significant delays in bringing it forward, leaving millions of renters continuing to live in fear of eviction and being uprooted from their community.  

If the government were serious, they would go further than this too. At a time when rapid rent rises are causing significant insecurity and financial stress, a specific form of rent control should be considered. Instead of capping rent at a particular level, they should limit the amount rent can rise, while allowing the initial rent at the start of a new tenancy to be agreed freely.  

A pragmatic and effective solution

This would be a moderate step, recognising the widespread support for rent controls, but also the need to be pragmatic. It would address key problems tenants themselves identified with renting privately: powerlessness, insecurity, and being forced to move away from their home. It would give tenants the confidence to plan ahead, knowing that future rent increases would be affordable and proportionate.  

Crucially, some form of rent control will be needed to make the end of ‘no-fault’ evictions work in practice, because otherwise landlords could use unaffordable rent increases as a means to force out tenants regardless.  

This proposal is not a radical transformation: it is pragmatic but effective. It is not about forcing down rents dramatically, which would likely hurt tenants by forcing landlords out of the market – something that the private renters we spoke to recognised. Ultimately, well designed and targeted controls on rent increases can improve the way the private rented sector works – without major negative consequences.  

However, it is clear that the government has no interest in protecting private renters from rising insecurity. The delay to scrapping Section 21 proves that.

Instead, it will be up to a Labour government to fix a broken market and deliver a fair deal for the 11 million people currently living without security and the millions more to come.   

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