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Opinion: Helping renters doesn’t have to mean harming landlords

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Opinion: Helping renters doesn’t have to mean harming landlords

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Published by Max Salsbury for 24dash.com in Housing

Westminster negotiates lower private rents on former council flats Westminster negotiates lower private rents on former council flats

A new report from Shelter has revealed that a ban on letting agent fees would not have a detrimental effect on the private rented sector.

Here, the charity's Susan Nash examines the claim that banning fees would harm landlords.

You often hear people suggest the way to fix the problems with private renting is for renters to simply complain or shop around. But this presumes that renters can easily do either. Unfortunately whilst renters should feel able to complain many are fearful of doing so. 

Our research has found that 1 in 12 renters avoided asking their landlord to carry out improvements or repairs in the last year, because they were scared of eviction. And arguments telling renters to shop around ignore how the market works. The current excess of demand and shortage of suitable, affordable homes in many places makes it extremely difficult for renters to exercise much choice at all.

Renters don’t choose a property based on the credentials of the landlord or letting agent, renters search by property. Even if they had the time to research and weren’t under pressure to secure a home quickly, details about the landlord can be difficult to obtain, and in the lettings market it can be challenging simply to find out how much the fees are going to be, despite rules stipulating that the agent must display them upfront. 

So helping England’s nine million renters relies on the government stepping in and better protecting renters. But this doesn’t have to mean hurting landlords – it is perfectly possible to have a functioning and healthy private rented sector whilst addressing the instability and unpredictability caused by short term contracts and unexpected costs.

Research by Jones Lang La Salle, commissioned by Shelter, shows that most landlords would benefit from a steadier long-term income that rose more gently and predictably, as this would cut out the hassle factor of churning tenancies and all the costs and management that involves. And evidence from Scotland shows us that tackling sky-high letting fees also doesn’t need to hurt letting businesses.

Independent research we commissioned, released today, shows a healthy and growing letting agency market in Scotland despite agents there being prevented from charging fees to renters. A majority of letting agency managers (54%) said the ban on fees was positive for the sector and all key business indicators show very encouraging growth in the last 12 months – with Companies House data showing more businesses associated with the lettings sector in 2013 than they were in 2012.

To their credit politicians across the board are starting to realise this. The government have supported the development of a voluntary ‘family friendly tenancy’ which would give renting families better stability, and Labour have promised if elected the introduction of three year tenancies with limits on rent rises and the banning of letting agency fees. Of course there’s still lots of work to be done to make these promises a reality – we outlined in a previous blog what elements are essential to make a stable tenancy truly renter friendly.

Politicians have come a long way in recognising that renters deserve better – perhaps unsurprisingly, given that many of England’s nine million renters may play a key role in deciding which party wins in marginal seats at the next election. That progress is down in no small part to the pressure and attention thousands of Shelter supporters. 

It’s great news, but there’s still a way to go, particularly as millions of renters believe they’ll be renting for the rest of their lives.  For them, and for everyone else who rents their home, we’ll keep fighting to make the experience fairer, more stable and more affordable.

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