Mitigating poverty for low income private renters
Tom Moore (Urban Institute)
Housing and poverty have always been inextricably linked. The location of housing, its cost, and its condition, impacts on individual incidences and experiences of poverty. Income poverty may prevent people from accessing suitable housing, or consumption of unsuitable housing may induce higher degrees of material deprivation. This is increasingly the case in England and the rest of the UK. The number of people living in poverty induced by housing costs has increased over the past two decades, while the tenure structure of the housing market and insufficient supply of new homes constrains individual choice and aspiration.
Particular attention needs to be paid to the growing use of the private rented sector (PRS). Increasing numbers of the population in England reside in the PRS, rising from 11% in 2003-04 to 19% in 2013-14 (DCLG, 2015), largely due to constraints on social housing supply and the expense of homeownership relative to incomes. Much of this growth has stemmed from the increased use of the PRS by young adults aged 25-34: 45% of all households of this age now privately rent, more than double that of a decade ago (DCLG, 2015). In addition, welfare reforms – particularly changes to Housing Benefit for social housing tenants and Local Housing Allowance for young adult private renters – have contributed to the increased and varied demands placed on the PRS.
To inform policy development in this area, this project focusses on an examination of the private rented sector in Ireland, which has undergone substantial reform in recent years, and considers how such reforms may benefit, enhance, and be implemented in England.
Ireland provides a useful reference point, given it has a broadly similar housing tenure mix and trends, with high levels of homeownership but growing proportions of private rental due to affordability issues (National Economic & Social Council, 2014). The Irish Residential Tenancies Act 2004 introduced a series of measures including: security of tenure of up to 4 years for tenants, with provisions that landlords must have a designated valid reason for termination, a model that permits landlords to review rents only once per annum, and a Rental Accommodation Scheme, where local authorities draw up contracts with private landlords to provide for people with long-term housing needs. In addition, a mandatory national tenancy registration system was established – the Private Residential Tenancies Board – which also adjudicates in tenant and landlord disputes.
These reforms are similar to policy and advocacy development in England, though recent reflection on the reforms note that parts of the private rented sector in Ireland still suffer from significant issues of affordability and standards, generating debate about further regulatory reform (Private Residential Tenancies Board, 2014; National Economic & Social Council, 2015). In the context of contemporary policy debate in England, as well as ongoing reflection on the strengths and limitations of reform in Ireland, it is therefore an opportune time to identify new and emerging issues and comparisons that can develop solutions that mitigate poverty in the private rented sector.
Joseph Rowntree Foundation