It feels like....home!

Introduction

Landlords may be struggling to find good news at the moment. They face increased regulation, new legislation and a government which seems intent on pushing a “greedy landlord” narrative.

Whilst the media are happy to push a culture war between private landlords and their tenants, the reality of the sector remains different. This blog presents the latest snapshot of reality, a reality which differs from the negative coverage which surrounds the PRS narrative.

Twice a year the NRLA contribute to a tenant-focused research programme led by our research partners, Pegasus Insight. The NRLA is one of several organisations who contribute to the cost of the research.  A range of organisations with an interest in understanding what is really going on in the sector support the research. They use the results to guide their own campaigning and product development. This research is essential to the NRLA as it gives us a realistic snapshot of the tenant experience, helping us identify key issues from a tenant perspective - which we can report to landlords.

Being part of a wider network of funders brings several benefits (i) the fieldwork is more extensive than we could fund alone and (ii) the reporting is seen to be completely transparent, with no suspicion of a dominant agenda.

A final benefit has been that through the findings, this research has often provided a counterbalance to the anecdotal narratives pushed elsewhere.

Tenant profile

Tenant Trends is based on over 3,000 15-minute online interviews with tenants currently renting in the Private Rental Sector (PRS) across England & Wales.

Without dwelling (no pun intended) too much on the background and demographics of the tenants, this post focuses on three groups of tenant who live in England and Wales:

The first group rent directly from a landlord who also owns the property. The tenant will call the landlord with any problems. NRLA members typically fall into this category.  Almost half (48%) of all tenants in the survey rent from this type of landlord.

Secondly, those who let from either a company or corporation who either built the property/apartment block or own the retail/office premises above which the accommodation sits. Becoming more typical of this sector are the Build to Rent (BTR) operators, now  common in larger conurbations. In terms of this particular survey, this is the smallest group – around 5% of the total participants.

Finally, tenants who let through a letting or management agency. They report all problems to the agency and typically have no direct contact with the landlord. They account for about a third (30%) of tenants in this survey.

(Note the remainder of the sample either lived as lodgers or declined to give a definitive answer – these have been excluded from the analysis here).

Overall satisfaction

Tenants were asked outright about the overall level of satisfaction – and dissatisfaction – tenants have with the service provided by their current landlord.

As with several of the questions and statement presented here, responses were made according to a five-point scale (in this case Very satisfied - Quite satisfied - Neither satisfied nor dissatisfied - Quite dissatisfied - Very dissatisfied).

Chart 1 below groups together the "Total satisfied" and the "Total dissatisfied" responses. These are presented by landlord type:     

The overall result above - as with other surveys - shows renting from a private, independent landlord is the model which has the highest satisfaction level.

1. Eight out of ten tenants with private landlords are satisfied with the service their landlord provides.
2. Fewer than one-in-ten expressed overall dissatisfaction.

Though not shown, it should also be noted that private landlords have the highest proportion of “Very” satisfied tenants:

• Almost half (47%) of those expressing satisfaction declared themselves to be “Very” satisfied.

Finally, it is worth noting that for all of these models, tenant satisfaction is high.

• Across the sector as a whole almost 90% (89%) of tenants expressed either satisfaction or else took a neutral “Neither satisfied nor dissatisfied” stance towards their landlord.

Would tenants recommend their landlord or property to another tenant?

The research dug deeper into tenant satisfaction: In marketing a key metric is the “Net Promoter Score” (NPS) based essentially on the rating (on a scale of 0-10) a business receives from its customers. This rating derives from the “likelihood” of a customer recommending a business or service to another potential customer. [For more information on NPS scores, please follow this link.]

The key component of a high NPS score is the proportion of customers/clients who indicate the likelihood of recommending a business would be a “9” or “10” out of ten.

In this case tenants were asked about the likelihood of recommending the landlord and, separately, the property/dwelling in which they lived.

Chart 2 shows the results for each of the three private rented sector models under the microscope here:

Again, it is the private landlord who receives the highest ratings – both as a landlord, and also by the tenant assessment of the property they let.

In each case above, the likelihood of recommending the landlord and the property are similar to each other within each of the three models: but only for the individual landlord is the personal recommendation [slightly] higher than that of the property. 

This perhaps emphasises the additional weighting a tenant gives the landlord, when scoring against likely future recommendations.

In depth: why tenants appreciate independent landlords

Underpinning these overall scores is the support and confidence tenants expressed for independent landlords across a series of measures:

Tenants were presented with a series of statements, they were asked whether they agreed or disagreed with those statements on a five-point scale (in this case: Agree strongly – Agree – Neither agree nor disagree – Disagree – Disagree strongly).

Chart 3 shows the percentage of tenants who agreed with those statements. Note that for the two columns in orange on the right hand side of the chart, the lower the percentage then the more positive the tenant is.

What is key here is that on every one of the above measures, the independent landlord scored better than their corporate or agency-based equivalents.

Summary

Tenant Trends is the largest regular survey of tenants undertaken in England & Wales. The insights the report offers cover topics such as affordability, reasons for renting, the goals and aspirations of tenants, and, as reflected on here, tenant satisfaction.

NRLA research is regularly highlighting the negative effects and impacts the media portrayal of landlords is having on members. Specifically, how this negativity is influencing landlords to sell property, and even to exit the market completely (see our quarterly publications as evidence).

Whilst the broader media would paint a picture of tenants and landlords engaged in a kind of battle, the data suggests something different.

Tenants themselves are more than satisfied with both their landlord and their property. This overall satisfaction applies right across the PRS in all regions and all types of landlord.  Even so, closer analysis of the results show it is independent, individual, landlords who, through the relationships they develop and the service they provide, achieve the highest ratings within the PRS. 

In spite of the changes which have taken place in Wales, and about to in England, it seems tenants themselves, through their preferences, will ensure individual, private landlords will continue to thrive as a model within the private rental market.