Quarterly Report Dr Tom Simcock 15/12/2017

State of the PRS - 2017, Quarter 2


Housing is quickly rising up the political agenda, with more focus being directed to policy changes in the private rented sector. At the moment there are currently 15 consultations by the Government on issues affecting the sector. Notwithstanding this, numerous changes have already been announced that will see the Government take direct actions to influence the operation of a market.

These changes include the proposed deposit cap, the ban on letting agent fees, and the already introduced ‘Right to Rent’ checks, that essentially turn Landlords into defacto border control officers. This report provides an opportunity to make sense of recent and proposed policy changes and how these changes are and will change the nature of renting.

This report presents the findings from our longitudinal research project and survey data collected from 2,792 responses.

Key findings

  1. The ‘Right to Rent’ checks are fuelling divisions in society and are turning landlords into state agents in enforcing border controls. Our research findings show that a large proportion of landlords (42%) are now less likely to let to anyone without a British Passport.
  2. Selective and Additional Licensing Schemes are not improving standards and are largely ineffective. Over half of landlords reported the schemes had no effect on their community and only 4% believed the scheme had reduced anti-social behaviour.
  3. The proposed deposit cap needs to be at least 1 1/2 months’ rent or 6 weeks to minimise financial risk. 51% of landlords reported that they would seek to stop tenants from having pets to mitigate any negative impact. We believe the government must consider the potential unintended consequences of the cap on landlords, tenants, and the wider sector.
  4. The ban on letting agent fees is going to cause a significant disruption to the PRS. Over half of letting agents reported that they would seek to increase fees to landlords due to the ban, while at the same time 35% of landlords reported they would seek to increase rents, and a further 35% reported they would seek to self-manage their properties instead.
  5. Landlord confidence in the sector is weak and landlords are currently taking action to promote stability across their property portfolios. While the proportion of landlords that are planning to keep their portfolios the same has remained flat, there are more landlords looking to reduce the size of their portfolio than those who plan to invest further, indicating the potential for a net loss of properties to rent.


2017 Q2 landlord survey - state intervention

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