Long term tenancy should be guaranteed to the tenants in Private Renting Sector

In our previous blog posts we have been already mentioning about the rush in the home renting sector, and how that is living on rent becoming a trend in UK. Having also known the problems that these private tenants face from their private landlords, the problem does really need a check.

More people are going to opt for living in private rented sector over social housing in UK because social rents will be 80% of the local market rate. Since, the supply is low and the other options unviable, many in UK are finding house renting quite attractive, which facilitates making initial payments through overdrafts and the best thing, you can quickly move out and quickly get a house – only possible through renting. Since the supply is already low, there are many youngsters in London, who having no option are living with their parents and grandparents.

Today, we all know that the UK’s private renting sector is booming. However, we don’t even want to it boom through unfair means. Thus we can ensure their fair growth of the private rental market in two ways:

• Build more houses – increase in supply
• Renting needs to be easier, i.e. affordable - even if there is a sudden increase in the demand, the landlords need not higher the rents. This will only cause them the problem relating to irregular rental payments or else losing out on the tenant.

Therefore, long term renting is what is advisable for the private landlords of UK, if they really want to cash on the situation fairly. “There is nothing wrong with long-term renting per se: it's the norm in most European countries, where the law tends to favor tenants. And so it should: a tenant's need for secure shelter takes moral precedence over a landlord's right to safeguard his income” – should be remembered by the private landlords.

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UK’s torpid economy may flourish its rental market

Recent reports from Resolution Foundation and Shelter from Cambridge University notices serious implications that could been seen in the UK’s housing/property market given the economic indicators such as low economic growth, credit crunch, lower level of incomes, low levels of building houses.

If these indicators are going to going to show the same tendencies, then this would mean that half the UK’s population would opt for a rented house by 2025. Despite the crunch being felt, even in the mortgage sector, still there are a few out there who can afford to buy a home in UK through UK mortgage finance. But a continued weakened Britain economy would mean that the proportion of people who can own a home in UK through mortgage will be one among four households. This accounts to 27% which is much lower than what the percentage of 43, in initial 90s, on the percentage of home buyers in UK through mortgage finance.

That aside, the trend is welcomed by the private rented sector and the private landlords for; the lower mortgage finance will obviously make the Britons want to live in privately rented houses rather than choosing to own a house through mortgage loan.

This trend is further pushed by the families in UK with children. More than half the families of UK with children are now planning to rent a house rather than buying it through a mortgage loan. This increase is recorded at an 86%.

However, with the growing rental market in UK, there are many issues faced by the UK tenants. These prospective tenants, having no way out for a shelter, desperate, chooses to rent a house. The demand being more than the supply, these private landlords are seen to exploit the tenants by charging exorbitant rents and also do not guarantee a secured tenancy to the tenants. Therefore, with the growing rental sector in UK, it does become way too imperative for the government, especially the social housing sector to address the issues of stability and affordability in rents in the private rented sector.

This also means having to make provisions for renters of UK in terms of quality rented accommodation where the families can lead a better, secured, affordable life not only for themselves but also for their children. Institutional investment in private rented sector in UK would surely be a welcoming step that would better and strengthen the UK rent sector.

All in all, this seems to be for time the new reality of the housing market in UK – a flourishing rental sector over the house owning pattern. Having to be known the reality, the challenged faced, its time the government to do something substantial in terms of housing for the people of UK.

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UK landlords not returning tenants’ deposits

According to the reports from the Shelter, a housing charity, complaints have been surging of private landlords deny repaying rental deposits of the tenants.  Shelter, worrying about the trend measures 86% of such grievances from the UK tenants.

 The UK government have had come up with several schemes ensuring tenancy protection, despite; the tenants are unsecured about their stay/occupancy.  In the face of that, shelter helpline is still getting calls on this issue.

Under the rules of schemes established, it is needed requisite on behalf of the landlord to place the tenant's deposit in any one of the authorized tenancy protection scheme in 30 days from the time he has received it, failing that, the landlord can face severe penalties in from of being taken to court and making them pay fine of between one and three times the value of the deposit.

However, according to the research by digital data Collector Company, it was noticed that 57% of people who were tenants in private rental properties weren't aware of such schemes, thereby making it defensive stance for the private landlords.

Such instances can snatch a roof from someone's head and that could prove disastrous for them. There have been complaints on not returning deposits having to lead tenants going bankrupt or homeless.

Keeping in mind the importance of having a proper shelter over your head, it becomes way too necessary to be abreast of all the rental schemes. For, they are for the tenant's good. These schemes are meant to protect and empower tenants, so that they can live a peaceful, secured life under the rented house.

However, for that it is needed on part of tenants to read property news from journals, magazines, websites and newspapers, ask out people, consult property consultants before staying in the rented property. 

Shelter , is urging tenants to visit its new webpage –shelter.org.uk/depositprotection – to use its new three-minute checker to make sure their deposit is protected.

According to Countrywide, the estate agency, have pointed a marked rise 275,000 new tenants have registered to rent private accommodation in 2011, making it an increase of 24% in 2010.

Campbell Robb, chief executive at Shelter, said: "It is extremely worrying that we have seen such a huge rise in problems with tenancy deposits at a time when privately renting is no longer just a stepping stone to something better but a long term reality for more and more families.

"While we know that most landlords do the right thing, some cause absolute misery for their tenants, accusing them of owing thousands of pounds for damage that doesn't exist or falsely claiming to have protected their deposit and then never returning it."

Withholding tenants' deposits is indeed a very stressful situation for them as that deposit can be used for so many things, even for letting another house. In such grievous economic time, the money out of these deposits can be tremendously useful.

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Families in London need, £ 3, 500 per month to afford a rented home

A report analysis, Homes for London campaign, by Shelter, analyzed the cost of renting across the capital . The report showed that people in London needs to earn £3,500 per month, making it a total of £ 52,00 per annum to afford themselves rented property in UK.  More important, that this amount is needed to afford a two bed house only.

However, if you're eyeing to be a tenant in eight London boroughs including Hackney and Tower Hamlets, then they would need to earn more than £60,000 per annum.  The numbers of tenants under private renting have increased to about one in every four households and on the same, even the rents have risen by 7% in 2011.

Keeping the economic downturn in mind, many people are coming to London for work, and with the current trend, as such earning is a hard thing, and on top almost many tenants spend half their incomes on paying rents. This brings us to question the trend of high rents and its detrimental effect on tenants'' savings.  If this rate of rent is to continue, then this will seriously pose financial for tenants the challenge of struggling financially, in the already finically odd time.

Shelter chief executive Campbell Robb said: "With so many Londoners locked out of homeownership, more and more families have no other option but to rent – but rents are now so out of touch with wages that some families are spending over half of their income just to keep a roof over their head, leaving little left for food, fuel and other essentials."

The only thing that Homes for London campaign is asking for lowering or at least regulating the private rented sector, so that the private landlords don't charge the economical /vulnerable tenants high rental charges.  For this, the Homes for London campaign is wanting the next mayor to stand up for this cause and help influence the sector by formulating local policies that will help bettering the position of the tenants and prevent the capitalist tendency of the private landlords when they charge high rents, or deny repaying the tenant deposits, or any of such scrupulous acts performed.

This was seen true in an Ipsos Mori poll released last week, where the people of London, more precisely, the tenants in London have had only stressed on making policy with the mayoral candidates to chalk a way to reduce the cost of private renting.

Since, in this hard hit economic time, buying and selling home doesn't fetch you a regular income, renting does exactly what you need. It is this very mentality attached to renting, that has made the minds of the landlords, private landlords especially, capital minded.  If the landlords can get a steady monthly income, then why not increase and earn more in these times? This very mindset makes leads to tenants' exploitation. This is why we see, the value of let homes in UK mounting to £840bn. If this trend continues for a long then by 2016, we'll see the rental incomes generated by the private landlords shall be to the tune of £70bn.

With the problems of house building happening to the minimum and the demand increasing as hell due to the increase in population, changing needs of ageing population, the changes in family pattern, the break-ups and divorces, have all led to an exceeding demand not able to keep pace with the supply.

Keeping in mind the problems, UK needs policies and laws both at state and national level to ensure its people their right to live in a house, securely and safely.

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Need for regulating the private renting sector

Housing is the essential most need for humans. In UK, with the ongoing trend of economic downturn, this basic necessity is literally now turning into a luxury with the private landlords trying to charge much more to the tenants than usual.

Unusual growth of the private renting sector has made lives hard for the tenants. More often, issues regarding safety and security of tenancy are neglected by the private landlords. There are many cases to prove this fact. One of such recent case in the sector was investigated by Guardian's journalist; Amelia Gentleman who helped unearthed the corruption occurring in the sector.

Guardian's journalist exposed how many of the vulnerable and low income earning's tenants are asked to pay exorbitant rents for merely a shed with a toilet. Examples of such practices are rampant and widespread.  This makes it a total visible case of corruption in the private rending sector, of how heinously, the private landlords are cashing on the situation of lower supply and higher demand of housing in UK.

With the further deteriorating economic condition in London and South East, the minimum wages of the low income workers are seen falling below their real wages, making them so vulnerable at the hands of private landlords.

This phenomenon serves as the latest example of how capitalists rule the society and how they exploit, till date the needy and destitute.
Other problems faced by private tenants are that of high energy costs, absence of security of tenure and landlords' reluctance to repair to improve the property.

If this trend is to continue more, then this will only lead to an addition in the already increased demand, thereby increasing the rents, and those, in utter need, most of the time the poor, get pushed aside and denied of their right to live in securely and safely.

This problem needs to be solved for housing is a basic need for poor as well as wealthy in a nation and to provide a secured roof to its citizens is the foremost duty of the state. Keeping the fact in mind, there is a dire need for regulating the private rented sector.

Regulation of private renting sector needs to be made in the form of holding licenses for private landlords a compulsion. A compulsion should be made for all the private landlords, in fact all the landlords, to hold the license, and only that shall act as a basis for trading. Besides, the license, they should also be guaranteeing on adhering to certain standards required and letting a property that is genuine.

The task of this can be given to professional property management companies, who shall also see that the regulation is followed and implemented on, regularly.

All in all, there is an utter need to regulate the private rented sector, before it expands exponentially at this chaotic speed and exploits the poor further.

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Tenants kicked out in the run-up to London Olympics

In the run –up to the London Olympics, to be held from July 27, trends of tenant evictions are reported. It has been reported that the landlords are asking the tenants to leave their houses so that they can rent it the tourists who’ll be coming to see the games.

For this, the tenants are usually illegally evicted by giving them no notice or a lesser time or else they are being made to sign a clause that for the particular time period, the tenants shall have to make some other arrangement and they can come back and stay after the Olympics.

The private landlords are leaving no stone unturned to seek higher profits from this event.  With more than a lakh visitors would be coming to see the Olympics and with the only availability of around 110. 000 hotel rooms in London, thus, most of the landlords are seen capitalizing on this issue in order to make killer profits.

According to the report by Property Wire web site, it revealed, that there has been an increase in the short term lets by 35% available in London’s Olympic boroughs of Barking and Dagenham, Greenwich, Hackney, Newham, Tower Hamlets and Waltham Forest.

All this has an effect on the rental market in London and that is the fact that the rent rates would in future be seen increasing.  To add on, a website has been launched called campinmygarden.com for people to set up tents temporarily in the backyard.

To this, the UK Housing Minister, Grant Shapps said: "Landlords should be under no doubt that it is a criminal offence for them to evict a tenant without giving proper notice, and that anyone found guilty of doing this - or of harassing a tenant - could lead to a custodial sentence of up to two years."

All in all, the playing of Olympics in London, would certainly enhance its image in the world over and that it will help strengthen its Global brand image, but what is more ironic is the fact that the locals are a part of the place, either as students from other countries who have come to study or work or people who just can’t afford to buy, are being kicked off for a temporal period only as  to woo the  visitors.

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