Private eye

Discussion of the private rental sector was almost entirely absent during the general election campaign. The recent growth of the sector means that this is the worst possible time to ignore it. Instead, we need a renewed focus on private renters, not just from politicians, but from everyone involved in housing. Together, we need to ensure that all private renters have access to decent and affordable housing.

New research from the Building and Social Housing Foundation highlights how quickly the private rented sector has grown in recent years. It increased by 1 million households between 2005 and 2009. Private renting is now a significant part of the UK housing system, accommodating 15 per cent of UK households. If this growth continues at same rate, private renting will be larger than social housing within three years and will account for one in five households by 2020. Despite this growth, too much discussion about housing acts as if social housing and owner occupation are the only options. It is time to think more carefully about private renting and the role that it plays in our housing system.

It would be unwise to assume that the recent growth in the private rented sector will just cease. The tenure mix in the UK has changed rapidly over the past 100 years; as recently as the 1950s, more than half of households were private renters. There is no reason to assume that current tenure patterns will continue unchanged in the coming decades. These major historic changes in the tenure mix have been caused by a combination of social, political and economic drivers. We need to understand the drivers behind the recent growth in private renting in order to respond to it and assess the likelihood of continued growth.

Demographic and lifestyle changes, such as the growth of small households, are likely to have played a role in the recent growth of the private rented sector. But the speed of the sector’s growth since 2005 suggests that other factors are the major drivers. Our research suggests that two drivers are likely to have been particularly important in this recent growth. Affordability has severely constrained access to owner occupation (both in terms of deposits and monthly payments), particularly in some locations. At the same time there has been growing, unmet demand for social housing.

It seems highly likely that many, if not most, of the new private renters have ended up in this tenure despite a desire to access social housing or owner occupation. The private rented sector cannot be left to become a tenure of last resort. Last week housing minister Grant Shapps announced that the coalition government will not be taking forward additional regulation of the private rented sector. If that is to be the case, the government will need to provide details of what they will do instead to ensure that the sector provides decent and affordable housing.

Jim Vine is head of programme (UK housing policy and practice) at the Building and Social Housing Foundation