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Housing White Paper: Analysis from property expert

A leading lettings expert has welcomed a renewed focus on rented homes in today’s Housing White Paper but has bemoaned a “missed opportunity” for “more radical renting reform”.

Measures relating to renting announced in the policy document published by Communities Secretary Sajid Javid MP this afternoon include:

• Government plans to attract more institutional investment for the construction of homes for rent, particularly from pension schemes. • Efforts to ensure that “family-friendly” tenancies of three or more years are available in newly-built rental homes • A consultation on legislation banning letting agent fees • The introduction of banning orders preventing rogue landlords from operating, and new powers allowing local authorities to issue fines instead of seeking prosecutions.

Speaking earlier this week, Housing Minister Gavin Barwell MP confirmed, that the White Paper was aimed at recognising the growth of the private rented sector in the UK, stating:

“We want to be a government that helps people who are working hard to get on the housing ladder. But if you’re going to have a country that works for everyone you have to have something to say to people that want to rent a home as well.

“Yes, most people want to own their own home and the government should be doing everything they can to help them with that. But there are some people who cannot afford to own and there are others who actually want to rent for the flexibility that comes with that.”

This change in emphasis was welcomed by leading property expert Ajay Jagota of KIS Group sales and lettings and deposit-free renting solution Dlighted.

He said: “Twice as many people live in a rented home compared to ten years ago. A change in emphasis from home-ownership as being the sole goal of housing policy from the government is as welcome as it is overdue.

“That said, I’m not as optimistic as the government that financial institutions are falling over themselves to invest in new rented homes, or at least not in the numbers the government wants or needs. Historically pension funds have avoided investing in bricks and mortar and have stuck to the flexibility of stocks and shares. I can’t see that changing.

“My major complaint is that the Housing White Paper is a missed opportunity for more radial rental reform. The government has been heavily pre-briefing that it believes the housing market is ‘broken’, but has left the most broken part in place – tenancy deposits.

“This White Paper leaves us with a system where people can’t afford to pay tenancy deposits on good quality rental homes, forcing them into bad ones. These deposits don’t just give landlords little meaningful protection, they also rob our economy of a significant amount of investment.

“There’s £3.5bn currently still sitting in useless tenancy deposits. A more radical proposal would have seen that money transferred into the government’s own Help to Buy ISAs, with landlords instead using insurance policies to protect their assets.

“This would have led to a better deal for renters, a better deal for property investors, and gone a long what towards helping renters who want to own their own homes get a first step on the property ladder.”

This was posted in Bdaily's Members' News section by Ajay Jagota .