• Generation Rent: A testing time for tenants

Generation Rent: A testing time for tenants

Generation Rent: A testing time for tenants

Liverpool’s rental sector special

Words by Christine Toner

For many, renting is a temporary step with the eventual goal being home ownership.

However, that isn’t always the case.

While the term ‘generation rent’ was originally coined to describe those tenants who desperately wanted to get on the housing ladder but were left out in the cold thanks to a lack of mortgage finance and a shortage of affordable homes, it has now come to incorporate a whole new type of occupant – one who actively chooses to rent a home.

Renting can offer a multitude of benefits, from the freedom to move at the drop of a hat, to the chance to live in an area and, indeed, a property which would otherwise be out of reach if you were looking to buy.

However, the rental sector is not without its flaws. The last few years have brought about further turbulence for tenants – and landlords – which has only highlighted these.

So what matters most to renters in the city? And what initiatives are in place to ensure those people renting Liverpool properties – whether short or long term – can access safe, secure homes at an affordable price?

In the first of a series of features on the rental sector, Your Move takes a look at the issues impacting the city’s tenants.

Quality Counts

Poor quality rental accommodation is a significant problem across the country. Just last month the Chartered Institute of Housing called for new minimum standards to be introduced for the private rented sector (PRS), suggesting landlords should receive tax incentives for signing up to accreditation schemes.

In Liverpool, however, landlords no longer have a choice. From 1 April 2015 landlords have been required to buy licences for all of their private sector rental properties and must meet certain criteria in order to obtain the licence.

In 2016 the first landlord in the city was fined for not signing up to the scheme. The landlord was charged £1,000 for failing to do so, over twice as much as the cost of a licence (around £400 – although discounts are available for landlords registered to an industry body).

An update on the scheme’s progress revealed 47,300 licensing applications have been started to date, and 26,000 of those have been or are about to be licensed. It claimed the initiative was helping to drive up standards in the rental sector.

Safe & Secure

One of the biggest concerns experienced by tenants is a lack of security. While one of the benefits of renting is the freedom to move whenever you like with just a couple of months’ notice, this obviously works both ways and often tenants are forced to move when they’d rather not.

Interestingly the rental sector was a key focus of the government’s latest report on the issues facing the industry – the Housing White Paper. Communities secretary Sajid Javid announced plans to make renting more secure for families by implementing longer tenancies.

The paper claimed families subjected to six or 12-month tenancies were having to move home before they planned to with children often having to change schools.

Longer tenancies – potentially three years – would give added security for renters.

At present, however, the move has only been suggested for housing associations, and whether Liverpool landlords in the PRS will adopt it remains to be seen.

> Related | News: Housing White Paper – Liverpool reaction

Rising Rents

The proposed ban on letting fees for tenants announced in last year’s Autumn Statement, while welcomed by many, has resulted in speculation that rents could rise. The theory is that if letting agents can no longer charge fees to clients they will have to increase the fees they charge landlords in order to recoup the loss. Landlords, in turn, may hike their rents to cover the increased costs.

Rent increases – and speculation of them – cause significant headaches for tenants. Unfortunately for those based in Liverpool, they’re pretty common too.

According to research by HomeLet, the North West saw rents rise by 2.2% between January 2016 and January 2017. The tenant referencing company last year ranked Liverpool number six in its top 10 cities where rents are rising fastest.

> Related | News: Hundreds of new Liverpool apartments given the go-ahead

Outlook

Looking ahead, the rental market in Liverpool shows no sign of slowing, bucking the national trend with rising rents as well as demand.

And the city is responding accordingly with numerous new purpose-built PRS developments coming to market.

Last month plans to build more than 270 apartments near to Liverpool’s Project Jennifer regeneration scheme on Great Homer Street were given the green light while 60 new apartments are planned for the Lark Lane Conservation Area.

Elsewhere, Peel will add a multi-storey PRS scheme to its Liverpool Waters plans at Princes Dock.

Generation rent, it seems, will have no shortage of choice in Liverpool.

> Related | News: £21m residential tower planned for Liverpool Waters

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About Author: Christine Toner