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May 18, 2022

Tackling tenancy insecurity in the private rented sector to prevent homelessness – what works?

Our latest report with the Centre for Regional Economic and Social Research (CRESR) highlights that more could be done within the Private Rented Sector (PRS) to prevent homelessness.

The report comes at a time in England when:

  • 4.5 million households are now living in PRS, many in short lived Assured Shorthold Tenancies, or living with the possibility of eviction at short notice 
  • A loss of tenancy in the PRS is the leading cause of homelessness
  • The precarious nature of the Private Rental Sector has been exacerbated by the Covid-19 pandemic, with temporary measures serving to ‘store up’ a glut of eventual evictions
  • Almost 30% of PRS tenants are experiencing in-work poverty.

The PRS now plays a mainstream role in meeting housing needs in the UK, but the growth has occurred alongside a long-term reduction in the availability of social rented housing, and it is therefore relied on heavily by councils to meet their homelessness duties. The number of households in temporary accommodation in England has increased steadily since 2011, with 96,600 households in temporary accommodation in June 2021 – nearly 60% of these households have children. However, a loss of tenancies in the PRS is also the leading cause of homelessness.

Watch the video below to hear from Guillermo Rodríguez-Guzmán, our Head of Evidence and Data, about the key takeaways from the report, and download our Tackling tenancy insecurity in the private rented sector - what works? report to explore the evidence.

Those on very low incomes are struggling the most in PRS accommodation, with virtually unmanageable housing costs with households spending 64% of their income on rent in England, 68% in Wales and 57% in Scotland. In addition to unmanageable housing costs, almost 30% of PRS tenants experience in-work poverty - a figure which has increased by about 50% from 2000-01, and is expected to rise as the cost of living increases.

Evidence in the report also suggests that the current welfare structure is contributing to rental arrears. The benefit cap particularly adds further disadvantage to those with multiple needs, or households with large numbers of dependents, further contributing to higher levels of child poverty.

Dr Ligia Texeira, CEO of the Centre for Homelessness Impact, commented on the report:

'It is our great fear that the cost of living crisis will push more people to the brink of homelessness this year. Many of the commendable government actions during the pandemic, such as providing emergency housing, halting evictions and the temporary lifting Universal Credit payments have come to an end just at a time when millions of people face high housing costs and rises in inflation, fuel prices, and for some people on lower incomes, a rise in National Insurance contributions.

'We are particularly concerned about the 4.5 million people living in private rented accommodation where provisional contracts, shorthold tenancies, and the renewed possibility of eviction from landlords if tenants fall behind with the rent or when fixed tenancies end make this an insecure form of housing for many.

'In response to the cost of living crisis, we would like to see more trials into the effectiveness of experimental ways to sustain tenancies such as incentives for landlords to offer and maintain tenancies for people on low incomes or with a history of homelessnss, mediation and targeted legal advice for tenants as well as an increase in the supply of affordable housing.'

The report makes the following recommendations to help prevent homelessness in England:

  • Local policy should support and encourage private landlords willing to rent to tenants with experience of homelessness - Landlords  could be offered cash incentives, guarantees, deposit bonds and tax breaks
  • Changes to legislation around evictions will remove ‘no fault’ evictions and continue transitioning to a more protective environment for renters
  • Forms of intensive case management are effective for those who require support for multiple disadvantages, with unconditional housing, such as Housing First, demonstrating strong outcomes
  • Mediation and legal advice for tenants could play a complementary role in securing better outcomes for people facing evictions. 

The report considers how Assured Shorthold Tenancies (ASTs) and the Section 21 mechanism for regaining possession in England and Wales under the Housing Act 1988 have become a key focus for policy makers and practitioners involved in trying to tackle homelessness. Drawing on evidence collected through the CHI’s Evidence & Gap Maps, as well as learning from the social rented sector, the report considers a number of critical studies, systematic reviews and impact evaluations to examine the primary drivers of tenancy insecurity and its relationship with homelessness in the UK.

Download our Tackling tenancy insecurity in the private rented sector - what works? report.

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