Communities and Local Government CommitteeWritten evidence submitted by Sue Thompson

I am appalled at the fact that you are about to embark on yet another enquiry into the Private Rented Sector. We have already had the Rugg report which succinctly said there was no need for further regulation. We have had the 2004 Housing Act which extended the powers of local authorities to license private landlords.

Our country at the moment is suffering under the burden of tremendous debt which needs to be addressed. These enquiries cost hundreds of thousands of pounds. At the end of the day it appears that you the government do not listen to what the enquiries say. The Private Landlord has become the scapegoat for all the ills of housing. The biggest gripe the government has is the cost of the housing benefit bill. (Perhaps as a knee jerk reaction to the ludicrous amount being paid in parts of London—not a reflection of the rest of the country.) You claim that it has almost doubled in the last 10 years. You have not taken into account that you have had quantative easing which has halved the value of our money. You have not taken into account the extra half a million people now claiming housing benefit. In real terms the bill has actually reduced in the past ten years.

I think that you are suffering from a new broom syndrome whereby you feel that you have to shake up the housing market. If you want to save money stop demolishing perfectly good housing and building new. Start refurbishing the old stock if there is a demand for more housing. This can be done at a fraction of the cost of new build without taking up further green belt land.

There are proposals to radically change the welfare system. You are expecting single under 35 year olds to move into shared room accommodation or pay the top up on a one bed flat. In Sunderland the difference between a one bed rate and a shared room rate is £45 per week. These people are living on £53 per week income. Landlords cannot afford to drop their rents to the shared room rate—they have service charges usually £20 per week plus the variable/unknown costs of insurance, repairs, maintenance, mortgage repayments and void periods to cover. They would be trying to run a business on less than £20 per week per flat return on an investment of £50,000. As a family business, at present we personally have very little overheads with no mortgages, only one paid member of staff and yet we are struggling to make 3% on our investments. The reason I have highlighted the single under 35 year old proposal is because there just is not any shared room accommodation available in the North East. Owner occupiers do not want to have more Houses in Multiple Occupancy built in their neighbourhoods. Local authorities here in the North East do not have shared accommodation. They do not have hardly any one bedroom accommodation.

Another proposal is the bedroom tax for social landlords as well as private landlords. This will not affect pensioners who are the main group of under-occupiers. Single widowed pensioners whose children have left the nest leaving them in a three or four bed house. It just does not make sense to exclude this group from the proposed legislation. Oh yes it does for you the government as this group are voters. So this rather reeks of a political rather than economic agenda. One social landlord I was speaking to is actually proposing to knock down bedroom walls to decrease the number of bedrooms. In future years when you or another government have a change of policy he will be rebuilding the walls. All this is at the cost to the tax payer. Housing is not like stocks and shares where you can buy and sell in a minute. We need long term planning.

We are always being told, rather patronisingly, that we the private rented sector are a vital part of the housing market. Yet here you are suggesting rent controls and more regulation. You cannot persuade the pension funds and corporate investment in housing because of the over-burdensome regulations. Please leave us good landlords alone and concentrate on the few rogues who still operate. The legislation is already there to deal with them.

January 2013

Prepared 16th July 2013