The Housing Act of 1988 was designed to change the balance of power between landlord and tenant in order to attract landlords, mainly by allowing them to regain possession of the property if they followed certain procedures.
The result of this can be seen in the chart above. The 1991 census shows the ratio of owner occupiers to social renters to private renters in London was 60:30:10 and by 2011 it was 50:25:25.
Many are surprised to learn that at start of the twentieth century over three-quarters of the UK population lived in private rented accommodation.
Over the course of the century home-ownership levels increased dramatically owing to the pursuit of political philosophies like the ‘property-owning democracy’ and ‘homes for heroes’, following the world wars.
The chart above puts that in the context of the terms of each Prime Minister since 1963 and potentially shows that the private rented sector stopped shrinking and started growing at around the time of the Housing Act of 1988
The sector got an extra supply-boost following the housing market crash of 2008/9. Many people active in the market were lumbered with properties that they were expecting to sell on, but had to let them out, thus becoming “accidental landlords”.
It would seem that all this increase in supply should lead to lower rents for all, but in reality the general trend is the reverse. While the amount of rented stock has increased, demand has increased even more so because the relative scarcity of properties to buy (given the reluctance of the above landlords to sell) and large mortgage deposit requirements have made renting the only option for many.
Renting privately has become desirable in its own right because of the flexibility it provides, but predictably, the result has been above-inflation increases in rent although this has stabilised in Dunstable and the surrounding areas recently. There have been calls for controls to be bought into place to provide more protection to tenants. You might have heard “Rent controlled apartments” referred to in US TV shows like Sex and the City. Despite being the capital of free-market economics, New York City has very strong rent control laws.
