The treatment of tenants of the New Era estate by Westbrook Partners is deplorable. Like thousands of other private tenants across London, the New Era estate highlights the degree to which private renters have become disempowered and, increasingly, at the mercy of landlords who are only concerned by profits.
On Monday, Boris Johnson decided to wade into the dispute. He will, he said, ask his Deputy Mayor for Housing and Land to write to the landlord.
What the letter will say is beyond me; the Mayor is utterly opposed to stronger regulation of private landlords.
His 2012 manifesto explicitly pledged to “campaign against rent controls” and has claimed that the existing regulations are “broadly sufficient”. In 2012, Boris’s Housing Covenant went further, arguing that “regulation is damaging for investment into the PRS and it should always be a last resort” and that “the sector’s capacity for voluntary self-regulation has not yet been exhausted”.
That’s the Mayor’s policy, a private rented sector where regulation is determined by landlords and letting agents, which they can ultimately decide not to abide by anyway. As a system for protecting tenants, it’s laughable.
From banking to housing, at the most fundamental level the role of government is to protect citizens from market excesses. Can it really be said that the state has done enough to protect private sector tenants? I’d argue not, and the shocking treatment of tenants on the New Era estate – and thousands of tenants like them across London – is testament to this.
In London, private sector rents increased by 13 per cent in the year to October 2013, 39 per cent of private rented sector tenants now live in poverty and one-third of privately rented homes fall below the Decent Homes standard used in the social rented sector. Between 2008 and 2013, complaints against London landlords increased by 47 per cent.
The awkward truth for the Mayor is that the New Era estate is a nauseating piece of a bigger picture about the private rented sector. Given the lax regulatory system governing it, this is how private landlords can and do behave – particularly in London where housing need far outstrips housing supply.
Westbrook are doing what landlords will do given the opportunity – profit maximising at the expense of tenants. Rather than the Mayor half-heartedly asking the landlord to be nice, we need tougher regulations that provide genuine protection to people in their homes.
The argument that stronger regulations force landlords out of the market (incidentally, this argument seems to assume landlords will demolish their homes rather than sell them onto new homeowners or better landlords) is not borne out by the evidence. The UK has the worst protections for tenants in Western Europe, yet countries such as Germany and Switzerland have much tougher regulations and also have much larger private rented sectors.
The situation with the New Era estate would not be possible in either of these countries, and it is this European approach to the private rented sector that we should import. There are a number of policies that have been proposed that will go some way to achieving this, including statutory three year tenancies with predictable rent increases and ending no fault eviction. New Era shows why these are needed.
As for the Mayor, he needs to signal clearly to Westbrook that their grasping approach will be fought at every turn. He should consider whether there are any legal options for the GLA to issue a Compulsory Purchase Order for the estate, with a view to selling it on to a reputable social landlord. It is unlikely that Hackney council would be able to take such a step itself given the arbitrary cap the Coalition Government has imposed on council borrowing for housing.
But fundamentally, we need a new approach to the private rented sector. Call it a revolution or a new era for private tenants, we need a system that recognises that a tenants’ house is their home, it shouldn’t be a commodity ripe for profit hungry landlords.
Tom Copley AM is a Labour Londonwide Assembly Member
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