Category: Housing

  • Navendu Mishra – 2022 Speech on the Private Rented Sector White Paper

    Navendu Mishra – 2022 Speech on the Private Rented Sector White Paper

    The speech made by Navendu Mishra, the Labour MP for Stockport, in the House of Commons on 3 November 2022.

    Thank you for calling me so early in the debate, Madam Deputy Speaker. This is a very important issue in my constituency and across England. More than 7,000 households—households, not people—are on the waiting list at Stockport Homes, which is one of the main providers of housing in my constituency, and 11 million people rent privately in England. That underlines the importance of this debate, and I am grateful to my hon. and good Friend the Member for Brighton, Kemptown (Lloyd Russell-Moyle) for securing it.

    We heard about reforms the Government were going to bring in some three years ago; unfortunately, in the three long, hard years since, we have seen very little progress. I will describe two separate cases that have recently come into my inbox. The first involves a family of three—a single mother with two teenage children, one of whom has severe autism. They were served with a section 21 notice of no-fault eviction. The mother had always paid her rent and kept the house spotless, and the family had lived in the property for 12 years. When they were served the section 21 notice, the landlord said they wanted to sell, but my constituent suspects that the landlord was seeking a higher rent in the market.

    Sadly, the family were evicted. They were rehoused in a hotel outside the borough of Stockport, which caused massive problems for the family, including the 16-year-old son with a medical condition. The three of them were accommodated in a small hotel room, and Stockport Homes has had to extend the six-week period for hotel costs because the son is unable to cope with the trauma of moving into temporary accommodation before being rehomed. Stockport Homes is also paying the storage costs, which the family will have to reimburse, increasing the pressure on the family. The mother is flexible about where the family can be rehoused; she is just desperate for a permanent home. There has been a mental impact on the entire family, but particularly on the son who has autism. It is a serious case and I wanted to highlight it in the Chamber.

    The other case is also quite tragic. I was contacted by a recently bereaved constituent who was on a protected tenancy. Her private landlord’s agent had asked for her rent to be increased from £350 a month to £800 a month. She had been living in that one-bedroom flat with her late partner for 44 years on a protected tenancy, with very little upkeep and maintenance of the property undertaken. The valuation office was approached and the formal rent valuation process was gone through. The rent for the property was determined to be £450 a month, not £800 a month as the agent was demanding. This tenant was fortunate to have protected tenancy status at a time when she was most vulnerable, after the loss of her partner of 44 years. Sadly, most people are not so fortunate. Those are two serious cases, but I could go on. My inbox is filled with similar cases of people who are desperate to get housing.

    I am grateful to several organisations, but particularly Shelter, which provided an important briefing for the debate. Research from Shelter conducted in April 2022—three years after the Government first committed to scrapping section 21 no-fault evictions—shows us that every seven minutes a private renter is served with a section 21 notice and that more than 200,000 renters have been evicted in the three years since the Government first said they would scrap no-fault evictions. These figures are staggering and very worrying. Other colleagues have mentioned Generation Rent and other organisations, including Shelter, which conduct important research and act as a lifeline for many people in that desperate situation.

    While we are debating housing, I want to mention Mrs Sheila Bailey, a local councillor in my constituency who very sadly passed away recently, and highlight early-day motion 428, which I tabled in this House to pay tribute to her work. She was a champion for housing in particular, and played an important role in creating Viaduct Housing Partnership, a local housebuilder, when she was cabinet member for that portfolio.

    I know there are several other speakers, so I will not take much more time. I want to mention the inadequacy of local housing allowance. I have raised this matter on several occasions via both oral and written questions. According to the Office for National Statistics, the median rent for a one-bedroom flat in the private rented sector in Stockport borough is £600, yet, by the Government’s own admission in answers to written parliamentary questions I have tabled, in the two broad rental market areas that fall under that local authority, 71% and 52% of households respectively have a gap between local housing allowance rates and their rent. That needs to be looked at.

    I could say a lot more; a vast amount of casework comes through my office via letters, emails and telephone calls from people desperate to find housing in my borough. Stockport, I would say, is the best place to live out of the 10 boroughs in Greater Manchester—in fact, I would say it is the best place to live in England—but that means that the housing market is very competitive. People are facing hardship as it is because of the failed economic policies of this Government, but in addition, in Stockport, we have a problem where housing is in a dire state. We must ensure that people are not left behind.

    Lastly, I must mention Stockport Tenants Union, which was set up just over two years ago and provides support to people across the borough; Jonathan Billings, who is a long-standing campaigner against homelessness and has set up a charity named EGG, or Engage Grow Go; and the Wellspring in Stockport, which has been serving the local community for decades. My hon. Friend the shadow Minister will speak later on, but I want to congratulate my hon. Friend the Member for Liverpool, Wavertree (Paula Barker), who has just been appointed to the role of shadow Minister for homelessness and rough sleeping.

    The Opposition are taking this issue very seriously. We cannot wait three more years for action, or even three more months—we must ensure that it is delivered quickly.

  • Natalie Elphicke – 2022 Speech on the Private Rented Sector White Paper

    Natalie Elphicke – 2022 Speech on the Private Rented Sector White Paper

    The speech made by Natalie Elphicke, the Conservative MP for Dover, in the House of Commons on 3 November 2022.

    I thank my friend and co-chair of the all-party parliamentary group for renters and rental reform, the Member for Brighton, Kemptown (Lloyd Russell-Moyle) for his opening speech.

    Housing is a long-standing interest of mine, and I draw Members’ attention to my entry in the Register of Members’ Financial Interests.

    Reforming the private rented sector is an important area of work for all Governments, and I and other Conservative Members signed up to that in the 2019 manifesto on which we were elected. The vehicle for that important pledge is the White Paper, “A fairer private rented sector”, which was published in June. There has been much change in the short time since the White Paper’s publication. I welcome the Under-Secretary of State for Levelling Up, Housing and Communities, my hon. Friend the Member for Kensington (Felicity Buchan) warmly to her place, and I hope she will not mind if I place on record my considerable regard for the work that her predecessor at the time of the White Paper’s publication, my hon. Friend the Member for Walsall North (Eddie Hughes), undertook.

    I wish to illustrate the pressures of capacity in the private rented sector by reference to my own constituency and across Kent, before turning to why these reforms are so important and need to be progressed urgently.

    Today, the Home Secretary is visiting Dover. The situation of housing people who have crossed the channel illegally in small boats is putting a huge strain on housing and local services. It is not unheard of for local people to be turfed out of accommodation by landlords who want higher rents. There are concerns that landlords are looking to cash in on lucrative, long-term Home Office contracts. That is why we must push forward on these reforms.

    It is a great pity that the Home Secretary had not planned her visit to Dover and to Kent so that she could meet Kent MPs and Kent council leaders to discuss at first hand the serious local impact on residents, including the struggle to access affordable private-rented housing. I hope that she can meet us urgently to discuss these issues. The extent of the issue was laid bare in a strongly worded letter to the Home Secretary from Kent council leaders yesterday. They said:

    “Put simply, Kent is at breaking point. Our public services, including health, social care and schools are already under extreme pressure. We have approaching 20,000 households on the waiting list for social housing, soaring costs, limited availability of private sector rented housing and temporary accommodation all fuelled by being in an expensive south-east London periphery, while having pockets of severe deprivation and low average earnings… Kent’s housing sector cannot absorb further asylum places on top of those existing burdens over and above local demand.”

    How does the concern expressed by the council leaders translate to my constituents on the ground? Let me give an example of its impact in my constituency. My constituent, who I shall refer to as Emily, is a mother with seven children. She was required to leave her privately rented property on no notice, under section 21, and there was no suitable accommodation. In the end, she was offered accommodation in Leeds, some 280 miles away. She has ended up living with her mother in a two-bedroom house, sleeping on the sofa and the floor. Her grandmother told me how upset she was that migrants were housed in four-star hotels while her granddaughter and great grandchildren faced these conditions and impossible choices.

    In an attempt to shut down debate, too often such concerns can be labelled as extreme or even racist. There is nothing extreme for a person to be concerned about their family; that is about as mainstream as it comes. In my area, inevitably, given the scale of the small boats crisis, it is the issue of accommodating migrants and asylum seekers that puts this additional strain on the private rented sector and services. In other areas, it might be holiday lets, Airbnbs or student accommodation. But the underlying point is the same: there needs to be reform of the sector, which needs to be implemented as set out in the White Paper, and consideration of all these different housing markets and drivers.

    Building on the White Paper, there is other work that could drive improvement and understanding of local market dynamics further, and that might require supplementary solutions—be that Airbnb registration or other measures. I would be happy to meet my hon friend the Minister to discuss this further.

    Pages 7 and 8 of the White Paper set out a 12-point plan of action for private renters. In effect, it is a 13-point plan, as page 8 references that this plan is a support for the journey to home ownership. I shall shortly be developing an argument for a 14th point to that plan: support on the journey to council housing and social housing.

    There are three types of housing tenure in England: owner occupation; social rented; and private renting, which is property owned by a person who is different from the tenant and let out at rates and on terms and conditions that are different from those that apply to registered social landlords.

    The private rented sector has grown rapidly in recent years. As it has become more dominant, it is inevitable that that has been at the expense of both the social rented and home ownership sectors. Throughout the 1980s and 1990s, and right into the early 2000s, the proportion of total housing in private rented stock was around 10%. Between 2008 and 2017, it mushroomed to more than 20% of all stock, before settling to its current level of around 18.5% of stock. That translates into a doubling from about 2 million to more than 4 million households in private rented homes.

    In the context of this debate, housing stability means that a person knows where they stand; that if they pay their rent or mortgage and they do not behave outrageously, they have the choice as to whether to stay in their home. That is not the case for private rented tenancies. The landlord chooses whether a person can stay or must leave, no matter how long they have been in a property or how good a tenant they have been. That is what these reforms are trying to address—otherwise, the expense, time, disruption, distress and uncertainty caused by a section 21 notice all falls on the tenant.

    Improving housing stability is at the heart of abolishing section 21 no-fault evictions. The reform is intended to take away the immediate day-to-day worry and concern for tenants that they will wake up one morning to a notice saying that they have to go. The longer-term solution is to introduce more affordable accommodation and council housing as well as promoting home ownership.

    Dover District Council is a Conservative council that is compassionate and active in many ways. It has embarked on a council house building programme to help prioritise local need. I wish to give a couple of examples. Walter Hammond Close is a development in Dover, which comprises 16 studio flats, all let at social rents, providing interim housing for local people facing homelessness. It complements the Elizabeth Carter Court project in Deal. Completed in August, it provides eight one-bedroom flats, which are also let at social rents, providing interim accommodation for local people facing homelessness. Those two excellent examples of the work being undertaken by the council are encouraging, but the council cannot build enough to keep up with demand. That is why we need a large-scale affordable and council housing programme across the country.

    Helping constituents with private-rented housing is a staple of our work as MPs. I want to refer to one of my constituents, who I shall call Natasha. Her granddad asked for my help. He said:

    “My granddaughter and her child have been given notice to quit by a private landlord in Dover and have been desperately looking for alternative accommodation without success… She has suffered domestic abuse, ensuing mental health difficulties”—

    for which she has had counselling and has recovered amazingly well. He went on to say that she lives in a property with a dangerous electricity system and that they had battled with the landlord about this for months. He said:

    “The current situation is that we are now 52 days away from Natasha’s eviction date, which, ironically, is Christmas day… Here is a young single mother and her two-year-old child who have been given the most awful situation to face when all they wanted to was…to live in a safe environment.”

    It is vital for Natasha and all the others in Dover and Deal and all over the country that these measures are brought forward into legislation promptly. I had been concerned that there had been some hesitation about this, so I would be grateful if the Minister could confirm when we can expect these measures to be brought forward.

    In Natasha’s case, as hon. Members will have heard, there was an electrical safety issue in her flat. She battled for months, but it did not get fixed. Natasha is now in flat two and her child is three. This is her current position:

    “The property is a privately rented flat. The area where she lives affects her three-year-old child’s health due to traffic fumes. He now has a constant cough. The area is overrun by rats, which can be heard scratching and scurrying in the walls of the property and can be seen in the surrounding areas.”

    I look forward to seeing how the proposals in the White Paper will help Natasha and the many other cases that fill my inbox and, I am sure, the inboxes of many other Members across the House.

    There is good intent in the ombudsman’s proposals for redress, but that redress needs to be extremely swift and enforcement robust. In order for that redress to happen, landlords need to be identifiable as well as accountable. At the present time, we do not know how many landlords there are. In addition to potential revenue loss to the Exchequer, this makes accountability and traceability of landlords very difficult and expensive for councils in instances where they wish to take public health or other enforcement action.

    I welcome the proposed measures for the property portal, but I ask the Minister to consider what steps may be taken to ensure that the information contained in it is validated as to ownership and management, and that it can support efforts to ensure that all taxes are paid where they are due, and that the new proposed ombudsman, local authorities and other enforcement agencies may be able to access the portal in order easily to fulfil their obligations.

    I wish to move on to the White Paper’s plan around rent management and challenging excessive rent rises. Even before the current cost of living crisis, rent levels were unaffordable for many. The Local Government Association’s view is that the best way to increase housing security is to address the unaffordability of housing, which is the key reason why people lose their tenancies and become homeless.

    I agree completely that affordability is a vital ingredient of a good home. In the longer term, there is a need to rebalance the housing market through a tenure strategy to make sure we balance affordable and council housing and increased home ownership alongside a reduction in the private rented sector, but in the near term, there is increasing pressure on rents, making them unaffordable and unsustainable for many.

    In the White Paper, the Government rule out rent controls to set rents at the outset of the tenancy. In recent weeks I have proposed controls to freeze current rents for up to the next two years, while the current economic pressures are expected to reach their peak. The proposal would comply with the premise set out in the White Paper because it affects only rent rises, not base rent levels. The measure would be deflationary, not inflationary, and would be to the wider benefit of everyone, including landlords.

    A case may be argued for managing rents more widely, but to some extent high rents are the symptom, not the cause. As the hon. Member for Brighton, Kemptown eloquently set out, the private rented sector has expanded to become all things to all people. It is providing both homes to those who can and should be home owners with a mortgage, and a roof over the head of those who have none, who should be in affordable housing.

    I understand that many landlords want to be compensated for any costs they pass on to tenants—indeed, some of them are very vocal on that subject—so the nature of the landlord and their relationship with the property is important. The UK landlord market is unusual compared with some other countries, dominated as it is by individuals, not by housing organisations and institutional landlords. The latest English private landlords survey shows that some 94% of landlords are individuals representing 84% of tenancies, so they are strongly dominant. About half of them are longer-term landlords of more than a decade. When people were asked to describe themselves as a landlord, over half said they considered their properties to be a long-term investment to contribute to their pension, and 27% said they considered them to be an investment for capital growth. So while for the tenant the property is their home, for the landlord it is first and foremost an investment, and as we all know, investments can go up and down.

    Just as there are longer-term structural issues around tenure, there are longer-term issues with savings and investment vehicles, including property. In that context, I ask the Minister to consider whether the financial management proposals on rents set out in the White Paper could be developed further, and whether there should be more robust measures to assist renters during this cost of living crisis. Communications I have received from landlords seem to suggest that they are unable to weather changing market conditions in the way that other businesses are expected to. The assumption seems to be that the tenant should bear all the financial costs and risk; otherwise, the landlord threatens to sell, even in a falling market.

    In that context, I ask the Minister what work has been undertaken to assess resilience to market changes in the landlord market with the mortgage lenders, as happens for individual owner occupiers, and whether stronger mortgage market regulation is needed for landlords with buy-to-let mortgages, to make sure they have sufficient planning and affordability to weather different market conditions. Is the Minister considering interest support or greater interest deductibility to support under-capitalised landlords in the near term? I would be grateful if she also considered whether such support could be linked to, for example, landlords committing to keep their rents in check during this cost of living crisis.

    There is strong evidence that the inherently insecure nature of the private rented sector has an adverse impact on people living under that type of tenure. There are measures in the White Paper that will incrementally move the private sector forward, and I welcome them. I look forward to working with my hon. Friend the Minister on this important aspect of her work.

  • Lloyd Russell-Moyle – 2022 Speech on the Private Rented Sector White Paper

    Lloyd Russell-Moyle – 2022 Speech on the Private Rented Sector White Paper

    The speech made by Lloyd Russell-Moyle, the Labour MP for Brighton Kemptown, in the House of Commons on 3 November 2022.

    I beg to move,

    That this House has considered the White Paper A fairer private rented sector.

    I thank my co-chair of the all-party group on renters and rental reform, the hon. Member for Dover (Mrs Elphicke), who is the co-lead sponsor of today’s debate, and the 30 other MPs from across the House who supported it. I also thank the Backbench Business Committee for ensuring that we have such a timely debate on the matter. Of course, I direct Members to my entry in the Register of Members’ Financial Interests and declare that I am the chair of that all-party group.

    Many commentators have said that the private rented sector is really three markets. The first is the luxury and high-end market, where people wish to pay high amounts for quality housing. To some extent, that market does not need the regulation we are discussing here. It will not be harmed by it, but this regulation is not aimed at it. The second is the market for people who are unable currently to buy a home or wish to have the flexibility of renting. This White Paper is about making their market a feasible, long-term, sensible one that they can live in. The third is for people who need social housing and often wider wraparound support. They should not really be in the private rented sector, as it will never be appropriate for them, but the White Paper still must protect them while we deal with the social housing problems that the Government, in the Bill they are bringing forward on Monday, recognise we need action on.

    The core of the debate is about how we create a private rented sector that is stable, affordable and safe, and where all parties have access to justice. I do not think that is a controversial thing. If it is not, the question is: how do we go about achieving those principles? It is not about whether those principles are desirable. Again, I believe there is broad consensus on the ways of doing it, most of which are laid out in the Government’s White Paper, “A fairer private rented sector”, published in June. It not only covers the points I have mentioned, but discusses information, enforcement, children and pets in the home, and giving people the protections they need.

    The chief executive of the National Residential Landlords Association said, on the release of the White Paper, that the

    “headline commitments to strengthening possession grounds, speedier court processes and mediation are helpful”.

    The renters’ campaign group Generation Rent said:

    “This is a serious set of proposals that will help to raise standards in private rented homes and restore some balance to the relationship between tenants and landlords.”

    The charity Shelter said:

    “This White Paper promises people safety and security in their home”.

    I could go on with the countless other ringing endorsements of the White Paper and its proposals that are coming from across the sector, with everyone wanting to go further on one bit or another, but welcoming the core.

    That is why it came as such a shock to many of us when it was briefed to The Times at the beginning of last month that all of that was being dropped. In Prime Minister’s questions on the same day, the former Prime Minister—I know it is hard to keep up with which one we have at the moment, but I am referring to the right hon. Member for South West Norfolk (Elizabeth Truss)—recommitted to a ban on section 21, but the full status of the rest of those proposals remains unclear. I hope that the Minister will continue in the good vein that the Minister but one initiated. I put no blame on her immediate predecessor, who did not have the brief long enough to make a difference one way or another. This is about how we make the pledges that we all put in our manifesto a reality.

    Let me deal with the substance of this issue. I start with the root of so many of the problems in the private rented sector: the issue of people’s stability and security in their home. Section 21 provides the ability for a landlord to evict without any reason a person from their home—that structural power imbalance is hugely consequential and exists in almost no other form of contract that we have today.

    On safety standards, I know of many cases in which renters do not wish to complain about the condition of their property, through fear of revenge evictions. The law at the moment is not good enough on revenge evictions; it currently requires a council to have made an assessment that the home is unsafe or in poor condition, in accordance with the housing health and safety rating system, in order for someone then to have the protections from eviction. That sets the bar well beyond where it is practically useful if it is to protect a renter who complains about something such as a boiler not working or the windows jamming.

    On affordability, section 21 is creating a crisis that is spiralling out of control, where we see a wave of assured shorthold tenancies coming to an end and section 21 being used to get higher rents, pushing up inflation, to above 20% in some areas. I know of a schoolteacher who received a demand for a 40% rent increase at the end of their lease. Unable to pay, he is now sofa surfing and homeless. A school teacher who is working full time is homeless not through any fault of his own but due to the state of the housing market today.

    Shelter commissioned research to show that some 230,000 private tenants have been served with section 21 notices since the Government made their first pledge in 2019—that is one every seven minutes. But that does not even show the scale of the problem, because a notice is not usually required; knowing they have no rights, renters will often just leave when the landlord asks them to do so, at an inconvenience to themselves. Section 21 provides no real recourse, no appeal and no exemptions, and even if it did, we know that the current court system has delays coming out of its ears, so taking things to court will not be an answer to these problems.

    Last week, in preparation for this debate, I asked renters to get in touch with me with their stories. One of the many replies I received was from a young couple who said that before they moved in the landlord agreed to carry out a deep clean, but when they entered the flat they found that it had an insect infestation and it had not been cleaned for months. Both the agent and the landlord refused to do anything. Later, the couple found that two windows were broken and so they asked for repairs, but, again, there was a refusal to do anything. They contacted the council, but it did not carry out an in-person inspection—we all know the pressures on councils—and in the end, on the balance of things, it just accepted the landlord’s word against that of the tenants. At the first possible instance, in November 2021, the couple were issued with a section 21 notice. They had a three-month-old baby and they were homeless.

    I have countless other such examples, and I am sure many other Members do, so it is no wonder that the commitment to deal with this was a cross-party commitment in all manifestos, but we cannot allow the abolition of section 21 to be in name only. We must not allow the next crisis to be the use of section 8 evictions due to rent arrears. If we simply abolish section 21 but allow landlords to increase rents uncontrollably, we will create a loophole that a lorry could be driven through. If a renter complains about the state of a property and the owner wants them out, the owner will just raise the rent to £10,000 a month and evict the tenant. The current rental increase protections are inadequate for protecting renters. When I last looked, the only way to make an application to the tribunal was by fax. That is ridiculous.

    Potential economic evictions were foreseen by the Renters Reform Coalition, and I am pleased that the White Paper addresses the issue. It states:

    “We will only allow increases to rent once per year… We will end the use of rent review clauses, preventing… rent increases that are vague or may not reflect changes in the market price… where increases are disproportionate, we will make sure that tenants have the confidence to challenge unjustified rent increases through the First-tier Tribunal”.

    Those are the Government’s words. If that works, it will be a game changer for stability in the rental market. Personally, I would like the Government to take on more rental controls. I know that they have ruled that out, but I hope that others will press them on the matter. My friend the hon. Member for Dover will say more about rental controls. However, the proposal in the White Paper is a sensible compromise on which we can start to make progress.

    I note the concerns of the National Residential Landlords Association about moving from periodic tenancies and the effects on student housing. It points out that both landlords and students need to know that a property will be available many months ahead. I am sure that the Government are working on solutions to that perceived problem, but if I could offer one piece of advice, it would be, please leave the proposals in the White Paper as they are. More loopholes will be taken advantage of.

    I offer a solution. Dare I say that there should be an opportunity, if not a duty, for universities to house all their students who wish to be housed? Universities could engage in tenancies with the private rented sector. They would be permanent periodic tenancies, and universities could license rooms to their students. That would give the private rented sector the security it needs and students the wraparound support they often require. In our communities, we often hear complaints about people not coming forward. Such a solution would give universities the knowledge that their students were in safe and secure accommodation. It could also work for other institutions and would still mean that the decent homes standards that the White Paper requires had to be fulfilled in such accommodation.

    Security of tenancy is particularly urgent. We are facing a difficult time, with many landlords selling their properties. Mortgage rates are going up and many landlords may wish to leave the market. That is fine. Some say that landlords leaving the sector means that rental provision leaves the sector. However, for every landlord who leaves the sector, there is another homeowner or private rented landlord entering it. My fear, which is shared by many, is that turmoil in the housing market will mean that renters are evicted so that landlords can sell property to another buy-to-let landlord, who would often be more than willing to allow a renter who had been paying rent for a long time to stay there.

    The Government stated:

    “We encourage any landlord who wishes to sell their property to consider selling with sitting tenants, which may provide an easier and faster solution.”

    However, most mortgages do not allow that. I ask the Minister to sit down with mortgage providers and work out a way in which buy-to-let tenancies could facilitate that. It might mean a slightly higher premium in some circumstances or some conditions, but it needs to happen now.

    Ideally, we would have a system such as TUPE, whereby when an employer is taken over, the employees continue in employment. If a landlord is taken over, the tenants should continue to live in the property. We should aim for that. Of course, a new buyer might choose to move in and renovate the property. The existing clauses allow them to remove a tenant as they see fit.

    There is broad agreement on both side of the House and in the sector on access to justice. Unless we take enforcement and the ability to access redress seriously, this is all a waste of time. The rogue landlords list was set up in 2018 with a great deal of fanfare. It was meant to be a game changer. Earlier this year, the Government were asked how many landlords were on the list. The answer was 61. That makes a joke of the entire system. I could probably name more than 61 in my constituency, let alone the country. That is even more reason why the White Paper’s proposed property portal, which would require all landlords and properties to be registered, is the only way forward. I think that the Government have come to realise that. I genuinely believe that they have seen the error of their ways. That is why they talked about establishing an ombudsperson to

    “provide fair, impartial, and binding resolutions for many issues without resorting to court.”

    The White Paper goes on to say:

    “The Ombudsman will have powers to put things right for tenants, including compelling landlords to issue an apology, provide information, take remedial action, and/or pay compensation of up to £25,000.”

    That is spot on. It empowers renters and gives them a body to seek redress, but it also means that landlords know that there is a place where they will be fairly heard. That, combined with the removal of section 21, is a life changer for many. It will give people the ability to complain about poor housing.

    One person told me:

    “One electrician said that the wiring was the worst he had ever seen. The poor wiring led to us having a power cut, which was only repaired with a temporary fix. The landlord admitted that they were aware of the oven being faulty at the start of the tenancy but refused to fix or replace it.

    Our hot water didn’t work when we moved in—the landlord had a friend (who wasn’t a qualified gas safety engineer) disconnect our heating from the boiler without telling us. We had to call out emergency gas and electrical technicians to fix these issues and shortly after” —

    surprise, surprise—

    “we were served with a Section 21 notice.”

    If the Government enact their proposal, renters could go to the ombudsperson and get their home fixed to a decent standard, and they would not have to fear a section 21 eviction notice.

    It is vital to include deposit protection schemes in the responsibilities of the ombudsperson. Decisions about such schemes should be published on the property portal. At the moment, they are not and they are only sporadically enforced.

    Last year, the APPG heard from a young woman in her early 30s. She said that she was still sharing a house in an insecure renting arrangement, despite earning £35,000 a year. She spoke about wanting to start a family with her partner, but said that she could not because she could not provide a stable home. The system has robbed that young woman of the ability to start a family. The White Paper could not just address some of the imbalances in the system but restore dignity to millions of renters.

    As is customary, I will finish with some questions for the Minister. Will she commit to implementing all sections—that 12-point plan—of the White Paper? Does she recognise that the pledge to abolish section 21 is not about getting rid of a clause called section 21 but about providing stability, security, and justice in the housing market? Will she commit to introducing the draft legislation this year? If not, when will that happen? Will she commit, as I have asked, to meeting mortgage lenders to discuss buy-to-rent mortgages with sitting tenants?

  • Sadiq Khan – 2022 Comments on Homeless Crisis in London

    Sadiq Khan – 2022 Comments on Homeless Crisis in London

    The comments made by Sadiq Khan, the Mayor of London, on 30 October 2022.

    Since I was elected Mayor, around 13,500 people have been helped off our capital’s streets with eight in ten staying off the streets for good. Our outreach workers, charity teams, healthcare professionals and council staff are not only vital partners in this work but unsung heroes and deserve our heartfelt gratitude.

    Despite this progress, extraordinary financial pressures are putting the poorest Londoners at growing risk of homelessness with the number of people sleeping rough already up by a fifth year on year. We continue to see a revolving door of people ending up homeless as a result of this escalating cost of living crisis.

    This cannot be allowed to continue, this new Government must act now to prevent the circumstances that lead to people sleeping rough before thousands more are forced to face a winter on the streets.

  • Paula Barker – 2022 Statement on Becoming Shadow Minister for Homelessness and Rough Sleeping

    Paula Barker – 2022 Statement on Becoming Shadow Minister for Homelessness and Rough Sleeping

    The statement made by Paula Barker, the Labour MP for Liverpool Wavertree, on 28 October 2022.

    Today, October 28, 2022, I am delighted to confirm that I have been appointed to the role of Shadow Minister for Homelessness and Rough Sleeping.

    It comes at a time when tackling this issue could not be more serious or pressing as renters struggle with the highest private rents on record alongside rocketing household bills.

    It is clear to me that as our country faces its biggest economic crisis in over half a century this issue needs a spotlight placing on it – homelessness and rough sleeping is getting worse, not better in this country.

    The Government’s own figures released earlier this summer, show 74,230 households in England became homeless or were at imminent risk of becoming homeless between January and March 2022 – including 25,610 families with children.

    This represented an 11% rise in three months, and a 5% rise on the same period last year. Moreover, since March household incomes have been and continue to be further hit by the cost of living crisis.

    The government’s latest homelessness data also revealed that, despite being in full-time work 10,560 households were found to be homeless or threatened with homelessness. This is the highest number of people in full-time work recorded as homeless since this government started recording this data in 2018.

    And moreover, 1 in 4 (25%) households in our country, were found to be homeless or at risk of becoming homeless because of the loss of a private tenancy (18,210 households). This has increased by 94% in a year and is the second leading trigger of homelessness in England.

    Over the coming months, I will be looking to work with leading organisations like, Homeless Link, Shelter, The Big Issue, Crisis, the Local Government Association and many others.

    There is so much more that can and should be done to end homelessness and rough sleeping.

    Homelessness and rough sleeping is also a matter that deeply impacts those in my own Liverpool Wavertree constituency. I have seen at close hand the excellent work that organisations like YMCA Together, Whitechapel Centre and Liverpool City Council have done in recent years to try to combat this.

    And I have also seen the positive outcomes from Mayor Andy Burnham’s ‘a bed every night’ scheme in Greater Manchester as well as the Homeless Friendly initiative – a social enterprise started by Cllr Dr Zahid Chauhan a North West GP.

    Up and down the country there are examples of brilliant things going on and we must find a way of learning from such good practice and sharing it across the country.

    But ultimately, this Government cannot be allowed to simply continue burying its head in the sand – we need interventions that will help prevent a steep rise in homelessness. I intend to push them on that agenda.

    We face a tough challenge ahead of us on this agenda but I am determined to be a fierce advocate of this very important brief.

  • Lee Rowley – 2022 Speech on Unfinished Housing Developments

    Lee Rowley – 2022 Speech on Unfinished Housing Developments

    The speech made by Lee Rowley, the Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities, in the House of Commons on 18 October 2022.

    I congratulate the hon. Member for North Shropshire (Helen Morgan) on securing the debate, on making her case so cogently and, in particular, on talking about the constituents on whose individual circumstances, as she outlined, this issue has had such an impact.

    I thank the hon. Member for Strangford (Jim Shannon) for his contribution, as ever, to an Adjournment debate, and for highlighting the elements of the Northern Ireland approach, which is something for us all to consider. I also thank the right hon. Member for Warley (John Spellar) for the information that he provided. He has written to the Department as well; I am looking at that correspondence and will get back to him as soon as I am able to do so.

    As has been clear tonight, the hon. Lady speaks for many Members on both sides of the House in arguing for better protection for people in unfinished housing developments. I cannot comment on individual cases because I do not have all the details in front of me, and obviously there are two sides to every story and different circumstances in each case. However, I would say to people who have been adversely affected by inappropriate practices, whether in North Shropshire or elsewhere, that that is not acceptable; I am sorry they have had that experience, and I hope they can seek redress and correction in any way that is available to them.

    I think everyone in the House would agree that we need more homes, but we need them in the right places and we need them when they are constructed. That is often a controversial and difficult process, but when they are constructed, we need them to be of a standard that enables people to live in them. They have to work, and they have to work within the local community that those people are seeking to join. The debate is timely in enabling us to highlight the latter point, because in a minority of instances that might not be the case.

    For too many people, at least initially, the dream of home ownership does not live up to their hopes, because they are forced into resolving faults in their new build homes that are not of their making. The delays in getting those issues resolved often leave homeowners out of pocket, in financial stress or, as the hon. Lady suggested, having to engage in lengthy battles with developers to put things right—if the developer concerned is still in place. As a constituency MP, I have had some experience of that in North East Derbyshire, albeit with a developer who did in the end put things right—but it took a while for that to be done, which caused many residents in a number of villages, but one in particular, a significant amount of stress. So on a personal level, from a constituency perspective, I understand the point that the hon. Lady has made.

    The Government are unequivocal in stating that all new housing developments should be finished on time and to a standard that buyers expect. If things go wrong, as they sometimes do—we all know that processes are not perfect; the developer sometimes has problems and challenges and we should be reasonable in expecting that—the buyer should be treated fairly and promptly. I would like to say a little bit about the action we are taking to make sure that this is the norm in all new housing developments, wherever they are in the country. This breaks roughly into three different elements. The first is the length of time that it can often take for houses to be developed in the first place. The second involves the infrastructure commitments that the hon. Lady has highlighted, and the third relates to the quality of work in the developments when they are concluded and people begin to live in them. There are often concerns about the quality at that point.

    Jim Shannon

    I thank the Minister for his helpful response, and again I want to use it to be constructive. Back home there are many developers who sign up to the Master Builders Association agreement. As members of that organisation, they are accountable for the finish of the houses. If at the end the houses are not finished to the standard they should be, the owner has the right to take a complaint to the Master Builders Association, which will ensure that the work is completed to standard. I ask in a constructive way: is that something that could be done here?

    Lee Rowley

    The hon. Gentleman makes an important point, and I would be interested in hearing more. He will appreciate that I am seven weeks into post and I am still learning, but I would be genuinely interested in understanding the Northern Irish approach, given the information that he has highlighted this evening. Where there are things that are done well, we should be willing as a Government to look at those to see where we can take best practice and apply it on a broader level. I want to understand in more detail what is happening in Northern Ireland, and I will be happy to do that separately with him and his colleagues, if that would be helpful. I would be keen to understand the particular difference that he thinks comes from the Northern Irish approach, and I am always happy to find out more about particular instances and whether they would work on a broader scale, should that be helpful.

    Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)

    Could I perhaps look at the issue the other way round? As in Northern Ireland, housing and planning are entirely devolved to the Scottish Parliament, yet as a Member of this place, I get stuff about housing all the time. Looking at it the other way around, as and when His Majesty’s Government develop clever ways of doing things with housing, taking on board the points made by my hon. Friend the Member for North Shropshire, I would be grateful if those new methods could at least be offered to the Scottish Government in case they could glean something that might improve the housing issues north of the border.

    Lee Rowley

    The United Kingdom Government are always keen to indicate to the Scottish Parliament and the Scottish Government where we might be able to work together and where we think that elements of policy might work for Scotland as well as they work elsewhere in the Union. Occasionally, the Scottish Government are not that keen to listen to His Majesty’s Government, but perhaps, given the hopeful outbreak of consensus on the desire to make progress, that will not occur on this particular subject. I am happy to consider the point that the hon. Gentleman rightly and properly makes.

    John Spellar

    I think we need to look at two separate, although related, problems. One is about the individual build quality of the houses. The other is about the infrastructure of the estate, which is certainly a problem that I and neighbouring Members of Parliament in the west midlands conurbation are finding. We have to find a way through that. In addition, if a developer goes bankrupt, the titles revert to the Crown Estate, so does not the Crown Estate have an opportunity to play a proactive role here? At the moment it seems to be playing a fairly passive role.

    Lee Rowley

    I will come to those two points, because I agree there are different elements that we need to consider and unpack. I would be happy to discuss the second point with the right hon. Gentleman in more detail, should he wish.

    On completing new housing developments—I accept the hon. Member for North Shropshire made a broader point about further down the chain—the Government are clear that developments should be built out as soon as possible once planning permission is granted. The frustration of local communities where that does not occur is completely understandable. We expect developers and local authorities to work closely together to make this happen.

    The Levelling-up and Regeneration Bill, which is in Committee today, will increase transparency on build-out, helping councils and residents to better understand what they can expect from development proposals and putting in place sanctions should the homebuilder fall short. Of course, there are examples where developers will need to vary their approach to building and constructing properties, and of course timeframes will both elongate and reduce as part of that process, but in general we are keen to see that when development is granted permission, often through difficult and sometimes controversial processes, and the clock starts ticking, the development should get moving and conclude as soon as possible.

    The hon. Member for North Shropshire rightly highlighted infrastructure. Taking roads as an example—she mentioned a number of examples—when a new development is granted planning permission, councils can currently use section 106 planning obligations, as she indicated, to secure a commitment from developers to construct roads to a standard capable of being adopted by the local highway authority. It is up to developers and local planning authorities to agree on specifics such as timescales and funding, which may include the provision of a bond. This is currently a local decision and, notwithstanding the difficulty she rightly highlighted—she made a constructive suggestion on potential compulsion in this area—there are going to be different circumstances in different instances.

    I encourage councils to use bonds where they think it is appropriate. Equally, I do not know whether we want to be so prescriptive as to mandate that from the centre, as there may be instances where it is neither appropriate nor necessary. Hundreds of thousands of houses are built each year in very different parts of the country, so we have to have regard to the fact there are different circumstances. None the less, I accept the premise of what the hon. Lady indicates and, where good practice exists—she indicated the good practice in Oxfordshire, and it also happens in Derbyshire—I encourage councils to use it, where appropriate and reasonable.

    Helen Morgan

    If compulsion is not appropriate, what about disseminating best practice to all councils in England to encourage them to use this mechanism, where appropriate, to avoid the situation that my hon. Friend the Member for Caithness, Sutherland and Easter Ross (Jamie Stone) and I have described? That would be a positive way forward to prevent this happening in future.

    Lee Rowley

    Within the bounds of localism, and without an individual Minister directing councils to do so, I think it is reasonable to indicate that, where possible, reasonable and proportionate, and where councils think it is appropriate, they should consider using bonds, which are a helpful lever and tool to be used where possible, while accepting that individual local authorities may have different reasons and different views on either using them or not using them. Ultimately, I will leave it to the discretion of individual local authorities to determine the appropriateness of that utility.

    Returning to the point about roads, the Government believe it should be made clear to potential purchasers what the arrangements are for the maintenance of roads. Section 38 agreements facilitate the adoption of such roads as highways maintained by the public purse. It is certainly possible for local authorities to adopt streets and roads. Ultimately, though, that is a decision that is taken in relation to how these estates are created and how local authorities want to approach ensuring that they have highways that are at a standard that they can then maintain.

    Although I recognise, as has been indicated, that this does not work in a number of instances, if we can balance the appropriateness of localism—of making sure that local areas have the ability to vary how they approach this—while also ensuring that there is a general usage of the tools that are available, I hope that will be reasonable and proportionate.

    The other element of the discussion is effectively around the quality of what is delivered at the end of the process when people move in—or by the time they move in. The Department for Levelling Up, Housing and Communities has also provided local planning authorities with tools to enforce requirements with strong penalties for non-compliance. Again, we encourage councils to use them where possible, and, again, through the Levelling Up and Regeneration Bill we are seeking to strengthen those measures.

    I should add that when residents have a complaint about the local planning and highways authority that has not been adequately resolved, they may be able to complain to the Local Government and Social Care Ombudsman. I know that, in at least one incident, as the hon. Lady said, the residents of North Shropshire tried to do that. Obviously, the ombudsman is independent, but it is worth reiterating that it is there to redress issues, and I hope that anybody watching this debate who has a similar concern will consider its usage should that be appropriate.

    On the matter of delays to completion, warranties and the actual quality of new homes themselves, I know of the problems that new home buyers face regularly and we do not underestimate the detrimental impact that this has. Most new-build home contracts typically have a “short-stop” date, which is an estimated completion date, and a “long-stop” date, which is the date by which a home must be completed in the contract. The rights and responsibilities of the homebuyer and developer should be set out in that contract, including the circumstances in which a deposit and other money is returned.

    There are other routes to redress, which we are strengthening, and I will come to those in a moment, because they offer alternatives that the hon. Lady may wish to consider. The status quo currently is that most new-build homes are issued with a 10-year new-build warranty. Home buyers may also be able to complain to the Financial Ombudsman Service about their insurance cover.

    Within the first two years of most warranties home buyers may be able to seek to resolve issues with their new homes through that warranty provider. If the new home is covered by one of the consumer codes, they may also be able to help resolve the issues that residents unfortunately face.

    Even with those options available to home buyers, we recognise that the system is not in a perfect place. That is why the Government have committed to taking further steps to improve consumer redress. Through the Building Safety Act 2022, we have included a provision that contains a statutory new homes ombudsman scheme, which will place greater accountability on developers and make it easier and simpler for new home buyers to seek redress when things go wrong, which perhaps will move us closer to the Northern Ireland model in terms of outcomes.

    In the meantime, and as we consider the next steps for the statutory scheme, the independent New Homes Quality Board has progressed work to set up the voluntary New Homes Ombudsman Service, which will launch shortly. My second visit was to see the launch of a New Homes Quality Board and to see the first developers to be brought onto that scheme. I went to Solihull a couple of weeks ago, and I am grateful to the chief executive for meeting me. It is an important step forward. The scheme is voluntary at the moment, but, equally, that voluntarism gives the opportunity for home buyers to see the different ways in which developers are engaging with that system, and I hope that most developers will in the end engage with that system.

    The hon. Lady talked about leasehold at the end of her speech and I just want to dwell on that for a few seconds. We acknowledge that there are practices that are not where they need to be within the leasehold sector, and the Government and previous Ministers have given commitments that we will reform leasehold. We remain of the view that that is what should be done. Although I cannot give the hon. Lady the date she seeks, I am personally committed to trying to take the matter forward and I hope I will be able, with my colleagues, to give further information in fairly short order on the process for that.

    In conclusion, this is an important area of policy, and I am grateful to the hon. Lady and all those who have contributed to the debate tonight for the opportunity to talk about it. It is important to note that there are processes already in place that homeowners should use if they are in the unfortunate place described by some people in North Shropshire, which I know is also the case elsewhere. They should seek to use those and seek to—

    House adjourned without Question put (Standing Order No. 9(7)).

  • Helen Morgan – 2022 Speech on Unfinished Housing Developments

    Helen Morgan – 2022 Speech on Unfinished Housing Developments

    The speech made by Helen Morgan, the Liberal Democrat MP for North Shropshire, in the House of Commons on 18 October 2022.

    I thank the Minister for his attendance and response this evening. I secured this debate following a number of instances in my constituency in which the buyers of new homes have been left to pick up the pieces when critical infrastructure is not completed by the developer.

    Let me tell the House first about The Brambles in Whitchurch. That is a development of 14 houses, built by developer Sherwood Homes Ltd in 2016 on land that had already been granted planning permission for development by Shropshire Council. It was a condition of the planning permission that the road, footpath and drainage should all be complete before the occupation of any houses occurred. However, despite those things never happening, building completion certificates were issued for all the properties and they were subsequently sold and inhabited. Unfortunately for the residents, the drainage system failed, leading on some days to raw sewage backing up in their gardens. Sherwood Homes Ltd had not taken out the section 104 agreement required in the planning permission, and not only was the arrangement dysfunctional, but the connection to the Welsh Water sewerage network was illegal, and neither were the road, lighting and footpath completed to an acceptable standard.

    In October 2019, a creditor of Sherwood Homes Ltd, which appears to have shared some of the same directors, petitioned for it to be wound up and an order for insolvency was made by the court in December 2019. As a result, Shropshire Council could not take planning enforcement action against Sherwood Homes Ltd, and the residents of The Brambles, who are the successors in title to the private company established to manage the development, have been the subject of the enforcement process. They have been required to accept five-figure charges on their properties in order to rectify the issue of connecting the drainage to Welsh Water’s network. Indeed, the saga has also cost the rest of Shropshire’s taxpayers a considerable amount of time, as council officers have expended time and effort to attempt to rectify the situation.

    Shropshire Council believes that the developer’s failure to complete the necessary works before the first house was occupied should have been established by conveyancing solicitors, and the lessons to be learned from this episode are, “buyer beware.” It may be right, but few residents have been able to establish that principle with their solicitors and would not have the resources to begin legal proceedings against them. I believe that some of the home buyers took up the offer of conveyancing services facilitated by the very developer who left them high and dry, raising serious concerns over a potential conflict of interest.

    Jim Shannon (Strangford) (DUP)

    I commend the hon. Lady for securing the debate. Back home in Northern Ireland—I say this to inform the Minister as well—we have a very clear system whereby each developer must put a bond on the property. Therefore, should there be any difficulty in relation to the footpaths and roads not being finished, or if the streetlights are not done and the sewerage fails, that bond can be used for those repairs. Does the hon. Lady feel that the methodology used in Northern Ireland may settle the problems that she refers to, and that the Government and the Minister should look at that option?

    Helen Morgan

    I thank the hon. Gentleman for that sensible intervention; I will make a very similar suggestion in my speech.

    The leader of the council declined my request to undertake a case review of the sequence of events that led to the situation at The Brambles to understand whether the council could have prevented the situation at any point as it evolved. As the law stands, it would appear that she is right. The Building Safety Act 2022 does not cover issues relating beyond the house itself, and the Local Government and Social Care Ombudsman declined to consider the case, arguing that:

    “Caselaw has established that where a council issues a completion certificate and the work is later found to be substandard, liability for any defects rests with those who commissioned the work and those who carried it out. We cannot therefore hold the Council responsible for substandard work by the developer and we could not achieve any worthwhile outcome for”—

    my constituent by investigating the complaint.

    This is a very serious case—the most serious case I have seen in North Shropshire—but there are numerous instances in which roads have not been completed to a standard suitable for adoption, streetlights are not installed, shared areas are not landscaped as per planning permission and, in some cases, even the plot sizes vary from the original plan.

    I can provide further examples. A development at Isherwoods Way in Wem has been without streetlights and a surfaced road for 10 years; although the situation is about to be resolved, it is not quite there yet. On the west side of my constituency, a site that I cannot name because legal proceedings are under way features an unadopted sewerage system that has not been completed to the required standard. A development in Ellesmere was left without an adopted road and open space when the developing company collapsed. The situation is only being resolved now that the development has been purchased by a major national house builder. The developer of another site in Wem has applied for insolvency despite the road being unadopted, the open spaces not having been landscaped and concerns having been expressed by residents about the water drainage system.

    The cost to residents of these sites is not only financial. Untold distress and emotional strain have been caused and an enormous amount of precious time has been spent on resolving the situation. At a recent constituency surgery, one resident told me, “I’m a truck driver. I don’t have time to become an expert on planning control.” His neighbour, a construction worker, described the strain of worrying about everything that could go wrong with the drainage system, and about the cost involved in digging up the road to rectify the faults.

    John Spellar (Warley) (Lab)

    I have a similar problem in Cranford Street in Smethwick. I find it utterly deplorable that Severn Trent, which is making hundreds of millions and whose chief executive is paid millions, will not take over any responsibility for the sewage that is backing up into people’s homes. People have bought the home of their dreams and are now finding that it has turned into a nightmare.

    Helen Morgan

    I thank the right hon. Member for his intervention. I have had some productive discussions with Severn Trent on the issue and am about to propose a solution that I hope will help to rectify the situation.

    It has become apparent that residents are tied into an impossible situation. They no longer want to live in their homes, but realistically they cannot sell them until the defects are rectified. There are also wider financial ramifications because if any resident defaults on their mortgage, a bank will not be able to sell the property to recover its investment.

    The other common theme emerging from all these developments is that homebuyers will be expected to contribute to the costs of maintaining shared areas via a management company to which the title for the shared areas has passed. These companies typically pass on the management cost to the residents at zero profit. However, the ones that I have investigated then subcontract the work to a profit-making company. I am sure that the House will not be surprised to learn that in many such arrangements the subcontractor is related in some way to the original developer.

    The companies can charge uncapped amounts indefinitely to the homebuyer, in what is known as a fleecehold—I am aware that several hon. Members have raised the plight of fleeceholders on previous occasions. The management company can be used not only to pass on to the homebuyer the financial responsibility for completing the development, but to extort money for years to come, often for substandard management services. I am aware that the Government have indicated that they will legislate to control such management charges. I urge the Minister not only to commit to a date for such legislation, but to ensure that protections are included to cover previously unfinished developments.

    To tackle the issue up front, however, I propose a different course of action. I believe that it is possible for a water company or a local council to obtain a financial bond when a section 104 or section 106 agreement is put in place, such that when critical infrastructure is not completed, funds are still available to complete the work. In addition, there are mechanisms such as section 38 agreements incorporating financial bonds that can be used to ensure that roads are of an adoptable standard. Having spoken to colleagues, I believe that some councils, such as Oxfordshire County Council, use financial bonds for that purpose and to avoid the distressing situations that I have described. I have not been able to establish why that is not standard practice for all councils.

    I urge the Minister to consider using the Levelling-up and Regeneration Bill to require councils to take a step involving a financial bond before planning conditions are discharged, so that unsuspecting homebuyers are not left with unmanageable costs if their developer goes bust before the site is completed. The principle has already been established in the Government: National Highways requires a bond from local authorities if they propose works affecting the strategic road network, so that significant disruption is avoided if the works are not completed. I am concerned to learn that the changes proposed to the Bill would reduce councils’ ability to use section 106 agreements for smaller developments and would remove current powers to protect homeowners.

    The rationale for planning deregulation is that it will enable house building targets to be met by removing barriers to completion, but I would argue that, certainly in the case of North Shropshire, it is not necessary. The evidence does not show that planning regulations are behind slow rates of house building. Shropshire’s local plan contains a target of 30,500 new homes by 2038, but there are already 18,000 planning applications on which consideration has not yet commenced. The current build rate of just under 1,900 houses a year does not suggest that planning permission is the issue holding things up.

    I appreciate that requiring a financial bond from new house builders might deter smaller companies from entering the market, but first I question whether homebuyers and council tax payers should be taking on the risk posed by a financially unviable housebuilder; and secondly, it should be possible to find an alternative, such as an investment bond, to combat that risk.

    I am extremely concerned about the fact that councils lack the tools they need to ensure that the buyers of new-build homes do not fall victim to rogue developers, and the fact that the effectiveness of the tools they do have may be reduced by the Levelling-up and Regeneration Bill. I hope that the Minister will agree to consider making the use of financial bonds as part of section 106 or similar agreements a required practice for councils and water companies, to protect both homebuyers and councils’ own taxpayers from high-risk housing developers.

    If the Minister rejects such a solution, however, will he agree to meet me and other stakeholders, such as the Local Government Association, to formulate a practical mechanism to prevent the distress and financial hardship caused by unfinished housing developments? Homebuyers, councils and the wider community need to be confident that they will not be left to the pick up the pieces when a developer fails to deliver. The owners of The Brambles are victims of a rogue developer, and we should act to ensure that their experience is not repeated elsewhere.

  • Bill Wiggin – 2022 Speech Proposing the Ban of Sealed Bids for Property Purchases

    Bill Wiggin – 2022 Speech Proposing the Ban of Sealed Bids for Property Purchases

    The speech made by Sir Bill Wiggin, the Conservative MP for North Herefordshire, in the House of Commons on 11 October 2022.

    I beg to move,

    That leave be given to bring in a Bill to prohibit the sale of property by sealed bids; and for connected purposes.

    The role of Government is to ensure that markets work and that deals are fair and as transparent as possible. We make rules to ensure that unfair exploitation does not occur. That is clearly more important in land and property transactions, as they are usually the largest deals that most of us will ever do with our own money.

    The purpose of my Bill is therefore to enhance transparency, to reduce costs and opaque behaviour, and to ensure that both buyer and seller are treated fairly by the estate agent. Let me say that, despite the vast number of good agents, there are still some who think that using such opaque techniques to try to extort money is acceptable.

    We know that when one buys a property, one does a search and survey before exchanging contracts. That is sensible and prudent. However, when one is asked to submit a best and final offer or a sealed bid, that is done to try to extract more money without any extra information being given. That is not in the interest of any party except the agent, who has made little or no effort to assist in the deal making, as a broker of any other transaction would expect to do.

    A sealed bid or private treaty sale will be suggested to a seller when multiple potential buyers are interested in purchasing the same property. Prospective buyers are invited to submit bids for the property through a secret ballot or through an invitation to submit a best and final offer. All bids are then supposed to be considered at once. The owner of the property and the estate agent then decide behind closed doors, in an unclear and opaque process, who should be declared the winner.

    Agents are not bound by any legislation setting out appropriate processes for how transparency following bids should be handled, nor is there any later declaration of the price or any other useful information that would help the market. In fact, there are no credible statistics available recording how many sales take place by sealed bid, which demonstrates the overly relaxed nature of the regulations surrounding property buying.

    The system is therefore ripe for abuse and detrimental to the confidence of potential buyers. I hope that this Bill can generate real reform and encourage genuine transparency in the property market.

    It is inefficient that with such a process of sealed bids the prospective buyer has no idea what their competitors have bid. To be eligible to submit a bid, one must go through the cost of searches and surveys—an expensive procedure. The average homebuyer pays between £1,000 and £1,500 for conveyancing before exchange of contract. There are also other tedious undertakings, such as letters from one’s bank or lengthy pieces on one’s suitability to own the property.

    Bidders are required to do so much before even being considered for the property, but what do they get in return? Nothing but confusion, secrecy and unanswered questions. They often find themselves in frustrating and distressing circumstances: either they have not bid enough and are never told what the winner paid, or, if successful, they might be paying well over the asking price, and often far more than that which the agent thought the property was worth.

    All that is great news for the seller and the estate agent —right up until the seller becomes a buyer, of course. It leaves an agent who did not know his market with a larger commission, having done less work. It is not surprising that they do not want more transparency and no wonder that this element to the market needs reform.

    Once a bid is submitted, a buyer cannot really alter their offer. Estate agents will often tell buyers that their offer is legally binding before exchanging contracts. That may or may not be true, as a “subject to survey” clause is possible. Supporters of sealed bids claim that they speed up the buying process and discourage time wasters. However, in many cases, the seller or the buyer attempts to renegotiate after the sealed bid has been accepted, thereby prolonging the process. According to Quick Move Now, in quarter 4 of 2021, 39% of property sales fell through due to the buyer changing their mind or attempting to renegotiate the offer. When a property sale falls through, people lose not only the house or flat, but any money they have spent on applying for a mortgage, conveyancing or a property survey. Government figures suggest that consumers waste £270 million each year because transactions fall through. Failed transactions make moving house—already considered one of life’s most stressful experiences—more frustrating and less practical.

    Research undertaken by the Department for Business, Energy and Industrial Strategy suggests that consumers are extremely concerned by the weakness of regulation for estate agents. Aggressive tactics that are employed to close a deal quickly include practices such as gazumping. A system of sealed bids only encourages such harmful practices, which waste time, wreck estate agents’ reputations and artificially inflate the housing market.

    Often, estate agents use the sealed bids process to pressure inexperienced sellers into accepting the highest bid, with no regard to the circumstances of the buyer, while buyers are pressured into submitting their very highest offer. I must keep saying that estate agents are, by and large, good, honest people. However, the actions of a few can sully the industry. Processes such as sealed bids and best and final offers only add to that unfortunate perception. That is why reform is long overdue.

    Sealed bids not only affect the housing market. In Herefordshire, the average price for prime arable land is £10,670 an acre. Agricultural land values in England have reached their highest level since 2016. During that time, the use of sealed bids for farmland has also increased. That is concerning, as the price per acre for farmland is being increased artificially, in turn putting pressure on the price of food.

    Due to transport costs, the land next door is always more valuable to a local farmer than land further away, and it is more valuable to them than to someone who lives further away. That means that farmers are much more exploited and much more vulnerable than any other type of property buyer. This has to stop. How can we encourage new and aspiring young farmers to acquire land in such an opaque market environment?

    This Parliament has the ability to do far more for prospective home and farm buyers. Now we must find the will. We were elected on a key manifesto commitment to rebalance the housing market towards more home ownership. Home ownership is a fundamental Conservative value. Sealed bids and best-and-final-offer messages do not rebalance the market; they seek to corrupt it. They are not the way to an open, transparent, competitive market; they seek to stifle competition and transparency. They artificially raise prices and hopes, meaning that thousands of pounds are wasted. Through this Bill, I wish to see better regulation of the housing and property market, fairness for all prospective buyers and sellers, and transparency for an industry that has for far too long operated in murky ways. That all starts with an end to the practice of sealed bids and best and final offers.

    Question put and agreed to.

    Ordered,

    That Sir Bill Wiggin, Mr Ian Liddell-Grainger, James Grundy, Dr James Davies, Andrew Rosindell, Cherilyn Mackrory, Mr Mark Francois, Sally-Ann Hart and Sir Edward Leigh present the Bill.

    Sir Bill Wiggin accordingly presented the Bill.

  • Julie James – 2022 Statement on Building Safety in Wales

    Julie James – 2022 Statement on Building Safety in Wales

    The statement made by Julie James, the Welsh Minister for Climate Change, on 7 October 2022.

    I have always made it clear that I do not expect leaseholders to bear the cost of repairing fire safety issues that are not of their making and that I expect developers to step up to their responsibilities.

    I am very pleased that following our roundtable meeting in July a number of major developers have acknowledged their responsibility by signing up to the Welsh Government’s Developers Pact.  This confirms their intention to address fire safety issues in buildings of 11 metres and over in height that they have developed over the last 30 years.  These developers are Persimmon, Taylor Wimpey, Lovell, McCarthy and Stone, Countryside, Vistry, Redrow, Crest Nicholson and Barratt.

    I met with these developers yesterday to confirm next steps, and their plans and timescales for remediation.  I wish to commend them for their engagement to date and look forward to a productive relationship in the future.  In some cases, developers have started their remediation works, and are making the repairs necessary.  I look forward to this work continuing at pace.

    I remain disappointed that three developers are yet to provide me with assurances that they do not have any medium or high-rise developments in Wales or, if they do, are prepared to meet their responsibilities in respect of these developments.

    The three developers yet to reply are: Laing O’Rourke, Westmark, and Kier (now Tilia).

    I am urging these developers to contact my officials immediately to confirm their position.  I want to make clear I am exploring all options, including legislation, to ensure that those developers will face consequences for their unwillingness to accept their responsibilities.

    I am proud of the commitment we have made in Wales that a holistic approach is necessary to effectively address fire safety issues.  This means that both internal and external factors are considered, rather than a focus on cladding alone.

    I have made £375 million available to tackle building safety and have taken steps to ensure all appropriate routes are being explored to make sure that all medium and high-rise buildings in Wales are as safe as they can be from fire.

    To deliver on this commitment, it is essential that we understand the needs of individual buildings and design bespoke solutions to best address their fire risk.  A comprehensive survey provides this information, and the Welsh Building Safety Fund, which is still open for expressions of interest from responsible persons, is supporting this aim.

    Both the digital and intrusive survey work is paid for by the Welsh Government. By funding and commissioning the surveys, Welsh Government will gain a clear, consistent and comprehensive picture of building safety issues across Wales.

    Where buildings are found to be low risk, our consultants will provide an EWS1 certificate. This will help to reassure leaseholders and remove barriers to them accessing financial products such as mortgages.

    To date, the digital surveys have identified 163 buildings across Wales that require intrusive surveys.  All responsible persons have been contacted to advise them of the need for intrusive surveys, and to arrange for permission to access the building to undertake this work.

    In some cases, our consultants have faced restricted access to buildings, which has delayed our programme of surveys.  I would urge responsible persons to do all they can to facilitate access, so that our surveyors can continue this important work.  I have written to responsible persons / managing agents to press this message.

    I have been made aware that in a number of cases, survey work was undertaken prior to the launch of the Welsh Building Safety Fund, funded by residents, building owners or managing agents.  Where this has happened, and subject to certain eligibility criteria being met, surveys costs will be reimbursed by Welsh Government.  If responsible persons / managing agents are in this position, please contact my officials at buildingsafety@gov.wales.

    While it is right that developers are accountable, building owners and Managing Agents also have accountabilities when it comes to ensuring the safety of buildings and it is important that effective maintenance programmes are in place.   I would encourage all residents to assure themselves that maintenance on their buildings is being carried out in accordance with their lease agreements.

    I am also aware that in some cases, leaseholders are in severe financial difficulties as a result of fire safety issues and to address this I launched the Leaseholder Support Scheme in June.

    As I committed when I launched the scheme, I have instructed officials to review the criteria to ensure that those in greatest need are receiving support.  This review is underway, and I will announce any further changes to the scheme and eligibility criteria shortly.

    Building Safety in Wales must both address our present situation and undertake fundamental reform of the building safety regime to ensure the problems we face now cannot arise again in future.  Alongside investment over the next three years for building safety work, plans are underway for a significant programme of legislative and cultural reform to establish a fit for purpose building safety regime in Wales. Reforming the current system of building safety is a key commitment for this Government and also forms an important part of our Co-operation Agreement with Plaid Cymru. In addition to this, a number of provisions that apply in relation to Wales were included within the UK Building Safety Act 2022.

    The Act received Royal Assent in April 2022. The provisions that apply in relation to Wales focus primarily on the reform of the building control system (Part 3 of the Act) but do extend to other areas, including several provisions intended to add further protection for leaseholders.

    Some of the key provisions which have been commenced include:

    •         Amendment of the Building (Approved Inspectors etc.) Regulations 2010 to make the approved inspector sector more resilient and flexible in the face of insurance market fluctuations, and to create alignment on insurance requirements between approved inspectors and other professions

    •     The extension of the Defective Premises Act 1972 time periods and provision to deal with the lack of redress availability where a development company no longer exists.

    We have completed our design and construction phase transition plan which enables us over the next three years to make the legislative changes necessary to ensure that the problems identified with the current building control regimes are rectified.

    The first of the public consultations on this work was published in September. This consultation is focused on the rules and standards we will expect Building Control Bodies both in the public and private sector to comply with.

    This can be found on the Welsh Government Consultation pages.

    https://gov.wales/operational-standards-rules

    A full understanding of the impacts of any proposed changes is integral to this new regime, as is providing all stakeholders the opportunity to shape future policy.  To this end expect to see further related consultations over the coming months.

    We will be publishing more detail of our transition plan on our webpages shortly.

  • Simon Clarke – 2022 Levelling Up Secretary’s Op-ed for The Telegraph

    Simon Clarke – 2022 Levelling Up Secretary’s Op-ed for The Telegraph

    The article written by Simon Clarke, the Secretary of State for Levelling Up, Housing and Communities on 22 September 2022. The article was released as a press release by the department (mis-spelling the Secretary of State’s name).

    We have a new and reinvigorated government in Westminster.

    A government ready to roll up its sleeves and put in the hard graft so that the future of this country is bright and prosperous.

    We must ensure that everyone in our society – irrespective of where they’re from, what they do, or how much money they earn – lives somewhere warm, decent and safe.

    We’ve already acted on energy bills, so a typical household will pay no more than £2,500, while providing hundreds of pounds in relief for struggling families this winter.

    And we’re acting with that same urgency on building safety.

    What happened at Grenfell Tower was nothing short of a national tragedy. It should not have taken the death of 72 people for us to have woken up to just how ineffective the building safety regime was. It is our duty as a government to fix this, and ensure that it never happens again.

    Just a few weeks into the job I am hearing from leaseholders who are still waiting for remediation works to be carried out, who are unable to sell, and face sky-high building insurance premiums.

    I’m determined to finish the job my predecessors started, fixing the system for good, ensuring that industry rectifies the problems it created, and making sure that the leaseholders who have been so unfairly caught up in this scandal get the relief and protection they deserve.

    In recent months, we’ve already taken some big steps in the right direction.

    The Building Safety Act came into force over the summer.

    It represents the greatest set of reforms in a generation with a tough new regulator and an even tougher regulatory regime to ensure that people’s homes are made safe.

    The Act means that every block of flats must now have someone who is responsible for a building’s safety and the residents who live in it.

    It also provides far-reaching legal protections to leaseholders so that they’re no longer hit with unfair bills to fix cladding issues.

    For the first time government will have powers to force owners to fix dangerous buildings for which they’re responsible and ensure remediation works are both fast and proportionate.

    Forty-nine of the largest housebuilders have now risen to the challenge set by government and signed a public pledge to fix unsafe buildings that they developed or refurbished. Responsible housebuilders are wasting no time in getting on with fixing those buildings and I look forward to working with this group on our ambitious housing agenda to deliver the homes and growth this country deserves. We will shortly turn those pledges into legally binding contracts, which will give residents confidence that their homes will be made safe and that leaseholders will not have to pay.

    Any housebuilders that fail to act responsibly may be blocked from commencing developments and from being granted building control sign-off for their buildings. This month we have taken steps to set up a scheme in law to show which housebuilders are doing the right thing, and which are failing to do so.

    Our Recovery Strategy Unit will expose and pursue firms and individuals involved in the most egregious cases of building safety neglect. Where freeholders are not coming forward and accepting government money to make buildings safe, this unit will be launching legal action. I expect the first cases to be brought very soon. This government is determined to hold the worst actors to account, deliver for leaseholders, and restore confidence in the housing market.

    But this was never about heaping blame on one part of the sector. It’s about making the whole industry, including construction product manufacturers, play its part in fixing the wrongs of the past.

    That’s one of the reasons why my department is also working hand in hand with the Financial Conduct Authority to ensure that appalling practices within the insurance industry, like the sharing of commissions between brokers and managing agents, which can drive up prices for consumers, are brought to a swift end. I wrote to the British Insurers Brokers Association myself this week and I expect this immoral behaviour to stop immediately.

    It is also why we will continue to work relentlessly with the lending industry to ensure leaseholders are no longer trapped by over the top risk aversion and unnecessary paperwork, freeing them to take their next step on the housing ladder. I welcome their commitments so far but now is the time to see tangible changes to unlock the market.

    We will make homes safer. We will protect leaseholders from crippling costs. And we will work to restore the right of everyone in this country to feel safe in the place where they and their loved ones sleep at night.