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Assembly members debate the private rented sector

22 June 2016

Members of the Assembly turned their attention to the private rented sector on 20 June, during a debate on the landlord registration scheme.  The debate came about on foot of a motion by Sinn Féin that the Minister urgently review the landlord registration scheme and an amendment to the scheme regulations, proposed by the Alliance Party, which calls for the regulation of letting agencies.

The landlord registration scheme was introduced in February 2014.  Figures issued in March 2016 stated that over 46000 landlords have registered with the scheme providing details of over 97,500 tenancies. Based on 2011 census figures, this suggests that 98% of private tenancies are registered.

Private rented sector in Northern Ireland receives over £300m through housing benefit

Alex Maskey, Sinn Féin MLA for West Belfast, opened the debate and acknowledged that the vast majority of landlords are very professional and provide very good accommodation. However, the sector is in receipt of £300m plus in housing benefit, based on figures from 2013-14, a large amount of public money paid out to a sector that Mr Maskey believes is not as regulated as it should be. This view was echoed by Mr Maskey’s party colleague Carál Ní Chuilín, who stressed the importance of ensuring that public money is being protected.

Parties call for regulation of letting agents to improve standards and accountability

The Alliance Party amendment calls for the regulation of letting agents.  Mr Stewart Dickson, Alliance Party MLA for East Belfast proposed this amendment and welcomed the opportunity to debate the motion moved by Sinn Féin.  Mr Dickson praised the landlord registration scheme “for bringing hidden landlords into the open for the first time”.  Making reference to research carried out by the Private Tenants Forum with the support of Housing Rights, Mr Dickson stated that the unregulated nature of the private rented sector allows a number of letting agents to fabricate fees and to treat a now vital sector as a money making scheme.   Mr Dickson called this practice unjust and unfair and hopes that the Alliance Party amendment will help tackle a practice that “preys on people in desperation and treats them as victims rather than as clients”.  Housing Rights has previously investigated this issue in a 2015 briefing paper on the need to regulate these fees.

Mr Roy Beggs, Ulster Unionist MLA for East Antrim, reminded the Assembly that agents often have no involvement in a tenancy beyond sourcing tenants and pointed out that this can create confusion over delineation of responsibility.  Acknowledging this, Mr Dickson stated that it is vital that responsibility is clearly set out in appropriate agreements relating to the tenancy.

Paula Bradshaw, Alliance Party MLA for South Belfast, believes that this amendment will bring about an equitable and balanced structure between the basic needs of the tenant to secure shelter and the commercial needs of the landlord and the business. 

MLAs highlight constituents’ fears and concerns about renting privately

Mr Jonathan Bell, Democratic Unionist Party MLA for Strangford, declared an interest as a landlord, and spoke in support of the Sinn Féin motion and the Alliance amendment.  He stressed the importance of striking a necessary balance between the landlord and the tenant and in looking at ways of protecting both tenants and landlords, many of whom provide a vital service.  His primary concerns about the private rented sector related to affordability issues and landlords who are acting irresponsibly by failing to carry out necessary repairs, citing one constituent who continues to have difficulties getting repairs carried out even after involving the council who has statutory powers in this regard.

Mr Roy Beggs referenced his own experiences dealing with constituents whose landlords were, in his opinion, not carrying out their duties and commended the actions of Housing Rights and local council environmental health officers in trying to bring these individuals to account.

Ms Nichola Mallon, Social Democratic and Labour Party MLA for North Belfast, stated that research has shown that the Northern Ireland private rented sector works reasonably well with high reported levels of satisfaction and welcomed these findings.  However, Ms Mallon has also had experience at a constituency level of the impact of unresponsive or neglectful landlords on the lives of members of the public. While acknowledging that the vast majority of landlords are good and responsible and provide a high level of service, Ms Mallon pointed out that a minority do not provide this same level of service.  She acknowledged that the challenge for government is in creating a system that increases standards while protecting tenant and landlord without adversely affecting the majority of tenancies that are working. 

Mr Christopher Stalford, DUP MLA for South Belfast, said that housing is the biggest cause of people seeking MLA assistance.  He values the contribution made by the 48,000 landlords in Northern Ireland, many of whom own only one or two properties, to meeting housing need.  Mr Stalford said that measures such as those being discussed during the debate were necessary because, in his experience, constituents see the private rented sector as a less favourable housing option than the social sector. He sees the departmental review as an opportunity to close the gap that exists in people’s perceptions between social housing and the private rented sector and hopes that people will have the same confidence that a private landlord will repair or maintain their property as tenants have in the Housing Executive. 

Ms Michelle Gildernew, Sinn Féin MLA for Fermanagh & South Tyrone, raised concerns around fitness and believes there is a need for a quality standard in our private rented sector that will ensure that landlords meet the needs of the people to whom they rent properties. Tied in with unfitness were her concerns about affordability, with Ms Gildernew stating that cost is a prohibitive factor for a lot of people going into the privately rented sector, particularly those who work full time in low paid employment.  Ms Gildernew pointed out that some tenants can spend 50% of their income on heating their home if they are living in a property that is particularly inefficient and that she has recently assisted constituents who have found it impossible to find suitable, affordable privately rented accommodation in their local area

Ms Claire Bailey, Green Party MLA for South Belast opened by stating that she has lived most of her life as a tenant in the private rented sector and impressed upon the House the serious need for regulation in that sector.  In her experience, there are insufficient standards for properties in the sector, she has lived in properties with extortionately high rents, she has paid letting fees just to apply for a property and has lived in poor housing with damp and inefficient heating.  She also explained how she ended up homeless due to a lack of awareness of her rights as a private tenant.

MLAs debate future of private rented sector and need for improved regulation

During the debate, Mr Roy Beggs asked whether Northern Ireland is moving to a position where it becomes reliant on the private rented sector to help those who are facing homelessness.  It is important, he said, that any decisions made by the Assembly do not worsen the situation so that more people become homeless.  Any proposals should deal with addressing rogue landlords, rather than imposing additional bureaucratic costs and burdens on good landlords who may, in turn, pass these costs on to tenants via rent increases.  

Mr Beggs argued that there is merit in the creation of an arbitration service to resolve disputes that arise in private tenancies, one of the ideas floated in departmental consultations.  Creating an accessible arbitration service may be less bureaucratic than imposing additional legal obligations on landlords who are already compliant with legislation and held in good regard by tenants.  Some 87% of tenants surveyed by the department support the creation of a similar arbitration service.

MLAs welcome first step of landlord registration but caution that more work needs to be done

While Ms Mallon recognised the landlord registration scheme as a first step, she stressed that it is not regulation and welcomed the current departmental review of the role and regulation of the private rented sector, specifically it’s commitment to look at licensing, accreditation, security of tenure and affordability.

Ms Bailey also acknowledged the work done so far to improve the sector as a good first step, but was critical of inadequacies in some of the schemes.  While Mr Stalford welcomed the introduction of the tenancy deposit scheme as a means of ensuring that tenants receive their money back, Ms Bailey was critical of the time bar loophole in the deposit scheme regulations, an issue Housing Rights has previously raised in our briefing paper.

Ms Bailey also stated that the Assembly faces a huge body of work in bringing the tenancy deposit scheme, regulation of letting fees and the regulation of landlords together in order to help tenants.

Minister responds to MLAs’ concerns and points to ongoing review as way forward

Paul Givan, Minister for Communities and DUP MLA for Lagan Valley, responded to a number of points raised during the debate.  He discussed the background for the introduction of a landlord registration scheme, pointing to how an absence of centrally held and accurate data about landlords until the establishment of the register contributed to a lack of confidence and accountability.  It was hoped that creating a register would allow authorities to work in a proactive way to increase education and awareness of the rights and responsibilities of landlords and tenants.  Minister Givan believes the scheme has very successfully delivered on what it was set up to do, but recognises that this is very much a first step in making improvements to the sector.  

Minister Givan also briefly discussed the tenancy deposit scheme, lauding it as an effective means of managing the deposit arrangements, but he did not address the specific concerns raised by Ms Bailey.

The Minister also explained that a number of themes have emerged from the department’s initial consultation on the review of the private rented sector, issued in November 2015.  The issues which will be considered further include

  • a licensing scheme for private landlords
  • protecting tenants from agent fees
  • addressing inconsistencies in fees and services charged and provided by letting agents
  • the need for an independent dispute resolution or advice service, including mediation services
  • whether the current eviction process is fit for purpose
  • support available to vulnerable tenants
  • improved awareness of landlord and tenant rights and responsibilities
  • whether grants for private landlords will help to upgrade the housing stock.  

Further reading

The full debate is available in the official report on the NI Assembly website.  If you are interested in these issues, you may find the following articles, consultation responses and briefings from Housing Rights useful

Policy responses and briefings:

Articles and practical tips

Private Tenants’ Forum papers

This article was written on 22 June 2016. It should not be relied on as a statement of the current law or policy position. For help with housing issues please contact our helpline on 028 9024 5640 or use our online chat service at www.housingadviceNI.org.