Picture: BLOOMBERG
Policymakers have generally done little to alleviate that pressure. However, Chancellor of the Exchequer Jeremy Hunt may have made things a good deal worse in his Autumn Statement earlier this month. In making a great play that social-housing rent increases would be capped at 7% next year, he reminded everyone that, unlike in the private rental sector, annual rent increases are the norm for social housing tenants.
Up until now, most landlords have been content to keep good tenants happy by not rocking the boat and risking a costly void. An empty property means not only receiving no rent, but also becoming liable for council tax and utility bills. Added to that is the uncertainty about a new tenant. This is why rents tend to be reset to market levels only once someone moves out.
More recently, rising mortgage costs appear to be discouraging many existing renters from seeking to own a home of their own. A survey conducted for the insurance company Aviva indicates that as many as a million potential buyers under 45 have ruled themselves out of the first-time buyer market. They will largely occupy the properties that younger renters would be looking for.
Making longer-term tenancies the norm would not only provide fewer opportunities to increase rents, it would also bring greater protection against no-fault evictions. With many potential first-time buyers resigning themselves to renting indefinitely, a long-term tenancy might at least mitigate some of the cost pressures.