Longer Tenancies: Shelter Wants Them, But Do Tenants?

Shelter wants there to be a new kind of tenancy to be introduced in England’s rental market, which they are calling the Stable Rental Contract. It is a five-year contract designed to be beneficial for both tenants and landlords.

They argue that short-term tenancies of 6 or 12 months result in too much uncertainty for many renters, with unpredictable rent increases and concerns about contracts ending before they are ready to move out. It also prevents them from settling in a community.

They also argue that the high turnover of tenants is no good for landlords either, as it leads to regular void periods and the expense of marketing their properties in order to get it re-let, undermining their potential returns.

Campbell Robb, chief executive of Shelter, said, “With a generation priced out of home ownership, renting is the only choice for growing numbers of people.
But with the possibility of eviction with just two months’ notice, and constant worries about when the next rent rise will hit, the current rental market isn’t giving people, particularly families, the stability they need to put down roots.


“The Stable Rental Contract offers renters the stability of a five-year tenancy and gives landlords more confidence in a steady income, all within the existing legal framework.


“Turning rented houses into homes should be a priority for everyone who cares about the well-being of families in this country, and government must now show the political will to make renting better for millions of people desperate for a stable home they can rely on.

“The Government must pull out all the stops to encourage landlords and letting agents to offer the Stable Rental Contract.

“Last month, ministers set out their plans to commit millions of pounds of public money to underwrite investment in building more rented homes. Insisting that these homes are let using the Stable Rental Contract would be a good place to start.”

Included in their report, they cite a YouGov poll, which had a base of 541 private renting GB adults, which revealed that two-thirds of renters would like a longer term renting option, four out of five would like to be assured that their rent be increased above a certain level (the Stable Rental Contract is designed to keep rent increases in line with inflation, not the landlords discretion), and that two-thirds would like to be free to decorate their homes without being afraid of how their landlord might react.

However, house and flat sharing website SpareRoom decided to run a poll of their own following the release of Shelter’s report, and came up with some interestingly contradictory findings. 1,000 SpareRoom users were used in the poll, which found that 82% would be against the type of extended contract put forward by Shelter, while only 10% would be in favour, with 8% neutral. Although, it is unknown to what extent the SpareRoom users had read the details of the Stable Rental Contract beyond its five-year reach.

Matt Hutchinson, director of SpareRoom, said, “Extended contracts make people anxious, because they think they’ll be locked in for longer and the landlord will be able to increase rents at any point.

“Given that one of the benefits of renting is the flexibility to relocate to another area or a more suitable property if circumstances change, we can understand why people might be wary of longer contracts.

“Flat sharers also voiced concerns that a 24-month tenancy could place further restrictions on the tenants landlords will accept as they seek to reduce their risk, with stricter rules on deposits and guarantors. It is unclear whether the proponents of these changes have taken such factors into consideration.

“Many landlords would be happy to extend tenancies for good tenants but are precluded from doing so by mortgage lender restrictions.

“Landlords have voiced their concerns around the provision of longer tenancies, which included the difficulty of evicting bad tenants in the event they damage property or fail to pay their rent.

“A change to rental contracts that discouraged investment in property for rent could in turn serve to exacerbate the housing crisis rather than to resolve it.”

In July of this year, the Association of Residential Letting Agents (ARLA) revealed that the average length of a tenancy in the UK had risen to a record high of 20 months, which suggests that tenants are looking to stay in their properties for longer, due mainly to the fierce competition for properties, as demand outstrips supply.

You can read Shelter’s 48 page report here.

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