Charity claims rental bidding prices young people out
A YOUTH homelessness charity is calling for rental bidding to be banned in the UK.
Step by Step, based in Aldershot, has warned that the practice, which occurs when applicants for a property are asked to bid the amount of money they can pay in rent, is pricing out young people from the rental market.
The charity wants a change in law to ban rental bidding similar to in New Zealand, where rental properties cannot be advertised without a rental price listed and landlords cannot invite or encourage tenants to bid on the rental.
Sarah Muckart, senior placement co-ordinator at Step by Step, said: “As the need to bid for a property becomes more commonplace, the likelihood of a young person securing their own property declines.
“Young people who have faced challenging upbringings and experienced homelessness will be at an immediate disadvantage.”
Kelly Headen, supported lodgings manager at Step by Step, said: “We must push for rental bidding to be banned in the UK, as is the case in New Zealand.
“We need to acknowledge the increased demand and the reduced supply in rental properties postCovid, and put in effective regulated measures to enable access to all.”
The charity has claimed that in some cases potential tenants are asked to complete a form explaining to the landlord why they should be accepted over rival applicants.
However, there is currently nothing in law to stop landlords or estate agents from using their own criteria when choosing a tenant.
Sajjad Ahmed, CEO of the British Landlords Association, said he is concerned about rental bidding and warned landlords against seeking the highest amount possible when renting out a property.
He said: “Auctioning or bidding on rental properties is worrying and we are really dead against it.
“I do not think it is always the landlords – I think much of this is the estate agents trying to get more money for their commission. I feel frustrated that the government has put us in this situation, both Labour and Conservatives have made promises on housing and the bubble has just shot up and up. If landlords want tenants for the long term then do not go for the maximum rent, look at what the rent value is and go for something in the middle.”
Mr Ahmed added that landlords who over-inflate the rental price will ultimately lose any short-term gains due to the amount of work involved in dealing with a high turnover of tenants.
Data from the Office for National Statistics shows private rental prices paid by tenants in the UK increased by 2% in the 12 months to January, representing the largest annual growth rate since February 2017.
The Department for Levelling Up, Housing and Communities (DLUHC) said it will set out new housing reforms in the spring to make renting fairer.
A spokesman said: “We want everyone to have fair access to housing and strongly encourage landlords and agents to assess the suitability of potential and existing tenants on an individual basis.
“Our Private Rented Sector White Paper in the spring will also set out reforms to make renting fairer for all, including banning so-called ‘no fault’ evictions to protect tenants.”