RENT controls need to be brought in to end the most ‘exploitative practices’ in the market, according to the leader of Reform Jersey.
Deputy Sam Mézec has lodged a proposition to either amend or replace the 2011 Residential Tenancy Law. His proposals include banning rent increases within the first three years of a tenancy, a move to open-ended tenancies with no prescribed term and the establishment of a body for both landlords and tenants to resolve disputes.
A recent written question from Deputy Mézec revealed that net rental income declared by taxpayers had doubled from £61 million in 2011 to £123 million in 2020.
His proposals are based on Reform Jersey’s Housing Crisis Action Plan, which was published during the 2022 election campaign.
In his proposition, Deputy Mézec brands the current system a ‘catastrophe for renters’, as well as ‘having a harmful macroeconomic impact on the whole Island’.
Describing the ‘severe housing crisis’ in the Island, Deputy Mézec said that ‘rents are going up and tenants are being pushed closer to the breadline because of the failure of the States of Jersey to act’.
‘Young people are constantly citing the cost of housing as a key reason for why they are considering leaving Jersey, and businesses are facing severe recruitment and retention difficulties,’ he added.
The Reform Jersey leader explained: ‘Last year the government opposed a Reform Jersey proposal to freeze rents, and instead merely asked landlords to consider not raising their rents. This has clearly been a failure. We must introduce rent control now if we are to support renters in Jersey.
‘If the States adopt our proposition, we can have this new system in place by the start of next year. If the States are serious about dealing with our housing crisis, we hope they will choose our proposition to take action, rather than more reviews and consultation, whilst the cost of living continues to squeeze families.’
Deputy Mézec’s proposed amendment to the Island’s Residential Tenancy Law for rent control includes banning rent increases from being imposed in the first three years of a tenancy, requiring a minimum notice period of three months before a rent review can be implemented, and capping the amount that rent may be increased.
He suggests that this cap should be determined by a ‘measure of affordability’ such as the increase in the Average Earnings Index, the average of the Retail Prices Index over the past three years, or ‘an alternative effective measure which the Minister for Housing and Communities may deem appropriate’.
No fault evictions
Deputy Mézec also proposes to abolish ‘no fault evictions’ – which allow landlords to end periodic tenancies with three months’ notice without having to give any reason – by establishing open-ended tenancies as the default tenure, and requiring enhanced notice periods for tenants based on how long they have lived in the property.
The St Helier South Deputy explains that these plans to ban ‘no fault evictions’ – which have already been abolished in Scotland – will provide ‘enhanced security of tenure to renters’ which he says is ‘vital’.
Deputy Mézec said that allowing these evictions meant that ‘many renters, no matter how long they have lived in their homes, are just three months away from having their whole lives turned upside down, having massive costs put on them, or facing becoming homeless’.
He also added that this also meant that renters have ‘almost no negotiating power at all’ when ‘fighting unjustifiable rent increases’ as ‘if they complain or cause a fuss, they can simply be kicked out and replaced with a tenant who is more compliant’.
‘This leads many [renters] to suffer in silence,’ Deputy Mézec said.
Deputy Mézec also proposes that a ‘fit-for-purpose’ rent tribunal should be established to ‘provide both tenants and landlords with an outlet to resolve any disputes which arise because of the intricacies of rent control being introduced’.
He said that the current Petty Debts Court system was ‘undesirable for multiple reasons’, including creating a ‘great imbalance of power’ where ‘the tenant has far more to lose’.
‘Sometimes the mere threat of a petty debts summons can provoke a tenant into giving up standing up for themselves,’ he said.
The Reform Jersey leader described the most recent attempt to set up a rent control tribunal as ‘an unmitigated mess’, with its reliance on the use of an out-of-date law making it ‘almost powerless to help tenants facing unjustifiable rent increases’.
He described it as ‘a sad waste of time and public resources that this was pursued’ but suggests that a reform of the Residential Tenancy Law provides an opportunity for new legislation which ‘give[s] a new rent tribunal the vires to do its job effectively’.
In February, Housing Minister David Warr paused plans to revive the tribunal, which allows tenants to appeal against rent rises and has been dormant since 2009, until new tenancy laws are drawn up.
Impact on children
Deputy Mézec’s proposal also describes the impact of rent control on young people, explaining that the children’s commissioner’s 2021 report Life on the Rock cited housing as one of the top concerns that children in Jersey have.
He described it as ‘clearly fundamental’ for children to grow up in a ‘stable home environment’, adding that ‘the cost of that housing is a key part of this’.
Deputy Mézec said that ‘by legislating to introduce rent control and open-ended tenancies, the States of Jersey will effectively be providing “material assistance” to households to maintain their child’s home and protect the household budget from further pressure’ and ‘enable families to provide greater support for their children’.
– Deputy Mézec’s proposition will be debated in the States Assembly sitting on 2 May.