Youth Social Policy

Full Terms & Conditions of access and use can be found at https://www.tandfonline.com/action/journalInformation?journalCode=chos20

Housing Studies

ISSN: 0267-3037 (Print) 1466-1810 (Online) Journal homepage: https://www.tandfonline.com/loi/chos20

Private Renting After the Global Financial Crisis

Peter A. Kemp

To cite this article: Peter A. Kemp (2015) Private Renting After the Global Financial Crisis, Housing Studies, 30:4, 601-620, DOI: 10.1080/02673037.2015.1027671

To link to this article: https://doi.org/10.1080/02673037.2015.1027671

Published online: 07 Apr 2015.

Submit your article to this journal

Article views: 3628

View related articles

View Crossmark data

Citing articles: 63 View citing articles

Private Renting After the Global Financial Crisis

PETER A. KEMP Blavatnik School of Government, University of Oxford, Oxford, England, UK

(Received June 2014; accepted March 2015)

ABSTRACT Analyses of the impact of the Global Financial Crisis (GFC) on housing have largely focused on subprime mortgages and homeownership. By contrast, the impact of the financial crisis on the private rented sector has received much less attention. This paper helps to address that gap by examining the impact of the GFC on private renting in Britain. In recent years, the private rented sector (PRS) in Britain has grown in size after many years of decline; and the formal rules and informal practices that characterize this tenure have also changed significantly. This transformation began during the 1990s but the pace of change increased from the turn of the century and accelerated still further during the GFC. Drawing on an historical institutional perspective, it shows that the changes to private renting over this period were shaped not only by domestic events but also by developments in the international political economy.

KEY WORDS: Private renting, private landlords, private tenants, Buy-to-Let, Generation Rent, Global Financial Crisis, historical institutionalism

Introduction

Housing has rightly been at the centre of analyses of the Global Financial Crisis (GFC) and

the Great Recession that led on from it. It is widely accepted that the housing market, and

especially mortgage lending and securitization, was one of the key drivers behind the

boom that led to the GFC (Davies, 2010). It is hardly surprising, therefore, that the GFC, in

turn, has had a profound impact on the housing market. Nor is it surprising that the slow

recovery of the housing market was one of the reasons why the nations most affected

have taken so long to re-emerge from the crisis. Even less surprising is that the GFC

has prompted a boom of its own in analyses of the role of housing in the crisis.

Homeownership, and especially sub-prime lending to low-income homeowners, has

rightly been the main focus of that academic analysis (Aalbers, 2012; Forrest & Ngai-

Ming, 2011; Whitehead & Williams, 2011; Williams, 2011).

q 2015 Taylor & Francis

Correspondence Address: Peter A. Kemp, Blavatnik School of Government, University of Oxford, 10 Merton

Street, Oxford, OX1 4JJ England, UK. Fax: þ 44 (0)1865 616719; Tel.: þ 44 (0)1865 614342; Email: peter. [email protected]

Housing Studies, 2015

http://dx.doi.org/10.1080/02673037.2015.1027671Vol. 30, No. 4, 601–620,

However, private renting has been an important sub-plot to the GFC story and yet it has

received much less attention in the academic literature on the crisis.1 This stands in

marked contrast, at least in Britain, to the mass media and property press, where the

growth of ‘generation rent’ has been a prominent topic (e.g. Halifax, 2013). In fact, a key

feature of both the boom and the bust, not just in Britain but also in the Anglo-Saxon

liberal nations more generally, has been a fall in the relative share of households owning

their home and growth in private renting (Crook & Kemp, 2014). The aim of this paper,

therefore, is to turn the focus of attention onto the impact of the GFC on the private rented

sector. In doing so, it seeks to complement accounts of the GFC that have focused largely

on sub-prime mortgages and homeownership. Looking at the British case, the article draws

on an historical institutional perspective to examine the ‘return to growth’ of private

renting during both the recent boom and bust.

The paper proceeds as follows. The next section sets out the conceptual framework upon

which the paper draws to examine the growth of private renting that has taken place since

the turn of the century. The ‘The End of Decline’ section looks at the newly deregulated

private rented sector (PRS) in the 1990s, during which decade the sector experienced only

modest growth. The ‘Return to Growth’ section explores the key drivers behind the growth

and change in private renting in the housing boom leading up to the GFC. It argues that the

growth and transformation of private renting in Britain was affected not just by domestic

events but also by developments in the international political economy. Section ‘The GFC

and Beyond’ looks at developments since the onset of the GFC and seeks to examine how

the recent trends in private renting have been altered in the short and the longer term by the

crisis. The final section presents the conclusions.

Conceptualizing Change

This paper takes an institutional approach to examine the impact of the recent boom and

bust on the private rental housing market in England. As Burke & Hulse (2010) have

pointed out, an institutional perspective makes it possible to look beyond the intersection of

supply and demand to explore the wider context within which those forces operate. For the

purpose of this paper, an institution is defined as a ‘relatively enduring collection of rules

and organized practices embedded in structures ofmeaning and resources’ (March&Olsen,

2006, p. 3). These formal rules, informal practices and shared understandings both produce

and reflect everyday routines and taken-for-granted behaviour. This is not to imply that

actors will always follow institutional rules and practices. Indeed, some may circumvent

them (and may be sanctioned if they do so) while others may seek to reinterpret or ‘bend’

rules in ways that reflect their self-perceived interests. In addition, many institutions have

distributional consequences and hence are politically contested (Thelen, 2009).2

Housing tenures, such as private renting, are a form of institution. They can be defined

as socially constructed configurations of property rights and obligations, the precise

nature, characteristics and meaning of which vary to some extent between different

societies (Kemp, 1987). Housing tenures are themselves part of wider institutional

arrangements that Ball (1986) has called structures of housing provision (SHPs). These

encompass the processes of production, finance, exchange and consumption of housing.

As this highlights, institutions are typically nested within, or interact with, other

institutions. And, most importantly for the purpose of this paper, they are embedded within

a wider political economy (Streeck & Thelen, 2005).

P.A. Kemp602

Housing tenures necessarily have relatively ‘settled’ characteristics for periods of time.

Indeed, it is the enduring nature of housing tenures that makes them ‘institutions’ and

which helps the market to function. It enables dwellings to be bought and sold, and to be

let by landlords to tenants, under more or less well-defined terms and conditions. In this

way, tenures provide the formal and informal rules that help housing market actors form

credible expectations to guide their behaviour. In doing so, like institutions more

generally, tenures help to shape the real or perceived incentives and constraints that actors

face in the housing market. However, although housing tenures have relatively settled

features, they are not immutable and tend to evolve over time. Indeed, it is precisely the

transformation of private renting in Britain that is the focus of this paper. The housing

boom and bust that have occurred since the late 1990s witnessed the emergence of a new

structure of rental housing provision known as ‘buy-to-let’ (BTL), which became an

important component of the revival of private rental housing.

This paper draws on one particular variety of institutionalism—namely, historical

institutionalism (HI)—to examine that transformation.3 HI seeks to examine the genesis and

development of institutions over time. As Sanders (2006, p. 42) has argued, HI scholars are

typically interested in ‘the construction, maintenance, and adaptation of institutions.’ Early

work from a historical institutional perspective was mainly focused on the origins and stable

reproduction of institutions (e.g. Steinmo et al., 1992) rather than on change over time.

Change was conceptualized as a relatively rare event that was caused by an exogenous shock

such as a world war or major economic crisis. Such shocks were seen as causing a ‘critical

juncture’ that undermined the existing institution and led to the emergence of a new

institutional configuration. This model of change is often referred to as a ‘punctuated

equilibrium’: exogenous shocks puncture an existing institutional equilibrium and in doing so

create the conditions for the emergence of a new institutional equilibrium (Krasner, 1984).

The punctuated equilibrium model of change is closely aligned with the notion of ‘path

dependence’ that has been highly influential in both HI (e.g. Steinmo et al., 1992) and

rational choice institutionalism in economic history (e.g. North, 1990). Path dependence

has also begun to feature in the housing studies literature (e.g. Housing, Theory and

Society, 2010; Kemp, 2000). The defining feature of path dependence is that, during

critical junctures, choices are made that set the newly created institutions down a particular

path. As Pierson (2004, p. 135) explains, ‘Junctures are “critical” because they place

institutional arrangements on paths or trajectories, which are then very difficult to alter.’ In

essence, therefore, path dependency provides an explanation of institutional reproduction.

Critics of HI have claimed that it is unable to explain institutional change (e.g. Peters,

2005). It is true that the heavy emphasis on path dependency in the early HI literature

reflected a concern to explain the reproduction of institutions rather than change in

institutions over time. But a more accurate criticism is not that HI could not explain change,

but rather that it conceptualized change as a relatively rare and discontinuous event and one

that is caused by exogenous shocks. However, since the late 1990s, HI scholars have

increasingly recognized that institutional transformation is not only the result of dramatic

and relatively rare critical junctures but it may also be the result of incremental processes that

gradually transform institutions (e.g. Thelen, 2009). This perspective also recognizes that

path-departing transformational changemay be the result of endogenous processes operating

over time and not only a product of critical junctures arising from an exogenous shock.

This raises the question of how such gradual institutional transformation can occur.

Thelen has highlighted four types of endogenous processes that can generate gradual but

Private renting after the GFC 603

transformative change (cf. Mahoney & Thelen, 2010; Streeck & Thelen, 2005). These are

layering, displacement, conversion and drift.4 In brief, layering is the process whereby

new institutions or rules are introduced on top of existing ones. Displacement occurs when

new or previously subordinate institutions become increasingly important over time

relative to the previously dominant institution. Conversion takes place when an existing

institution, which had been established for one purpose, is given or acquires a new

purpose. Finally, Drift occurs when an existing institution is not updated to take into

account new conditions and consequently becomes increasingly less relevant over time.5

This article draws on these four processes to explore the transformation of private renting.

The End of Decline

The re-growth of private renting in Britain has been a largely unanticipated development.

This is because, for over four decades after the Second World War, the PRS was

characterized by a trajectory of decline and decay (Figure 1). The causes of that decline are

complex and have been discussed elsewhere (Hamnett & Randolph, 1988; Harloe, 1985;

Kemp, 2004). By the early 1980s, few commentators expected this long-term process to

halt and still less to reverse. However, the decline of private renting unexpectedly came to

a halt at the end of the 1980s and was followed by a modest revival during the 1990s

(Figure 1). This turn-around coincided with the implementation of the 1988 Housing Act,

which deregulated rents and weakened tenants’ security of tenure.

Before the 1988 Act, most private tenants rented their homes on ‘regulated tenancies’,

which provided strong security of tenure and gave landlords and tenants the right to refer

the rents at which properties were let to ‘rent officers’ employed by local government.

Although most rents were agreed privately between the landlord and their tenant, rather

than determined by rent officers, the evidence suggests that rental yields on regulated

tenancies were largely uncompetitive (Whitehead & Kleinman, 1986). However,

avoidance and evasion of the rent acts by landlords seems to have been common, as

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

19 53

19 61

19 71

19 81

19 91

19 92

19 93

19 94

19 95

19 96

19 97

19 98

19 99

20 00

20 01

20 02

20 03

20 04

20 05

20 06

20 07

20 08

20 09

20 10

20 11

20 12

Figure 1. Privately renting households in England 1953–2012 (millions). Note: Calendar year to 2008 and year from 1 April thereafter. Source: Department of Communities and Local Government

website.

P.A. Kemp604

a result of which there was uncertainty about the legal status of some lettings. This

represents an example of how actors seek to circumvent or ‘bend’ institutional rules in

ways that benefit their self-interests. In this way, over time the everyday practices and

meaning of an institution may come to differ from the legal rules that originally defined it.

The Housing Act 1988 reduced security of tenure and deregulated the rents on all new

lettings, which henceforth were required to be either ‘assured tenancies’ or ‘assured

shorthold tenancies’ (ASTs). The main difference between themwas that assured tenancies

were of indefinite duration, while assured shortholds had fixed terms of between six months

and five years after which the landlord had the right to regain possession. In practice, the

great majority of new lettings have been six-months or one-year assured ASTs.

The measures introduced by the 1988 Housing Act were certainly very important to the

revival of private renting. In the first place, the 1988 Act allowed landlords to let properties

at market rents, which were higher than regulated rents, and thereby provided a more

competitive rate of return. Second, fixed-term ASTs provide much weaker security of

tenure than regulated tenancies (Whitehead & Kleinman, 1989) and thereby increased the

liquidity of rental housing as an investment. Third, the new lettings regime provided

landlords and tenants with greater certainty about the legal status of the tenancy than did

the previous system (Kemp, 2004). And fourth, the new arrangements did not provoke the

political controversy that had surrounded previous attempts to deregulate lettings and

revive the PRS. Indeed, the changes had bi-partisan political support (Best et al., 1992).

This helped to ensure that investors could enter the rental market with more certainty than

before about the durability of the institutional rules governing it.

The new tenancy framework affected only new lettings granted from January 1989;

hence existing tenancies were left largely unchanged. This reform was therefore a classic

example of institutional ‘layering’. As Thelen (2009, p. 484) points out, layering ‘depicts a

situation in which the original institutions are left in place, but new elements are added

alongside the old system, elements that have transformative potential in the longer run.’

The mechanism driving that transformation is differential growth, as the new system

becomes more important than the old one over time. A key reason why politicians often

adopt this more long-term strategy, rather than outright abolition of the existing institution

(‘displacement’), is to circumvent political opposition to change. While elderly private

tenants with regulated tenancies were a politically sensitive group, younger private

tenants—who were the main group affected by the reform—were not. Within a decade of

the reform, the majority of private tenants had deregulated tenancies governed by rules,

practices and discourses that were very different those that had governed regulated

tenancies. The result was that the institutional rules, everyday practice and meaning of

‘private renting’ had been transformed.

While this new, more market-oriented institutional framework for private renting was

clearly an important turning point, it was arguably a necessary rather than a sufficient

condition for substantial revival of the sector (Crook & Kemp, 2011). Indeed, the PRS

experienced only modest growth in the decade following deregulation, rising from 9 per

cent of households in 1989 to 10 per cent in 2001 (Table 1). Moreover, part of the growth in

private renting that did take place was due to a slump in the owner-occupied housingmarket

during the early 1990s, shortly after deregulation took effect. The main features of this

slump were a sharp fall in house prices and in property transactions, the emergence of

widespread negative equity, and a surge in mortgage arrears and defaults (Forrest &Murie,

1994). This unprecedented crisis in the owner-occupied housing market generated a

Private renting after the GFC 605

temporary increase in the demand for and supply of privately rented homes. Crook&Kemp

(1996a) calculated that about half of the growth of private renting following deregulation

was accounted for by what they called ‘property slump landlords’. The latter were owner-

occupiers who wanted to move or sell for other reasons, but could not or did not wish to do

so because of the house price crash. Instead of selling, they let their homes and rented

somewhere else. Meanwhile, some prospective first-time homeowners deferred purchase

and continued renting until house prices recovered (‘property slump tenants’). In these

ways, the PRS played a counter-cyclical role during the early 1990s slump in the owner-

occupied housing market. Once house prices and transactions began to increase from 1996,

the modest revival of private renting stalled. Indeed, government estimates suggest that the

number of privately renting households actually decreased in 1997 and 1998.

Return to Growth

The growth in private renting took off, not from deregulation in 1989, but rather a decade

later, that is, from the turn of the century. As Table 2 shows, the number of households

renting privately in England increased by only 1.4 per cent per annum on average during

the 1990s. But during the period from 2000 to 2006, the average annual rate of increase

trebled to 4.1 per cent per annum. Thus, the modest growth of the 1990s was succeeded by

substantial growth from the turn of the century. A novel feature of this increased growth

rate was the emergence of a new structure of private rental housing provision that involved

leveraged investment using BTL mortgages. BTL initially referred to mortgages provided

to private landlords. However, the term is often now used in broader senses to also mean

landlords using such mortgages and private rental housing as an investment. In this

article, we ignore the third usage, but employ the first and the second, referring to them as

Table 1. Housing tenure of households 1981–2012 in England (per cent)

Year Owner-occupiers Private tenants Social tenants Total

1981 57 11 32 100 1991 68 9 23 100 2001 70 10 20 100 2007/2008 70 13 18 100 2013–14 63 19 17 100

Note: Calendar year to 2001 and year from 31March thereafter. Totals may not sum to exactly 100 per cent due to rounding. Source: DCLG (2014) Annex Table 1.

Table 2. Average annual change in households renting privately in England

Period 000s Per cent

1980s 226 20.7 1990s þ25 þ1.4 2000–2006 þ95 þ4.1 2007–2013–14 þ241 þ7.2 Note: During the first half of the 1990s, the average annual rate of growth was 31 000 and 1.8 per cent; during the second half of the 1990s it fell to 18 000 and 0.9 per cent. Source: Author’s calculations from DCLG (2014) Annex Table 1.

P.A. Kemp606

‘BTL loans’ and ‘BTL landlords’, respectively. We refer to ‘BTL’ when discussing the

provision of rental housing by landlords using BTL loans.

BTL Mortgage Finance

BTL was the name given to mortgages provided to private landlords by banks and building

societies. Prior to this development, most private landlords did not borrow money in order

to invest in rental housing. Instead, they more commonly bought their properties outright

with their own equity. Prior to the emergence of BTL, banks and building societies were

not especially keen to lend to private landlords and where they did so charged a higher rate

of interest (Kemp, 2004). However, the arrival of BTL lending transformed mortgage

finance for investors in private rental housing.

The origins of BTL lending by banks and building societies have been discussed

elsewhere (Ball, 2006; Gibb & Nygaard, 2005; Kemp, 2004; Sprigings, 2008). Such

accounts typically refer to the initiative established in 1996 by the Association of

Residential Letting Agents (ARLA) in association with a panel of mortgage lenders, which

devised the term BTL. But although BTL mortgages first appeared in 1996, it was again

only from the turn of the century that they began to account for a significant share of the

residential mortgage market. From less than 1 per cent of all mortgages at the turn of the

century, BTL loans outstanding accounted for 10 per cent by the mid-2000s, peaking at 12

per cent in 2007. In cash terms, the BTL mortgage market grew from £3bn in 1999 to

£46bn in 2007 (Figure 2). Initially confined to a handful of mortgage lenders, BTL

mortgages rapidly became a mainstream part of the market (Scanlon &Whitehead, 2005).

As well as high street lenders, the early 2000s also witnessed the emergence of specialist

BTL lenders including some—such as Paragon—whose source of funds was derived

solely from the international financial market rather than from retail savers in Britain.

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

50.0

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Figure 2. BTL gross mortgage lending 1999–2013, UK (£bn). Source: Council of Mortgage Lenders.

Private renting after the GFC 607

Although the ARLA initiative promoted the idea of mortgage lending to private landlords,

the rapid growth of such loans from the turn of the century was not due simply to events in

Britain. Instead, it was the product of developments in international capital markets.

In particular, the internationalization of finance and the boom in securitization, along with

the global ‘savings glut’ and the associated low interest rate regime, greatly expanded the

amount of mortgage finance that was available and reduced the cost of borrowing (Schwartz,

2009; Schwartz & Seabrooke, 2009). This in turn led to a search among lenders for new

sources of borrowers, much easier terms of credit and financial innovation in mortgage

products. In Britain, the latter included the emergence of mortgage products specifically

geared to private landlords. BTL mortgages typically had interest spreads over owner-

occupier loans that were much smaller than had previously been the case (Kemp, 2004).

Instead of being very expensive and difficult to obtain, mortgages for landlords rapidly

became relatively cheap and easy to secure. Notwithstanding the foresight and persuasive

powers of ARLA, this transformation in mortgage lending to landlords was a product of the

internationalization of financial markets. Whether they knew it or not, BTL landlords had

become participants in what Langley (2008) calls the ‘everyday life of global finance’.

Investor Landlords

In common with most other advanced economies, the ownership of private rental housing in

Britain is dominated by private individuals operating on a relatively small-scale and often as

a sideline to their main occupation or business. Moreover, the predominance of private

individual landlords increased after the turn of the century. In 1998, they accounted for 61

per cent of PRS properties in England, but by 2006 this had risen to 74 per cent. Over the

same period, the proportion of the PRS owned by landlords that had only one rental property

increased from 27 per cent to 35 per cent (Crook & Kemp, 2011). BTL mortgages clearly

helped facilitate this growth in small-scale landlordism. The IntermediaryMortgage Lenders

Association (2014), for instance, calculated that just over half of the growth in privately

rented homes was financed with BTL mortgages. While not all of that lending went to

private individual landlords, they nonetheless dominated the BTL market.

From an historical institutional perspective, BTL can be seen as a form of institutional

‘layering’ rather than ‘displacement’ (Streeck & Thelen, 2005). That is because cash-

buyer landlords (referred to here, for the sake of brevity, as ‘traditional’ investor landlords)

did not disappear. Instead, there was a rapid growth of BTL landlords, who became

increasingly important relative to traditional investor landlords. Meanwhile, some

traditional landlords ‘defected’ to BTL either to refinance their portfolio or acquire

additional stock (Rhodes, 2007). The extent to which the growth in investment in private

rental housing was facilitated by BTL is illustrated by a comparison of the private

landlords surveys in England conducted in 1993/1994 and 2010. In the 1993/1994 survey,

cash purchases were by far the most important means by which landlords acquired the

their property: 49 per cent of properties had been bought with cash and only 13 per cent

with the help of a mortgage or other type of loan (Crook & Kemp, 1996b).6 By 2010,

however, cash purchases were much less important and loan-finance had become the

dominant method of acquisition: 67 per cent of properties had been acquired with a loan

and only 21 per cent were cash purchases (DCLG, 2011).

For prospective investors in the PRS, a key attraction of BTL mortgages was that they

facilitated leveraged investment in rental housing (Rhodes, 2007) and offered what

P.A. Kemp608

seemed to be almost guaranteed capital gains as house prices surged (Hickman et al.,

2008). Using borrowed money enables landlords to gear up their investment and thereby

increases the rate of return on the equity invested. But it also increases the investment risk

that they face because their rate of return is affected by fluctuations in interest rates.

Moreover, landlords who take out BTL loans are required to conform to the conditions

incorporated in their mortgage agreement. In contrast, those who buy with cash do not

have that constraint. For example, one very common condition in BTL mortgages is that

the mortgagor must not grant tenancies of more than one year in duration. This illustrates

how institutional rules can constrain behaviour and thereby help shape everyday practice.

The new BTL landlords were more focused on capital gains than were ‘traditional’

private landlords. Many were new to landlordism, having entered the market after the turn

of the century, had small portfolios (often only one property), and some appear to have

been naive investors. In general, the new BTL landlords were less knowledgeable about

landlord–tenant law than were more long-standing investor landlords (Crook & Kemp,

2011). Seen in this light, the novice landlords who were focused on capital growth and

invested towards the peak of the boom were ‘momentum traders’. In a housing market

boom context, momentum traders can be defined as people who believe it is a good time to

buy because house prices are rising rapidly and will continue to do so (Piazzesi &

Schneider, 2009) even when evidence is beginning to emerge to the contrary. Late entrants

eventually get caught out when boom turns to bust and the anticipated capital gains

become losses as house prices fall. This short-term investment behaviour is predicated on

the existence of house price volatility, which has been a key feature of the housing market

in Britain since the 1970s (Muellbauer & Murphy, 1997).

As well as capital gains, there were other attractions of rental housing that reflected the

low or more risky returns from the assets that retail investors had traditionally relied upon.

The 2000s were characterized by poor stock market returns as well low rates on bank

deposits and pension annuities (the flip side of low mortgage rates). In addition, changes in

occupational pensions, a ‘miss-selling’ scandal in personal private pensions, and reforms

to the state pension system, served to highlight the potential attractions of rental housing as

a form of pension saving. For some landlords, ‘bricks and mortar’ provided a tangible

investment that seemed a more secure pension nest egg than the stock market or personal

private pensions (Kemp, 2004), especially after the dotcom crash at the turn of the century.

For example, a qualitative study found that saving for a pension was an important

investment motivation for private landlords (Rhodes, 2007). And the 2010 survey of

private landlords in England found that three-quarters of private individual landlords

regarded the sampled letting as a pension investment (DCLG, 2011). These points

emphasize the need to look well beyond housing policy and the housing market, and

beyond Britain, for the factors that drove the increase in investment in private rental

housing from the turn of the century. As well as domestic factors such as rent deregulation,

developments in the international political economy had helped to make private rental

housing an attractive investment once again.

Generation Rent

Meanwhile, a range of factors was increasing the demand for private rental housing.

Again, these have been examined elsewhere (Crook & Kemp, 2011; Sprigings, 2013) and

therefore are only summarized here. Three socio-demographic trends were especially

Private renting after the GFC 609

important. First, the number of young adults aged less than 35 increased in the 2000s.

Second, the proportion of young people entering higher education was also rising (Rugg

et al., 2002). And third, the number of economic migrants was growing, especially after

expansion of the European Union in 2004 (Thomas, 2006). These three groups—young

people, students and economic migrants—are all disproportionately likely to live in the

PRS (Rugg & Rhodes, 2008).

In addition, there was an increase in the number of families and low-income households

living in the PRS. The latter reflected the long-term decline in social rented housing, a

process that began in the 1980s when the Thatcher Government reduced local authority

building to its lowest peacetime level since the 1920s and gave council tenants the ‘right to

buy’ (RTB) their home at a substantial discount. The decline in building by local councils

was only partly offset by increased building by housing associations under a new financial

regime introduced in 1989/1990. Total completions of social housing fell from 89 700 in

1979/1980 to just 2060 in 2013/2014. Meanwhile, 2 million council homes have been

sold under the RTB (Murie, 2014), though some have since been let to private tenants

(Sprigings & Smith, 2012). In tenure terms, the transfers of social housing to

homeownership via the RTB, and from homeownership to private renting by the owners of

such properties, both represent a form of institutional ‘conversion’ from one SHP to

another. Conversion occurs where existing institutions are adapted to new purposes

(Streeck & Thelen, 2005). The formal rules and informal practices governing council

housing, for example, are very different from those governing ex-RTB homes let by

private landlords.

Since 1981, the proportion of households living in social housing has halved, falling

from one in three to one in six (Table 1). The declining supply of and lengthening waiting

lists for social housing have displaced some low-income households into the PRS. Indeed,

by 2007 over a third of private tenants in England were living in income poverty (Kemp,

2011). And according to Shelter (2012), families with dependent children—who

traditionally relied mainly on owner-occupation and social housing—account for a

substantial share of the recent growth in the PRS in England. The number of such families

increased by 86 per cent in the five years to 2010/2011. This represents a major change in

the composition of tenants living in private rental housing. The substantial growth in the

number of such tenants represents a partial ‘conversion’ of the role of the sector. Instead,

of being largely focused on transitional housing for new and young households—for

whom ASTs were implicitly designed—the PRS was also now playing an important role in

the provision of accommodation for more long-term tenants. However, while the six-

month and one-year tenancies used by the majority of landlords often suit childless young

people, they work much less well for families with children and other households that want

longer leases and more security of tenure. Indeed, the ‘flexibility’ that six-month and one-

year leases provide for young and mobile households represents ‘insecurity’ for low-

income families and other tenants who need longer term rental accommodation.

Finally, there has been a decline in the first-time buyer (FTB) housing market

(Sprigings, 2013; Whitehead, 2011). This has been a long-term trend among 18- to 24-

year-olds. However, after the turn of the century this trend not only accelerated among that

age group, but also extended to those aged from 25 to 34 (Table 3). Among heads of

household aged from 18 to 24, the homeownership rate fell from 36 per cent in 1991 to

only 10 per cent in 2011/2012, while private renting increased from 36 per cent to 68 per

cent. Meanwhile, the homeownership rate among heads of households aged 25 to 34 fell

P.A. Kemp610

from 67 per cent in 1991 to 43 per cent in 2011/2012, while private renting increased from

13 per cent to 41 per cent. As Table 3 shows, among 25- to 34-year-olds, most of the shift

from owner-occupation to private renting took place after the turn of the century.

These tenure changes among young adults partly reflect long-term demographic factors

such as later marriage and cohabitation, as well as an increase in the age of first

parenthood, which have helped increase the average age of FTBs. Changes to student

finance—in particular the shift from grants to loans as well as the introduction, and

subsequent trebling, of student fees—in effect reduced effective demand from, and

thereby delayed house purchase by, recent graduates (Andrew, 2006). However, the

accelerated decline in the FTB market from the turn of the century was largely due to the

boom in house prices, which increased much faster than consumer prices and average

earnings. This had a corresponding impact on the ratio of house prices to earnings. For

FTBs, the ratio of house prices to earnings increased from 2.1 in the second quarter of

1995 to unprecedented high of 5.4 in the second quarter of 2007. In the high inflation era

from the 1970s to the mid-1990s, borrowers could take out large mortgages relative to

their incomes safe in the knowledge that the real cost of their repayments would fall

rapidly over time. But in the post-GFC world of low inflation combined with slow earnings

growth, mortgages repayments that take up a large share of household incomes will

continue to do so for very much longer. As a result, the ‘degree of difficulty’ facing

prospective FTBs has increased compared with that which faced the postwar baby boom

generation.

Rising house prices also increased the amount of deposit required in order to obtain a

first mortgage. For example, the Resolution Foundation (2013) calculated that the number

of years required for low to middle income households to save for a typical FTB deposit

rose from less than 5 years in 1983 to more than 25 years at the peak of the housing boom.

Hence, as house prices surged out of the reach of many prospective FTBs, they had little

choice but to rent from a private landlord, at least for the time being. In other words, the

increase in real house prices that attracted many investors into the PRS also helped drive

young people to rent their home in the sector. This trend has been affected by wealth

inequality in that it has become very difficult for prospective FTBs who do not have help

from the so-called ‘bank of mum and dad’ to raise the deposit required to buy a home.

Indeed, the proportion of FTBs aged less than 30 who received financial help from their

parents towards a deposit increased from 35 per cent in 2005 to 78 per cent in 2011

(Inequality Briefing, 2014). Thus, about 8 out of 10 FTBs now rely on inter-generational

wealth transfers from their parents in order to buy their home.

Table 3. Tenure of householders aged 16–24 and 25–34 in England (per cent)

Aged 16–24 Aged 25–34

Year Homeowners Social renters

Private renters Total Homeowners

Social renters

Private renters Total

1991 36 28 36 100 67 21 13 100 2001 22 31 46 100 61 20 19 100 2011–2012 10 22 68 100 43 16 41 100

Note: Calendar year to 2001 and year from 31March thereafter. Totals may not sum to exactly 100 per cent due to rounding. Source: Author’s calculations from DCLG website housing tables.

Private renting after the GFC 611

The GFC and Beyond

The net outcome of these demand and supply drivers was that private renting increased by

almost a third from the turn of the century to the peak of the house price boom, rising from

10 per cent in 1999 to 13 per cent in 2007. Yet although the revival of private renting in

Britain took off during the housing boom, almost paradoxically growth accelerated again

when boom turned to bust. As Table 2 shows, the average annual rate of growth in

households renting privately increased from 4.1 per cent in the seven years from 2000 to

2006, to 7.2 per cent in the seven years from 2007 to 2013/2014. In absolute numbers, the

average rate of growth more than doubled from 95 000 per annum between 2000 and 2006

to 241 000 per annum between 2007 and 2013/2014.

The Financial Crisis of 2007–2009

This acceleration in the rate of growth of private renting was not widely forecast or seen as

an inevitable consequence of the GFC. That was in part because BTL mortgage lending

collapsed with the onset of the credit crunch (Figure 2). Indeed, specialist BTL lender

Paragon and several mainstream lenders (e.g. Chelsea Building Society and Nationwide

Building Society) ceased lending to landlords altogether. It might have seemed, therefore,

that the credit crunch had dealt a fatal blow to BTL. For example, writing in the heat of the

financial crisis, Leyshon & French (2009, p. 457) argued that ‘There are now considerable

doubts about the future of buy to let.’

These doubts were underlined by the fact that mortgage arrears and repossessions

increased more rapidly for BTL landlords than for owner-occupiers in the wake of the

financial crisis. Indeed, mortgage delinquency rates during the crash were higher for

landlords than for homeowners, whereas during the preceding boom they had been lower

(Kemp, 2004). As Figure 3 shows, the percentage of BTLmortgages that were three or more

months in arrears trebled between 2007 and 2008. Thus, not only had the BTL lending

0

0.5

1

1.5

2

2.5

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Figure 3. BTL mortgages 3 þ months in arrears (per cent). Source: Council of Mortgage Lenders.

P.A. Kemp612

market collapsed, but significant numbers of BTL landlordswere unable to pay themortgage

when their tenants fell into rent arrears rent during the recession. The financial crisis affected

the housing market more generally, of course, and not just BTL. House prices fell in real as

well as in nominal terms, property transactions halved, mortgage lending more than halved,

lenders substantially increased the size of deposit that they required on new mortgages, and

loans to FTBs fell sharply. However, house prices did not fall as much, nor owner-occupier

mortgage arrears increase to the same extent, as they did in the early 1990s housing crash

(Whitehead & Williams, 2011; Williams, 2011). This is likely to be why the GFC has not

generated as many ‘property slump landlords’ as in the early 1990s’ housing slump.

The fact that the housing market crash in the GFC was not as dramatic as the one in the

early 1990s was in part because of the unprecedented actions taken by the Bank of England

(BoE).7 First, in response to the negative impact of the GFC on the housing market and the

economy more generally, the BoE lowered the bank base rate to an all-time low of only 0.5

per cent in March 2009. Second, the Bank embarked (as did the Federal Reserve Bank in

the USA) on a large-scale program of quantitative easing (QE) in order to ensure that

interest rates remained at very low levels. And third, the BoE subsequently launched the

Funding for Lending Scheme (FLS), which provided cheap loans to banks for lending on

house buyers and small businesses. The banks mainly used the FLS for lending to house

buyers rather than to small businesses (Cunliffe, 2014).

These actions by the BoE had a number of important, but little discussed, effects on the

private rental market. In the first place, low interest rates helped to keep mortgage arrears

and repossessions among existing BTL landlords to lower levels than they would

otherwise have been. Second, it also meant that, for those landlords who could obtain a

mortgage, the cost of borrowing to gear up their investment in property was relatively

cheap. Third, a low bank rate and QE had the effect of reducing the yield on government

bonds, bank deposits and pension annuities, thereby further raising the relative

attractiveness of investment in residential lettings.

The combined effect was to help revive the BTL structure of rental housing provision as

investors searched for more competitive returns in this new low-yield environment.

As Figure 2 shows, BTL lending began to recover after the switch to cheap money in 2009.

The fall in house prices also created a temporary opportunity for investors in the PRS. For

although falling house prices had a negative impact on capital values, it also made it

possible to acquire properties with the prospect of capital growth when prices eventually

recovered. Moreover, the corollary of lower house prices was an increase in rental yields.

Thus, rental yields improved not only in relative terms but also in absolute terms as well.

These developments helped to reinforce the attractions of investment in private rental

housing for both ‘traditional’ and BTL landlords.

The demand for rental accommodation also grew strongly in the wake of the GFC,

which in some localities and especially in London was accompanied by rising real rents.

There was a shift away from owner-occupation and social housing towards the PRS as the

tenure destination of new households after the onset of the GFC. As Table 4 shows, the

proportion of new households who were renting privately increased from about a half in

2007–2008 to two-thirds in 2011–2012. Existing tenant households were also beginning

to stay in the PRS for longer periods than had previously been the case. For example,

results from the English Housing Survey show that the proportion of private tenants who

had been living at their current address for less than one year fell from 40 per cent in

2007/2008 to 34 per cent in 2012/2013. Those who had lived at their address for between

Private renting after the GFC 613

one and five years increased from 40 per cent to 46 per cent over the same period. Thus,

while the PRS continued to be dominated by young and mobile households, the extent to

which this was the case had begun to decline.

After the Crisis

As well as these more short-term impacts, the GFC has sparked off what are likely to be

more long-term changes, which are discussed in this section. These developments are still

unfolding and hence it is not yet clear how important they will eventually become. The

discussion therefore must inevitably be speculative to some extent. However, a number of

significant trends have emerged in the wake of the GFC that will ensure that much of the

new demand for private rental accommodation will continue for the foreseeable future.

First, although mortgage lending is recovering from the financial crisis, it is clear that

access to mortgages will be less lax than in the preceding two decades, with borrowers

expected to put down larger deposits. For example, a survey by the Halifax Bank (2014)

found that the average size of deposit had doubled from 10 per cent in 2007 to 20 per cent

by 2012/2013. Moreover, following an official review of the mortgage market (MMR),

since April 2014 lenders have been required to place more emphasis than before the GFC

on ability to pay. They are now expected to conduct close scrutiny of the income, and even

the spending habits, of prospective borrowers. These new rules apply only to owner-

occupiers, but not (at present) to BTL landlords. As Whitehead & Williams (2011,

p. 2164) pointed out, the changes made by the MMR ‘potentially make the current difficult

access problem into a permanent one.’ These more stringent lending criteria will thereby

exclude some marginal prospective FTBs from homeownership, leaving them little option

but to rent privately.

Second, the under-supply of new homes—a feature of the housing market in England

since the 1980s—is almost certain to continue for the foreseeable future. This under-supply

appears to have helped limit the extent to which there was a ‘correction’ in house prices

following in the GFC. Although the picture varies spatially, at the national level the average

house price has risen strongly since 2013 in nominal terms and relative to average incomes.

Government-funded schemes such as Help to Buy (HtB) risk making matters worse, by

increasing purchasing power without resulting in a commensurate increase in the supply of

new homes.8 Hence, the average house price-to-income ratio for FTBs will remain at very

high levels for the foreseeable future, thereby helping to ensure that some ‘reluctant private

renters’ will continue to rent their accommodation from private landlords.

Third, like many other advanced economies that were adversely affected by the GFC,

the British Government instigated a new era of fiscal austerity. This is as much a political

Table 4. Tenure of new households in England (per cent)

Year Homeowners Social renters Private renters Total

1999–00 34 26 40 2007–2008 34 20 47 100 2012–2013 19 17 65 100

Note: Calendar year to 2001 and year from 31March thereafter. Totals may not sum to exactly 100 per cent due to rounding. Source: Author’s calculations from DCLG website housing tables.

P.A. Kemp614

project to shrink the state as one to restore the health of the economy (Taylor-Gooby,

2012). Indeed, in autumn 2014 the Government pledged to reduce public spending as a

share of GDP to what it had been in 1948, which would imply cuts in public spending on

an unprecedented scale. Government funding for social housing was already one casualty

of this new era of fiscal austerity and it is possible that new construction in the sector will

fall to levels not seen since the interwar years. A further decline in social housing will

inevitably accentuate the shift to private renting among low-income households.

The net result of these developments is that the GFC has increased the number of

households needing to rent privately for the long-term. Despite this change, the rules

governing tenancies remain unreformed and landlord practices continue to be dominated

by six-month and one-year leases. This failure to reform the tenancy framework to require

landlords to provide longer-term tenancies for those who need them represents a form of

‘drift’. As noted earlier, drift is a process in which institutions are not adjusted to reflect

changing conditions (Hacker, 2005)—in this case, the increasing number of longer-term

tenants and families living in the PRS. Over time, drift makes institutions less well adapted

to current circumstances. However, the growth in ‘generation rent’ has increased the

political salience of private renting, for the PRS now accounts for a sizeable group of

voters once again. A number of pressure groups—the most vocal of which is in fact called

Generation Rent—have campaigned for better conditions for private tenants including

longer-term tenancies and the re-introduction of rent controls. The latter appears to have

significant support among the public: an opinion poll conducted in May 2014 by the survey

firm YouGov found that 56 per cent of respondents were in favour of the Government

introducing rent controls (33 per cent disagreed and 11 per cent did not know). Moreover,

despite opposition from private landlords, there appears to be growing support for the

introduction of longer fixed-term tenancies for tenants who wish them.

There have also been significant supply-side developments resulting from the GFC.

Most striking is the proportion new landlords in the private rental market. Figures from the

2010 survey of private landlords in England show that a quarter of private individual

landlords had first invested in the PRS since 2007 (Table 5). An influx of novice private

landlords on this scale in such a short period of time is historically unprecedented.

It reflects the increased attractiveness of investment in private rental housing in the wake

of the GFC. Historically low interest rates have made it cheap for landlords to borrow and

thereby gear up their investment in order to raise the rate of return on their capital.

Although bank rate will eventually increase from its historically low level of 0.5 per cent,

the post-GFC low-interest regime is likely to continue for the foreseeable future. This will

ensure that the income on bank deposits, government bonds and pension annuities remain

Table 5. Number of years since landlords first started letting in England (per cent)

Years Individuals and couples All private landlords

3 years or less 24 22 4–10 years 49 47 11–20 years 18 18 More than 20 years 9 12 Total 100 100

Note: Totals may not sum to exactly 100 per cent due to rounding. Source: DCLG (2011).

Private renting after the GFC 615

uncompetitive compared with private rental housing even when management and

maintenance costs are taken into account. Although rising house prices will reduce rental

yields, it will be offset by increased capital growth. For all these reasons, private rental

housing seems likely to continue to be an attractive investment for moderate and high net

worth individuals in Britain for the foreseeable future.

Since the GFC there has also been a substantial amount of overseas investment in the

PRS in central London and to a lesser extent elsewhere. The exact scale of this investment

is unknown, but all estimates indicate that it is substantial (Green & Bentley, 2014). In part

it reflects the role of housing in London as a ‘safe haven’ from continuing financial

turbulence in the wake of the GFC. In addition, London is also regarded as a safe-haven for

wealthy overseas individuals who wish to shelter their wealth in the face of political

uncertainties and turmoil elsewhere in the world. Thus, Badarinza & Ramadorai (2013)

have shown that economic and political risks in different regions of the world have had a

significant effect on house prices and transactions in the London housing market. Not all of

this investment from overseas has been in the PRS or in the capital, but it has helped to

drive up house prices in London, thereby pushing the rent/buy margin further out of the

reach of some prospective FTBs. Thus, rental property in London is no longer an outlet

only for domestic investors, but also one for high net-worth individuals from overseas; and

as such is connected, in a modest but important way to the global political economy.

The PRS has also begun to attract investment from both private equity firms and

financial institutions since the GFC. It is not clear as yet whether the private equity

investment will be enduring or focused on short-term capital growth as house prices

recover. But in the case of financial institutions, the interest seems likely to be more long-

term and reflects the ‘search for yield’ at a time when the yields on government bonds are

very low and on stocks very uncertain. There is already an institutional market for

investment in new build student housing blocks. Indeed, the largest student housing

company—Unite—is listed on the stock market and the sector appears to be expanding

somewhat in the wake of the GFC. Student housing companies represent an important new

structure of rental provision for this market segment. Their emergence represents a form of

institutional ‘layering’ running alongside and in competition with university-owned halls

of residence and mainstream PRS housing let to students.

Althoughpension funds and insurance companies havebeen largely absent from thePRS in

Britain since the 1950s (Crook&Kemp, 2011; Pawson&Milligan, 2013) a small but growing

number are beginning to acquire rental housing as part of their investment portfolios,

especially in London and the South-east of England (BNP Paribus Real Estate, 2013;

Financial Times, 2014). In order to help stimulate institutional investment in new rental

homes, the Government announced a £1bn Build to Rent fund in 2012 and a £3.5bn debt

guarantee scheme in 2013. The importance of these two schemes is less in the relatively small

number of homes that are likely to be built with their help than in signalling government

commitment to the emerging market of institutional investment in the PRS. Such investment

seems likely to grow to amodest but significant extent. For despite the disadvantages, the flow

of income from residential lettings tends to match the liabilities of pension funds. This is

because both rents and pensions tend to increase in line with earnings over time (Crook &

Kemp, 2011).Moreover, the continuing under-supply of housing in England will ensure that,

over themedium term, residential lettings are a relatively safe investment. In order to invest on

a sufficiently large scale, achieve design efficiencies, and obtain economies of scale in

property management, financial institutions are likely to mainly acquire new, purpose-

P.A. Kemp616

designedblocksofflats rather than suburbanhouses.UnlikemostBTLand traditional investor

landlords, their target market is likely to be relatively long-term tenants. This emerging SHP

represents another form of institutional ‘layering’ in the PRS. However, it is very unlikely to

substantially displace BTL and traditional investor landlords from the market.

Conclusions

This article has drawn on an historical institutional perspective to examine the impact of the

housing boom and slump on the private rental market in Britain. In doing so, it has

complemented accounts of the GFC that have largely focused on the role of sub-prime

mortgages and homeownership. The PRS has not only grown in size after many years of

decline, the formal rules and informal practices that characterize this tenure have also

changed significantly. This transformation began during the 1990s but the pace of change

increased from the turn of the century and accelerated still further with the onset of theGFC.

An historical institutional perspective draws attention to the ways in which changes in the

housing market are often powerfully influenced or shaped by developments in the wider

political economy.Thus, the emergence of the new structure of rental housingprovision based

on BTLmortgages was related to developments in global finance and not simply to domestic

events such as the negotiated agreement between ARLA and a panel of mortgage lenders.

BTL facilitated a surge of investment in rental housing, mainly but not exclusively by private

individual landlordswith only a handful of properties. BTL landlordism rapidly becamemore

important than the ‘traditional’ structure of rental housing provision based on cash-buyer

investor landlords.Moreover, developments in the international political economy, especially

after the onset of the GFC, also helped make rental housing attractive for investors relative to

alternative outlets for their savings. The ‘search for yield’ in the new low interest rate

environment and concern about the riskiness of stocks have also prompted some pension

funds and insurance companies to begin investing in private rental housing. This fledgling

structure of rental housing provisionbased onfinancial institutions seems likely to expand, but

is very unlikely to displace BTL and cash-buyer landlords from the market.

The emergence of ‘generation rent’ since the turn of the century has included growing

numbers of families and low-income households who might previously have expected to

become homeowners or social housing tenants. A related development is the increased

number of long-term renters. However, private landlords have generally proved reluctant to

offer longer leases. This is partly because most BTL landlords havemortgage conditions that

prohibit them from granting leases of more than one year. But it is also because many BTL

and cash-buyer landlords are focused more on capital gains than rental income and hence

want to maximize their freedom to sell with vacant possession. The result is that low-income

families and other tenants are often uncertain about whether their tenancy will be renewed

when it comes to an end. While the legal rules and everyday practices governing ASTs work

well for many tenants, they are less suitable for this growing group of long-term renters.

Indeed, the ‘flexibility’ that one-year (or six-month) leases give young and mobile people

represent ‘insecurity’ and anxiety for tenants who need to rent for the longer-term. To that

extent, the transformation of private renting is as yet an incomplete one.

Acknowledgement

Thanks are due to Alex Schwartz and the anonymous referees for their helpful comments on the first draft of the

paper.

Private renting after the GFC 617

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1 One exception is Sprigings (2013), who examines the relationship between the decline of

homeownership and the growth of private renting. He predicts that owner-occupation in the UK is

on its way to becoming a minority tenure again. In contrast, Whitehead (2011, p. 126) argues that

‘although owner-occupation rates may fall for some time, the fundamentals of tenure choice point to

continued demand for owner-occupation, even in a more uncertain world.’ 2 A good example here is rent controls, which typically redistribute income from landlords to tenants, are

often politically contested, and which ‘rogue’ landlords may seek to avoid or evade in various ways.

Landlords’ organizations often campaign to have rent controls removed or made less stringent while

tenants’ groups may mobilize to defend existing rent controls or campaign for rent controls to be

introduced. 3 In a seminal article, Hall & Taylor (1986) distinguished between three main varieties of

institutionalism—rational, sociological and historical—though others types have also been identified. 4 Streeck & Thelen (2005) identified ‘exhaustion’—the gradual break down or withering away of an

institution—as a fifth endogenous process that can generate gradual, transformative change, but it was

not mentioned in Mahoney & Thelen (2010). 5 Hacker (2005) who developed the concept in his analysis of US social welfare refers to ‘drift’ and

‘policy drift’ interchangeably. 6 Other sources of finance in 1993/1994 included inheritance (15 per cent), gifts (6 per cent) and the

acquisition of organizations had happened to have some lettings (4 per cent). 7 It was also because the government took action to limit arrears and repossessions, for example, by

temporarily dropping the two-year maximum entitlement to Support for Mortgage Interest paid to out-

of-work owner-occupiers. Likewise, lenders were careful to pursue a policy of forbearance towards

homeowners who were in difficulty with their mortgage repayments. None of these easements were

made available to distressed landlords. 8 The Conservative-Liberal Democrat coalition government introduced HtB in 2013, a scheme that uses

public loan guarantees and equity loans to enable owner-occupiers to obtain mortgages with loan-to-

value ratios as high as 95 per cent.

References

Aalbers, M. (2012) Subprime Cities: The Political Economy of Mortgage Markets (Oxford: Wiley-Blackwell).

Andrew, M. (2006) Housing tenure choices by the young, Housing Finance, 7, pp. 1–13.

Badarinza, C. & Ramadorai, T. (2013) Home Away from Home? Safe Haven Effects and London House Prices,

unpublished working paper (Oxford: Said Business School).

Ball, M. (1986) Housing research: Time for a theoretical refocus? Housing Studies, 1, pp. 147–165.

Ball, M. (2006) Buy-to-Let Ten Years on (London: Association of Residential Letting Agents).

Best, R., Kemp, P. A., Coleman, D., Merrett, S. & Crook, A. D. H. (1992) The Future of Private Renting (York:

Joseph Rowntree Foundation).

BNP Paribus Real Estate (2013) Housing the Nation (London: BNP Paribus Real Estate).

Bovaird, E., Harloe, M. & Whitehead, C. M. E. (1985) Private rented housing: Its current role, Journal of Social

Policy, 14(1), pp. 1–23.

Burke, T. & Hulse, K. (2010) The institutional structure of housing and the subprime crisis: An Australian case

study, Housing Studies, 25(6), pp. 821–838.

Crook, A. D. H. & Kemp, P. A. (1996a) The revival of private rented housing in Britain, Housing Studies, 11(1),

pp. 51–68.

Crook, A. D. H. & Kemp, P. A. (1996b) Private Landlords in England (London: HMSO).

Crook, A. D. H. & Kemp, P. A. (2011) Private Landlords in Transition: Housing, Markets and Public Policy

(Oxford: Wiley Blackwell).

P.A. Kemp618

Crook, A. D. H. & Kemp, P. A. (Eds) (2014) Private Rental Housing: Comparative Perspectives (Cheltenham:

Edward Elgar).

Cunliffe, J. (2014) Momentum in the housing market: Affordability, indebtedness and risks, speech at the

Worshipful Company of International Bankers dinner 1st May, London.

Davies, H. (2010) The Financial Crisis—Who is the Blame? (Cambridge: Polity Press).

Department of Communities & Local Government (DCLG) (2011) Private Landlords Survey, 2010 (London:

DCLG).

Department of Communities and Local Government (2014) English Housing Survey: Households 2012–2013

(London: DCLG).

Financial Times (2014) Rent—the next big asset class? Available at ft.com May 9.

Forrest, R. & Murie, A. (1994) Home ownership in recession, Housing Studies, 9, pp. 55–74.

Forrest, R. & Ngai-Ming, Y. (Eds) (2011) Housing Markets and the Global Financial Crisis (Cheltenham:

Edward Elgar).

Gibb, K. & Nygaard, C. (2005) The scale and impact of buy-to-let residential investment on local housing

markets: Evidence from Glasgow, Scotland, European Journal of Housing Policy, 5(3), pp. 301–326.

Green, D. G. & Bentley, D. (2014) Finding Shelter: Overseas Investment in the UK Housing Market (London:

Civitas).

Hacker, J. (2005) Policy drift: The hidden politics ofUSwelfare state retrenchment, in:W.Streeck&K.Thelen (Eds)

Beyond Continuity: Institutional Change in Advanced Political Economies, pp. 40–82 (Oxford: Oxford

University Press).

Halifax (2013) Generation Rent (London: Lloyds Bank).

Hall, P. A. & Taylor, R. (1986) Political science and the three new institutionalisms, Political Studies, 44,

pp. 936–957.

Hamnett, C. & Randolph, B. (1988) Cities, Housing and Profits (London: Hutchinson).

Harloe, M. (1985) Private Rented Housing in the United States and Europe (London: Croom Helm).

Hickman, P., Sprigings, N., McCoulough, E. & Cole, I. (2008) The Private Rented Sector in West Yorkshire. Final

Report, Sheffield: Centre for Regional and Economic Social Research.

Housing, Theory and Society (2010) Special issue: Path dependence in housing, Housing, Theory and Society, 27

(3), pp. 193–273.

IMLA (2014) Reshaping Housing Tenure in the UK: The Role of Buy-to-Let (London: Intermediary Lenders

Association).

Inequality Briefing (2014) Most first-time house-buyers depend on the “Bank of Mum and Dad”, in: Briefing 22,

14 March (London: Inequality Briefing).

Kemp, P. A. (1987) Some aspects of housing consumption in late nineteenth century England andWales,Housing

Studies, 2(2), pp. 1–16.

Kemp, P. A. (2000) Housing benefit and welfare retrenchment in Britain, Journal of Social Policy, 28(2),

pp. 263–279.

Kemp, P. A. (2004) Private Renting in Transition (London: Chartered Institute of Housing).

Kemp, P. A. (2011) Low-income tenants in the private rental housing market, Housing Studies, 26(7–8),

pp. 1019–1034.

Krasner, S. D. (1984) Approaches to the state: Alternative conceptions and historical dynamics, Comparative

Politics, 16(2), pp. 223–246.

Langley, P. (2008) The Everyday Life of Global Finance (Oxford: Oxford University Press).

Leyshon, A. & French, S. (2009) We all live in a Robbie Fowler house: The geographies of the buy to let market

in the UK, British Journal of Politics and International Relations, 11, pp. 438–460.

Mahoney, J. & Thelen, K. (2010) A theory of gradual institutional change, in: J. Mahoney & K. Thelen (Eds)

Explaining Institutional Change: Ambiguity, Agency and Power, pp. 1–37 (Cambridge: Cambridge

University Press).

March, J. G. & Olsen, J. P. (2006) Elaborating the “new institutionalism”, in: R. A. W. Rhodes, S. A. Binder &

B. A. Rockman (Eds) The Oxford Handbook of Political Institutions, pp. 3–20 (Oxford: Oxford University

Press).

Muellbauer, J. & Murphy, A. (1997) Booms and busts in the UK housing market, The Economic Journal, 107,

pp. 1701–1727.

Murie, A. (2014) The housing legacy of Thatcherism, in: S. Farrall & C. Hay (Eds) The Legacy of Thatcherism,

pp. 143–166 (Oxford: Oxford University Press).

Private renting after the GFC 619

North, D. C. (1990) Institutions, Institutional Change and Economic Performance (Cambridge: Cambridge

University Press).

Pawson, H. & Milligan, V. (2013) New dawn or chimera? Can institutional financing transform rental housing?

International Journal of Housing Policy, 13(4), pp. 335–357.

Peters, B. G. (2005) Institutional Theory in Political Science, 3rd edition (New York: Continuum).

Piazzesi, M. & Schneider, M. (2009) Momentum traders in the housing market: Survey evidence and a search

model, American Economic Review: Papers and Proceedings, 99(2), pp. 406–411.

Pierson, P. (2004) Politics in Time (Princeton, NJ: Princeton University Press).

Resolution Foundation (2013) Squeezed Britain 2013 (London: Resolution Foundation).

Rhodes, D. (2007) Buy-to-let landlords, in: D. Hughes & S. Lowe (Eds) The Private Rented Housing Market:

Regulation or Deregulation?, pp. 37–50 (Aldershot: Ashgate).

Rugg, J. & Rhodes, D. (2008) The Private Rented Sector: Its Contribution and Potential (York: The University of

York, Centre for Housing Policy).

Rugg, J., Rhodes, D. & Jones, A. (2002) Studying a niche market: UK students and the private rented sector,

Housing Studies, 17(2), pp. 289–303.

Sanders, E. (2006) Historical institutionalism, in: R. A.W. Rhodes, S. A. Binder & B. A. Rockman (Eds) Political

Institutions, pp. 39–55 (Oxford: Oxford University Press).

Scanlon, K. & Whitehead, C. (2005) The Profile and Intentions of Buy to Let Investors (London: Council of

Mortgage Lenders).

Schwartz, H. (2009) Subprime Nation (Ithaca, NY: Cornell University Press).

Schwartz, H. & Seabrooke, L. (Eds) (2009) The Politics of Booms and Busts (Basingstoke: Palgrave Macmillan).

Shelter (2012) Homes Fit for Families? The Case for Stable Private Renting (London: Shelter).

Sprigings, N. (2008) Buy-to-let and the wider housing market, People, Place & Policy, 2, pp. 76–87.

Sprigings, N. (2013) The end of majority homeownership: The logic of continuing decline in a post-crash

economy, People, Place & Policy, 7, pp. 14–29.

Sprigings, N. & Smith, D. H. (2012) Unintended consequences: Local housing allowance meets the right to buy,

People, Place and Policy Online, 6(2), pp. 58–75.

Steinmo, S., Thelen, K. & Longstreth, F. (Eds) (1992) Structuring Politics: Historical Institutionalism in

Comparative Perspective (Cambridge: Cambridge University Press).

Streeck, W. & Thelen, K. (2005) Introduction, in: W. Streeck & K. Thelen (Eds) Beyond Continuity: Institutional

Change in Advanced Political Economies, pp. 1–39 (Oxford: Oxford University Press).

Taylor-Gooby, P. (2012) Root and branch restructuring to achieve major cuts, Journal of Social Policy, 46,

pp. 61–82.

Thelen, K. (2009) Institutional change in advanced political economies, British Journal of Industrial Relations,

47, pp. 471–498.

Thomas, R. (2006) The growth of buy-to-let, Housing Finance, 9, pp. 1–14.

Whitehead, C. (2011) Owner-occupation in an increasingly uncertain world: The English experience, in:

R. Ronald & M. Elsinga (Eds) Beyond Home Ownership (London: Routledge).

Whitehead, C. & Kleinman, M. (1986) Private Rented Housing in the 1980s and 1990s (Cambridge: Granta).

Whitehead, C. & Kleinman, M. (1989) The private rented sector and the Housing Act, 1988, in: M. Brenton &

C. Ungerson (Eds) Social Policy Review 1988–1989, pp. 67–84 (Harlow, ND: Longman).

Whitehead, C. &Williams, P. (2011) Causes and consequences? Exploring the shape and direction of the housing

system in the UK post the financial crisis, Housing Studies, 26(7–8), pp. 1157–1169.

Williams, P. (2011) The credit crunch in the UK: Understanding the impact on housing markets, policies

and households, in: R. Forrest & Y. Ngai-Ming (Eds) Housing Markets and the Global Financial Crisis,

pp. 41–56 (Cheltenham: Edward Elgar).

P.A. Kemp620