Could the PRS help solve the housing crisis – if we let it?

I recently had the pleasure of working with Elizabeth Rapoport on a piece of research for World Habitat, looking at whether the private rented sector (PRS) could play a greater role in meeting the UK’s growing demand for affordable housing. The research fed into this Inside Housing article by World Habitat’s deputy CEO, Louise Winterburn, and is being explored at their conference in June.

Councils in England are now spending an extraordinary £2.29bn a year on temporary accommodation. This huge figure reflects both the scale of housing need and the lack of long-term, affordable options. 

In our research, we looked at examples across the UK and Europe where councils, social enterprises and ethical landlords are already offering affordable homes in the PRS by mediating between landlords and tenants - referred to as ‘mediated market’ models. These are small, often local initiatives using PRS models to provide stable homes for people on low incomes. Quietly and without much fanfare, they’re showing that there is another way.

These models are encouraging, though they’re not for the faint hearted. They rely on a rare combination of patient capital, entrepreneurial grit, and a mission-driven mindset. They’re also getting harder to sustain. With borrowing costs up, and key reforms like MEES and the Renters Reform Bill on the horizon, the headroom for landlords to offer affordable rents is shrinking.

Capital Letters - which helps house low-income families in the private rented sector - has announced it will close. It’s a reminder of how fragile these delivery models are without sustained support. Just when we need more affordable options, we risk losing the few that exist.

It’s worth remembering that the PRS accounts for nearly a fifth of all households in England - second only to owner-occupation - yet it sits awkwardly in our housing system. It’s often seen as the ‘problem child’ of housing: unstable, unaffordable, and poorly regulated. And while much of that reputation is deserved, it obscures the quieter part of the sector where good things are happening. Where affordability is prioritised. Where homes come with support. Where landlords are doing things differently.

With the right mix of investment, partnerships and policy, I believe it is possible to unlock more affordable homes in the PRS. It needs support, and deliberate action, from Local Authorities, private landlords, mission-driven organisations and policy makers. Most importantly, in my view: if we are to tap the potential of the PRS to play a meaningful role in tackling housing need, it needs a national strategy, and a national conversation, about what we actually want the PRS to be. Without it, we risk watching the most promising models quietly disappear, just when we need them most.