Find all the latest news, stories, insights and tips from Paragon Bank.

Sharing the responsibility of delivering decent homes

Installing windows - blog.jpg

The number of decent homes has increased from 1.6 million in 2006 to 3.6 million today, and buy-to-let lending has played an important role. Our Mortgages Managing Director, Richard Rowntree, reveals more.

February 2022 saw Michael Gove unveil the Government’s Levelling Up White Paper.

To achieve their ‘plan to transform the UK by spreading opportunity and prosperity to all parts of it.’, the Government has outlined 12 ‘missions’, one of which focuses on housing.

In addition to ensuring that renters have a secure path to ownership with the number of first-time buyers increasing, the Government’s ambition is for the number of non-decent rented homes to have fallen by 50% by 2030.

Looking at how the number of decent homes has changed over time; we can see the important role that buy-to-let lending has had in driving standards up.

The number of decent homes has increased overall from 1.4 million in 2006 to 3.6 million today. During that time, lenders have approved 1.4 million buy-to-let mortgages for house purchase. There has not been such a marked improvement in the number of privately rented homes classed as non-decent during the same period, the 1.21 million recorded in 2006 falling to 1 million more recently.

From this, it seems safe to assume that improving standards in the sector have been driven by the growth in new properties coming into the PRS overall, diminishing the proportion of non-decent homes.

By only providing mortgages for homes that are of an acceptable standard, lenders have acted as a safeguard against poor quality property. This has been done through prudent lending with an increased focus on exacting underwriting standards and thorough property assessment.  

For a dwelling to be considered ‘decent’ under the Decent Homes Standard it must meet the statutory minimum standard for housing under the Housing Health and Safety Rating System (HHSRS), provide a reasonable degree of thermal comfort, be in a reasonable state of repair and have reasonably modern facilities and services.

Paragon research shows that over three quarters of landlords (77%) invest in upgrading newly purchased property before letting it out to a tenant, the average spend being £8,720.

The responsibility for raising standards is one that should be shared across the industry, and we see that brokers can add tremendous value here too, acting as the first line of defence against poor property.

Although it may seem counterintuitive to be more stringent at a time when purchase levels may be impacted by constrained stock, by focusing on quality over quantity, brokers can save time and minimise the frustration of declined applications.

This can be as simple as discussing cases with landlords, asking the right questions about properties and making them aware of what is likely to be considered as part of the inspection process.

Analysis of our own data suggests that this is happening. Although you may expect to see some landlords forced to take a risk on any lower quality properties that remain amongst the limited options available, the proportion of unsuitable properties assessed by our surveyors has remained stable.

Of course, everyone is entitled to a good quality home so even though significant progress has been made over the past 15 years, there is still more to do to further increase the proportion of decent properties, something we all have a part to play in.


Richard Rowntree

Richard Rowntree
Managing Director for Mortgages


This article was also published in Mortgage Solutions. 

Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551