Tenants in the private rented sector should be given new rights to stay in their home as long as they want, according to Civitas.
The think tank also suggested that tenants should receive guarantees that their rent will not increase above inflation.
In a report entitled The Future of Private Renting, Civitas called for a new regulatory regime in the private rental sector which would prevent landlords exploiting the shortage of homes at the expense of tenants and taxpayers.
The number of private renters needing housing benefit to meet their costs has more than doubled in the past decade, from 722,000 in 2003/4 to 1.7 million in 2013/14. This figure is forecast to reach 1.85 million in 2018/19, according to the report.
The report also said that the amount of housing benefit rent subsidies claimed in the private rented sector has more than doubled in real terms over the past 10 years, from £3.9bn in 2003/4 to £9.5bn in 2013/14, and is set to top £10bn in 2018/19.
The report argued that the private sector should be required to offer indefinite tenancies “as the norm”. It also argued that once an initial rent had been agreed, index-linked ceilings on rent rises would give renters the security they needed.
Daniel Bentley, author of the report, said: “As private renting grows it is important to ensure that it offers a fair deal to those who have little choice but to rely on it.
“Unfortunately the housing benefit system, which effectively props up purchasing power at the lower end of the market, militates against fair prices by subsidising landlords’ rent demands.
“This vicious circle will only worsen as the private rented sector comes to represent an ever-larger proportion of the housing market and more and more tenants have to fall back on housing benefit.”