Rents in the private sector are increasing by less than inflation – highlighting the damage that rent controls could do to tenants’ budgets. That’s the message from the RLA as official figures are released today showing an annual increase of 1 per cent in rents across England.
The latest figures from the Office for National Statistics (ONS) show that even in London, where properties are in high demand, rents rose by an average of 1.4 per cent in the 12 months to March 2014. This compares to a consumer prices index rate of 1.7 per cent and a retail prices index rate of 2.5 per cent over the same period.
The RLA, which represents private landlords across the UK, says the figures show that pegging rents to inflation would leave many tenants worse off.
Chris Town, vice-chair of the RLA, said:
“Rents in the private sector are continuing to rise by less than inflation. The sector offers a good and flexible option for many tenants in the face of much steeper house price rises. It’s important that people who talk about controlling rents through linking them to inflation realise that this could in fact hit many tenants who could face higher rents as a result.”
He added that the private sector was keen to expand to meet the need for homes which pushes rents up in areas of the country where demand is most acute. “The real problem is with supply,” said Mr Town. “The government should be making it easier for private landlords to provide more homes. An expanding private rented sector has a key role in tacking the nation’s housing crisis.”
Private sector rents have risen by 9.5 per cent across England over the past nine years and in London by 12.5 per cent. This compares with a Retail Price Index (RPI) increase of 33.8 per cent and a CPI increase of 13.3 per cent over the same period. By contrast, council rents rose by 42.5 per cent and housing association rents by 43.8 per cent over the eight years between 2005 and 2013.