The Residential Landlords’ Association (RLA) is today warning that rent controls proposed by the London Assembly would cause untold damage to the housing market, with tenants losing out.
Publishing its report on the private rented sector (PRS) today, the London Assembly’s Housing and Regeneration Committee has called on the Mayor to bring forward an effective mechanism to stabilise rent, which, would essentially be rent controls.
According to the RLA this would do considerable damage to the housing market in the Capital causing the supply of rental properties to dry up just at the time when tenants are crying out for more choice over where they live. Rent controls which applied up until 1989 shrank the private rented sector. They also adversely impacted on stock condition resulting in poorly maintained and un-modernised properties
In his report for the Government on private rented housing last year, Sir Adrian Montague noted that “investors have made it clear that their current interest in the sector would easily be undermined by proposals for rent controls or enhanced restrictions on gaining vacant possession.”
Rent controls have also been dismissed by all three of the main national parties, and in America substantial evidence exists showing that where rent controls have been in place, the quality and quantity of rented homes has deteriorated.
Commenting on the proposal, Alan Ward, Chairman of the RLA, said:
“It is a pity that the Assembly’s Housing and Regeneration Committee has called for a retrograde step that would cause untold damage to tenants in London. Tenants will be the losers.
“All the evidence clearly shows that rent controls would take us back to the past, drying up the supply of much needed new rented homes. It is little wonder that nationally all three of the main parties have distanced themselves from such a move. Have the lessons of history been forgotten already? When we had rent controls we saw how the sector was damaged and how hard it was to find a property to rent”
“For rents to be kept in check requires a massive expansion of private rented housing in London, giving tenants genuine choices over their housing options and driving rents down through much greater competition. This requires reforms to the planning system to make it easier for landlords to develop on unused plots of public sector land as well as a taxation system that recognises renting a home as a business activity to encourage investment.
“It is disappointing that this report makes no recommendations on how to boost the supply of rented housing, opting instead to support outdated calls for yet more burdensome regulations.”
- Simon Gordon does not think rent controls are, and never have been, the answer
- Labour are very engaged within the PRS; two consultations within weeks of each other
- Sir Adrian Montague spoke out against rent controls in 2012, via the Department for Communities and Local Government