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Rent controls have been a frequent topic in the news in the last few months. Labour are keen to introduce them but the private rental sector believes that such a measure would be disastrous for landlords and tenants. Up to now there has been no real factual research to show what would happen if rent controls were introduced, but a recent report commissioned by the London Assembly Housing Committee shows that many London landlords would sell up in the event of a rent freeze.
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Landlord Survey
Some 200 landlords in the capital were surveyed. They were all given various scenarios to consider, including rent rises linked to wage increases and three year rent caps. 40% of landlords questioned would consider selling some of their portfolios if rents were only allowed to go up in line with inflation. Landlords were also unhappy about the thought of being forced to offer longer tenancies, although tax incentives would sweeten the deal.
“We need solutions that work for the millions of Londoners – especially families – in the rental sector,” says Tom Copely, chairman of the London Assembly.
“For families, the prospect of having to up sticks with very little notice often means disruption to many aspects of their lives, including schooling and employment.”
RLA Comments
The Residential Landlords Association believes that the solution to the current housing crisis involves building more homes.
“This report reminds us of the dangers of rent controls which would in fact reduce supply, thereby increasing rents. Rent controls would also severely reduce standards in rented housing as investment dries up.”
