Earlier this year, the Mayor of London proposed to introduced rent controls in the UK’s capital. Looking at fresh data released yesterday, it seems that this plan may have already had a negative impact on the sector.
The latest information from the Office for National Statistics (ONS) shows that, in the 12 months to October 2019, private rental sector (PRS) rents in the capital have increased by an average of 0.9%. This is lower than inflation, which was 1.5% as measured by CPI and 2.1% as measured by RPI over the same period.
The Residential Landlords Association (RLA) has shared its worries about the rent control proposal. It has commented that this suggested change might have actually led to tenants paying more if rent levels had been linked to inflation.
Speaking recently to a committee of MPs, the Housing Secretary, Robert Jenrick, warned that he was “not in favour of rent controls”. He argued that they have “proven to be very negative for both landlords and tenants in the past, and I do not want to see any move in that direction.”
Research by the RLA has also highlighted that rent controls in other parts of the world have already proven to be unsuccessful. They led to a lower standard of housing and less choice for tenants.
David Smith, Policy Director for the RLA, has commented: “Today’s figures show how absurd proposals for rent controls are. Rents in London are falling in real terms yet the Mayor is failing to acknowledge this.
“If he wants to make renting cheaper it would be better to work constructively with good landlords to provide the new homes to rent the capital desperately needs. Without this, supply will fall, rents will go up, and tenants will have even less choice about where they live.”