Green Party claims rent controls will solve London’s housing crisis in London

A Green Party politician claims the Mayor of London, “has no choice” but to introduce rent controls to solve the housing crisis.

In a report, Zoë Garbett, London Assembly Member for the Green Party, claims London Mayor Sadiq Khan must show leadership and introduce rent controls to stop renters from being evicted from their homes.

Ms Garbett has also set out seven recommendations for Sadiq Khan, including holding landlords to account and granting more powers to introduce licensing in the capital.

Landlord lobby blocking progress on rent controls

Ms Garbett blames “the landlord lobby” for blocking progress on rent controls.

She said: “Too often, policymakers dismiss rent controls and suggest that increasing supply alone will rescue private renters from this affordability emergency.

“But there’s no guarantee more private housebuilding will limit or drive down the price of renting, especially in the short to medium term. There is a guarantee that rent control will. However, the noise of the landlord lobby leaves little space for alternative discussions to be had about rent controls.”

Ms Garbett adds: “Against this backdrop, the Mayor has no choice but to start leading a conversation on rent controls. While he floated the idea of a Rent Commission six years ago, in 2019, he has not formed one – instead, he said he’s waiting for the government to gift London rent control powers.

“But London’s 2.7 million renters cannot afford to wait any longer. Londoners need their Mayor to bring together a renter-led Commission, to specifically explore what effective rent control could be like for London and how it might work in practice, and start a conversation the government can no longer ignore.”

Different approaches to rent controls

According to the report, average rents in London are 39.8% of income, exceeding the ‘affordability’ threshold of 30%.

The report sets out different designs on what rent controls could achieve in London.

It says: “Within tenancy controls would mean renters who currently have a rental contract with a landlord would be protected from excessive rent rises.

This would not protect renters moving homes as landlords beginning a tenancy agreement with renters new to their property would be free to set the rent to whatever they like, without any caps.”

However, the report claims only introducing within tenancy controls could cause a two-tier private rented sector.

The report explains: “This could risk entrenching a ‘two-tier ’ private rented sector, where you have some good value properties (existing tenancies) and bad value properties (new tenancies, already most vulnerable to rent-price inflation).

“This would intensify competition for ‘good value’ properties in the private rented sector. It would also unintentionally reward new landlords entering the market who would not have an initial cap while perversely ‘penalising ’ those who are currently providing good value properties.”

The report claims in-between tenancy rent controls would be the best solution, as they would maximise the positive impact of rent controls by applying caps on what landlords can charge new tenants.

The level of these caps would need to be determined by the local or regional authority in each area.

Report failed to mention rent controls disaster in Scotland

The report failed to mention that when Scotland introduced rent controls, it caused rents to skyrocket by 11.6% and created a housing emergency.

According to the Scottish Association of Landlords (SAL), government policies, including rent controls and anti-landlord rhetoric, are to blame for a 22,000 drop in rental homes across Scotland in just one year.

An interview with the housing spokesperson for the Scottish Conservatives, Meghan Gallacher, for Property118 said that the introduction of rent controls in the Scottish Housing Bill is an attack on the private rented sector and will cause landlords to leave the sector.

Hold landlords to account

Elsewhere in the report, Ms Garbett set out seven recommendations to the Mayor of London, including setting up a renter-led commission for London.

Ms Garbett also suggests that Mr Khan should work with other metro and regional mayors to lobby the government for devolved powers to set caps on rent prices in the private rented sector, pushing for a cross-regional approach to rent controls.

Ms Garbett adds: “The Mayor should also set out in detail how he will deliver on his manifesto promises to back renters, defend their rights, hold landlords to account, provide funding to renters’ unions, and improve landlord licensing across London with new devolved powers.”

A spokesperson for Sadiq Khan, told the London Evening Standard: “The Mayor is concerned about the impact of unaffordable private rents and is determined to do everything in his power to make housing more affordable for London’s 2.6 million private renters.

“The Mayor is focused on working with government, London boroughs and housing associations to deliver more affordable homes. Last year, Sadiq unveiled an innovative new proposal for key worker living rent homes, which could save Londoners in vital frontline jobs up to £600 a month, helping to build a better and fairer London for all.”

The full report and list of recommendations can be viewed here.

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