Labour could bring in rent caps at a local level

Labour could bring in rent caps at a local level

9:50 AM, 20th May 2024, About a month ago 9

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A Labour government could bring in rent caps that would empower local councils to restrict annual rent increases by landlords.

That’s a similar proposal to Scotland’s Housing Bill which has recently been unveiled.

Rachel Reeves, the shadow chancellor, made the revelation during a BBC Radio Essex interview.

She said that rent controls might be a viable solution in some areas but dismissed the idea of a nationwide implementation.

‘Not always delivered the results’

Ms Reeves said: “Where that has happened, it has not always delivered the results that people might want.

“I think that should be up to local areas to decide.”

She added: “There may be the case for that in some local areas, but as a blanket approach, I’m not convinced by that.”

Landlords exiting the market

However, Scotland’s previous strategy that imposed a rent cap, spearheaded by Nicola Sturgeon, led to landlords exiting the market and a surge in rental prices.

Paul Shamplina, Landlord Action’s managing director, warned on LBC that such a policy could lead to unintended outcomes.

He said: “I think with regard to rent controls, I understand why it’s in conversation – rents are becoming more unaffordable for tenants at the moment.

“The problem you’ve got is Scotland tried it and their rents went up. You’ve got landlords leaving in their droves, for multiple reasons.

“If rent caps came in, that could stifle investment with regard to lending.”

‘War on landlords’

Labour’s proposal for rent caps has been called a ‘war on landlords’ by one Conservative MP.

Jonathan Gullis is the party’s deputy leader and he said: “Given the destructive impact of rent controls it beggars belief Rachel Reeves is contemplating introducing them in parts of the UK.

“This war on landlords is nothing but the same old Labour, all it will do is drive up costs for hardworking people.”

Fairness and security for renters

Labour has pledged to ensure fairness and security for renters, including abolishing section 21, ending tenant bidding wars and extending Awaab’s Law to the private rented sector.

Last week, a Labour-commissioned report proposed rent controls, suggesting that rent should not increase faster than local prices or wages.

A Labour party spokesman said: “As Rachel Reeves said, she does not believe rent controls are the right approach.

“While Labour believes action needs to be taken to address extortionate within-tenancy rent rises, rent controls are not national Labour Party policy as we remain mindful of the risk they could pose to the availability of rental properties and the harmful impacts any reduction in supply would have on renters.”


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Comments

John MacAlevey

10:13 AM, 20th May 2024, About a month ago

The ego of Queen Canute is staggering.. `..we will control the market.`
The market decides..not dreamy politicians.

Neilt

10:16 AM, 20th May 2024, About a month ago

Rent caps in some areas by Labour? Of course. Nationwide will follow for sure.
Security of Tenure next? Why not?
We had it before Margaret Thatcher brought in the Assured Shortholds, so why not do it again?
The Labour Party loves policies that stifle free enterprise.

NewYorkie

10:30 AM, 20th May 2024, About a month ago

They'll leave it to councils to decide. 'nuf said! 🤣 🤣

Stella

11:01 AM, 20th May 2024, About a month ago

Reply to the comment left by Neilt at 20/05/2024 - 10:16
Yes I agree

We are going back to the days of the protected tenant the writing is on the wall and the evidence is in the RRB bill

Labour will quickly complete the process.

Jimmy Smith

12:50 PM, 20th May 2024, About a month ago

“I think that should be up to local areas to decide.”

I think it should be up to the landlord to decide it's their private property.
Should not be controlled by a dictatorship government.

Grumpy Doug

13:54 PM, 20th May 2024, About a month ago

"Labour’s proposal for rent caps has been called a ‘war on landlords’ by one Conservative MP."
Er, so what do you describe the events of the past decade?

Cider Drinker

15:33 PM, 20th May 2024, About a month ago

If the rent doesn’t cover the landlords’ costs and provide a little something for all the hassle, landlords will leave.

Rents could be capped at a percentage of property value. I’d suggest BofE Base Rate +3.9% as this is the rate that mobile phone providers such as Vodafone increase their charges.

Michael Johnson - Amzac Estates

16:27 PM, 20th May 2024, About a month ago

So tell me you are bringing rent controls without telling me you are bringing in ret controls!
Honestly to think that the Tories are incompetent is fair enough but Labour will make them look positively angelic.
You can tell they are very cock sure of themselves as they are slowly telling us all what we suspected and they aren't even trying to cover it up.

Reluctant Landlord

20:41 PM, 20th May 2024, About a month ago

right ho - get the rents increased now all to market rate - ahead of the expectations and tell the tenants its due to what Labour will do if they win. Explain you wont be able to carry on letting AT ALL if they cap the rents and explain what happened in Scotland and Wales when they did this and how worse off tenants were... give them the details of their MP to write to about the situation.

Faced with the reality NOW of what will happen if Labour get in, will tenants then decide NOT to vote for Labour in the GE?

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