Not again! Mayor of London calls for rent controls as he launches re-election bid
Sadiq Khan tells supporters at his Hackney launch yesterday that the “Prime Minister will have to give us the powers we need" to introduce a rent cap in the capital.
Rent controls in London would be a disaster for aspiring tenants says the Residential Landlords Association and the National Landlords Association as the Mayor of London, Sadiq Khan, intends to introduce them as he launches his re-election bid.
At a housing estate in Hackney on Tuesday, the mayor said, “The case for rent controls is now absolutely undeniable. But Tory ministers have blocked us from introducing our plans for rent controls in London and have simply said no.
“That’s why today I am making the mayoral election on 7th May a referendum on rent controls – showing Londoners that I will stand up for renters. The prime minister will have to give us the powers we need, because if he refuses to do so he will be denying the express democratic will of millions of Londoners. And as we have all heard Boris Johnson repeatedly say, the democratic will of the people must be respected and it is not for politicians to frustrate it.”
Demand vs supply
The RLA says that the mayor’s proposals come despite experts warning of the danger rent controls would cause at a time when the demand for private rented homes in the capital is outstripping supply. Research by Knight Frank has shown that last year in the capital there were 6.1 prospective tenants for every rental listing, up from 4.7 in 2018.
Expert reaction
Professor Kath Scanlon, a housing expert at the London School of Economics last year warned that the Mayor’s rent control proposals would result in landlords simply deciding that they were no longer going to rent their properties.
John Stewart, Policy Manager for the Residential Landlords Association, said, “Rent controls might appear attractive to those already renting but they would be a disaster for anyone looking for somewhere to rent.
“All they would achieve, as history and experience elsewhere tells us, is to drive landlords out of the market exacerbating an already serious shortage of homes available. Instead of putting out simplistic and superficially appealing proposals in attempt to win votes, the Mayor should focus on boosting the supply of available housing using the powers he already has.
Only then will he make any discernible impact on improving the affordability of housing across the capital.”
David Cox, Chief Executive, ARLA Propertymark, says: “Rent controls do not work; it hits hardest those its designed to help the most, and the Mayor of London has failed to learn the lessons of history.
“The last time rent controls existed in this country, the private rented sector (PRS) shrunk to the lowest levels ever recorded.
“At a time of demand for PRS homes massively outstripping supply, rent controls will cause the sector to shrink. In turn, this means professional landlords will only take the very best tenants, and the vulnerable and low-income people that rent controls are designed to help, will be forced into the hands of rogue and criminal operators, who may exploit them.”
Sadly Sadiq Khan doe not recall the terrible issues we had prior to 1988 with rent controlled property, it is a certain way to reduce the quality and stock of property available to the open market sector. Perhaps a history lesson would be in order of Mr Khan.
It seems a case of Groundhog day for the incumbent Mayor looking for re-election, and I am anti Rent Controls, because they are blunt instruments. On the face of it, ensuring that tenants in this case in London have a decreased rent burden may seem a good thing. But it causes, a ceiling on what a landlord can see as a return, this means good landlords exit the market, and fewer properties being available. This then leads to the most vulnerable in need of housing without accommodation.
To sort out generation rent, it is the housing policy, not the rental sector that needs reform, it may as in 2018 when Sadiq Khan brought this policy issue up be a popular vote winner for some. But if instigated, the sad reality is that many tenants may end up renting from ‘rogue landlords’ in inferior accommodation as maintenance will be cut back to balance rents and the cost of having the properties.