Property industry leaders have reacted with “alarm” to news that the Government is considering a rent freeze.

Reports suggested Chancellor Rachel Reeves is looking at a freeze within the private rented sector for a limited period as higher prices caused by the Iran war mean ministers are worried about cost of living pressures.

U-turn

The move would represent a major U-turn after repeated refusals by ministers to introduce any kind of rent control.

Now, Timothy Douglas, Head of Policy and Campaigns at Propertymark (pictured), says: “With the UK Government introducing huge regulatory change through the Renters’ Rights Act, which will ultimately mean less flexibility and higher costs for landlords and tenants, it is alarming to hear reports that the Chancellor is considering additional rent control measures – particularly when Housing Ministers have recently publicly denounced their role.

Singling out landlords to solve the cost of living is not the answer.”

“Evidence from across the UK, particularly in Scotland, shows rent controls restrict supply, deter investment, and reduce choice for tenants. Singling out landlords to solve the cost of living is not the answer,” he says.

“Rent controls risk distorting the market and undermining investment at a time when demand already far outstrips supply.”

Rents increase

Meanwhile, new research suggests many landlords are planning to raise rents in response to the Renters’ Rights Act, which comes into force this week.

Nearly two thirds – 61% – of landlords are planning to increase rents in the next 12 months, with 75% of them linking this to the introduction of the Act, according to Pegasus Insight.

Mark Long, Founder and MD at Pegasus Insight, says: “A rent freeze would represent unprecedented intervention in the private sector, thwart the business plans of the majority of landlords and potentially force some out of business.”

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