The mayor of London has called for additional powers so he can introduce rent controls in the capital.
Sadiq Khan believes greater controls are needed to rebalance London’s private rented sector and ensure that it is “fit for purpose”.
Average monthly private rents in London have increased by 35% from £1,095 in 2011 to £1,473 in 2018, according to analysis by the Valuation Office Agency.
Private renters in the city spent 42% of their household income on rent, compared with 30% spent by those living elsewhere in England, according to the latest English Housing Survey.
“Londoners who rent privately need help with the high costs of renting,” said Khan.
But critics said his plans were a mistake and could have a negative long-term impact on the quality of housing in London’s PRS.
David Cox, chief executive, ARLA Propertymark, commented: “Rent controls do not work; it hits hardest those it’s 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 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.”
Also responding to the mayor of London’s proposals for reforming the PRS in London including calls for powers to implement rent controls, David Smith, the Residential Landlords Association’s policy director, said: “Rent controls are meaningless if Londoners can’t find a home to live in. Rent controls will lead to a drop in investment and increasing supply should be the Mayor’s priority.
“Localised rent controls would also have a huge impact in the surrounding areas. With demand continuing to outstrip supply, residents would have to move out of the city and rents would be pushed up further as demand increases in the commuter belt.
“Research from the Centre for Cities has found that rent controls divide renters into the privileged and outsides, with those already renting when the controls are introduced doing well but those hoping to move into the city or for more space losing out, damaging social mobility.
“London rent rises are already well below inflation increasing at just 0.9% in the year to June compared to CPI at 2%.
“We do welcome a number of the Mayor’s proposals for improving London’s rental sector including establishing a dedicated housing court and reforming the Section 8 process for landlords to regain possession of their property in legitimate circumstances.”