Private landlords would be banned from above-inflation rent rises if Labour wins power after the next general election, according to a new report.
The proposed draconian restrictions on buy-to-let property owners would aim to help ‘generation rent’ by restricting rent rises at the rate of inflation or growth in earnings.
It is reported that Labour would also seek to gain greater control on landlords and their ability to evict renters ‘on spurious grounds’. This could include ending a landlord’s automatic right to sell
The new proposals feature in a radical report, commissioned by the party, which calls on Labour to try to stabilise residential property prices.
The report, Land for the Many, calls for measures to be introduced to end what it referred to as the ‘buy-to-let frenzy’.
The Land for the Many report said: ‘Tenancies should be open-ended, and landlords should lose their power to evict a tenant who has not broken the terms of the tenancy agreement for the first three years of the tenancy agreement, and should have to provide grounds for eviction after that point.
‘There should be a cap on annual permissible rent increases, at no more than the rate of wage inflation or consumer price inflation (whichever is lower). Buy-to-let mortgages should be more firmly regulated and restricted.’
Many leading commentators agree that rent controls would ultimately destroy much needed investment in housing, which is clearly Labour’s aim.
The report said the restrictions on private rent were needed to ‘discourage the use of homes for speculation and rent extraction’ and to ‘reduce the amount of unearned windfall gains that are privately captured’.
Rent controls and an end to no-fault evictions are already party policy.
A spokesman for Labour said: “We welcome this independent report by a group of experts. As the report makes clear, Britain is a deeply unequal country and we need to start addressing that.
“Rent controls and tighter restrictions on the ability of landlords to evict renters on spurious grounds are essential to rebalance a rental market which often leaves tenants powerless. House price stabilisation is not Labour policy, but with home ownership at a 30-year low, it is clear there is a desperate need to tackle runaway house prices.”