Labour’s proposals to introduce rent controls in London risks reducing the number of private homes available for rent, as landlords look to exit the private rented sector.
Shadiq Khan is being urged to forget about rent controls and instead focus on increasing the supply of rental accommodation in the capital by enticing more people to invest in the PRS.
The Mayor of London has called on the government to hand him extra powers so he can cap rents in the city in order to rebalance London's private rented sector and make it, in his view, "fit for purpose".
But the Residential Landlords Association and the National Landlords Association are warning that plans for rent controls, which are at the heart of Khan's re-election bid, would be a disaster for aspiring tenants.
The Centre for Cities has warned that strict rent control “would close off London to new residents” and the Resolution Foundation commented that holding down the true market price of private housing via rent controls rather than increasing housing supply is unlikely to succeed.
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 RLA, and Chris Norris, policy director for the NLA, 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.”
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I really hope this idiots proposals get accepted.
1) Tenants fighting amongst themselves to get a property. Throwing cash at me in brown envelopes to get the tenancy which of course I will be declaring on my tax return
2) Landlords switching to even more short let’s Air BnB
3) Sadiqs passive aggressive stance (on everything it seems - blame the government on everything he refuses to do) as well as this ridiculous populist rent control stance of his gets him voted out
Why can’t the London public wake up and see (pardon the pun) how this will make the housing situation even worse by advocating this
khant is totally out of his depth but mozzie postal votes--vote early and often--will see him in gla again
All the current incumbent Labour Party Mayor is espousing as far as rent controls are concerned is Labour Party policy.
It should be no surprise therefore that wherever the Labour Party holds sway they will try their damndest to impose such bonkers Labour Party policies on the local electorate.
Amazing therefore that so many Councils turned Labour.
They will do whatever it takes to introduce SOCIALISM through the back door.
Landlords should hardly be surprised that any Labour Party political entity will attempt by whatever means to put LL out of business.
The Labour Party is ideologically opposed to the mere concept of the private LL.
Their policies therefore as far as the PRS is concerned is that they would prefer it didn't exist!!!
This is why they had their even more ludicrous expropriation policy of forcing LL to sell their properties to tenants at knockdown prices paid for by loss of the LL equity however that was achieved.
Make no mistake rent controls are Labour Party policy.
Had they attained power it would be a nationally imposed policy.
The threat of expropriation and rent controls is just another reason of so many that I am getting out of being an AST LL.
If there was just the threat of rent controls that would be bad enough although of course all that would happen as has been intimated that a black market would develop with cash being handed over to LL to achieve a tenancy.
This would immediately have a tax hit for Govt as no LL would declare more the controlled rent amount.
No tenant could ever prove cash in excess of the controlled rent was being paid to the LL.
Of course many LL would need to become self-managing as no LA could legally receive more than the controlled rent amounts.
That would bankrupt many LA!
There would also be an issue for property values.
A BTL lender could only base a mortgage offer on the controlled rent amount even though they would know the true black market rate would be substantially higher.
LL who are buying would be required to put down a massively higher deposits as a Lender could only base a mortgage offer on the supposed controlled rent amount.
That would cause a massive decline in LL being able to buy.
It would also affect those with existing mortgages which are supported by existing rents.
If theses are forced to be reduced then technically the LL won't have sufficient rental income to pay the mortgage.
This would result in breaching PRA and LTV requirements etc.
LL would be bankrupted.
There would be a property slump probably leading to a UK wide depression.
The Labour Party is a serious existential threat to the UK economy.
This threat will revisit the UK at the next GE.
I simply cannot risk being an AST LL with the threat of a possible Labour Govt.
Forget the days of the fairly benign Blair Labour Govts
We now have the fully paid up looneys in charge of the Labour Party.
As such they are a continuing threat to any LL.
LL need to consider do they wish to gamble with their business that a bonkers Labour Party won't attain power next GE.
Personally I'm no gambler which is why I intend over the next 4 years to ensure that my business and its assets are put beyond the reach of an expropriating Labour Party.
LL have at least the cushion of a fairly benign Tory Govt for the next few years to get their house in order if the threat of a Labour Party in power comes to pass.
London is now a self serving immigrant town who vote Labour.
Hopefully the Tory Govt will be able to restrain the London Mayoralty from imposing its bonkers Communist policies on London LL.
If I was a London LL I would be selling up and investing outside London.
Rent control threats are a threat too far!
john prescott was paying £40 a week for property in clapham old town--market rent was at least £400 a week--jp did not live there--his useless son did
bob crow got rid of prescotts
also dolphin house
also frank dobson and his mansion flat--fortunately dobson is dead--one less trougher
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