A prominent property website, which monitors the lettings market, suggests that rent controls would drive a proportion of rental stock to short let platforms such as Airbnb.
That’s the warning from property platform Home, which speaks of “an unprecedented decline in available rental stock on the market” from around 120,000 properties available for renting in February 2019 to scarcely 50,000 now, February 2022.
Home says this represents a massive 58 per cent fall in three years.
It suggests that Greater London is now the main driver of rental inflation overall, as tenants return to the capital following the easing in Covid restrictions.
And it believes that rental affordability is looking stretched in all regions, including London, but due to supply constraints here are unlikely to be significant rent falls this year.
More likely is a period of consolidation at these higher levels, it suggests.
Home says: “What is immediately apparent is that, while there is so little choice for prospective tenants, it is unlikely that rents will fall. Letting agents are overwhelmed with demand and renters have no real bargaining room in the majority of lets.
“Setting rent controls would only make the situation worse as landlords would likely exit or switch to Airbnb-style letting.
“In order to improve the choice for tenants and keep rents in check, we clearly need more competition and that means more properties available for rent. To achieve that, the government must stop disincentivising buy to let through taxation and further regulation. However, the new Levelling Up agenda seems to be offering precisely the opposite.”
Politicians across the UK appear to be growing more vocal in their support for rent controls.
The Welsh nationalist party Plaid Cymru has put down a motion in a bid to get the Welsh Government to implement rent controls across that country.
The idea is already enshrined in a policy agreement between Welsh Labour and Plaid Cymru.
Meanwhile the mayor of Labour-controlled Bristol council is teaming up with local activists to look at how to introduce rent controls in the city.
At a so-called ‘summit’ on March 2, Mayor Marvin Rees will set out his goals to have more powers over landlords.
He says: “I made a manifesto commitment to campaign for the power to introduce rent controls to make Bristol an affordable living city, and we are calling on government to give us the power to regulate rents.
“Piloting rent control in Bristol will allow us to take a step towards tackling our local renting crisis and will help us develop learnings and that can inform wider positive change for the rest of the city.”
And in London mayor Sadiq Khan has repeated his calls for controls.
In a statement last week he said: “I want to see tougher penalties for rogue operators and this action can only come from the government. Poor housing conditions and exploitative rents have an awful impact on both the physical and mental health of tenants and these actions need to have consequences.”
