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A Labour Mayor and a former Labour baroness have teamed up to call for rent freezes in London, claiming they slash landlords’ income by an average £3,000 a year.
London Mayor Sadiq Khan has made the claim in his latest repeated call on government to give him the powers to freeze private rents for two years.
His analysis - based on estate agent Savills forecasts - shows that freezing private rents for two years would take £2,988 from landlords, with £881 in the first year and £2107.60 in the second year.
“Private renters make up nearly a third of everyone living in the capital and they are set to be hit by a devastating combination of price and bill rises. Too often the needs of private renters are ignored by both landlords and the government” says Khan.
“Rising fuel and energy costs – which will hit renters in energy inefficient homes the hardest – are already causing anxiety and stress, with a big rise in the energy price cap due next month. That’s why today I’m calling on ministers to give me the powers to stop rents rising in the capital, and help me to give people a chance to get back on their feet after the pandemic” he continues.
Generation Rent director Baroness Alicia Kennedy of Cradley was deputy general secretary of the Labour Party from 2006 to 2011 and was a Labour member of the House of Lords until taking up her Generation Rent post in 2020.
Now she says in support of Khan: “With the cost of living spiralling out of control, the Mayor is right that renters need more protections from unaffordable rent hikes.
“It's too easy for landlords to raise rent on tenants and it’s too difficult for renters to negotiate, or challenge a rent increase at a tribunal. Without intervention landlords can effectively evict their tenants by making their home too expensive for them to afford. The mayor needs powers to intervene for London's millions of renters.”
The statement from the two pro-rent freeze politicians state that Khan himself “has consistently been on the side of London's private renters, successfully campaigning for the government to end unjust letting fees, suspend evictions during the pandemic and put in a package of grants to help keep renters in their homes.”
Although various organisations have claimed credit for persuading the Conservatives to commit to the end of Section 21 evictions in that party’s 2019 election manifesto, Khan now says he was the key influencer - his statement says he has “secured a commitment that ministers will end 'no-fault' evictions for good.”
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How about a freeze of their ridiculous wages too ?
I think the Mayor has too much power is out of control and don’t seem to have any Boss, who is doing outrageous things. He shouldn’t have had the power to sack Commander Cressida Dick head of Metropolitan Police and she should be reinstated, its a bit like giving a Landlord a big fine for something one of his Tenants done as if he could have known what an individual was thinking or might do it’s ridiculous. Sadiq Khan is already fleeting us in so many ways with levy’s of every kind, he is also taking unjustifiable amount of Council Tax from all London Residents / house holders weather private owners or landlords of £363.00 for a Band ‘D’ property but the greedy parasite is adding another £30+ this year making his take of our Council Tax to an average of £400.00 per year (evening standard). So out of our £1800+ c/tax he takes £400.00 then has the cheek to talk about the cost of renting.
So how is reducing landlords income by £3000 going to help them pay their increased heating costs\?
LLs can only put up rents when the market will sustain that increase. The anti LL policies of recent times, leading to an exodus of private LLs, have created a perfect storm of supply & demand that is pushing rents ever higher.
Cutting LLs profits further by introducing rent caps & freezes at a time when their costs are also rising will force more LLs out and so put further pressure on the PRS leading to further rent rises.
Do they not understand even basic economics?
It not Sadiq khan’s remit and none of his business he wants to poke his nose in everywhere. So he is on about building 116’000. affordable homes in London which is very big of him with tax payers money, not withstanding the fact that many Developers who built affordable homes as part of the Development then on completion give the Council’s a few quid to have them reclassified, end result no affordable homes in the Developments, should that not be put right before using tax payers money to replace them.
I fully agree that landlords should not be able to put up rents whenever they feel like it. Its very unfair on tenants. it's very distressing for tenants to having to second guess landlords if they will increas, and if they do, will they be able to afford it, I haven't increased my rents in 6 years, I find that the open market rent does not justify any increase to make it cost eefective and the little extra rent I would get it would hardlly cover all my extra work, redecoration agents , voids, not to start to think about my own time spent.
In Cyrus, landlords are only allowed to increase rents once every two years and then only by a % of the rent. there has also been a rent freeze for the last 4 or so years.
I believe the unscrupulous landlords that increase rents methodically at least once very two years just do this and they know tenants would rather pay up then have all the hassle to start to looking and moveing for new accomodation.
The agency I use of not changing the rent for tenancy renewals until there are new tenants. During the pandemic, I dropped the rent by 6%.
I haven’t put my rents up for 10 years as the tenants have been in for 10 years and they are good tenants. But I have had to put them up this year as
HIGHER EPC = HIGHER RENT.
Rent caps will add fuel to the flames. No one asked to freeze rents when rents shot down during the pandemic and there were many empty properties. No one is even asking why rents are going up. If they did and then listened and understood the answer then they would know caps (of any kind - look at the energy crisis now) ) don't work. The reality is that government has increased taxes (and red tape) so much on Landlords that they are leaving the market. There is no more money to be made - so why risk hard earned capital in a sector that has become highly politicised and where landlords are demonised. Look up Section 24, Finance Act 2015 to understand why supply is reducing. Tax rates on profits are now 100%+ . They killed the golden goose and hence...supply. .
In my opinion the government have FULED rental increases.
Higher EPC rating = higher rent.
Someone has to pay for all the upgrades.
No decent Landlord will increase the rent with a good tenant within 2 years. I don’t know where they get these figures from but it’s a typical Labour ploy.
I agree nobody wants to loose a good tenant
It seems his sole intention is not to help tenants but to punish landlords by taking £3,000 a year from them.
Khan is like a clip from Back To The Future which in this case will result in rent controls as per the 1970s but properties to let as rare as rocking horse manure, resulting in homeless figures soaring.
in the 60 70 up to 88 the law was completelly different , Landlords could not get a tenant out even when contract had lappsed, the tennt could even pass the tenancy rights over to their children , thas why you had sitting tenants and no one wanted to become a landlord , in 1988 the law completlly, we then all became landlords.
To answer Tricia’s last question…. Not a chance they can even grasp the economic basics.
This drip, drip will kill off the PRS, with the fatal blow being the introduction of EPC C. I have set in motion my evict/sell off plans, I expect others will follow
They understand the economics perfectly fine. They just don't care. There is enough anti landlord narrative to last a lifetime, and whatever happens, LL's will take the blame.
I think the problem is the public do not understand the economics. The public think all landlords are rich because they own property, so when the politicians attack the landlords the public think that's fine and the politicians win votes.
I’m not a London landlord so doesn’t affect me but FFS - many investors won’t touch London now because the rent barely covers the mortgage and they get taxed on the full rental income.
The rental market has a natural churn and so more measure like these means more landlords selling up or moving into other areas, and less landlords coming in to replace them. Net effect is less available properties for rent. Landlords often put their prices up in between tenancies, and because of the shortage, at that point rents will go up significantly, any renters looking to move or enter the market will be negatively affected by these hair brained policies.
Will The mayor take responsibility for the negative consequences of his policies? No, never has, never will.
I think London have some of the worse returns in the Country because of the high purchase price, just add endless costs & Regulation’s for years getting worse all the time which haven’t arrived fully or applied as severe to many other Towns & Cities. High Turnover and income is not profit as anyone knows just add tax on Bank interest loan repayments / S.24 for good measure, travel restrictions ULEZ £12.50 per day 7 days a week, Congestion charge if you hit that zone £15. per day, extraordinary parking charges very often £16. pd more for Diesels, that can be a few hundred a week and you haven’t even started work yet, you’ll be very luck if you also don’t get a another penalty during the day as well for speeding doing more than 20 mph or stop to buy something cameras everywhere. if they haven’t already put stupid double lines on blank roads for the hell of it, huge permit & skip costs if allowed at all, never mind haven’t you got a bicycle to bring all your gear, it’s easy to know those clueless rule makers never had to earn a living. Oh excuse me sometimes they work for home very handy.
Why are you still down there in the smoke Michael ? sell up and move up here to Norfolk with our big skies , fresh air and sensibly priced houses with much better yields, no need to touch anything leasehold here, all freehold, what's not to like ?
This mayor is the most pointless and useless mayor i have seen in 20 years i have been in london.
He bankrupted tlf and blame other, he doesnt know how to manage a business himself.
He keeps pointling blame at everyone and everything without understanding himself..
Besides rent freezes why on earth is trying to expand road charges!!! And what the heck is doing with those money!
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