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Another opponent of rent controls speak out

Opposition continues to build to the prospect of rent controls in part of the UK, with the latest voice citing the failure of such measures in the Republic of Ireland.

David Alexander - head of Lomond Group-owned company DJ Alexander Ltd, based in Scotland - has analysed research for Ireland’s Institute of Professional Auctioneers & Valuers and the Irish Property Owners’ Association.

The research, which covers many of the changes which have occurred and are proposed for the private rented sector in Scotland and the rest of the UK, found that constantly changing regulations and more punitive tax regimes led to more individual landlords leaving the market and being replaced by institutional landlords and that rents, rather then reducing, actually rose as a result of the new policies.

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The report found that there was evidence that Ireland’s Rent Pressure Zones created a two-tier rental market, cutting both accommodation quality and quantity. 

It found that the legislative and financial changes resulted in individual and small-scale landlords leaving the market and being replaced by institutional landlords charging higher rents. 

 

David Alexander says: “It is fascinating that this new Irish analysis and [an earlier] review have both come to the same conclusion that rent controls don’t benefit tenants, landlords, or homeowners. Tenants suffer because they limit appropriate supply and so rents, rather than falling as a result of the policy, actually rise in many cases.”

“Landlords and individual investors suffer as they opt out of the private rented sector leaving the space free for institutional investors to come in with higher rents resulting in more expensive homes for tenants. Homeowners in areas with rent controls also experience substantial financial losses as these areas are devalued in the marketplace resulting in lower property values.

“This is another survey telling us what most in the UK sector have been saying for some time: rent controls don’t work. They damage the private rented sector in the long term which impacts on tenants, landlords, and investors, as well as affecting the value of individual homeowners in rent restricted areas.”

You can see a detailed report on the Irish research here.

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    Will the pro-tenant organisations take heed? No - why let the truth get in the way of your narrative?

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    Tricia

    These do gooder rabble rousers are not pro tenant and are as much anti tenant as they are anti landlord. Unfortunately most decent tenants don't realise how much harm is being done to them by that lot!

     
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    When did facts have anything to do with it?

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    As John says, facts come secondary to political goal’s, aka the Iraq War ! I think the pressure will be unrelenting and in the end it will come in… after s21 removal….. EPC C introduction and a whole host of other anti landlord legislation. The corporate boys will be lapping this up.

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    It’s a fore gone conclusion we all know Institutions charges more rent and are favoured by Government, so creating more expensive renting and the loss of dedicated landlords devoting millions of hours of their time to make sure everything is looked after, loosing the personal touch being replaced by Contract workers who won’t be too bothered just mark the report sheet then a big admin who ha, no Section 24 for them that says it all.

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    I am a landlord with a foot in each jurisdiction. Ireland is now a basket case with all stick and no carrot. the only respite is stamp duty at 1%. Other than that we have suffered interest allowance restricted to 75% which only changed last year. It attempts to do what section 24 does. Landlords have run for the hills. Rent Pressure Zones which effectively are rent freezes. Anecdotally, registrar doctors couch surfing. Institutional investors free of CGT here, leaving apartments empty to maintain high rents rather than accepting a reduction. We have had a Panorama equivalent (RTE investigates) which has proven the Institutional allegations. Irish Landlords pay Property Tax whereas UK tenants pay council tax. S21 removal will definitely be food for thought for a lot of landlords.
    That is pretty much what we have in Ireland now.

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    Ken, a snapshot of what could come 🤔

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    "Could" or "will"?

    I fear the latter is more likely!

     
  • George Dawes

    All the luxury flats round my way , what about affordable housing for key workers

    It’s obvious their long term plan is replace them with robots, sounds crazy

    Then again the people in charge are crazy , utterly mad

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