Over a third of private landlords would sell properties if rent controls were introduced in their area, according to a trade survey.
The data, from polling firm YouGov for the National Residential Landlords Association, shows 37 per cent would reduce the number of properties they let if an external agency like a council was given authority to set rents both during and between tenancies.
The NRLA says that such an exodus of landlords could have “a devastating impact on the supply of homes to let at a time of ever-increasing demand.”
The Scottish Parliament has recently announced that it’s so-called emergency rent controls are in fact here to stay as long as the Scottish National Party and Green alliance stay in power north of the border.
The current UK Government has been clear that it has no plans to introduce such measures and Labour’s previous shadow housing secretary dismissed rent controls – although the party’s London Mayor Sadiq Khan have been vocal in his calls for controls to be introduced in the capital.
The Labour Welsh Government has recently published a Green Paper calling for some form of rent controls to be “explored”.
The NRLA says landlords’ plans tended to differ slightly depending on the types of controls proposed.
These are broadly split into three categories:
– First generation rent controls – a ‘hard’ control in which rents are fixed and remain frozen;
– Second generation rent controls – rent increases are limited to a set percentage or pegged to inflation; or
– Third generation rent controls – these allow initial rents (such as new tenancies) to be freely set by landlords or with a very light restriction but limit rent increases within tenancies.
A statement from the NRLA, following the results of its survey, says that rent controls typically lead to a reduction in supply, fewer incentives for landlords to invest in property upgrades, and tenants staying longer and locking out younger renters.
The NRLA has long warned that they controlling or freezing rents could actually make the problem worse, with landlords – no longer able to make their business models stack up – more likely to leave the sector.
