Nov

Minister takes rent controls off the table…

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Rent Controls:

In a pre-elction
boost for buy-to-let landlords, housing secretary, Robert Jenrick has
indicated that he is not in favour of rent controls in the private
rented sector (PRS).

This comes as
officials have been discussing ending section 21 possession orders,
the two-month eviction notice that landlords can use to end a tenancy
without having to give a reason – the so called “no-fault”
eviction process.

Previous,
restrictions on rent increases in the PRS had been mooted as part of
the Government consultation on section 21 by a Housing, Communities
and Local Government select committee.

Mr Jenrick had said:

“I am not in
favour of rent controls. As I said, that has proven to be very
negative for both landlords and tenants in the past, and I do not
want to see any move in that direction.”

It was though
previously that rent controls would have to be part of any section 21
reforms as there was concern in some quarters that landlords would
simply use “rent hikes” to remove tenants if they lost their
‘no-fault eviction’ process.

The consultation
rubric had stated that:

“The Government is
clear that there must not be any mechanism for landlords to force a
tenant to leave the property by including clauses in fixed-term
tenancy agreements which hike up the rent by excessive or
unreasonable amounts just before the agreement is due to expire.”

However, rent
controls have received strong backing from London mayor Sadiq Khan,
who will make the issue part of his 2020 Mayoral re-election
campaign, similar to the policy outlined in the Labour’s Party’s
2017 election manifesto.

Rent controls or
some variant of them (rent stabilisation) have been introduced in
Scotland, the Irish Republic and in some countries in Europe. But
England has not seen rent control legislation since the Rent Acts,
pre 1989 when Margaret Thatcher’s government deregulated the
industry setting loose an unprecedented grow spurt in renting.

David Smith, of the
Residential Landlords Association trade body, told The Daily
Telegraph:

“We welcome the housing secretary’s recognition that rent controls are ultimately bad for tenants. All the evidence from around the world where they have been introduced shows that they reduce supply and drive up cost, making the situation for tenants worse.”

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The government mulls the return of rent controls

The Problems with Price Ceilings: Rent Controls – a YouTube Video

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