Diane Abbott, MP for Hackney, is calling upon the government to introduce rent controls. She says the private rental market is in serious need of reform because the high cost of renting in the capital has distorted living costs and many people have to hand over up to 50% of their monthly earnings to a landlord.
“A major international city without measures to stabilise rent runs the risk of rents spiralling out of people’s reach. It is no coincidence that New York, Paris and Berlin all have some version of rent control. For too long politicians have rejected any form of rent controls but it is time to look at the issue again.”
It is a contentious viewpoint, and to date not one that has been very popular with the politicians, but tenants’ pressure group, Generation Rent, is very much in agreement.
“Rent Control is one of those strange policies that’s popular with the public but beyond the pale for much of the political establishment. This is because it devalues the price of land, and wealthy people have a lot of money tied up in land at the moment,” says Alexander from Generation Rent.
Alan Ward from the Residential Landlords Association thinks the introduction of rent controls would be extremely “short-sighted”. Chris Walker from the Head of Housing, Planning and Urban Policy at Policy Exchange, doesn’t agree either:
“Not only do rent controls reduce future returns for landlords – lower returns imply lower investment – but they send entirely the wrong signal to future investors creating more uncertainty, not less…”
