Rachel Reeves considering freeze of private rent?

[Locutus2000]

It's being widely reported suggesting the Guardians original article is correct.

Rachel Reeves is considering a one-year freeze on private rents to help tenants with the cost of living amongst the fallout from the Iran war.

I find the concept of rent control appealing but there's evidence they produce mixed results.

What does MN think? YABU - rent controls bad, YANBU - rent controls good

Well if there is some kind of mortgage interest rate control going hand in hand then maybe I'd agree!

My instinct here is that trying to control the market like this can have adverse affects - I mean I can see new rentals inflating hugely to offset long term rent freezes being one of them.

If she really wanted to get cost of living under control, fix income tax thresholds and sack off all these green levies.

Rent freezes distort the housing market. They reduce landlords’ income while their costs - mortgages, insurance, maintenance and repairs - keep rising. As a result:

• Many landlords sell up or exit the sector, shrinking the supply of rental homes.

• Fewer people invest in new rental properties, worsening the housing shortage.

• Landlords have less incentive (and less money) to maintain or improve properties, so housing quality declines over time.

• In the uncontrolled parts of the market (e.g. new tenancies), rents often end up higher because of reduced supply.

We’ve seen this pattern in places like Berlin, Scotland and various US cities - short-term relief for some sitting tenants, but fewer homes available overall and higher rents for those trying to get on the ladder or move.

There are only two solutions to high rents in economically weak times that don't make the economy worse - stop the rapid population rise and redress what's happened with immigration over the last few years, and / or build more houses.

Well, no that's not OK! I haven't read the article but assume this is rent across the board?. So again, that's great for some people, but no help for working people with mortgages - like me who's about to come off the historical low fixed rate!
And what about if it's a small landlord who's mortgage is about to go up, if the rent is frozen that will push the financial burden onto the landlord.

And.... if you lose your job you can claim benefits you can get help with your rent, no ones helping me pay my mortgage if I'm made redundant though.

I thought we lived in a free market economy.

No it's not OK for the Government to tell anyone how much they can charge for something.

It sets a dangerous precedence for overstepping control.

I'd be interested to understand more how this has worked in other counties but my initial thought it that with lots of LLs exiting the market anyway, surely this is going to ultimately exacerbate the problem?

Surely the only reliable way to reduse housing costs is to increase supply (more house building) or decrease demand (fewer people)?

There is precedent though, in energy bills for example, or rail fares (I am not saying it's a good idea BTW, just pointing out the example)

I don’t think it’s going to happen but the article talks about a one year freeze which isn’t the same as rent control and i can’t see why it would impact landlords who should really only raise rents annually anyway. They skip a year, not the end of the world.

i don’t think rent control works unless you heavily regulate the sector

I make about £200 a month on my house.
When my deal comes to an end , I could end up in a deficit after tax etc. some months I don’t make anything. This year for example I’ve had 4 months without rent. Replaced things and repairs. 1 increase in 4 years.
So I’m not a career landlord , just me who moved in with a partner and kept my house for security for the future.

I've asked MNHQ to edit the misspelling of Rachel in the title.

It's private rents which would be frozen, it doesn't affect social housing.

Why not a freeze on food prices? That would genuinely help everybody.
Oh wait, I bet supermarkets wouldn’t accept that, easier to impose it to individual landlords who can’t push back.

Benefits help pay private rents, I think that was the point the poster was making

Food isn’t very expensive compared to rent though.

I am not a fan of landlords but I think this would be silly and unworkable.

She should instead look at measures to reduce energy prices and stop utility companies general profiteering as well as freezing public transport fares increases and supporting businesses to help improve the employment market.

Some landlords might be coming off low mortgage rates this year and having to increase the rent as a result and a freeze would just mean them chosing to sell instead which helps no one...

Many landlords have already chosen to sell because of recent tenants legislation and that would just accelerate the process.

It’s just student politics. No real understanding of the effects.

In principle, no, but given the way rents have soared in the area where we have our sole rental, I am inclined to agree.

Just yesterday dh emailed me a new rental, close to and much the same as ours - except that ours is IMO nicer. A 2 bed maisonette in SW17 - for £700 pcm more than ours! Admittedly we have always kept ours lower than usual for the type and area - well worth it for retaining very good tenants - for us anyway - but this really is taking the greedy piss.

Good grief, she's absolutely clueless. I'm not a landlord so no skin in the game, but Labour have already massively damaged the rental market with the latest law/regulation changes and private landlords are selling in the droves. She's going to absolutely kill the private rental market.

As others have said, they need to be concentrating on house building and controlling immigration. They also need to be tackling the huge number of unoccupied buildings, conversion of empty/derelict retail/industrial to housing, and encouraging downsizing for people living in homes too big for them.

If that coincides with their mortgage going up due to the end of a fixed rate deal it could be a big difference

Very few people pay anywhere near as much for their food as they do for their rent.

They said they assumed the rise was 'across the board' which I interpreted as meaning all rents.

A lot of benefits are used to pay private rents so I suppose it saves the government some money indirectly.

Most things she touches turn to shit, I can see this backfiring massively, with landlords preemptively raising rents.

This is not unreasonable given this government's track record. We know they don't mind U-turning.

Labour are panicking about the threat from the Green Party, so floating the idea of rent control......but half-arsing it, as always.

So rather than increase the rent by CPI/ RPI or a local inflator you’re suggesting the landlord would’ve passed the increase in their monthly mortgage payment directly onto the tenant?

this is why underfunded private landlords shouldn’t exist, frankly. Turn all the stock over to housing association and other corporate landlords and get some professionalism and financing behind it

I think this will just mean more LLs kick their tenants out and sell up. If your mortgage payments go up and you can't charge more rent on your property, are you expected to just absorb that cost? Fuck that! I'd sell up. This government is so fucking clueless and inept. Everything they do compounds the damage that they are doing to the British people and the British economy. Their renters' rights bill has already led to thousands of people being evicted from their homes and this won't help.