I never thought I'd say this but...Ken Livingstone for PM!

[breadandbutterfly]

I've never liked Ken much on a personal level, BUT Ken will win the London election by a landslide, thanks to this policy:

www.guardian.co.uk/politics/2011/dec/13/ken-livingstone-tackle-london-rent

At last, at bloody last - a politician who recognises the massive importance to an increasing number of voters of affordable, reasonable quality housing for those forced to rent currently at the mercy of greedy landlords and unscrupulous lettings agencies.

How long till the rest of his party, let alone the others, catch up??

I've just read the article and these are my thoughts:

1. He's light on details. How is he going to establish a "living rent". And just what is it anyway? A living rent will differ massively to a single mum on minimum wage versus a DINKY on national average wages.

2. A non-profit letting agency sounds great in theory. In practice letting agents are hardly mandatory anyway. There are plenty of ways to find a privately rented house without having to pay an agency fee. People use them for convenience.

3. A non-profit letting agency doesn't necessarily mean no agency fees. I can't see how he's going to fund all the additional checks he's proposing without charging a fee to cover the administration costs.

The article doesn't mention rent controls at all and I doubt it would have any chance of working anyway.

At the end of the day it's supply & demand. The more people whom want to live in London, the more scarce and expensive properties will get. In a free market economy we should let this balance out or increase supply to meet demand. Artificial controls won't work and akin to trying make water flow uphill.

sincitylover, good luck. Uncontrolled rents and letting agent fees and the lack of security of tenure for private tenants in this country is disgraceful. As observed by other posters above, the decisions to abolish rent controls and introduce Assured Shorthold Tenancies were essentially political decisions and as such can be changed.

I could be wrong, but I suspect most of those parroting the mantra of 'supply and demand' and 'let the market sort it out' are not at risk of being served 2 months' notice to quit their home at any time after an initial 6-month tenancy, no reason required. Knowing that you can stay in your home on agreed terms for a reasonable period of time is really vital to having a decent quality of life, whether you are a family, a couple, a singleton or a commune, and it really angers me that someone's right to make a quick buck is considered more important than that.

Incidentally, I am a homeowner with a mortgage and I am under no illusions about the risks of repossession for those defaulting on mortgages (I advise both homeowners and tenants on these issues as part of my job). I also rented privately for ten years before buying. We had had to leave the SE for the Midlands in order to buy a home, but AST actually worked fine for us as young, mobile people. The properties DH and I rented over the years were of good quality, landlords/agents were ok and nobody tried to rip us off majorly. So, I have no axe to grind with landlords as such, but AST is not suitable for people looking for stability, esp those with families.

Here's a thought: maybe Ken thinks that the market should work for us

Salme but if you've only signed up to a 6 month tenancy then surely it's only fair that you can be given notice to move out? After all, as a tenant they can also quit.

It will be interesting to see how the cuts to LHA (local housing allowance) affect the private rented sector which in London is helping to prop up the market. I like the way people talk about "supply and demand" as though there have been no artificial supports to the market. In a real capitalist society, interest rates would have gone up and all those distressed BTL sellers would have to sell up. They are being protected by beneficial tax laws, low interest rates and a system which at the moment is grossly in favour of the "investor". It is precisely because the Bank of England is holding the base rate so artificially low so that all those distressed BTL property owners and owner occupiers who could not afford to pay their mortgage with higher rates that we have so many BTL sellers creaming it.

Anyway, I don't like Ken Livingstone at all on a personal capacity but I really do think that this policy sets a precedent as a major vote winner from the feudal rental class of the future.

Madhatter. I really doubt the BOE have given the BTL market any thought at all when setting interest rates. I suspect their decision is based more on ensuring there's an interest rate low enough for struggling mortgage holders and small businesses who are desperate for loans.

I think it's all part of the picture they look at. Maybe a larger than they'd admit given that most of them probably own more than 1 property.

Great posts, Salme and Madhatter.