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Rent controls would take us back to evil Rachman days – warning
Rents in the private sector have been falling in real terms – and private landlords are fiercely opposed to any form of rent controls, according to a new study.
The Cambridge research found that between 2006 and 2013 private sector rents increased by less than inflation and average wage rises both in London and in England as a whole.
Drawing on a survey of landlords in London, the report also found that 45% said they would sell all of their housing stock and leave the market altogether if they were legally required to cut rents.
The research was commissioned by the Greater London Assembly’s Housing Committee and carried out by the Cambridge Centre for Housing and Planning Research.
David Smith, policy director for the Residential Landlords Association, said: “The report bursts the myth, peddled by some, that rents are spiralling out of control.
“Whilst the RLA accepts that there are some areas, especially in London, where rents are high, this is quite simply as a result of a lack of supply.
“This report reminds us of the dangers of rent controls which would in fact reduce supply, thereby increasing rents. Rent controls would also severely reduce standards in rented housing as investment dries up.
“It would take us back to the bad old days of Rachman landlords.”
But Jonathan Monjack, CEO of landlords’ collective The Happy Tenant Company, said landlords might have to accept some form of rent controls.
He said: “While it’s understandable they do not want to see their income reduced, it doesn’t necessarily mean they will lose money should rent caps or rent controls come into force.
“The market needs to be overhauled when it comes to letting agent fees, hidden commissions and contractor costs which continue to mount up.
“Landlords could bring an equilibrium by reducing or capping rents while maintaining income by controlling the fees and costs they fork out for property management.”
http://www.propertyindustryeye.com/rent-controls-would-take-us-back-to-evil-rachman-days-warning/
