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Posted on November 3rd 2015 by admin-movingin

Labour MP and veteran agency founder clash over rent controls

Labour MP David Lammy and Kevin Hollinrake, the founder of Hunters – and now a Conservative MP – have clashed online over the issue of rent controls.

On the Politics Home website Lammy, MP for Tottenham, says the UK rental market is now “out of control” with average rents 10.5 per cent higher than a year ago, and some parts of London having rents 40 per cent more than in 2013. 

“We should be setting a sensible cap on the amount by which rents can be raised within a certain period. This is the mechanism that cities in countries including Germany, France and the USA all successfully employ to protect renters from the worst effects of a spiralling rental market” writes Lammy. 

“This form of modern rent control nods to the market while supporting those in the most precarious situations. Berlin, for example, has recently moved to prohibit rent increases that are more than 10 per cent above the local average – but, in a move designed to encourage investment in property development, the cap doesn’t apply to new-build homes” he says.

Lammy says the fact that German Chancellor Angela Merkel and the former mayor of New York Michael Bloomberg both support rent controls in their respective locations proves that “the introduction of rent controls is not simply a socialist pipedream but a sensible and practical measure that can and should have support from across the political spectrum.”

On the same website, Hollinrake – MP for Thirsk and Malton – insists that the rental sector has changed beyond recognition in recent decades and is no longer the poor relation of the sales market. 

“Lowering rents for those in need would lift millions of people out of poverty – a golden opportunity to deliver social justice” says Hollinrake, but he says it is the social rented sector and not the privately-owned properties that should achieve that. 

“Controls would hurt tenants on lower incomes, disincentivise landlords from making improvements, and deter developers and investors from building and buying new properties to rent” he writes, adding that controls would hit the poorest tenants more than any others.

“Here’s why – those on higher incomes benefit because they stay in a property with a rent below market levels and have money to improve it. Tenants on lower incomes cannot afford to improve their home so have to live in a property progressively deteriorating, and which they cannot afford to leave. Developers and investors will not build or buy new properties if they are faced with the prospect of ever diminishing returns” he says.