The case for rent controls in England
Where we live should help us, not hurt us, but the pain of being a private renter in the UK is increasingly plain to see. By almost any metric, it is the worst place to live. Most of us are renting privately by necessity rather than choice, but what we are forced to endure is getting worse.
We now number over 12 million in England and make up about one in five households. Never before have so many people lived in so much insecurity. We can be evicted at the drop of a hat, have no protections from unfair rent increases and suffer from a fundamental power imbalance when asking our landlords to make repairs or improvements to our homes. One in 21 people in the UK is now a landlord, and this pursuit of profit leaves those of us trapped in renting continually on the back foot.
The spiralling cost of rent has a stranglehold on our wallets as tenants. At the height of the cost of living crisis Generation Rent found that renters’ no.1 concern was paying the rent, with tenants in London now paying 41 per cent of their income on rent. This tramples over our long term dreams as saving for a mortgage deposit has become impossible for so many, even if the monthly payments would be less than what we’re already giving our landlord each month. This makes renting right now unbearable, while renting into the future is unavoidable.
Tackling this is vital for the new government. Building new homes is key, something which most people and organisations with skin in the game agree on. But it won’t be the silver bullet that brings rents back down to affordable levels. Action must be taken now. The Labour Party manifesto/the manifesto upon which the new government stood commits to “empower(ing) renters to challenge unreasonable rent increases”, which is a welcome step, but so far this looks like little more than tweaks to the process that won’t prevent hikes that force tenants to move.
There is a simple and fair solution which leaves everyone knowing where they stand. At least in the initial phase, rent rises should limited to the lowest of inflation and local wage growth.
Amazingly, that sentence will be considered controversial and radical by some. In fact, in March proposals by Generation Rent and others were dismissed by a London Assembly member as “socialist, populist nonsense” for daring to suggest that the cost of keeping a roof over your head should not be allowed to be hiked beyond reasonable limits at a landlord’s whim.
The truth is that the current system is the one that is divorced from reality. England is now lagging behind many of its neighbours who have taken common sense measures to wrestle back control from a market that has profited from misery and insecurity. Such a system has been done here before (for the majority of the twentieth century), it is being done within the UK now in Scotland, so there’s no reason it common sense can’t return in England.
15 of our nearest neighbours – European and Anglophone countries – limit how landlords can increase rent. In none of those places has the sky fallen in. In fact, the Social Market Foundation’s excellent report on the subject found that “controls do not hold back the growth of the sector.”
This undoes the principal argument against reform: that landlords would sell up and move on if any progressive change were implemented. What exactly are these landlords threatening to flee from? Landlords, especially those wishing to be seen as ‘housing providers’ with a “focus on the experience and benefits that it can bring to consumers” rather than being solely profit-driven, must understand that this is not a business like any other.
Inhibiting those who wish to drive people from their homes and communities in search of more passive income should not be controversial. There is nothing about a reasonable, index-based ceiling on increases – and increases there will continue to be – that should send shivers down any fair-minded spines.
Renters are suffering, have suffered for a long time and on the current trajectory will continue to suffer long into the future. Introducing a cap on rent increases is a common sense tool to curb the worst excesses of landlord profiteering and protect people from poverty and homelessness.
We need homes that help rather than hurt us. The next/new government must listen to common sense and give England’s renters the breathing space we so desperately need.
Conor O'Shea is a Policy and Public Affairs Manager at Generation Rent.
