The politics of rent control

A debate is taking place about whether we should control – or cap – private rents in London.

With the 2016 Mayoral Election edging closer, this debate is heating up. Anyone throwing their hat into the ring is taking a view.

Shelter are currently looking at the technical implications of capping or controlling rents. But we also need to understand the political implications of this very public debate.

It is little wonder that renting dominates our capital’s discourse. The annual English Housing Survey (EHS) was released this week; its perspective on London is staggering. Over two and a half million Londoners now rent their home from a private landlord. This equates to 30% of all households in London – more than double the 13% who rented privately just ten years ago.

At the same time, renters are becoming more and more anxious about their future. Affordability is at the heart of this anxiety. Across all tenures, ordinary Londoners are finding themselves priced out:

A pretty dismal picture.

On the surface, rent control appears to be a ‘gold dust’ policy that will tackle many of these problems. Aspiring Mayoral candidates are searching for immediate, demonstrable solutions that will appeal to anxious renters. Capping or controlling private rents feels doable: its effect will be instant and it won’t cost public money.

But there is a danger that the political expediency of rent control is diverting attention from the root cause of London’s crippling affordability crisis: a lack of supply.

The only way we can reverse these dismal trends is to dramatically increase the number of genuinely affordable homes. London should be building around 50,000 homes per year. Around half of these homes should be affordable – with a particular focus on social rent homes.

There is a desperate need for low rent homes – and it will take serious political courage to not only acknowledge this, but to do something about it. London’s next Mayor needs to be:

  • Up front about the need to increase public and private investment in affordable and social housing
  • Fighting for the devolved powers necessary to get land into the hands of those who want to build
  • Ensuring that new supply meets the needs of Londoners on low and middle incomes

The task ahead is daunting, but it is also achievable. With strong leadership, the Mayor can reverse London’s housing crisis.

Of course, presenting a stark choice between rent control and supply is disingenuous. We do need to stabilise private rents – and we should have a public debate about what the best mechanism would be.  But if we allow rent control to dominate the affordability debate, we risk letting politicians off the hook. They should be talking about the big, bold measures that are needed to kick start supply – and they should be held to account on their delivery of social and affordable homes.