Investing

Buy-to-let investors condemn Corbyn’s rent-cap proposal as a ‘disaster for tenants’

Jeremy Corbyn’s proposed rent controls would “spell disaster for tenants”, landlords have warned, amid mounting concern from lenders and charities about Labour’s planned intervention in the housing market.

Even Shelter, the housing charity which until now has been sympathetic toward Labour’s housing policies, warned the moves could “exacerbate Britain’s housing crisis”.

A lengthening of tenancies to five years and inflation-linked controls on rent rises within those agreements is already established Labour policy. But Mr Corbyn, giving his address to party members in Brighton yesterday, suggested Labour would go further and directly limit rent based on models adopted in other countries.

Polly Neate, chief executive of Shelter, said this would result in a reduction of rental property.

Speaking on the Radio 4’s Today programme, she said: “What ends up happening is landlords will just sell because they can’t make any money.

“That actually exacerbates the crisis, because you end up with an even greater housing shortage.”

Buy-to-let investors swiftly echoed Ms Neate’s concerns.

David Smith, the policy director at the Residential Landlords’ Association, the biggest trade body for private landlords, branded the proposals a “disaster for tenants”. He said: “History proves rent controls stifle investment and reduce supply.  

“This is what happened before controls were lifted in the 1980s and it led to a reduction in the quality of rented housing.

“Private sector rents are increasing by less than inflation and the call for rent controls is a diversion from the real need to increase the supply of rented housing. Instead of attacking landlords, the private rented sector should be seen as part of the solution to the housing crisis.”

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