National Association of Property Buyers responds to Labour Party’s plans for rental caps

IF LABOUR plans to bring in rent controls they won’t work, a leading property association has warned.

The National Association of Property Buyers (NAPB) say the idea would lead to an exodus of landlords from the sector.

Their comments come days after the Shadow Chancellor hinted the policy could be a key part of Labour’s policy-approach to handle the housing crisis.

Labour may give local councils the power to set rent caps if it wins power later this year, something few landlords or agents will welcome.

Shadow Chancellor Rachel Reeves said in a BBC Radio interview she would support a cap on rents in some areas, but not everywhere.

“I think that should be up to local areas to decide, there may be the case for that in some local areas, but as a blanket approach, I’m not convinced by that,” she said on BBC radio.

Reacting to the idea, Jonathan Rolande, spokesman for the NAPB, said: “There is no doubt rent control seems to solve, at a stroke, many of the issues afflicting the property market. It has long been a socialist policy as it instantly benefits society’s poorer, whilst penalising the wealthy. There’s only one problem, a watered down version doesn’t work.

“Unless tenants have complete security of tenure – they cannot be forced to leave even if the property is sold as with sitting tenants decades ago, then landlords will simply take fright, evict and sell. Prices will fall and many homes will be bought by people who would otherwise be tenants.  But for the millions who don’t want to buy or realistically never will, the poorest and most vulnerable in society, well for them things would become far worse.”

Outlining how he thinks this would impact the sector he said: “New landlords would not enter the sector, current ones would leave. The supply of new rental homes would evaporate. Even those willing and able to pay more to secure a property, would not be able to do so. Rachel Reeves, if she was indeed flirting with the idea will know that the housing crisis has been long in the making and is extremely complex. The simplistic approach to control rent would backfire.”