Labour about turns on rent controls

Landlords breathed a collective sigh of relief as the Shadow Housing Secretary announced that Labour would not introduce rent controls, a policy favoured by many within her own party.

At the Chartered Institute of Housing's recent conference, Lisa Nandy announced a reversal of her previous position.

She said "As the mortgage crisis deepens - for homeowners and renters alike - is is inevitable that the debate has turned again to short term fixes.

"And when housebuilding has fallen off a cliff and buy to let landlords are leaving the market, rent controls that cut rents for some will inevitably leave others homeless."

The change of stance has put her at odds with some senior party members such as Sadiq Khan and Andy Burnham who have long argued for the power to introduce rent controls in London and Manchester respectively.

Proponents of rent controls argue that they alleviate the burden of high rents, but critics contend that they risk unintended consequences, including reduced investment in housing and restricting rental supply.

The Scotland example

It may be that Ms Nandy has considered the results of the changes made to rental regulations in Scotland over the last year. Holyrood initiialy introduced a six month ban on rent increases and evictions. When that expired they capped rent increases to 3%. The cap remains in place today

According to Hamptons Research, over the last five years the number os sales and purchases by landlords has represented 9% of all transactions. Since the changes, sales by landlord have increased to 14% and sales have fallen to 6%.

This reduction in rental supply is likely to contribute to Scotland topping the UK charts as the region with the highest rent increases for newly let properties.