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Labour comes under attack over rent control proposals

Labour’s proposed rent controls will ultimately lead to “huge rent hikes” every three years, says the Liberal Democrats.

Today, Labour said it would introduce as standard three-year tenancies with rent rises capped at inflation.

It said rents should rise by no more than the CPI measure of inflation – currently 0 per cent – and tenants should have a legal right to know what the previous tenant paid.

But for the second time today, Labour’s policies have come in for criticism. Earlier, Capital Economics suggested its proposal to offer a stamp duty holiday for first-time buyers purchasing homes worth less than £300,000 would actually leave FTBs worse off.

The LibDems argue Labour’s rent control plan is “ill thought through and will make things worse for tenants”.

Campaign spokesman Lord Paddick says: “Rather than reduce rents, Labour’s plans will lead to huge rent hikes every three years, higher rents overall and fewer available rental properties.

“Labour consistently failed to support house building in government and their inaction left millions struggling to pay their rent.

“Instead of announcing unworkable, populist policy, Labour should be straight with the public about the fact that they will simply not build the homes we desperately need.”

Separately, 72 per cent of letting agents believe the cap on rents and three-year tenancy proposals will see landlords pull out of the market, according to the Association of Residential Letting Agents.

ARLA managing director David Cox says: “A vast majority of ARLA letting agents are worried that Labour’s proposed three-year tenancies with strict caps on rents will only cause the gap between supply and demand to widen.

“Flexible tenancies are what makes the sector work. If this changes, some landlords will be forced to exit the market and tenants are likely to automatically incur rent hikes and feel driven to stay in agreements for longer before getting on the housing ladder, thus not freeing up rental properties for other tenants.”

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  • William McEwan 28th April 2015 at 1:35 pm

    I’m not fooled at all Martin they are economically incompetent.
    In saying that the Tories historically have been socially incompetent.
    The last gaff before this one was the non doms where they knew it would reduce the tax take but wanted to do it on a point of principle.

    Nuts

  • Martin Evans 28th April 2015 at 12:12 pm

    William Mc Ewen, I agree, you are correct but do not be fooled by the Red Rose, the Red Flag still best defines their Labour party. In their last Government term we saw more of our rights removed than most can possibly imagine, but it was done slowly, so most don’t even know they have lost them.

  • Martin Evans 28th April 2015 at 12:07 pm

    All this will go is increase the rental cost and limit access for anyone without a one hundred percent clear credit history and a permanent means of income. Why would I allow anyone to enter a property with the right to remain their for three years, if I am not sure that they will be able to pay, will pay and maintain the property.

    I for one would increase my rents before hand to allow for the next three years cap. As for the right to know how much the last occupier paid, so what, this is the new rent, take it or leave it. The last property I got back I had to spend thousands on just to get it back up to the current levels to rent, will the government pay this expense for me.

    Bunch of idiots, who will unfortunately eventually bankrupt our nation. If you want to resolve housing the issue, build houses, don’t sell them and under cut the private sector. You have an asset that will increase in value, you have affordable housing and can try to reduce the rental incomes in the private sector through competition. So why don’t they do this, because they know it cost to much to build, maintain and cannot afford to implement it cost effectively. They also know that their likely tenants will not look after the property, most likely not pay and the cost to maintain them is to high. Yet they have the nerve to tell those that take the risk which they will not how and what they can and cannot do.

    I have no respect for any politician, all this election has done for me is to highlight how dishonest and self serving they are. They look after themselves first, then the party but at no stage does the wealth and health of the nation come first. They will say anything to gain votes and get into power, then do as they please.

  • William McEwan 27th April 2015 at 7:02 pm

    Most lenders will only lend on a property with a 6 month ast.
    If someone owns a property you cant tell them what rent they can charge its up to the market to decide.
    Its almost as if labour doesn’t understand economics or are economically inept or illiterate.

  • ManxNorton 27th April 2015 at 5:38 pm

    With 11 million tenants, and more importantly, voters, it was only a matter of time before landlords and letting agents were given a good kicking by politicians.

    As the next ‘Government’ could well be a loose ‘progressive alliance’ of Lab/LibDems/SNP/Plaid/Greens then the kicking could go on for a fixed term Parliament, by which time, people living in especially England, will have probably decided that they either like that arrangement or return to a more capitalistic model e.g. revamped Tories.

    Interesting times.

  • SW Broker 27th April 2015 at 5:37 pm

    3 year tenancies….

    Will this not breach some investors mortgage conditions that state 6 month AST or 12 months max. I wonder how the lenders will react to that.