With Labour tightening its grip on politics and power, we can’t rule out rent control in London and across England. Landlords who are just about breaking even may even experience financial losses if their ability to increase the rent is capped, while a restricted supply of private rented properties may send non-controlled rents so high tenants won’t be able to afford them.
There is a delicate balance to strike but as the rest of the world has proved, rent controls are rarely the magic bullet, with 1,000s landlords selling property fast as a result of their introduction. In this blog, we answer the most common rent regulation questions we’re asked.
Q. Are there currently rent controls in England?
A. There are currently no rent controls in England, nor in Wales. Landlords are free to set the monthly rent as they see fit. A letting agent, however, can help landlords set a rent that attracts interest and doesn’t sell the property short.
Q. Could the Government introduce rent regulation?
A. This is a grey area. While the Renters’ Rights Bill does not seek to introduce rent controls, we can’t rule out rent regulation while Labour is in power. This is because Chancellor Rachel Reeves spoke out in favour of rent controls when she was part of the shadow cabinet. Earlier this year, The Telegraph also reported how back bench MPs were pressing for rent controls. In fact, 31 MPs signed an amendment to the Renters' Rights Bill, which would imposes a cap on rent rises within tenancies. The amendment hasn’t been adopted so far but the Bill still has its final debate ahead this September.
Q. Are there rent controls in Scotland?
A. Scotland has rent control areas where there is a limit to how much private rents can be increased by. These are known as ‘rent pressure zones’ (RPZ). A local council can ask Scottish parliament to set an RPZ if rents in an area are rising too much, if rents are causing tenants issues or if the local council is coming under pressure to provide housing or subsidise the cost of housing as a result of rent rises.
Q. How much can rent be increased in Scotland?
A. Currently, Scottish legislation limits rent increases to CPI+1%, to a maximum of 6% in rent control areas. If a landlord improves a property, they have to apply to a Scottish rent officer for permission to increase the rent – a request that can be refused.
Q. How do rent controls affect private rental markets?
A. The evidence overwhelmingly shows rent regulation has a negative impact. This Institute of Economic Affairs briefing paper from August 2024 reviewed 196 rent control studies, undertaken over 60 years and spanning almost 100 countries. The conclusion? Rent controls lead to reduced supply of rental housing, reduced housing quality and increased rents in housing not subject to rent controls.
Q. How will English landlords react if rent controls are introduced?
A. A new survey carried out by Landbay asked landlords ‘How will you react when rent caps are introduced?’ Of those polled, 16% said they would sell all their rental properties and 37% said they would stop investing in their buy-to-lets.
If Labour stay in power, the threat of rent controls won’t go away. We understand if the changing lettings landscape leaves you with no alternative but to quit buy-to-let. LandlordBuyer can offer you a fast house sale, without an estate agent.
We can help with selling a tenanted property, selling a property portfolio or selling if your buy-to-let flat has a short lease. Contact us to start a sale