The Labour Party has taken a big step forward in the UK’s ongoing housing debate and is proposing a policy to help protect private-sector renters from “sky-rocketing” rents. Speaking at Labour’s recent conference on the economy, the Shadow Chancellor, John McDonnell, said among the policies that Labour would like to see, is one that helps protect tenants in the growing private rental sector.
“Many, particularly young people, who are unable to get onto the housing ladder are then at the mercy of an unforgiving, unrestrained housing market,” Mr. McDonnell said, according to the text of his conference address. “Other urban areas are suffering from skyrocketing rents. We’ll look to give local authorities the powers to impose rent regulation to secure fair rents where these are needed as Labour committed itself to at the last election.”
It’s not just Labour’s shadow chancellor who feels strongly about the UK’s chronic housing shortage and ever-rising prices and rents. Party leader Jeremy Corbyn feels passionately about it, passionate enough to give his shadow housing minister a full position on the shadow cabinet – something which has happened for a number of years.
And that’s not all. New London Mayor Sadiq Khan put London housing at the forefront of his campaign. Since taking office mere weeks ago, he has already begun the tough task of making the right changes that will benefit Londoners and help increase the amount of affordable – for purchase and rent – homes that are available.
Of course, any Labour policy plans must be vetted and approved before they can become a real part of the party’s future intentions. This means that while they can still be idealised by Labour, they are also subject to discussion, debate and possible stress test-type scenarios from both within and outside the party.
In the meantime, Mr. McDonnell’s comments on rent regulation has already been the subject of debate. The National Landlord’s Association said that while it welcomed ideas to support the private rented sector, the Labour party should be careful it doesn’t “pull the rug from under the feet of responsible landlords”. And, while he has big plans to provide more affordable homes for Londoners, London Mayor Sadiq Khan has said previously that he doesn’t necessarily favour rent controls for England’s capital city.
The mention of rent controls also sparked an opinion piece on Forbes from British Academic Adam Smith. He states that it’s “the worst of ideas” and that “95% of economists would agree it’s a terrible idea.”
Of course, as the Private Rental Sector continues to grow there is a need for some robust regulation – both for renters and landlords. The difficulty is getting the balance right to encourage landlords to continue to provide habitable accommodation in areas where people want to live, while ensuring renters feel they are paying the right price and have enough protection from landlords, both rogue and legitimate ones.