Reeves considers freezing rents in bid to ease pain of price rises sparked by Iran war
Rachel Reeves is considering forcing landlords to freeze rents for up to a year while looking for ways to ease the impact of the Iran war on household budgets as food and fuel prices rise.
The Chancellor is considering the move as part of a wider cost of living package to be announced in the coming weeks. Guard reported.
George Bangham, head of social policy at the New Economics Foundation think tank, called on the government to follow up on the proposal. He said: “We are experiencing a procurement crisis in the private rental sector that dates back to before the pandemic.
“We know rent controls can solve the affordability crisis if done carefully, we just need to be willing to enforce them.”
But the idea faced immediate criticism from others who said a better solution would be to build more homes and warned that the move could force private landlords to sell and exit the rental market, reducing the supply of properties.
Ben Beadle, Chief Executive of the National Association of Residential Landlords, said: “A rent freeze would be a disaster for landlord and investor confidence and therefore the supply of homes in the UK. “Any hope of growing the market or even preserving the homes that millions of families rely on is lost.
“There is no evidence to suggest that this would make rents more affordable. In fact, the impact on supply would inevitably cause new rents to rise further. Such a move would be completely contrary to economic logic and the Government’s previous decision to rule out such measures.”
Robert Colville, chief executive of the Center for Policy Studies think tank, added: “This feels like an intervention on a mind-boggling scale in the private market. If the government wants to cut rents it needs to build a lot more homes.”
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As voters across the country prepare to head to the polls next week, debates about rent controls have featured heavily in the campaign.
Green Party leader Zack Polanski has called for a rent freeze as part of his intention to stop “robbing Britain”. The Greens say they want “the effective abolition of private landlordism”.
The Treasury declined to comment on “speculation”.
New-build properties will be excluded from the rent freeze scheme to ensure developers do not stop work on new homes already being built.
Labor has promised to build 1.5 million new homes this parliament, but it falls well short of meeting that target.
While in opposition Labor had previously considered a rent freeze proposal, but it was put forward by Hammersmith and Fulham Council leader Stephen Cowan. He later rejected the idea.
Around 20 per cent of households live in private rented accommodation, according to figures from the Office for National Statistics.
