London rent controls become a political issue

AFS Team·5 March 2020·4 min read
London rent controls become a political issue

London rent controls become a political issue

The issue of rent caps on properties in the private rental sector has become a political issue with the upcoming London mayoral campaign.

Current incumbent, Sadiq Khan, has relaunched his re-election campaign with a pledge to gain powers to implement rent controls in the capital if he is voted in as mayor.

During his launch, Mr Khan says that being re-elected would offer an 'undeniable and irresistible mandate' for the enforcement of rent controls.

This move will then put him on a collision course with landlords and also builders in the capital.

Currently, the power to implement a rent cap is not within the remit of City Hall and will need to be devolved by central government.

'Give us the powers we need for making rent controls happen'

Mr Khan said: "The Conservatives have blocked as from plans to introduce rent controls in London and they've simply said no. They refuse to give us the powers we need for making rent controls happen."

He also says that since 2010, the 2.54 million tenants in the capital have seen their rents rise by 27%.

Now, in a bid to combat housing affordability, Mr Khan says that implementing rent controls and establishing a landlords' register will help control rogue landlords.

The National Landlords' Association's director of policy, Chris Norris, said that any rent cap would 'damage housing sector investment'.

He said: "Rent controls will cap the price that a landlord will charge but it will not cap a landlord's costs meaning the cost of providing homes will increase and so will the losses a landlord will make."

Mr Norris says that landlords will then take their potential investment money elsewhere, which will then make it more difficult for those looking for a home to rent to find a house they need.

BTL maintenance accounts for 28% of income

Meanwhile, it's been revealed that the average cost of maintaining a buy to let investment accounts for 28% of a landlord's annual rental income.

The research from Howsy highlights that the average cost of maintenance across the country stands at £2,313.

The most expensive region for landlords to carry out maintenance is the East of England, which accounts for 28% of rent income.

The most affordable region is the North East where maintenance accounts for 20% of income and London, surprisingly, offers the fourth lowest BTL maintenance costs at 23%.

Howsy's chief executive, Calum Brannan, said: "Maintenance costs are part of managing a buy to let investment and not doing so will affect profitability and tenants looking elsewhere. It can also land the landlord in hot water legally if their property isn't fit for purpose."