Rent controls for London slammed by right-wing think tank
The right wing Adam Smith Institute is the latest organisation to voice its strong opposition to Labour’s proposed rent controls for London.
London Mayor Sadiq Khan says he wants the powers to cap rents in future; it is thought that around 40 per cent of the capital’s households are now in the private rental sector.
Helen Paton, a research intern at the think tank, writes on its website that rent control has more lives than Doctor Who: “three regenerations in, and some people still think it’s a good idea.”
But she says New York City is an example of how controlled below-market rents lead to fewer homes. In NYC “tenants can rent a property for generations at low prices such as $500 a month” Paton claims, thanks to a policy dating back to 1943 allowing families to pass homes to another member and preserve the rent-control status.
“Why would your landlord renovate your home? Or paint the walls of your flat if you’ll stay there for years? What is their gain? This model has been tried, and there is a consensus by 94 per cent of economists from left, right and centre, that a ceiling on rents reduces the quantity and quality of housing” she insists, adding that only competition between landlord owners can solve the case of ill-maintained properties.
Instead, she backs attempting to improve the volume of housebuilding by building on parts of the green belt which arguably are not ‘green’ at all.
“The London green belt is enormous, and they are vast areas of broken land near train stations that are already developed. If we built on just 3.9 per cent of these forgotten spaces, we could build a million houses” Paton claims.
“It’s not all parks and pure hectares of perfect land, it’s about zoning the regions that are already in use and building homes to supply the increasing demand.”