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14th November 2011

Government say no to rent controls

Housing minister Grant Shapps has ruled out introducing rent caps in the private sector – just as London mayoral hopeful Ken Livingstone (pictured) has said he will bring them in.

Answering a question in Parliament put by Labour MP Jeremy Corbyn, Shapps said: “Private rents are market led and, therefore, significantly driven by housing supply.

“Excessive regulation would drive up rents and reduce choice for tenants. Rent controls, historically, resulted in the size of the private rented sector shrinking from 55% of households in 1939 to just 8% in the late 1980s.

“Rent controls also meant that many landlords could not afford to improve or maintain their homes.”

Meanwhile Ken Livingstone has said that if he wins the mayoral contest, he would bring in plans by which landlords would be unable to raise rents above a specific threshold.

He said: “Instead of a cap on housing benefit, we should have a cap on rents. We’re heading for a catastrophic housing problem. Poorer people are being squeezed out by higher rents.”

But Campbell Robb, chief executive of Shelter, said a rent cap would not solve problems. He said: “The only way to bring rents down in the long term is to increase the supply of homes.”

Livingstone’s plans would not just bring him in on a collision course with private landlords but also with the Government, as introducing a rent cap would almost certainly require parliamentary legislation.