Rent controls will only drive prices higher, Labour's Housing Secretary has warned, delivering a clear rebuff to the Chancellor's plans to offer voters more rent protections. Steve Reed on Wednesday categorically ruled out freezing rents for a year, despite Rachel Reeves declining to reject the idea on Tuesday.
Reed's Firm Stance
The Housing Secretary stated he is 'crystal clear' the Government is 'not doing' a freeze for private tenants. He explained that when Scotland introduced rent controls, 'it ended up with rents going up much higher, and the amount of homes that were available to rent going down'. Reed added: 'It's not just Scotland, that's happened in other countries around the world as well. So we don't want to make life harder for renters.'
Chancellor's Consideration
This follows reports that the Chancellor is considering a one-year rent freeze on private homes in a last-ditch attempt to win back votes ahead of the local elections. Under Treasury plans, the Government would ban landlords in England from raising rents for a year to ease the cost-of-living crisis in the wake of the Iran conflict.
Political Reactions
Kemi Badenoch accused Labour ministers of trying to 'curry favour with left-wing backbenchers' by briefing the policy. She said: 'It is time the Prime Minister gives her an easier job, so will he listen to businesses, listen to the country, and reshuffle the Chancellor?' Former Green Party co-leader Carla Denyer noted the irony of Ms Reeves mulling the policy ahead of the locals, where Labour could lose 1,600 seats in a best-case scenario. Reform UK deputy leader Richard Tice called a one-year rent freeze 'suicidal for Britain's rental market'.
Renting vs Mortgages
New research shows homeowners with mortgages will be worse affected by the Iran conflict than tenants. Rightmove analysis reveals that homeowners with new mortgages pay £1,670 per month on average, while tenants pay £1,547, making renting cheaper for the first time in nearly a year. In London and the South-East, the gap is largest, and renting is cheaper than mortgage payments in over two-thirds of local authorities.
