Rent controls are finally on the agenda – but we can’t wait another six years for action, says Sam Coates.
Finally, 19 months after the Labour-Plaid cooperation deal promised it, the government has finally said something about rent controls. This couldn’t come a moment too soon – rents in Wales have spiralled since the pandemic, and by as much as 24 per cent in Cardiff and 30 per cent in Rhondda Cynon Taf. Combined with the highest inflation in almost half a century, now is the time to radically change how private renting in Wales is done.
The lengthy green paper sets out two things of interest to our members: the principle of a ‘fair rent’ based on local incomes, and a detailed review of types of rent controls across the world. What jumped off the page for me is that if pegged to 30 per cent of household income, a ‘fair rent’ for people on low incomes would be almost £100 per month less than the current average rents. Many will be paying more, especially in expense areas, or if they’ve moved in recently.
We shouldn’t get excited yet, but take this as a crucial opening for campaigning. The government has promised a white paper, not legislation, and any one of the radical ideas could be jettisoned before making it into that white paper. And any proposals could take years to take effect. Readers will be familiar with the debacle of the six-year delay to implementing the Renting Homes Act.
Renters can’t wait that long for rents to stop rising far faster than incomes. The data clearly shows that new rentals, or contract renewals, are the main driver of rent rises. Tenants are forced to choose between paying more to stay in their home or navigate a brutal market now saturated with demands for guarantors or six or even 12 months of rent in advance.
Any model of rent controls the government considers needs to ensure landlords can’t use tenant turnover as a way to keep boosting their profits. But we need a freeze on rents now – not just possible controls in several years. The Scottish government has recently renewed its own freeze on rents, limiting hikes to 3 per cent.
The response from the landlord lobby has been as melodramatic as predicted, but reminds us that they will lobby hard to block any meaningful change. Charities, housing associations and the rest of the sector have a responsibility to back grassroots campaigners and support fast-tracked legislation to freeze rents now, and design an effective regulation regime for the future.
Sam Coates is chair of ACORN Cardiff