Cameron will NOT consider rent controls.

Graham_Devon

Asked on Prime Ministers questions whether Cameron would regulate private sector rents (which got a lot of groaning anc exacerbation in the background!!).....

Cameron stated he would NOT support rent controls, as this would see a "massive" decline in the rental sector. This suggests it's built on greed?

He also stated we spend £6bn on housing benefit in London ALONE.

He went on to say the best thing would be to provide more houses. But of course, they won't.

Roughly 18m 30s in if anyones interested.

alleycat`

I'm not sure how you'd regulate private sector landlords outside of setting a maximum amount the state will pay?

This then leads to all the arguments about displacement from friends and family, etc.

Mostly, looking from the outside, this appears to be a London & South East problem?

brightonman123

rent control seems to work well in New York - max set by the state, regardless if work, on benefits etc..

HAMISH_MCTAVISH

Cameron will NOT consider rent controls.

Of course he won't.

That was never in doubt.

IveSeenTheLight

Graham_Devon wrote: »

Asked on Prime Ministers questions whether Cameron would regulate private sector rents (which got a lot of groaning anc exacerbation in the background!!).....

Cameron stated he would NOT support rent controls, as this would see a "massive" decline in the rental sector. This suggests it's built on greed?

He also stated we spend £6bn on housing benefit in London ALONE.

He went on to say the best thing would be to provide more houses. But of course, they won't.

Roughly 18m 30s in if anyones interested.

He wont because previous governments have sold of rental properties and they governments are now reliant and indeed need private rental market to increase.

We've posted links confirming so recently

Fella

Graham_Devon wrote: »

Cameron stated he would NOT support rent controls, as this would see a "massive" decline in the rental sector. This suggests it's built on greed?

Had to double-check who wrote that as it's not the sort of comment I'd expect from GD.

Surely it suggests that artificial controls on a free market would be likely to kill that market?

princeofpounds

Rent controls, like any price control, are usually a bad idea.

Prices are information signals about the scarcity of a good or service. If too scarce, prices go up, promoting investment to increase supply.

Without that profit opportunity, you don't get investment in capacity, and the underlying problem doesn't get resolved.

Plus, you can create black markets where the price premium gets expressed in other ways. For example, in France the allocation of price-capped city-centre social housing is seriously corrupt. Looks like New York has had similar problems.

http://online.wsj.com/article/SB122126309241530485.html

If an exploitative landlord can't charge more cash for a rental, I'm sure they will figure out more.... creative... ways of extracting value.

Real solutions would involve removing barriers to supply, creating a more responsive market, or reducing any inappropriate demand.

PasturesNew

brightonman123 wrote: »

rent control seems to work well in New York - max set by the state, regardless if work, on benefits etc..

My friend has a flat in NY. He is rent controlled and explained to me how it works. Once you're in, the rent is set and a maximum rise/year is set out .... so once in you should always be able to afford to stay in that flat. He said that new incomers now would have to pay double what he pays. So each is rent controlled, based on the initial entry poit - he'd certainly not be able to afford to rent another rent controlled flat in that same block. I think his rent's £500/month for a 1 bed with heating and water included.

I guess it stops the LLs remortgaging, pocketing the equity and then putting up the rent to cover the new mortgage.

homelessskilledworker

Fella wrote: »

Had to double-check who wrote that as it's not the sort of comment I'd expect from GD.

Surely it suggests that artificial controls on a free market would be likely to kill that market?

Agreed...

Just like the £25 Billion the Government pays out in Housing benefit, and that is just for starters.

CLAPTON

we need to build more houses

we need to reduce the infrastructure and 'affordable housing' levys so that the costs of building are reduced

we need the FSA to change the rules about 'risk' taking by the banks on mortgages

we need modest changes to the planning rules

Fella

homelessskilledworker wrote: »

Agreed...

Just like the £25 Billion the Government pays out in Housing benefit, and that is just for starters.

I don't agree with that either. The housing benefit cap should be way lower than it is, even the "reduced" figure is ludicrously high.