"The case for rent controls"

I was asked to put the case for rent controls in the latest edition of the Labour Housing Group newsletter here. See below and also in the link the case AGAINST rent controls as well. 

"Here are two articles about rent controls. John Gray, former Cabinet Lead for Housing Services in the London Borough of Newham makes the case in favour while Chris Worrall argues against. Further contributions are welcome on what will no doubt remain a contested subject! Paul Martin (Editor) pauljmartin@clara.co.uk

For some time before the General Election in December 2019, I had been exploring with our Council Pension Committee whether we should be investing money in social housing. Our pension officers took their due diligence very seriously and we had a seemingly endless series of meetings and presentations with institutional fund managers and financial advisors. 

Nearly all the models included some form of mixed tenure and cross-subsidy of social housing by market or intermediate rents (or sale). I was pleasantly surprised that, despite it being Labour Party policy at the time to have some limited rent controls, most fund managers did not appear to think that this would cause any serious problems with their investments. 

Some managers did think it would have serious implications and a small number had no idea that the Party was committed to rent controls and were clearly exercised by any such policy. 

I imagine that meeting small, private “buy to let” landlords who are mortgaged to the hilt and still losing money despite charging sky high rents would have told me something very different. 

Certainly the historical evidence on the impact of rents controls is mixed. Were “fair rents” in the past set too low and was that the reason for the decline of the private rental sector and its “Rising Damp” reputation? 

Or was that a consequence of government subsidy of social housing and home ownership? 

Ironically it was David Cameron and a Conservative Government that last imposed UK rent controls, but only on social landlords. 

Rent controls are in force in other countries, such as America, Germany and France. Again, there are differing views on the positive and negative consequences. 

While there will be problems with any introduction of controls, doing nothing is not an option because the private rental sector is completely out of control in many parts of this country. 

While surveys of young professionals often show that they are paying a staggering 50% of their income in rent, it is families who suffer most from high rents. 

On top of living in insecure, overcrowded and often poor quality housing, in Newham, East London, 66% of children live in poverty after their parents’ housing costs are taken into account. 

I hate to think what these figures will be now due to the impact of Covid-19. Pension funds and other investors expect market rents to carry on growing in excess of inflation. 

In all likelihood, today’s affordability crisis will get even worse if nothing is done. Rent controls will only be part of a wider housing solution and a massive expansion of social housing is my preferred option. 

However, this is not going happen with a Tory parliamentary majority of 80. So we have until 2 May 2024 (or sooner) to come up with workable solutions. 

Rent controls were first introduced to tackle housing problems caused by World War One. Perhaps our modern day Covid emergency will result in their reintroduction. 

Cllr John Gray. Former Cabinet lead for Housing Services London Borough Newham. Representing Housing Association & Voluntary Sector workers on UNISON NEC. 

Labour Party Manifesto 2019: Housing

"Everyone has the right to a decent, secure home. In 1945, Labour promised to ‘proceed with a housing programme with the maximum practical speed until every family in this island has a good standard of accommodation’. 

In 2019, we renew that pledge.But too many people are being denied their right to a good home by our housing system that treats homes as financial assets rather than places to live. 

There is no starker symbol of the failing housing system than the horror of the Grenfell Tower fire. A Labour government will bring system-wide change, so that a tragedy like Grenfell never happens again. 

We will introduce a £1 billion Fire Safety Fund to fit sprinklers and other fire safety measures in all high rise council and housing association tower blocks, enforce the replacement of dangerous Grenfell style cladding on all high-rise homes and buildings, while introducing mandatory building standards and guidance, inspected and enforced by fully trained Fire and Rescue Service fire safety officers. 

Grenfell Tower was the confirmation of a more far reaching crisis. Everyone knows of someone affected by the housing crisis: younger people unable to buy a first home, renters trapped in damp flats, families stuck on council waiting lists, leasehold home-owners hit by unfair fees, people who are homeless living and dying on our streets. The gap between the housing haves and have-nots is at the heart of the injustice in our country today. 

Since 2010, the Conservatives have slashed funding for new homes, refused to regulate for higher standards and given a free hand to commercial property developers. There are fewer new homes for social rent, a million more households stuck renting from a private landlord, 900,000 fewer young people owning a home and more than twice as many people sleeping on our streets. Only Labour has a plan to fix the housing crisis. 

We will act on every front to bring the cost of housing down and standards up, so that everyone has a decent, affordable place to call home. Labour will create a new Department for Housing, make Homes England a more accountable national housing agency and put councils in the driving seat. We will set out a strategy for a flourishing construction sector with a skilled workforce and full rights at work. 

Labour will set up a new English Sovereign Land Trust, with powers to buy land more cheaply for low-cost housing. We will use public land to build this housing, not sell it off to the highest bidder. 

Developers will face new ‘use it or lose it’ taxes on stalled housing developments. We will keep the Land Registry in public hands, and make ownership of land more transparent. We will make brownfield sites the priority for development and protect the green belt.

Labour will tackle the climate crisis and cut energy bills by introducing a tough, new zero-carbon homes standard for all new homes, and upgrading millions of existing homes to make them more energy efficient. 

We will review the planning guidance for developments in flood risk areas. Council and Social Homes The only way to deliver on everyone’s right to a good home is to build publicly funded social housing. 

Labour will deliver a new social house building programme of more than a million homes over a decade, with council housing at its heart. By the end of the Parliament we will be building at an annual rate of at least 150,000 council and social homes, with 100,000 of these built by councils for social rent in the biggest council house building programme in more than a generation. 

We will establish a new duty on councils to plan and build these homes in their area, and fund them to do so, with backing from national government. 

We will scrap the Conservatives’ bogus definition of ‘affordable’, set as high as 80% of market rents, and replace it with a definition linked to local incomes. These council and housing association homes will be more affordable than market housing and built to higher standards. 

We will end the conversion of office blocks to homes that sidestep planning permission through ‘permitted development’.

We will stop the haemorrhage of low cost homes by ending the right to buy, along with the forced conversion of social rented homes to so-called ‘affordable rent’. 

We will review the case for reducing the amount of housing debt councils currently hold. And we will give councils the powers and funding to buy back homes from private landlords. 

We will give tenants a stronger say in the management of their homes and stop social cleansing by making sure regeneration only goes ahead when it has the consent of residents, and that all residents are offered a new property on the same site and terms. 

We will fund a new Decent Homes programme to bring all council and housing association homes up to a good standard. Home Ownership Under the Tories, home ownership is getting further out of reach for more and more people. 

Numbers of new affordable homes to buy have fallen, and fewer younger people can afford their own home. 

We will build more low-cost homes reserved for first-time buyers in every area, including Labour’s new discount homes with prices linked to local incomes. 

We will reform Help to Buy to focus it on first-time buyers on ordinary incomes. 

We will introduce a levy on overseas companies buying housing, while giving local people ‘first dibs’ on new homes built in their area. 

We will bring empty homes back into use by giving councils new powers to tax properties empty for over a year. Labour will end the scandal of leasehold for the millions who have bought their home but don’t feel like they own it. 

We will end the sale of new leasehold properties, abolish unfair fees and conditions, and give leaseholders the right to buy their freehold at a price they can afford. We will introduce equivalent rights for freeholders on privately owned estates. 

Private Renters More than 11 million people rent from a private landlord and many of them are at the sharp end of the housing crisis. We will take urgent action to protect private renters through rent controls, open-ended tenancies, and new, binding minimum standards. Labour will stop runaway rents by capping them with inflation, and give cities powers to cap rents further. 

We will give renters the security they need to make their rented housing a home, with new open-ended tenancies to stop unfair, ‘no fault’ evictions. 

We will make sure every property is up to scratch with new minimum standards, enforced through nationwide licensing and tougher sanctions for landlords who flout the rules. 

We will fund new renters’ unions in every part of the country – to allow renters to organise and defend their rights.

We will get rid of the discriminatory rules that require landlords to check people’s immigration status or that allow them to exclude people on housing benefit. 

We will give councils new powers to regulate short-term lets through companies such as Airbnb. 

Homelessness No one should sleep without a roof over their head in one of the richest countries in the world. But under the Tories, the number of people sleeping rough has more than doubled. Over 125,000 children are now living in temporary accommodation, without a home to call their own – or the space they need to thrive. 

Labour will tackle the root causes of rising homelessness with more affordable homes and stronger rights for renters. Labour will end rough sleeping within five years, with a national plan driven by a prime minister-led task force. We will expand and upgrade hostels, turning them into places where people can turn their lives around. We will make available 8,000 additional homes for people with a history of rough sleeping. 

We will tackle the wider causes of homelessness, raising the Local Housing Allowance in line with the 30th percentile of local rents, and earmarking an additional £1 billion a year for councils’ homelessness services.

We will bring in a new national levy on second homes used as holiday homes to help deal with the homelessness crisis, so that those who have done well from the housing market pay a bit more to help those with no home. 

We will save lives this winter by ensuring extra shelters and support are in place in all areas. And we’ll repeal the Vagrancy Act and amend antisocial behaviour legislation to stop the law being used against people because they are homeless.

(Long post but what a brilliant housing manifesto. Restoring the political duty to decent homes for all is key. If this is implemented we will solve the housing crisis in Newham and elsewhere. I have put bold emphasis and underlined what I think are the most key commitments)

West Ham Labour Party Stall - Stratford 2015

Today we had a West Ham Labour Party stall outside Stratford Shopping centre, giving out the ever popular Labour Party balloons to prospective voters under the age of 10 and leaflets to their parents on Labour plans for rent controls and protect the NHS.

We had a very positive response with people coming up asking for Labour Party posters to put up on their windows, telling us that we must get rid of the Tories and how they will always vote Labour.

There was some good conversations with residents and shoppers on key political issues and we picked up case work for local Councillors and MP's. 

After we finished the stall many of us went off to "door knock" at the marginal seat of Ilford North for Wes Streeting. 

Fantastic May Day news - Return of rent protection & security of tenure

I missed Ed Miliband's launch of Labour's Local Government election campaign this morning in next door London borough Redbridge.

I am really pleased with the commitments he made to reform the private rented sector.  Insecure tenancies, unaffordable rent rises and rip off letting agency fees are the top 3 complaints I get as a Councillor from private tenants.

Also more UNISON members now live in the private rented sector than in Social Housing.

Check out this report by progressive housing blog RedBrick.

"The three elements of the reform package are:

• three year tenancies to be the norm, with suitable exemptions (eg a mortgage covenant and students) and a 6 month probationary period.
• an upper limit on rent increases during a tenancy.
• scrapping extortionate letting agent fees to tenants, saving tenants an average of £350 for each letting".  

Finally, together with the commitment to build 200,000 homes a year by 2020, the Party is going to stop just moaning about the broken housing market we live in and do something about it.

The Tories obviously want to do nothing and just let the rip off continue. Even though I know privately many think we should adopt such policies that even right wing governments in Germany don't even blink about. 

I look forward to more announcements on Labour spending more on capital investment and social rents than continuing to waste money on housing benefit.

Should Labour follow the Housing Policies of Europe’s most successful Conservatives?

Fascinating post here by Steve Hilditch on Labour Housing Group blog "Red Brick" about Housing policies in Germany. There is a long tradition of rent controls in what is arguably Europe's most successful capitalist society.  The new Government coalition led by Chancellor Angela Merkel have agreed further powers for new developments to restrict rents.

Steve contrasts the German experience with the almost total opposition in the UK by our Conservatives to practically any form of rent regulation. Unless of course, David Cameron makes yet another "U" turn.