Saturday, 17 May 2014

Time for rent controls

My article in last week’s Cornish Guardian, focused on housing and the need for rent controls in the private sector. It was as follows.

Fifteen years ago, at the turn of the millennium, it was possible to buy a new two-bedroom house in my home parish for under £50,000, or a three-bedroom house for under £60,000. Rents in the private sector were also much more reasonable.

Since then, the housing market – both for purchase and rent – has become truly dysfunctional. House prices pretty much tripled in the decade after 2000, while the cost of renting in the private sector also exploded.

In comparison, wage increases have been very limited and the gap between household incomes and the cost of putting a roof over one’s head has become so much greater.

Shelter and the Joseph Rowntree Foundation take the view that spending more than one third of disposable income on rent or a mortgage means that individuals or families may not be able to afford their other basic needs. In 2011, Shelter did a survey and estimated that – based on their model – 85% of private rents in the South West were unaffordable.

It is little wonder that the number of people in work who claim housing benefit to meet their monthly rent payments has rocketed by 59 per cent since the Coalition came to power.

It has long been my view that we need to reintroduce rent controls in the private sector and I am pleased that Labour leader Ed Miliband has joined the debate and is considering support for a cap on rent rises and measures to combat excessive rents.

But somewhat predictably, Conservative opponents slammed his comments as being “anti-business” and misrepresented rent controls as being some sort of “soviet-style” intervention.

I have no sympathy for those people who desire to protect the present dysfunctional housing market.

I also have no sympathy for the Conservative MP – who has been a persistent critic of the welfare state, even condemning it as a “something for nothing culture” – has recently been exposed as the director of an estate which pocketed £120,000 in housing benefit from his local council.

I have more sympathy with a critic of the MP, who was quick to point out the hypocrisy of the situation: “How dare [he] lecture us about ‘something for nothing’ when he is living off the poorest and milking taxpayers all the way to the bank? It’s not tenants who gain from housing benefit, but some of the richest people in Britain. They get richer at our expense – and blame us while they’re at it.”

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