Labour MP Bell Ribeiro-Addy challenged Keir Starmer on skyrocketing rents at Prime Minister’s Questions (PMQs):
Rent in my constituency is becoming exceedingly unaffordable with the ONS’s most recent data estimating that the average price of rents have risen by over 10% in the last year whilst average wages haven’t risen at the same level. And I know several metro mayors are calling for the power to control rents in their region to help tackle the issue… The steps in the Renters’ Rights Bill to cap market rents at the market rate are positive. But as landlords are the ones setting the market rates, renters in my constituency are fearful that this won’t be enough to protect them from rising rents so can the prime minister tell me what steps this government is taking to bring down rental prices
Indeed, the Renters’ Rights Bill contains a gift to landlords in that it doesn’t cap rent, but only caps rent increases at the market rate. This means rents can keep rising year upon year. Yet people in the UK are already spending 42% of their income on rent with that figure rising to 72% in London areas like Ribeiro-Addy’s constituency of Clapham and Brixton Hill.
That means a high proportion of people’s incomes is stagnating in landlord’s bank accounts – money that less well off people would spend in their local economy. This would increase demand for products and services, stimulating local business.
Rents at up 27% since 2021.
Some positives – when the bar is so low on rents
In response, Starmer said:
She’s absolutely right to raise this important issue. Communities across the country are facing the consequences of the utter failure of the party opposite to build enough homes. Our Renters’ Right Bill improves the system for 11 million private renters, blocking demands for multiple months of rent in advance and finally abolishing no fault evictions: something they said they’d do over and over again and as usual never got round to doing. Mr Speaker that’s backed up by major planning reforms, our new homes accelerator and 600 million pound to deliver 300,000 homes in London part of our 1.5 million homes we’ll build across the country, that are desperately needed.
It’s true that the Renters’ Rights Bill contains some positives like the end to Section 21 arbitrary evictions. But it’s only progress because the bar is currently so low. For instance, the bill extends the ‘Decent Homes Standard’ to privately rented properties – meaning they must have basic conditions such as functioning roofs and kitchens.
On top of that, Labour has pledged that just 1.2% of the 1.5m houses the Labour government plans to oversee the construction of this parliament will actually be affordable. And the government hasn’t said how many of them will even be social.
Common Wealth has warned that Labour’s 1.5m new homes risk domination from private equity in the Build to Rent sector. Build to Rent properties in the UK have gone up to 20% of all new builds in recent years – and 27% in London.
That’s despite Resolution Foundation analysis that shows the current housing system has plunged 1.1 million children into poverty, 690,000 of which are renting from the private sector. Starmer makes noise on reducing child poverty, but isn’t tackling the issue of excessive landlordism.
The government spends 88% of its housing budget on subsidising landlord’s rents through people’s benefits. This chimes with the amount of private rented households in the UK almost tripling from 1999 to 5.6 million in 2021. It followed the introduction of parasitic (when compared to providing housing at cost price for a non-bubble value) buy-to-rent mortgages in 1996.
Labour should end the artificially inflated housing market and provide modern shelter at cost-price for citizens. Homes: not assets.
Featured image via the Canary
