The Green Party plans to push for rent controls in Wales as the party looks set to win its first seats in the Senedd next month.

In the run-up to the country’s elections on 7^th May, the Greens are proposing rent freezes followed by rent controls to improve affordability for renters. At a press conference, Wales Green Party leader Anthony Slaughter said he could not put a figure on the cap but suggested it could be around CPI inflation plus 1%.

There would be an initial one-year freeze on rents, including between tenancies. Following this, powers to introduce ‘Rent Pressure Zones’ would be introduced, and the manifesto explains that “rent increases will only be permitted where landlords deliver genuine improvements to homes”.

The Green party in England has also backed controls, with leader Zack Polanski calling for mayors to be given powers to set them.

Slaughter said it would reform council tax by replacing it with a land value tax to reduce the burden on lower-income households – and put it on landlords rather than tenants. Its manifesto also includes tackling homelessness by banning no-fault evictions, and training more retrofit experts.

Theory

However, the Institute for Fiscal Studies says economic theory and evidence suggest that property taxes levied on occupiers are mostly shifted on to owners via lower rents. “Shifting the legal responsibility for paying tax to the owner would therefore result in rents increasing over time, offsetting much of the benefit to tenants and of the hit to landlords.”  

David Phillips, head of devolved and local government finance, adds that with lower rents potentially increasing the demand for and reducing the supply of rental properties, other tenants could struggle to find suitable properties – and landlords could introduce much bigger rent increases when they do have the opportunity to do so.

Evidence

“Evidence from other places where rent controls have been introduced suggests that, as well as reducing the supply of rental properties, there can be other unintended consequences, such as poorer maintenance and attempts by landlords and tenants to circumvent the regulations,” says Phillips.

Polls suggest that a wave of Green candidates could take up seats after the nation’s first election using proportional representation. A hung Senedd is possible along with a potential alliance between Plaid Cymru, meaning that the Greens could wield some power and influence policies.

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