The minister who played a key role in the Renters’ Rights Bill behaved in the opposite way to that prescribed by its reforms because the very rules she backed aren’t rational or thought-through, a centre-right think tank has said.
Emma Revell (main image), external affairs director at the Centre for Policy Studies, believes that Rushanara Ali - who evicted tenants out of her rental property she planned to sell only to raise the rent by £700 a month and advertise for new tenants after failing to find a buyer - was foolish as a government minister but rational as a landlord.
Writing in City AM, Revell says it shows how politicians – both Tory and Labour – fail to understand incentives.
"If we make it harder to make money out of renting a property, we will get fewer people renting out their properties."
“It should be obvious even to our politicians that if we make it harder to make money out of renting a property, we will get fewer people renting out their properties - and the Bill makes it harder," she says.
“The more difficult it is to do something, the fewer people will do it. But legislators seem to think this will magically not apply to landlords who, faced with the prospect of even more legislation – like the possible re-emergence of rules requiring rented properties to be at least a C grade on an EPC certificate – are already withdrawing properties from the market.”
If Labour pushes ahead with restrictions on the private rented sector, thousands of landlords will either hike rents in advance or exit the sector, adds Revell.
As reforms bed in, they are likely to do further harm, for example by leading those landlords who remain to become incredibly picky about the tenants they choose.
In the meantime, housebuilding in London has ground to an almost complete halt. “Ultimately, the only real way to fix the housing crisis is to have more homes available to rent and buy. So, stop tinkering with the rental market and get building.”
Image credit: Centre for Policy Studies.
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