Tenants across Wales would be worse off under Plaid Cymru’s plans for rented housing published today.
Included in its manifesto for the forthcoming Welsh Assembly elections, the Party has pledged to introduce rent controls and ban fees paid by tenants to letting agents.
The Residential Landlords Association has pointed out that in February last year the Minister responsible for Housing, Lesley Griffiths, warned that rent controls would stifle investment in properties leading to reduced quality for tenants.
According to the Office for National Statistics, contrary to popular belief, private sector rents in Wales grew in the year to February 2016 by just 0.2%. This was by far the lowest increase of any part of the United Kingdom.
In 2013 the charity Shelter noted that landlords would be justified in increasing rents were letting agents not able to absorb the cost of scrapping fees paid by tenants.
Commenting, Douglas Haig, the RLA’s Director and Vice Chairman for Wales said:
“Plaid’s proposals for rental housing would take us back to the past. They are a one way street to fewer and poorer quality homes for rent with tenants facing higher, not lower, rents.
“There is a wealth of evidence from all around the world that all rent controls do is shrink the rented sector making it more difficult and more expensive for tenants to find accommodation.”
The RLA represents 40,000 private sector residential landlords in England and Wales.
The Office for National Statistics’ most recent index of private housing rental prices can be found here
It notes that “private rental prices grew by 2.8% in England, 0.2% in Wales and 0.7% in Scotland in the 12 months to February 2016.”
On the 10th February 2015, Lesley Griffiths AM (Labour), the Welsh Minister for Communities and Tackling Poverty made a statement to the Welsh Assembly introducing the Renting Homes (Wales) Bill. The transcript is here
As part of this, Plaid Cymru’s Housing Spokesperson, Jocelyn Davies asked Ms Griffiths:
“Minister, I wonder if you’ll tell us if you’ve considered rent control methods in the lead up to this Bill and, if so, why it doesn’t appear to be included.”
The Minister replied:
“relation to rent controls, I do recognise that rent control can look attractive initially, but I think previous experience shows that rent controls reduce the incentive for landlords to invest and can then lead to a reduction in quality housing. Those properties that are still subject to rent control under the Rent Act 1977 are often of the poorest quality, so I think such a proposal would require very careful consideration. Again, I think that could give possible unintended consequences to the supply of private rented properties.”
In June 2013, Shelter published a report “Letting Agencies: the price you pay”. This can be accessed here
Page 17 says of the proposal:
“If letting agencies do not absorb the costs they currently charge to tenants, landlords may be justified in increasing rents to reflect their additional costs.”
Plaid Cymru would see tenants made worse off… – https://t.co/0GDWtXhDZV
— LandlordZONE Press (@LandlordZONEPR) April 7, 2016