Sadiq Khan has called on the government to grant him the powers to introduce rent controls in London.
The Mayor of London has published a report setting out his plans to overhaul tenancy laws using the new powers to follow in the footsteps of German capital Berlin, where rent controls were announced earlier this month.
Under Khan’s plans, open-ended tenancies would be introduced while section 21 “no fault evictions would also be axed, as the current government pledged to do in April.
1/6 🚨Big win for renters! 🚨Sadiq Khan has today called for powers to introduce a deflationary rent control for London, based on our research @nef! Really important for a major politician to be calling for powers to make private renting affordable. https://t.co/Z7nyp8s3Hp
— Joe Beswick (@joebeswick1) July 19, 2019
The report, developed with Karen Buck MP and Deputy Mayor James Murray using the New Economics Foundation’s research as its basis, also wants to increase landlord notice periods to four months and scrap break clauses in tenancy agreements.
This would help shift the power balance to London’s 2.4 million renters, according to Khan, while they would also be represented on a newly set-up London Private Rent Commission working to keep rents lower and within reach of those on the breadline.
That commission would use a universal register of landlord and rents to design the specifics of the rent control system and recommend incentives to encourage investment in boosting the rental housing supply.
Great for London Citizens members to have a seat at the table today with @SadiqKhan @jamesmurray_ldn and @KarenBuckMP_ today as we talked about redressing the power imbalance between tenants and landlords. What do you think of #rentcontrol for London? https://t.co/JyBY4IfXQO pic.twitter.com/b5YhBlGw7I
— Peter Brierley (@Petebrierley) July 19, 2019
While that is being developed, Khan wants interim powers to limit rent increases within and between tenancies.
He said: “It is high time for private renting in London to be transformed – Londoners need fundamental change that is long overdue.
“Unlike other mayors around the world, I have no powers over the private rented sector. That’s why this landmark report sets out a detailed blueprint of what the government must do to overhaul tenancy laws, and what powers City Hall needs from them to bring rents down.
“We have made important progress over the last three years by working closely with councils and renters – from ‘naming and shaming’ rogue landlords and banning letting agents fees for tenants, to being part of the successful campaign to scrap ‘section 21’.”
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Khan’s proposals arrive on the same day as the Residential Landlords Association’s own warning that that getting rid of section 21 orders will not solve renters’ problems.
Their new survey found that 84 per cent of landlords would be “more selective” without the order, opting not to risk renting to tenants where there is doubt over their ability to pay.
The RLA also say that the government’s consultations on proposals to scrap section 21 repossessions must take into account landlords’ “lack of confidence” in the current alternative, known as section eight.
NEW: Today we have released the findings of our largest ever landlord survey. Our research shows that of those landlords who had served a #Section21 previously, 83% said they had done so due to rent arrears. https://t.co/VuS2NsDXTx #fairpossessions pic.twitter.com/CUaf2FMYIj
— RLA Landlord News (@RLA_News) July 19, 2019
This process is lengthy as repossession bids often head for the courts and RLA policy director David Smith insists that without a way to regain control of homes quickly, landlords will leave the housing market and reduce the number of available properties for tenants, driving up prices.
“Whilst no landlords should ever abuse the system, it is only right and fair that they can repossess properties swiftly and with certainty in legitimate circumstances.
“At present, only section 21 provides this certainty. If the government is to get rid of it, landlords should have the same level of confidence and certainty about repossessing properties in cases such as rent arrears, anti-social behaviour or wanting to sell the property.
“Without such confidence landlords will simply leave the market, making it more difficult for the growing number of people looking for a home to rent. Secure tenancies will mean nothing without the homes to rent being there in the first place.”
Please don't be fooled: Landlords' fears of losing #Section21 are fundamentally premised on fears of a shifting power balance, tenants having any redress to challenge evictions and possibly hindering landlords' ability to sell-up super quick, in light of tax changes #EndSection21
— Rent Rebel (@rentrebel) July 19, 2019
However, responding to Khan’s announcement, Dan Wilson Craw, director of campaign group Generation Rent, insists that the pendulum needs to be swung towards renters.
“As long as your landlord can evict without needing a reason, or raise your rent by more than you can afford, the rental market can never offer you a true home,” he said.
“While we need to build to meet the demand for homes, renters are struggling right now to make ends meet – they cannot wait any longer for relief.”