Labour must stop landlords hiking rents if Keir Starmer is to help working people

I imagine most people spent last Monday’s sun-drenched evening spilling out of pubs, cold drinks in hand, or sunning themselves in the garden/local park. But there were no such joys for me. Instead I was cooped inside, watching a smattering of peers debate the finer details of the Renters’ Rights Bill.

Now, while a cold pint or an ice cream were certainly tempting, I’m not complaining. The debate that ensued not only showed the cross-party support for limiting rent hikes, but also spoke to a deeper contradiction in Labour’s policy on this issue when compared to its commitment to govern for ‘working people’.

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The Renters’ Rights Bill is without question a positive first step in addressing the power imbalance between tenants and landlords that has caused a huge range of social problems in recent years. But there is a glaring gap in the legislation in that it does nothing to slam the brakes on soaring rents.

A December 2024 report from Zoopla found that rents for new lets are £270 per month higher than three years ago. Meanwhile, the Joseph Rowntree Foundation’s 2024 UK Poverty Report found more than a third of private renters were in poverty after housing costs.

Peers from across the political spectrum put forward ideas to limit how much landlords can raise the rent. These included capping it at the Bank of England base rate, or wage growth. But the Labour minister Baroness Taylor gave these short shrift, saying: “We have considered rent regulation within the broader context of the private rented sector, and we do not believe that limiting rents in this way leads to positive outcomes.”

Labour MP Bell Ribeiro-Addy then asked a question on rent controls at PMQs on Wednesday, but Keir Starmer dodged it, citing instead the Renters’ Rights Bill and the government’s home building programme. 

While this was expected, given that the government has continually responded in this fashion when pressed on the issue of rent caps, its position contradicts its promise to ‘protect the payslips’ of working people.

Keir Starmer describes a working person as “someone who earns their living” and “can’t write a cheque to get out of difficulties.” When pressed on whether this includes people who work whilst also getting additional income from assets such as property, he said they “wouldn’t count within my definition.”

Half of private renters have no savings at all. Meanwhile, According to the 2022-23 English Housing Survey, over three quarters of private renters are in work (65% full time and 11% part time). At the same time, over 40% of landlords have no borrowing of any kind on their properties, two thirds are retired and only three in ten are in full-time employment.

I’ll leave you to decide who the ‘working people’ are in this scenario.

At Generation Rent, we recently surveyed our supporters, with nearly 1000 renters responding. The median proportion of people’s income spent on rent was 39%, way above the government’s 30% definition of affordable.

Consider this, if you spend around 40% of your income on rent, nearly five months of your salary in a year goes straight into the already deep pockets of your landlord. That’s January to the end of April. The same landlord who, in my experience, took two months to respond to complaints of a faulty boiler, leading to what me and my housemates dubbed the ‘accidental Wim Hof Winter.’

It also robs renters of ambition. I recently spoke to Olivia, who rents in Manchester and works full-time as a surveyor. When she first moved in 2020, her rent was £750 a month. But, since then her landlord has consistently raised the rent, despite not having a mortgage on the property, meaning she now pays £1100. “It’s profiteering, pure and simple,” she said “despite having a good job, my rent means I simply can’t save for my own home. It’s a deterrent to work hard because what’s the point?”

And it prevents key workers from living close to their work. In inner London for example, Generation Rent’s analysis shows that no borough is affordable for key workers renting privately, such as teachers, bus drivers and care workers. Research by London Councils also found a 1% increase in housing affordability could yield a boost of over £7 billion to London’s economy over a 10 year period, through allowing working people to invest in more productive areas of the economy and live closer to their workplaces.

According to the 2024 English Private Landlord Survey, the median gross rental income landlords receive increased by nearly a quarter between 2018 and 2024, while more than one in five landlords had a total gross income of more £100,000 or more. As the Liberal Democrat peer Baroness Thornhill said in Monday’s debate: “The idea that, to remain sustainable, landlords must be able to pass the entirety of any increased business cost and risk on to the tenant through a rent increase is, frankly, ridiculous.”

By continually rejecting a cap on rent rises, Labour is allowing landlords to swallow the hard-earned money of renters. Introducing a cap on how much landlords can raise the rent would be a simple fix which would benefit ‘working people.’

Nye Jones is head of campaigns at Generation Rent

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