Bristol council investigating rent caps

Rent controls in Bristol could see rent hikes capped at inflation or average wages

The council is consulting the public about how rent controls could work

Rent controls in Bristol could see rent increases capped at inflation or average wage growth according to a new consultation. As living in many parts of the city becomes increasingly unaffordable, an expert commission is exploring how to limit landlords from hiking up rents.

While Bristol City Council does not currently have the legal powers to introduce rent controls, City Hall chiefs are lobbying the government to change the law. The council is now consulting the public about how rent controls could work, with several different scenarios on the table.

Options include capping rents across the whole of Bristol or just parts of the city, having temporary rent controls or a long term policy, and allowing for one-off increases if the landlord pays to improve their property. The consultation asks whether controls should aim to stop large rent increases, reduce overall rent levels, or set rent levels related to incomes.

Councillor Tom Renhard, cabinet member for housing, said: “In Bristol we face a housing crisis. We have more than 19,000 households on our waiting list for social housing, along with over 1,100 households in temporary accommodation. The cost of renting in this city is one key cause alongside the lack of security that renters have in the private rented sector. This is why we set up the Living Rent Commission.

“The commission is investigating issues in the private rented sector in Bristol and how we can better respond to the identified challenges. We want to know if people support the idea of rent control in the city, and if so, how they would like to see it work. This survey asks about broad principles. If a rent control policy were to be introduced, then there are lots more details that would need to be considered.

“The powers needed to ensure the rental market is accessible and works for all do not exist. The powers come from the government, so we want to work with Westminster on policy development to reform the private rented sector, enabling Bristol to become a Living Rent City.”

Over the past decade, average rents in Bristol grew by 52%, according to the council, while wages only increased by 24% over the same period. This means many tenants are now paying a far higher chunk of their income straight to their landlord compared to 10 years ago.

The survey asks whether rent level should be determined by the property’s market worth, number of bedrooms, rent for similar properties nearby, income of the tenants, typical household income in the area, or the landlord’s mortgage payments and repair costs.

Rent controls can work either during a tenancy, so tenants will know how much their rent will rise during their tenancy, or between tenancies, so landlords can’t raise the rent too much for the next tenant.

Rent increases could be linked to a fixed maximum percentage each year, the general rate of inflation, house price inflation, average wage increases, or the tenant’s income. One-off rent increases could also be allowed when the landlord improves the property, like installing a new bathroom or better insulated windows.

Examples of different rent policies include setting rents at 30% of the tenant’s income, capping annual rent increases to 3% a year, or freezing rents at their current levels. The survey runs until December 29. Researchers at the University of Bristol will analyse the results, which will inform the work of the Living Rent Commission and its final report. The report is due to be published early next year.

The new consultation was welcomed by Acorn Bristol, a community union representing many renters in the city. The union is campaigning on a national level for rent controls, and said they would work best by capping rents to local wages.

Ewan McLennan, head organiser at Acorn Bristol, said: “Soaring rents in Bristol are a big part of the cost of living crisis that sees many families across our city struggling to make ends meet. Not only are sky-high rents pushing people deeper into poverty, they’re tearing apart communities and forcing people out of the city they grew up in.

“At root this is being driven by the greed of landlords and letting agents who are intent on wringing every last penny out of their tenants. This has to stop — and rent controls are an important part of this.

“The basic idea behind rent controls is pretty common sense: the needs of the community should be taken into account when thinking about rent, not just the interests of the landlord. As well as stopping evictions and taking on rogue landlords across our city, Acorn is campaigning for the introduction of rent controls at a national level.

“We believe the simplest and fairest approach would be to cap rents according to local incomes and wages. This would ensure that rents are truly affordable for the average person in a community. We welcome the fact that Bristol City Council is looking into rent controls and we will be encouraging our members and renters across the city to be part of this.”

The Living Rent Commission was set up in July this year, with members from the council, university, landlords and tenant representatives. The commission’s final report will act as Bristol’s response to the Renter’s Reform white paper, part of the government’s plans to change the law on how renting is regulated.

However, in an old report Shelter cvame to the conclusion that rents caps didn’t work, stating:

Whether the first option, old-style rent caps, work depends on how landlords respond. Historic and international evidence suggests that the side-effects can be pretty undesirable:

  • In markets where demand outstrips supply, landlords may discriminate on a tenant’s characteristics rather than price.
  • This could see people with lower incomes pushed even further to the bottom of the market (or into a black market with fewer protections) as prospective tenants with higher incomes are viewed as more reliable.
  • Landlords may attempt to maintain their margins by cutting down on repairs.
  • Or they may try to game the system. In New Jersey, where rent caps exist, landlords have been subdividing their apartments. These landlords end up benefitting while ordinary renters are forced into even more cramped living conditions.
  • Equally, if capped rents do not cover mortgage payments, landlords with large mortgages may be forced to end the tenancy and sell the property. This could leave those families who have no choice but to rent privately with even fewer options.

 

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1 Comment

  1. Tony Orchard
    Tony Orchard on December 13, 2022 at 9:45 am

    Also, we should make Tesco reduce their prices for essentials, such as bread and meat.
    Then force taxi drivers to only charge slightly above the cost of fuel they use.
    Of course, we’ll need Thought Police to stop people thinking of working extra hard to better themselves

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