Consultation on social rent cap – will the PRS be next?

The Housing Secretary, Greg Clark, has announced a consultation to impose a rent cap on social housing next year – at below the rate of inflationThe move is aimed at helping tenants with the cost-of-living crisis.

Mr Clark said: “We must protect the most vulnerable households in these exceptional circumstances during the year ahead.

“Putting a cap on rent increases for social tenants offers security and stability to families across England.”

He added: “We know many people are worried about the months ahead. We want to hear from landlords and social tenants on how we can make this work and support the people that need it most.”

The rent cap would be temporary and would apply from 1 April 2023 to 31 March 2024 and the consultation also seeks views on whether to set a limit for 2024-25.

The obvious question is, will the PRS be next.  Previously they have ruled one out; in a written reply to a question from Labour MP Rachael Maskell, Eddie Hughes, a junior minister at the Housing Ministry, said there was enough evidence available to show they would discourage investment in the private rented sector and lead to declining property standards.

Hughes commented: “Historical evidence suggests that rent controls would discourage investment in the sector and would lead to declining property standards as a result, which would not help landlords or tenants.”

“Recent international examples also suggest that rent controls can have an inadvertent negative impact on the supply of housing and may encourage more illegal subletting.”

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