Private landlords, whether they know it or not, are often exploiting the majority of people who are unable to buy a home due to the crippling inflation of house prices and deposit requirements. Not to mention the inadequacy of the minimum wage and job insecurity.
Of course, being a private landlord doesn’t automatically make one a bad person. Everyone has a right to do their best to improve their own economic situation, and landlords wanting to make money from rent are just doing what they can to help themselves and where applicable, their families. However, where they are at liberty to charge exploitative rents, they are the players in a broken market that has not been properly regulated in order to promote fair living standards.
With social housing usually unavailable and home ownership unaffordable for many first-time buyers, renting privately is often the only option for households on lower incomes. At the same time homelessness is reportedly on the rise with more than 55,000 households in temporary accommodation in England. This is 10% higher than a year before. More than 1.8 million households are currently on the waiting list for social housing. This is a 60% increase in the last 10 years. In other words, the housing situation for many people is bad.
In response to the problems highlighted in the report, a previous conservative Housing Minister Mark Prisk called the situation “alarmist…And it fails to recognise that housing benefit provides a safety net which ensures that up to a third of private properties in most areas are affordable to low income families”. Prisk’s response arguably “fails to recognise” that where private rents are inflated, low income families are having to find more of their own money to pay landlords and are struggling with other living costs as a result – less money to eat, to pay bills, to travel to work, to look after children.
Even if individuals are not actually spending more of their own money on housing, Prisk’s comment makes it clear that housing benefit payments plug the gap. This must mean people’s taxes are being used to pay greedy private landlords. In conclusion then, either individuals are being squeezed by over inflated private rents, society is being squeezed, or both. None of these options are good. All are costly, and all see the wealthy get richer at the expense of everybody else.
Housing is not a designer handbag
Housing is not like a designer handbag. People can do without the latter. Whatever your stance on wasting good money on logos, no one can survive without housing. Therefore, like a broken strap, we need a radical solution.
What’s the solution?
Like capping energy bills, the mere suggestion of a rent control policy that restricts the level of rent is labelled as economically incoherent for the preserve of communists. That’s not how I see it, and neither does Germany; a country we often look to with admiration for their sturdy engineered economy. Rent control is a brave political intervention that truly challenges inequality.
Many people are dying or skipping meals because they cannot afford energy bills while giant corporate conglomerates make record profits with executive directors on millions. Capping serves to defeat well paid lobbyists and their false messages.
Similarly, private rents are squeezing many people into a miserable existence; anxiety and poverty. Therefore, in certain areas within the country, excessive profiteering of private landlords should be curbed because with the renters’ desperation, we need strong action. Of course, any such policy needs to be very well considered. It would perhaps be poor form to punish all those who have already invested in buy-to-let property without expecting this radical change. Therefore rent caps might best be at a point that does not cause mortgage defaults. On the same token, the heavy hand of the law should enforce property maintenance obligations on landlords such that they do not scrimp on housing standards to recoup lost profits brought about by any cap. Such maintenance obligations would be particularly important seeing as housing standards are another significant problem spreading plight across rental markets.
Whatever form a rent cap takes in the UK, we should not be scared of employing a policy that pushes back against the often well articulated interests of the wealthy.