Tories call Labour's rent cap proposals a 'gimmick'

Personal Finance Editor

Conservative Party chairman Grant Shapps has hit out at Labour proposals to help tenants by introducing rent controls.

Labour leader Ed Miliband made a promise that private landlords would face rent controls and longer tenancy agreements under a Labour government.

But Shapps said the Labour plan was a "short-term gimmick" and accused the opposition of "political tampering".

"The only way to raise people's living standards is to grow the economy, cut people's taxes and create more jobs,” he said.

The Conservatives also claimed that evidence from other countries suggested rent controls lead to "poorer quality accommodation, fewer homes being rented and ultimately higher rents".

Launching Labour’s local and European election campaign earlier in the day, Miliband set out sweeping reforms of the private rented housing sector. The changes, he said, would help millions of households caught in the cost-of-living crisis.

“A Labour government will ban letting agents from charging tenants. We will legislate to make three-year tenancies, not short-term tenancies, the standard for those who rent their homes in the private sector.”

He added: “These new longer-term tenancies will limit the amount by which rents can rise each year so tenants won’t face the shock of rents that go through the roof.”

The proposals were also slammed by the property industry. “Labour’s three-year tenancy proposals are unrealistic,” said Carole Charge of lettings specialist Leaders. “They do not appear to give landlords the right to terminate the tenancy agreement. Without the right to repossession most investment landlords would pull their property from the market.”

Graham Kinnear of eviction company Landlord Assist, said: “The proposals are simply unworkable. Capping rent increases will put people off investing in buy-to-let. This will lead to a reduction of available quality accommodation.”

But Chris Henry, an activist with Movement for Change from Home Sweet Home in Brighton & Hove said the reform is long overdue.

“Since last year, we’ve heard stories of young families being forced out of their homes by landlords who hike up prices, and evict at short notice,” he said. “We heard stories of students charged hundreds of pounds in fees by agents who don’t pick up the phone, or return emails, let alone do repairs.

“But there remains more work to be done to build a private rented sector that works for everyone.”

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