The issue is having houses where people want to live (central London/Bristol/Cambridge etc.). There's no shortage of actual dwellings overall. It's an obsession with crowding our society/economy around a small number of economic hubs. It's a never ending downward spiral.
@@chrisjie2127 No, both house prices and rents have increased substantially in most parts of the country. Also, government statistics on population growth and house building prove that, no matter what way you look at it, not enough houses are being built. There are also not that many empty dwellings nationwide, certainly not enough to provide a solution to the housing crisis. There is, in fact, a massive shortage of actual dwellings overall.
Building more houses won't help if they are just bought by more landlords and used to harvest people's wages. Councils need to build more houses, so that people from poorer areas can move where there is work, and so they don't have to pay private landlords to house people at inflated rates. We have enough houses, they are just in the wrong hands.
In Sweden you can only buy to let one property per household and only for a maximum of two years and the government prioritise house building. Rent is affordable. Edit: there is a huge amount of rent control in Sweden. Not only that, but the amount you can sell your house for is also capped. Both numbers are capped mainly based on the size of your property and the area it's in. This prevents people from being able to make a large amount of profit from flipping. Also, whether or not you can rent an apartment in a buy to let scenario is voted on by a committee of home-owners in the apartment's block. You can only rent out your apartment if the committee agree to let you do so. Furthermore, Sweden has the second lowest average age of first time buyers IN THE WORLD at 24-years-old.
In Sweeden, housing isn't affordable because of their cap on owning property. It's affordable because the supply of housing is sufficient to meet the demand. That's the exact opposite situation in London.
@@donaldkinsey5245if you can buy multiple houses. That takes a house away from a owner occupier, who potentially has to save longer and adds competition to rent. Obviously building houses is important, but not having people stuck renting because house price gone through stratosphere is a massive contributor.
@@Kalimdor199Menegroth That is a choice. I note that in the entire history of housing crisises, and them being solved, was it ever solved by it being treated like a commodity? No, i cannot think of a single historical example of that, can you? Yet there are many historical examples of mass support for ending a housing crisis, leading to Govt building more housing and that solved it and it doesnt cost anything, even makes money (bc govt sells it or leases it). Historically, it has even been solved with less technology and worker and material shortages. Would you like to know those examles? Vienna, Singapore, Australia and UK after ww2, Auckland city, USSR under Krustushev.
Because we’ve allowed 10s of millions of unproductive migrants to move here, allowed them to take up social housing as a priority over natives if they have children, not built new social housing, and allowed a monopoly of property developers to control the flow of new builds into the market via a system of red tape that makes it impossible for a normal person to build on land they own.
@@Kalimdor199Menegroth Could you pls give me a counter examle? And historically, hasnt housing being a commodity caused the housing crisises? I recommended Economist Cameron Murry on this topic, because he is not paid for by Swap Donor Class Owned Media.
From Sweden here. Yeah, rent controls do not work. We have them here in the biggest cities. Nobody wants to build or maintain rental properties, so home-buying prices have skyrocketed instead. The waiting list is many years long, and the shortage has been described as hindering overall growth. Many economists have wanted to sack this system for years, but since government is Sweden is mostly left-wing (and people living in these rent-controlled flats have a lot of political power) it has not happened. The left-wing always say that massive subsidies to the building-sector will solve everything, which it generally does not. PS. Not forgetting the huge black market for second-hand renting.
I see what you're saying, and this has been the case for the years prior, but since the right-winged parties in sweden now hold a majority (government coalition + SD) shouldn't they in theory be able to get rid of this?
That 40% is a strange statistic to mention. Spending one year will either be higher or lower than the previous. So a 40% decrease actually suggests that most landlords have INCREASED repairs spending in Scotland. Was there a category for "maintained the same spending"?
Am I missing something here? If 44% of landlords have stopped or decreased the amount they’ve spent on maintenance, how does that mean that maintenance has increased?
That's a statistic from people who don't actually understand numbers even though they use them ALL THE TIME in their videos. Yes: there could have been a 44/56 split between reduced-or-stop and maintained-or-increased. OR it could be (say) 44/35/21 for reduced/maintained/increased. We weren't given enough information. So, that figure doesn't help us understand at all....
2080 being AVERAGE rent in London is absurd. During my time renting in London I paid £250k. I could have bought a house with that elsewhere in the country. Renting is tantamount to slavery. You work obscene hours to the point where you're barely home enough to enjoy the overpriced flat you rent and at the end of the month you give a huge chunk of your wages straight into the bank account of your landlord. It's disgusting and wrong.
Rather than rent controls, why not heavily tax housing that is not in use. There is a lot of housing owned by the wealthy that sits unused, treated as a commodity that accrues value, rather than shelter for people that need it. Oh, and build more. Demand is high, increase supply.
That makes no sense. Renting out a property doesn't prevent its capital value going up so why would you turn down free money by leaving it empty. Most properties are left empty waiting for planning permission. There are second homes but they are not that common.
Because Sadiq and most MPs have a property in London so they can be in Westminster and also in their constituency. Well any career MP who you'd recognise anyway.
@@SmileyEmoji42because there is work and such involved with renting out. just leaving a house vacant requires next to no work and the value will just keep going up
You know what, this is actually a good idea. I'm normally against more taxes but empty properties need to be dealt with and the solution isn't rent control but more housing.
People and politicians must understand that prices are signals, they are consequences of something. If you limit or mess with prices you will create discordination issues that will just make the situation even worse.
Simple really. Ban buy-to-let. You should not be allowed to buy a house unless you're going to LIVE IN IT. Suddenly the value of housing plummets, making both buying affordable and renting affordable.
Very succinctly put. It’s made a worse problem everywhere it’s been done. What I don’t get is why the young Marxists can’t figure out why it’s really a subsidy for large London employers and power brokers at mostly the cost of small land lords.
@@lordsummerisle852because do you really think landlords will decide to reduce their margins if tax is reduced? They’ll just maintain their prices and get more revenue
@@hassantaibaly293Or more realistically they would invest in new development and spread out cost,there is no world where this can be bad for the housing supply.
A London Rent control would be a disaster with a drop in properties being rented and a decrease in quality of the remaining housing stock. Something needs to be done with the rental market, just not Rent caps. Following Barcleona with a ban on AirBnB in London would be a good start. Tax break for REITs focusing on the residential sector who conform to additional standards would be a clever way. Or call me crazy, build more properties.
I hadn't realised how bad the AirBnB problem was until I got home from my summer holiday to see five new key boxes on my building, which means in the past year half of the ten flats have been turned into holiday rentals - and I don't even live in a place that gets a lot of tourism.
Why would renting be dropped by home owners? It would still be an extra source of income that the house is generating for the homeowner. Even though it’s less money would it not be still attractive to do?
Making it law that only the British/EU members can own property would make a lot of difference. It's actually ridiculous how many hundreds of billions of pounds in dodgy money is in London
@@precariousworlds3029idk if you’re being sarcastic but this is the actual solution. The problem really isn’t that there aren’t enough houses, it’s that the price of houses (alongside everything else) have skyrocketed yet wages have stayed the same since the early 2000s.
@@Sirlarrythecat Stop subsidising or giving loans on useless degrees and pour the money into apprenticeship schemes, when people get told either pay 200,000 for your English degree with 0 job prospects or take this apprenticeship scheme and start earning 30,000 a year straight away, people will start changing their priorities fast.
Multi-home tax that increases on each subsequent property is the only way to fix this awful system, but too many of them have stakes in property themselves to give a damn. Labour, Tory, no difference except the color of their ties.
True, rent control *on its own* always reduces housing supply and increases costs. Thankfully this government finally recognizes that problems take more than one course of action to fix, which is why they've come around the supply end of the equation with the new homebuilding plan. Of course rent control should be permanent, any solution to a problem has to be.
Rent control is like the one thing that nearly every economist agrees is bad. Unaffordable housing is an availability problem and rent control makes availability significantly worse
@@GG-hu9dn it doesn’t work. Basic economics tells us we have a supply problem but no one wants to fix that. Building targets have never been met since they started recording them!
Nothing to do with buy to rent then?? And / or laundered money being parked into corrupt UK inflated property market? Or inheritance? I mean, it's a complete joke of - a - country?!
same issue is in Manchester. living in a one bedroom apartment and our rent went up from 955 to 1050. and when trying to go to a new place we have to bid higher amounts to secure the places, but the amounts are unreasonable
Rent controls are completly normal policy throughout Europe. In the UK the suggestion is radical and unthinkable. You can't save this country. Too small minded to its core.
Yeah rent control is almost never the solution. We have rent controlled housing in my city (still from socialist era) and those houses/apartments are often in sorry state as landlords simply cannot afford repairs above what is required (with taxes, fees and severely capped rents) and you have to wait 10+ years for something to be available. On contrary market rates are high (though not much higher than mortgage) but you often get newer/modern building, better services, parking space, no need to pay for repairs/taxes on the house. And the solution? Building more, not taxing more or restricting landlords. The plans here are to build around 50 000 more units/houses in next 10 years in various areas of the city. One project is building completely new part of the city in 5 km by 1.5km plot of land with housing, shopping centre, hospital, schools/pre-schools, tram, roads, new park, etc.
I think the plans suggested by khan / labour think tanks are second order rent controls rather than first order. This means that it'd be a cap on the annual increase of rents, rather than a cap on rents overall. This means it could be similar to a pension triple lock idea, where it can only go up by the higher of CPI or wages for example.
@@wackypeace1135 That's monopolistic, and breaking monopolies is one of the only things a government can do in a capitalist economy that does more good than bad.
@@xemorr "pension triple lock idea, where it can only go up by the higher of CPI or wages for example." Houses are not like people, they cannot get up and move to an area with lower costs of living. Even such limits will inevitably result in dilapidation, since costs of living and inflation do not change equally throughout the country.
Rent controls do not work. We have proved that repeatedly. Every time rent controls fail, those in favour simply claim it was "old style" rent controls that failed and the new generation of rent controls will work. I believe that the currently completely failing Scottish rent controls are 3rd generation rent controls (whatever that means), so no doubt Khan's ideas would be 4th generation rent controls - which will inevitably fail. There is only one solution to rising rents which has proved to work - build more properties to rent. Only problem is that the private sector is not prepared to invest enough to do that, mostly thanks to underlying trends in regulations supported by all main political parties. So the solution to London's rental crisis is to build a lot more social housing by public funded entities something Khan has been very bad at delivering
@@moneyobsessed Of course we have in all of UK, in various guises from 1915 to 1989 and in Scotland from 2022 to date. But of course you did not know that, so much was before your time. You are no different to those who spout how the latest generation of rent controls are different to the previous versions (or to use your terminology how the latest version are "real" rent controls and somehow the past were not) and will definitely "work" this time - except they do not
@@justinstephenson9360 You make only valid points but just saying, they're agreeing with you. They're just joking like those people who say ''we've never tried REAL communism''.
no they don't, they work in several countries I've lived in or been to - landlords are leeches and housing shouldn't be treated like a commodity in a decent society, you're just repeating capitalist propaganda
It's been tried for years but I don't think people have understood that this easy easy solution rent controls, one vote and all our problems go away just doesn't work. It doesn't even take a genius to figure out why rent controls don't work either.
Rent control has been tried in every country and has, without except led to deprivation. Have studied this, economist Assar Lindbeck pronounced: “Rent control appears to be the most efficient technique presently known to destroy a city…. Except for war”.
If Labour stops overtaxing landlords, they will decrease prices. As a comparison: £1,350 rent (-) £450 tax (40% bracket) (-) £650 mortgage interest (-) £140 agent fees (-) £150 service charge. --- £40 _loss_ to the private landlord. Why do you think your rent is high?
People think Landlords make a fortune, they really don't understand the costs involved. And you are actually missing some stuff. Maintenance, compliance fees, void periods and god forbid you have any tenant or legal issues.
@@Burito-tj5ry if you have 3 properties more or less the same the rents are £2,000, £2,000 and £3,000 which one are you going to pick? Almost like the buyers dictate the price.
@@Burito-tj5ry Way to simple a way to look at it. For example, I'd rather have good tenants paying less than bad tenants paying more. I'd rather have a long term tenant paying less, than have short term tenant pay more. There is a balance.
Once again, the issue is not land-Lord vs not land lord. It's supply vs demand. On the demand side : Find way to make companies move their headquarter and high paying job outside London and people will follow. On the supply side, punish empty-house with steep taxes, remove zoning law, promote constructing etc ... and price will go down.
All landlords otherwise an agency won't "take" instruction and they'll have to manage it themselves. Agencies force them to maximise profits, though in the London market most wanted to do that anyway so it's not quite as insidious.
Whenever a state or country or municipality introduces a Cap on rent, almost every unit that's currently renting below the cap almost immediately or at the end of its current lease goes up to it. You also see a changing of issues, where instead of properties being available but being too expensive for most people to rent, which is a market issue that can change on its own, the problem then becomes every available unit was rented out as soon as the rent control went into effect, and there's no available units to stay.
You can get anything below 2000 in London, this is actually insane as wages have been pretty stagnant and getting outpaced by the rental inflation, high rental yields are encouraging the property owners to gauge the prices and charge whatever they want
It’s a supply, not demand issue. Why don’t they losen building tax and regulations, and companies would make more profit when building housing units. If you are relying on politicians, you’re screwed. If 100k homes need to be built to ease housing inflation, why are they focusing on pricing caps? It’s very simple. More houses need to be built.
I’m not saying it’s right or even the correct decision, but from a purely political perspective it’s far cheaper (cost basically nothing for the gov to do), easier, and quicker to introduce price caps than build 100k houses. A cheap, easy, and quick policy that might help, or more importantly gives the illusion of helping is like catnip for politicians
Supply and demand are relative terms that are intrinsicly linked. If demand does not change, but supply increases, you have less relative demand to the supply. We are allowing more and more and more people into this country, with nowhere to live. We have very little green, publically accessible spaces left in the country (i.e. we live in a high density country), farming is already suffering and towns already ever expanding. Where are these houses going to be built? Immigration is the number one issues, whether folk want to admit it or not.
You xannot rely on private companies to build enough houses to match demand, because that would necessarily bring down prices, whichbwpuld bring down profits. Homelessness is good for business. The number of council houses that have been sold through right to buy (roughly 2m) is in great excess pf those on the waiting list for council housing. What we need is council houses. The rents they bring in can enter the councils tax pool and act as a revenue stream as well aa provode affordable housing. Capitalism cannot cure its own problems
Of course capitalism can solve its own problems commie. You do realise that new housing companies can be created right so even reduced house prices would be profitable. The fact that we have so few housing developers is due to excessive regulations not capitalism @outofideas42
Depending on how it's done, it may remove a lot of of properties from the market. If the introduce a cap that is lower than mortgage payments, the owner won't want to continue renting it out.
when trying to rent in london last year it was a horrible experience, every viewing we went to resulted in a bidding war (sometimes in person at the viewing). on multiple occasions we sent our deposits only to later be told that someone else has offered more. it's a bloody nightmare - right now I'm renting in an unlicensed HMO and thankful that even though this rental is shit, at least i'm not getting messed about by letting agencies.
£2,080 is a lot. In Toronto we have rent controls as well as constant new building high rises. Like most studio - 1 beds are between $2100(what I pay)- $2500.
Introduce a levy on buy to let mortgages that raises the effective interest rate and lower interest rates on homes that are the persons primary dwelling. Buy to let is what has been driving prices up and it's parasitic.
This is just wrong. Do you have any idea how much landlords have to pay out? There is no money in it so they are forced to raise rents massivley There is no way to lower costs unless we build more houses
@@sparkymmilarky Yeah they raise the rents, so more people buy houses wanting to cash in on the high rents, its a vicious and self amplifying cycle. The homes will still exist if landlords are not buying them. You can make price invariant perturbations to the market by subsidising a desirable kind of buyer (primary residence) and penalising another (landlords). Buy to let is the only heavily leveraged investment where we don't consider people idiots who deserve whats coming to them when it fails.
I live in Spain. A similar plan (rent cap in stressed areas) was introduced here to relieve the housing crisis but it has not been successful and with the housing laws that changed at the beginning of 2023 giving tenants all the rights and owners none. We have a MASSIVE squatter problem (the 48 hour rule giving anyone the right to live in your property if after 48hrs the police have not been informed, it’s unbelievable what’s happening here) owners are scared to rent and consequently thousands of properties are wrapped in cotton wool apparently waiting for the laws to change before considering renting there properties out again. Be careful what you wish for.
I love how Alessandro Manzoni put it in The Betrothed 200 years ago: price control is like "an aging woman who thinks she can be young again by simply altering her birth certificate.”
Thankfully the aging woman now has access to the fertility drug "build-more-housing-as-detailed-in-Labour's-manifesto-axine", so we should all be sorted!
@@Owain_Lord_Of_Glyndyfrdwy there's a massive amount of housing sitting empty in london, because it works as an investment property because house prices are high, because rent is high, because housing is sparse, because a large amount of housing is sitting empty
@@georgemangco2526Canada announced similar, but they're failing to deliver. Labour may have announced millions of new homes but in doing so they've made it impossible to deliver, since the price of the goods required will skyrocket.
I live in Brighton. My landlord wants to lift my monthly rent from £750 to £920. As a student working part time, Its either work full time to afford my flat, and pretty much fail Uni, or focus full time on Uni and not have enough money for my flat I genuinely dont know what to do
@@randomlygeneratedname7171 what im saying is is that rent controls are a bandaid solution because it doesn’t address the shortage of housing. Rent controls make demand even worse.
@@randomlygeneratedname7171we built about 250k houses last year, and we imported 700k, even if Labour somehow doubles that (which is nearly impossible) it's still not enough. That's also ignoring that the cost of products required for building would also skyrocket increasing the cost of the houses.
@@aldine_KSP The rich out their money in the housing sector to grow and preserve their wealth as everyone will need shelter. So just stop them extorting people and force them to invest in building more
Don’t introduce rent controls, introduce a Rent Tax. Tax the income that landlords gain on Rent Specifically. Ensure that the tax is high and progressive. This can kill two birds with one stone, as the government can gain a lot of money from this tax while landlords are disencentivised from raising rent.
I don't think this works, end result will be all landlords raising rent together to compensate the tax, and effectively government is just gaining money from tenants, not landlords
Rent controls do not work on a markwt with constrained supply, there are far too many immigrants for the rate of house building, we added more people in a year than an entire city worth of housing
Rent controls sound nice on the surface. But the more you think about them, the worse the idea becomes. Freeze rents for existing tenants? Expect to see rents rise substantially for new tenants. Freeze rents altogether somehow? Expect landlords to sell, and then we have even less houses available for rent. Leading to an even greater rental crisis.
If landlords sell, there will be more supply if housing in the market. Supply and demand means house prices will drop, making it easier for people who would rent to buy. Short term worse for renters but long term better
@@jackwillis2963 it is true that house prices would become lower but not likely low enough for everyone to buy one. Bear in mind how unaffordable they are right now
For someone to sell there must be a buyer, so why should we care that anyone sells. If you’re worrying about whether people build new housing, that is more a dysfunction of the financial system than rent control. And people would still build housing because it’d be a way to make money. Heck, most restaurants fail yet new ones pop up all the time. As long as there is money to be made, there’ll be people doing it.
Everywhere they have introduced policies like this i.e Scotland and California. It has had the opposite effect as intended. Hold your seat . Rents are about to get even more expensive if this happens
It cannot disincentivize landlords from maintaining or improving properties, because they're already not doing either. I've three friends searching for units in different parts of the UK, and every property they view has at least one major issue despite asking for absurd rents. Black mold, front doors that cannot close or lock, significant roof leaks, water damage, dead appliances (one was told the appliances in the unit couldn't be changed out, and also that the fridge hadn't worked in two years)
Doesn't fit with UK culture. In Singapore you don't have the silly right to live in a specific council area. You get told where to live basically. And they force the demographics of each housing block to be representative of the country to stop ghettos forming. As well as having ultra strict rules on noise and anything to do with social cohesion. And you never outright own the housing. It always goes back to the Government (which is how it should be). There's no way their system could be implemented in the UK, nor would the population in the UK accept it.
Well said. There are a lot of empty homes in the UK, but not in places where people generally want to live. Those would be the places the government would send people. High crime, low income or job opportunity places.
We had a rent freeze in NYC for rent stabilized buildings during covid, and the city survived just fine. Rent increase are normally capped for Rent Regulated buildings, and well landlords in return have their taxes waived or greatly diminished in those properties. (obviously, it is not perfect), and whenever a neighborhood is becoming gentrified, regulated buildings are bought by VCs who want to kick people out or make life so unbearable for tenants to leave (rent stabilized requires that the landlord offers you a new lease unless you did something egregious), and then look for loopholes to take the building out from being rent regulated. They also withhold empty apts to force scarcity, and ask for higher rent increases (City this year had to pass a law that fines landlords keeping units out of the market)
6:17 no surprise. I don’t believe rent control or landlord tax breaks would lower London rental prices in London. Housing supply increase is the only answer
@@michaelhutchinson2854 I agree its dumb, i prefer renting to buying and so do many others. But if being a landlord was outlawed the property wouldnt be worth 750k anymore.
There are millions in rental properties that could not afford to buy.. The government would have to buy up those properties and what let them live their for free... That would cost Trillions, even Labour doesn't have a magic money tree that big..
@@AMGitsKriss Yeah cos they often trash the property. Why should a private landlord be forced to subsidise such behaviour? Council housing should be the sort of thing to provide to these people, not the private sector.
In Ontario, Canada, we have had provincewide rent control for around half a century. It locked down all rents to essentially inflation, and that was the system for around roughly twenty plus years, when it got revised 1) when a site was not continuing under the same renter, the landlord could seek current market rates for the new tenant, although it would be then subject to rent control rates for the duration of that tenancy, and 2) anything new added to the rental stock from that point would be exempt from controls. That went for around twenty years until the government revised things again and rolled all rental stock built before a certain date into controls. That date was moved forward again more recently. -- Ontario has developers building new flats at best designed to be held by investors looking to ride property price growth, rather than actual renting. That of course is useless in the actual rental market - eventually they will be renovated into studios or essentially hotels. Someday governments will understand that developers won’t build for the vast stretch of the rental market because it doesn’t give them maxed profits, and realise that the government will need to build its own for the affordable end of the market.
4000 years of recorded history show that price controls lead to shortages. Argentina most recently ended its own price controls and saw a massive surge in supply of rental properties as a result. Rent control is a recipe for disaster.
I’m a Lefty but screw rent controls. We need to have universal tenant unions to negotiate rents, and require all rental properties larger than a single unit be owned by a domestic REIT, with REIT shares accumulated by the renters of the units. Single units can still be owned and rented out by individuals, but not companies or foreign owners.
"Single units can still be owned and rented by individuals, but not companies or foreign owners." Say goodbye to university dorms then, or assisted-living facilities, or any possible economies of scale. Building maintenance and upgrades will also be fun, when everything needs to be decided by a quorum of incessant meetings. "or foreign owners." - now that's just plain xenophobia.
This is a tough one. The pros and cons are pretty 50/50. I live in a European city with rent controls. It took me 6 months to find a bad apartment and then 14 months to find a good apartment. But now i pay less in a capital city than my friend in a medium English town. On the other hand, ive paid absurd prices for extremely substandard places in England, where the maintenance and repairs were awful despite the landlord taking way more money.
Ridiculous that Labour and Tories turned this into a "complicated" issue - the obvious solution is more council housing, but Labour were scared to change taxes in order to pay for it so we're only getting houses built for private renting. Local rent controls and changes to council tax may be helpful, but they can't solve the issue on their own.
@@WillmobilePlus tax funded infrastructure?! 😱 It's a data-driven position: we need a lot more houses, ideally at affordable prices, and housing development has plummeted since we stopped building council houses.
@@RushfanUK since the decrease in annual house building (lower supply), homelessness and rent prices have increased significantly, because demand for housing follows population. As a necessity, rather than a luxury, housing does not follow the rules of supply and demand in the same way as most commodities, because supply has almost no effect on demand. The only times that house building has kept up with population growth was during massive council housing projects.
@@OrangeNash Yeah? They are providing you with rental units because you cant afford a real home. Certainly more than what you can do in that realm. You want to cop an attitude about them, then get a house or live on the street!
Massively increase stamp duty on purchasing second/third properties. Deregulate construction and planning to allow for taller, larger apartment blocks to be built. This will not be an immediate fix, but rather a 15-20yr plan.
I love the idea that introducing a rent control will prevent landlords from investing in the property and doing maintenance on the property, like they do that in the first place.
From Toronto here, we have rent control for many years now, while I cannot say rent control definably made thing worse I can say it certainly did not help. Rent is going up like crazy and landlord are very unwilling to rent and supply is simply not increasing as no developer is will to build. The sad truth is if the rich don't get richer than the poor will definably get poorer.
"The sad truth is if the rich don't get richer than the poor will definably get poorer." True but the actual rich are people who's actions add wealth when they do things. So people with skills and who put a lot of effort in. There's just unfortunately far too slow a balancing effect for them to take over the cash rich people who will occasionally lose it.
I'm glad you made this video, I can recall when I was homeless and faced with many things in life until $75,000 biweekly began rolling in and my Life went from A homeless nobody to a different person with good things to offer!!!!!!!
Wow 😱 I know her too Sandra Maria Ferraguti is a remarkable individual who has brought immense positivity and inspiration into my life. Her unwavering wisdom have been invaluable assets, enriching my journey in countless ways.
Together with my girlfriend I pay 2k per month + bills and council tax for a 40sqm 1 bedroom flat in zone 4. It's fucking awful. A rent control is needed.
It's supply and demand. The majority of population increase over the last 2 decades comes from immigration. Add to that councils and housing associations haven't built enough houses. Rent restrictions will only reduce available properties, as seen with over regulation from the previous govt.
Limitations on annual increases for existing tenants combined with specific rules around under what circumstances someone can be evicted can go a long way to helping renters without some of the disadvantages of broad rent freezes. That said, there's other things that need to be done to address the housing crisis as well, such as letting property owners increase density
As will ending the right to be housed at taxpayer expense in London or any other expensive area. If you desperately need housing paid for by the taxpayer, why not put these people in the north of England. You could give these people more space at less cost to the taxpayer.
Not for renters, whom the cost increase will be passed onto. And mom and pop landowners who rent out property will be forced to first evict current tenants then sell their properties to corporations who get tax breaks.
Err, first of all, sounds like you're advocating to essentially deport the poor to the north, therefore distancing them from their better off family members who could offer support, creating a deeper class divide between the north and south, enforcing that London is for the rich, and just generally disrupting people's lives. That's a terrible idea. Second, I know from my disabled homeless friend I went to uni with that living in London on state benefits is essentially impossible due to the incredibly high rents that this video talks about. So if the people you're talking about can't possibly live here anyway then that's obviously not in any way related to the housing costs being so goddamn high. I think you've completely missed the point.
@@fabianstoll If you start taxing land developers will be more efficient with how they use that space. They will try fitting in as many units as they can. If you’re taxing a skyscraper the same as a single family home no developer in their right mind will build a single family home
First, when the government passes a law prohibiting an agency from taking deposits on a booking property before signing a contract. The thing is that agencies require a booking fee, but they charge it to many potential tenants, keeping them for longer than three days, sometimes two or three weeks, to finally say that the landlord has decided on someone else. But I might end up on the street.
Definition of fighting the symptoms not the cause as that’s all labour have done so far . The demand is high as people are living longer and immigrations is at sky high and uncontrollable levels meaning the demand is so high and bidding wars start
How can you police this? Only the council flats can be under such limit, private owners cant be stopped. Unless you want to have loads of empty flats around...
Bring on rent control. But then also make it so any property found to have no permanent resident is either; bought by the state for council housing, or sold at auction to another private owner that will use it. Done
And here’s a suggestion Strict property minimums for letting properties no broken windows, leaky taps or shit electric if you want to make money from habitation you had better keep it habitable and address issues swiftly no leaving the heating dead gif 3 months
@@npcknuckles5887 The owner has the choice to sell it or find a tenant. There is a housing *crisis*. I don't know how you can advocate for keeping houses empty.
@@Runboyrun89 well you don’t need to have a second place if you can’t afford the bare minimum in terms of repairs maybe you should rent If your personal house had issues would you leave it months every time I’m not asking for a lot just the bare fucking minimum
Rent control has been scientifically proven to be ineffective in increasing the number of affordable dwellings. It only, sometimes, make the rent cheaper for the people already renting and that don't need to change for a larger apartment for example. And that might also lead to some huge inefficiencies, e.g. older people that used to have children, but children are already adult might stay in the apartment they've been renting, even if it's now quite big and could be used by new families, but they have a nice discount on the rent, so they will stay. If you have a housing shortage the only real solution is to increase supply, either by more incentives for private developers or by constructing more council flats.
Rent Control works quite well if done correctly. Only saying that a rent may not be raised will not work, I agree with that, as that will indeed probably lead to less upkeep etc. However if you combine this with a point system, where the size of the property, all amenities and the state of repair receive certain points, and a landlord may charge a maximum price based upon the points of the property, then it works very well. No longer doing upkeep on the property won't work in this scenario, because that would automatically lead to less points, and thus a lower maximum rent that can be charged.
Rent controls are a bad idea and have never worked anywhere. It doesn't solve the underlying problems that caused prices to rise. Competition doesn't end with a cap on rent prices. It ALWAYS takes other forms [long waits, less investment, fewer units available, slower repairs, etc]
This subject is complex concerning consequences. I said this a million times, but here we go: 1) For Rent Control (always starting with a backdated freeze) to work for tenants and expel landlords, it will take at least ten years as houses are an illiquid asset (unlike cash is the most liquid) to either (historical evidence for this) sold to sitting tenants and/or local authorities to be turned back into social housing (1920s after four years rent freeze and 2 + years of Rent controls, 1 million properties sold to sitting tenants). As landlords sell up, the value of the land that property sits upon falls, and a domino effect ensues due to falling yields for landlords (i.e. future gains from land price increases). 2) This needs to be a national RC, as you'll only move the problem elsewhere (US and NY issues). 3) In 1910, 90% of property was rented, and there was no social (it didn't exist in real terms). Owner occupiers were only for the remaining 10% who owned multiple properties, a form of feudalism. 4) After RF and then RC post-1914, the government of the day was forced into provision. This started with the 1919 Housing Act for council homes, followed by a promise for slum clearances from the previous rentier landlords, who would ALWAYS do the minimum maintenance due to 'loss aversion'. Mass private building for owner occupiers for skilled working and middle classes as land fell as a proportion of total value to 3-15% (the other part being build cost inc materials and profit). Aided by the 1942 Beveridge Report linking housing with health (as we have seen recently, damp = mould = respiratory issues, even early death). 5) So even an average income of one earner could buy a 2.5-bed semi on a 25-year mortgage with a 10% deposit; this included postmen and women. Then, the 1947 Housing Act restricted what was known as the uplift of land values when former poor agricultural land was built upon by 100% taxation (too much and frightened the horses), but this meant a win for new towns with the government paying little fo the land, as there was no future uplift (i.e. yield) 6) In 1954 and 1956, major parts of the 47 Act were repealed, allowing for fewer forms of rent control, leading to slum landlord Peter Rackman. Still, housing was being built hand over fist, often of poor quality, by secretive 'free market' large private building companies. 7) By the 1970s, the Private Rental Sector (PRS) had dropped from 90% in 1910 to 7% in the mid-70s. There were surpluses in certain areas, but more slums needed to be cleared. Nobody was crying out for more PRS, just more owner-occupiers and better-quality social housing. 8) In 1970-73, credit deregulation (CCC Act) caused a bubble, but it was abandoned once the oil crisis started in 73, followed by Wilson's re-election. 9) Housing was still affordable, but food, electricity, and petrol were expensive. However, children could independently afford a starter home in their early 20s. 10) In 1979, the big change, the end of affordable housing We all know what happened next, but one point is worth highlighting. Rent Control was ended in 1988, and the market immediately inflated (aided by the financial deregulation of the Big Bang in 1986), but few landlords reentered. But in 1992, the ERM crisis flattened the housing market, and a buy-to-let mortgage was made legal to revive it. Then, those who benefited from cheap housing got greedy, but in their defence, the welfare state was slowly being chipped away. This led to what is now known as 'asset welfarism'; the issue is if you don't have an asset, you're screwed. So what has changed? Land values. Remember I said in the 1950s that they were 3-15% of the property's value? Well, now, because the land is a tradable commodity with a house built on top, and what is known as a financialised debt funds this (again due to future yields, i.e. price increases), it is now on average 70%! (Build being 30%). What type of rent control? Well, there is already an existing rent control; my flat is a do-it-yourself shared ownership property from the early 1990s; the half I pay rent on is controlled by never being allowed to go above RPI inflation (now CPI) and is ultimately governed by the central government. Its original value was based on 3% of the original purchase price. The beauty of this is that there is no need for rent inspectors. So now my rent has fallen far behind market rates. I pay a 50% share in rent at 40% of market value. Fun Fact: Currently, the PRS is roughly 21% of all properties. If we went back to 7%, that would release 4 million properties onto the market all over the country. No new builds are needed, and the last 1 million can be built over 4 years. A few people have a surplus property to rent, creating scarcity whilst doing sweet FA, the much-hated Rentier Class. It's not clever; it's exploiting people who make and do stuff, i.e. 'key workers'. All political will no more or less. This is a fundamental overview, leaving loads out; at a minimum, it's a 10 K-word essay for comparative analysis. A quick 800 words, for more information Housingresearch *(dot) solutions *(dot = .) .
Personally I do not support regulation on rental market because it will often cause more harm than good. For example, if we introduce rent control and make it too unprofitable for landlords, landlords will simply stop renting to tenants and make them Airbnb, then tenants will suffer from housing shortage as a result. Instead of regulation, I think we can just simply follow supply and demand, and increase supply by making house building easier, or reduce demand by constructing more basic infrastructure in less popular areas.
You can simply introduce a cap on how many properties one could own. Or even have the obligation to live in properties that become available on the market. But ok, in the Anglo-American world, any form or regulation to help society further is directly seen as communism.
The problem with leaving it entirely to the market is it will never reach full housing just as the market will never reach full employment. The natural rate of unemployment in the job market and the natural rate of homelessness in the housing market presuppose there is an equilibrium position at rest where some people are unemployed and some people are homeless. This is the only way to extract profit or rent.
Placing increased taxes on more than one property would be viable - still being profitable but just discouraging one person from owning several properties all being rented out.
"We're not saying rent freezes are a bad idea" Yeap, rent freezes are a horrible idea. Want to drive rent prices down long term, remove regulations for both building and renting.
I lived in London in the late 70s when rent controls were still in place. It was the only reason I could afford to live and work there (I was a teacher). If i needed to do so today, with an equivalent income, I would have no chance.
@@patch2792 Not true, I know a landlord personally and that is exactly what he does. Rent out a property, Show its profitable, Take out a mortgage using it as collateral, Use that to build another property, Rent out that property and repeat.
They don't, most landlords do not build properties, most either inherit, or they use a mortgage which they then have the tenant pay off and at the end they still own a property that has been paid off by the renter and it probably has appreciated in value, you don't know anything about housing markets.
Mortgages are also usually cheaper than rent, which in itself should be completely economically impossible - most people will pay more than a deposit of rent before they build up that same deposit in savings taking into account inflation (and still if it included rents). A 1bed flat in a city in the north is often over £600 easily.
"A disincentive for landlords to invest in their properties" 😂😂😂 Most private landlords have been milking the same houses with little to minimum maintenance, let alone investment, for decades while the rents are skyrocketing😂😂
Hi, a landlord here. I have to say I have never understood landlords who dont maintain their properties. A serious damp problem or electrical issue is going to hit your capital FAR more than the outlay to maintain the properties on a regular basis. The landlords that do neglect their properties end up taking a massive hit either when they sell (if its in bad condition), or end up forking out much more to treat a critical issue (e.g. a mild damp problem caught early might cost a few hundred quid to fix, an ingrained damp/mould problem would cost many thousands if it gets into the walls and floors).
Would they also cap interest rates, property tax increases, and insurance premium increases? It’s unrealistic to force one sector to shoulder the burden while other industries can increase costs.
Stop rich foreigners from buying up blocks of flats for investment and money laundering, driving prices sky high
Getting a fire under control is one thing but, at some point, you have to actually put out the fire and rebuild what it destroyed.
Very good point
People will try everything before building more houses
The issue is having houses where people want to live (central London/Bristol/Cambridge etc.). There's no shortage of actual dwellings overall. It's an obsession with crowding our society/economy around a small number of economic hubs. It's a never ending downward spiral.
@@chrisjie2127 No, both house prices and rents have increased substantially in most parts of the country. Also, government statistics on population growth and house building prove that, no matter what way you look at it, not enough houses are being built. There are also not that many empty dwellings nationwide, certainly not enough to provide a solution to the housing crisis. There is, in fact, a massive shortage of actual dwellings overall.
@@chrisjie2127finally a sensible comment
10 million in over the decade has no impact I suppose.
Building more houses won't help if they are just bought by more landlords and used to harvest people's wages. Councils need to build more houses, so that people from poorer areas can move where there is work, and so they don't have to pay private landlords to house people at inflated rates. We have enough houses, they are just in the wrong hands.
In Sweden you can only buy to let one property per household and only for a maximum of two years and the government prioritise house building. Rent is affordable.
Edit: there is a huge amount of rent control in Sweden. Not only that, but the amount you can sell your house for is also capped. Both numbers are capped mainly based on the size of your property and the area it's in. This prevents people from being able to make a large amount of profit from flipping.
Also, whether or not you can rent an apartment in a buy to let scenario is voted on by a committee of home-owners in the apartment's block. You can only rent out your apartment if the committee agree to let you do so.
Furthermore, Sweden has the second lowest average age of first time buyers IN THE WORLD at 24-years-old.
Scandinavia might not always have popular solutions but they always work
In Sweeden, housing isn't affordable because of their cap on owning property. It's affordable because the supply of housing is sufficient to meet the demand. That's the exact opposite situation in London.
This. Rent control isn't the answer. People owning multiple rental homes and pushing up cost of housing everywhere is the root cause problem.
@@donaldkinsey5245if you can buy multiple houses. That takes a house away from a owner occupier, who potentially has to save longer and adds competition to rent. Obviously building houses is important, but not having people stuck renting because house price gone through stratosphere is a massive contributor.
@donaldkinsey5245 it's a mix of both and that's why I mentioned both aspects.
the whole housing system is fucked. why is having a place to live treated like a commodity?
Because it is a commodity?
You mean investment,those are two different things.
@@Kalimdor199Menegroth
That is a choice.
I note that in the entire history of housing crisises, and them being solved, was it ever solved by it being treated like a commodity?
No, i cannot think of a single historical example of that, can you?
Yet there are many historical examples of mass support for ending a housing crisis, leading to Govt building more housing and that solved it and it doesnt cost anything, even makes money (bc govt sells it or leases it).
Historically, it has even been solved with less technology and worker and material shortages.
Would you like to know those examles?
Vienna, Singapore, Australia and UK after ww2, Auckland city, USSR under Krustushev.
Because we’ve allowed 10s of millions of unproductive migrants to move here, allowed them to take up social housing as a priority over natives if they have children, not built new social housing, and allowed a monopoly of property developers to control the flow of new builds into the market via a system of red tape that makes it impossible for a normal person to build on land they own.
@@Kalimdor199Menegroth
Could you pls give me a counter examle?
And historically, hasnt housing being a commodity caused the housing crisises?
I recommended Economist Cameron Murry on this topic, because he is not paid for by Swap Donor Class Owned Media.
From Sweden here. Yeah, rent controls do not work. We have them here in the biggest cities. Nobody wants to build or maintain rental properties, so home-buying prices have skyrocketed instead. The waiting list is many years long, and the shortage has been described as hindering overall growth. Many economists have wanted to sack this system for years, but since government is Sweden is mostly left-wing (and people living in these rent-controlled flats have a lot of political power) it has not happened. The left-wing always say that massive subsidies to the building-sector will solve everything, which it generally does not. PS. Not forgetting the huge black market for second-hand renting.
I see what you're saying, and this has been the case for the years prior, but since the right-winged parties in sweden now hold a majority (government coalition + SD) shouldn't they in theory be able to get rid of this?
The current Swedish government is right wing
Why does the building sector even need subsidies? Is a massive, years-long, list of buyers not a good enough incentive to build?
@@ziglausbeware you are almost going to find out that the market doesn't regulate itself
@@madpig7120 What do subsidies have to do with regulation?
That 40% is a strange statistic to mention. Spending one year will either be higher or lower than the previous. So a 40% decrease actually suggests that most landlords have INCREASED repairs spending in Scotland. Was there a category for "maintained the same spending"?
Am I missing something here? If 44% of landlords have stopped or decreased the amount they’ve spent on maintenance, how does that mean that maintenance has increased?
Oh I see your point, suggesting that 56% have therefore spent more money on maintenance
😂 ive lived in rent for the last 10 years and only one of the landlord s actually fixed anything
That's a statistic from people who don't actually understand numbers even though they use them ALL THE TIME in their videos. Yes: there could have been a 44/56 split between reduced-or-stop and maintained-or-increased. OR it could be (say) 44/35/21 for reduced/maintained/increased. We weren't given enough information. So, that figure doesn't help us understand at all....
@@mattmathematics3591 Your anecdotal experience and crying laugh emoji is noted
2080 being AVERAGE rent in London is absurd. During my time renting in London I paid £250k. I could have bought a house with that elsewhere in the country. Renting is tantamount to slavery. You work obscene hours to the point where you're barely home enough to enjoy the overpriced flat you rent and at the end of the month you give a huge chunk of your wages straight into the bank account of your landlord. It's disgusting and wrong.
Buy a house then?
Rather than rent controls, why not heavily tax housing that is not in use. There is a lot of housing owned by the wealthy that sits unused, treated as a commodity that accrues value, rather than shelter for people that need it. Oh, and build more. Demand is high, increase supply.
Plutocracy wouldn’t allow their political pawns to ratify such laws.
That makes no sense. Renting out a property doesn't prevent its capital value going up so why would you turn down free money by leaving it empty. Most properties are left empty waiting for planning permission. There are second homes but they are not that common.
Because Sadiq and most MPs have a property in London so they can be in Westminster and also in their constituency.
Well any career MP who you'd recognise anyway.
@@SmileyEmoji42because there is work and such involved with renting out.
just leaving a house vacant requires next to no work and the value will just keep going up
You know what, this is actually a good idea. I'm normally against more taxes but empty properties need to be dealt with and the solution isn't rent control but more housing.
People and politicians must understand that prices are signals, they are consequences of something. If you limit or mess with prices you will create discordination issues that will just make the situation even worse.
Once Paris set rent control and especially rules about not being able to rent out anything under 9m, lots of properties went on sale.
Simple really. Ban buy-to-let. You should not be allowed to buy a house unless you're going to LIVE IN IT. Suddenly the value of housing plummets, making both buying affordable and renting affordable.
Rent controls in a nutshell: easy short term political win, mid to long term disaster.
No, rent control should be seen as an add on rather then a single policy to pass.
Very succinctly put. It’s made a worse problem everywhere it’s been done. What I don’t get is why the young Marxists can’t figure out why it’s really a subsidy for large London employers and power brokers at mostly the cost of small land lords.
something drastic needs to be done and quickly too. its literally becoming unaffordable to have shelter.
Why not reduce taxes and red tape for landlords?
It's as if incentivising investment in the sector will increase supply
@@lordsummerisle852because do you really think landlords will decide to reduce their margins if tax is reduced? They’ll just maintain their prices and get more revenue
@@hassantaibaly293Or more realistically they would invest in new development and spread out cost,there is no world where this can be bad for the housing supply.
subsidizing demand is dumb and will make the problem worse. we need to build more, we have a massive housing shortage.
Maybe stop importing new people?
If you think the market is bad now, just wait until what happens when there’s rent control.
A London Rent control would be a disaster with a drop in properties being rented and a decrease in quality of the remaining housing stock. Something needs to be done with the rental market, just not Rent caps. Following Barcleona with a ban on AirBnB in London would be a good start. Tax break for REITs focusing on the residential sector who conform to additional standards would be a clever way. Or call me crazy, build more properties.
I hadn't realised how bad the AirBnB problem was until I got home from my summer holiday to see five new key boxes on my building, which means in the past year half of the ten flats have been turned into holiday rentals - and I don't even live in a place that gets a lot of tourism.
Banning REITs and RE SPACs is a better start
Why would renting be dropped by home owners? It would still be an extra source of income that the house is generating for the homeowner. Even though it’s less money would it not be still attractive to do?
agree airbnb's need to go
Making it law that only the British/EU members can own property would make a lot of difference. It's actually ridiculous how many hundreds of billions of pounds in dodgy money is in London
Build more houses. Remove height restrictions, and you will get more homes and therefore lower prices.
No bro we just need to give everyone money to buy houses! thats the real solution, what can go wrong?
Great idea but where are the builders going to come from to build the houses add to the cost of building materials which is mental thanks to Brexit.
The town and country planning act prevents all of that.
@@precariousworlds3029idk if you’re being sarcastic but this is the actual solution. The problem really isn’t that there aren’t enough houses, it’s that the price of houses (alongside everything else) have skyrocketed yet wages have stayed the same since the early 2000s.
@@Sirlarrythecat Stop subsidising or giving loans on useless degrees and pour the money into apprenticeship schemes, when people get told either pay 200,000 for your English degree with 0 job prospects or take this apprenticeship scheme and start earning 30,000 a year straight away, people will start changing their priorities fast.
Rent controls will only be beneficial to CURRENT tenants, not future tenants. Long-term, rent control has been disastrous.
Multi-home tax that increases on each subsequent property is the only way to fix this awful system, but too many of them have stakes in property themselves to give a damn. Labour, Tory, no difference except the color of their ties.
What, so increasing taxes on housing providers is going to help?
Erm okay
"The only way to fix the system"cruel lack of imagination,this is not even a good idea.Just use land value tax.
So no housing associations?
@@lordsummerisle852nobody said anything about taxing the construction companies who provide housing. Just taxing people who hog all the housing
Well its simple, make it illegal for companies to own residential properties.
Rent control is sold to the people as temporary, but it ALWAYS becomes permanent.
As it should be.
@@kj4748no, it reduces housing supply and increases costs long term.
@@kj4748 EVERY place it’s been implemented it just makes the problem worse.
It’s a supply problem. Think about it.
True, rent control *on its own* always reduces housing supply and increases costs. Thankfully this government finally recognizes that problems take more than one course of action to fix, which is why they've come around the supply end of the equation with the new homebuilding plan. Of course rent control should be permanent, any solution to a problem has to be.
Spoken like a true land lord, aw but my business won't survive. Yeah who cares
Rent control is like the one thing that nearly every economist agrees is bad. Unaffordable housing is an availability problem and rent control makes availability significantly worse
For property owners, I guess it is?!
@@GG-hu9dnyou should check out a current live case study in Scotland. Rents have shot up way more than places without rent controls.
@@joey-pn3xe Incredible, that this has happened?! It is completely unsustainable?!
@@GG-hu9dn it doesn’t work. Basic economics tells us we have a supply problem but no one wants to fix that. Building targets have never been met since they started recording them!
Nothing to do with buy to rent then?? And / or laundered money being parked into corrupt UK inflated property market? Or inheritance? I mean, it's a complete joke of - a - country?!
Maybe less unvetted migration would help.
REMIGRATION NOW!
same issue is in Manchester. living in a one bedroom apartment and our rent went up from 955 to 1050. and when trying to go to a new place we have to bid higher amounts to secure the places, but the amounts are unreasonable
London is very quickly becoming like a country within itself
Rent controls are completly normal policy throughout Europe. In the UK the suggestion is radical and unthinkable. You can't save this country. Too small minded to its core.
Yeah rent control is almost never the solution. We have rent controlled housing in my city (still from socialist era) and those houses/apartments are often in sorry state as landlords simply cannot afford repairs above what is required (with taxes, fees and severely capped rents) and you have to wait 10+ years for something to be available. On contrary market rates are high (though not much higher than mortgage) but you often get newer/modern building, better services, parking space, no need to pay for repairs/taxes on the house.
And the solution? Building more, not taxing more or restricting landlords. The plans here are to build around 50 000 more units/houses in next 10 years in various areas of the city. One project is building completely new part of the city in 5 km by 1.5km plot of land with housing, shopping centre, hospital, schools/pre-schools, tram, roads, new park, etc.
Building more won't help alone, they'll just be snapped up by the super rich as investments, which in turn will drive up prices/costs.
I think the plans suggested by khan / labour think tanks are second order rent controls rather than first order. This means that it'd be a cap on the annual increase of rents, rather than a cap on rents overall. This means it could be similar to a pension triple lock idea, where it can only go up by the higher of CPI or wages for example.
Taxing more IS the solution. Taxing on the value of the land makes landlords actually try to compete.
@@wackypeace1135 That's monopolistic, and breaking monopolies is one of the only things a government can do in a capitalist economy that does more good than bad.
@@xemorr "pension triple lock idea, where it can only go up by the higher of CPI or wages for example." Houses are not like people, they cannot get up and move to an area with lower costs of living. Even such limits will inevitably result in dilapidation, since costs of living and inflation do not change equally throughout the country.
Rent controls do not work. We have proved that repeatedly. Every time rent controls fail, those in favour simply claim it was "old style" rent controls that failed and the new generation of rent controls will work. I believe that the currently completely failing Scottish rent controls are 3rd generation rent controls (whatever that means), so no doubt Khan's ideas would be 4th generation rent controls - which will inevitably fail.
There is only one solution to rising rents which has proved to work - build more properties to rent. Only problem is that the private sector is not prepared to invest enough to do that, mostly thanks to underlying trends in regulations supported by all main political parties. So the solution to London's rental crisis is to build a lot more social housing by public funded entities something Khan has been very bad at delivering
"we never tried REAL rent controls"
@@moneyobsessed Of course we have in all of UK, in various guises from 1915 to 1989 and in Scotland from 2022 to date. But of course you did not know that, so much was before your time. You are no different to those who spout how the latest generation of rent controls are different to the previous versions (or to use your terminology how the latest version are "real" rent controls and somehow the past were not) and will definitely "work" this time - except they do not
@@justinstephenson9360 You make only valid points but just saying, they're agreeing with you. They're just joking like those people who say ''we've never tried REAL communism''.
Rent Controls fail everywhere.
not in France though
@@jennythufu7676 Except less properties and deteriorating units.
no they don't, they work in several countries I've lived in or been to - landlords are leeches and housing shouldn't be treated like a commodity in a decent society, you're just repeating capitalist propaganda
Not in austria
How many?
It's been tried for years but I don't think people have understood that this easy easy solution rent controls, one vote and all our problems go away just doesn't work. It doesn't even take a genius to figure out why rent controls don't work either.
Rent and housing should be part of inflation calculations
Rent control has been tried in every country and has, without except led to deprivation. Have studied this, economist Assar Lindbeck pronounced: “Rent control appears to be the most efficient technique presently known to destroy a city…. Except for war”.
If Labour stops overtaxing landlords, they will decrease prices. As a comparison:
£1,350 rent
(-) £450 tax (40% bracket)
(-) £650 mortgage interest
(-) £140 agent fees
(-) £150 service charge.
---
£40 _loss_ to the private landlord. Why do you think your rent is high?
Simple and straightforward, that's why it'll never catch on. People are too jealous of landlords as it is.
Or they wont lower the rent and pocket the difference... "Should i make more money?" man such a hard question to answer
People think Landlords make a fortune, they really don't understand the costs involved.
And you are actually missing some stuff. Maintenance, compliance fees, void periods and god forbid you have any tenant or legal issues.
@@Burito-tj5ry if you have 3 properties more or less the same the rents are £2,000, £2,000 and £3,000 which one are you going to pick?
Almost like the buyers dictate the price.
@@Burito-tj5ry Way to simple a way to look at it.
For example, I'd rather have good tenants paying less than bad tenants paying more. I'd rather have a long term tenant paying less, than have short term tenant pay more.
There is a balance.
Once again, the issue is not land-Lord vs not land lord. It's supply vs demand. On the demand side : Find way to make companies move their headquarter and high paying job outside London and people will follow. On the supply side, punish empty-house with steep taxes, remove zoning law, promote constructing etc ... and price will go down.
The MP's own most the properties in London and in UK. Its all done by design and some landlords are using this situation to exploit renters.
They really don't you know. There just aren't that many MPs and most of them are not that rich.
All landlords otherwise an agency won't "take" instruction and they'll have to manage it themselves. Agencies force them to maximise profits, though in the London market most wanted to do that anyway so it's not quite as insidious.
Whenever a state or country or municipality introduces a Cap on rent, almost every unit that's currently renting below the cap almost immediately or at the end of its current lease goes up to it. You also see a changing of issues, where instead of properties being available but being too expensive for most people to rent, which is a market issue that can change on its own, the problem then becomes every available unit was rented out as soon as the rent control went into effect, and there's no available units to stay.
You SHOULD be saying rent control is a bad idea: IT IS A BAD IDEA.
You can get anything below 2000 in London, this is actually insane as wages have been pretty stagnant and getting outpaced by the rental inflation, high rental yields are encouraging the property owners to gauge the prices and charge whatever they want
It’s a supply, not demand issue. Why don’t they losen building tax and regulations, and companies would make more profit when building housing units. If you are relying on politicians, you’re screwed. If 100k homes need to be built to ease housing inflation, why are they focusing on pricing caps? It’s very simple. More houses need to be built.
I’m not saying it’s right or even the correct decision, but from a purely political perspective it’s far cheaper (cost basically nothing for the gov to do), easier, and quicker to introduce price caps than build 100k houses. A cheap, easy, and quick policy that might help, or more importantly gives the illusion of helping is like catnip for politicians
Supply and demand are relative terms that are intrinsicly linked. If demand does not change, but supply increases, you have less relative demand to the supply.
We are allowing more and more and more people into this country, with nowhere to live. We have very little green, publically accessible spaces left in the country (i.e. we live in a high density country), farming is already suffering and towns already ever expanding. Where are these houses going to be built?
Immigration is the number one issues, whether folk want to admit it or not.
You xannot rely on private companies to build enough houses to match demand, because that would necessarily bring down prices, whichbwpuld bring down profits. Homelessness is good for business.
The number of council houses that have been sold through right to buy (roughly 2m) is in great excess pf those on the waiting list for council housing. What we need is council houses. The rents they bring in can enter the councils tax pool and act as a revenue stream as well aa provode affordable housing. Capitalism cannot cure its own problems
Absolutely.
Of course capitalism can solve its own problems commie. You do realise that new housing companies can be created right so even reduced house prices would be profitable. The fact that we have so few housing developers is due to excessive regulations not capitalism @outofideas42
Depending on how it's done, it may remove a lot of of properties from the market. If the introduce a cap that is lower than mortgage payments, the owner won't want to continue renting it out.
“We are not saying rent freeze is a bad ideia”, so you are wrong. They are a very stupid ideas
Can you, please, suggest a news channel that recognises that rent control is a terrible idea?
How to make the situation worse, rent controls!
Ridiculous policy which has failed everywhere its been.
Not once in history have price controls worked, and they never will.
Homelessness about to skyrocket
when trying to rent in london last year it was a horrible experience, every viewing we went to resulted in a bidding war (sometimes in person at the viewing). on multiple occasions we sent our deposits only to later be told that someone else has offered more. it's a bloody nightmare - right now I'm renting in an unlicensed HMO and thankful that even though this rental is shit, at least i'm not getting messed about by letting agencies.
£2,080 is a lot. In Toronto we have rent controls as well as constant new building high rises. Like most studio - 1 beds are between $2100(what I pay)- $2500.
Introduce a levy on buy to let mortgages that raises the effective interest rate and lower interest rates on homes that are the persons primary dwelling. Buy to let is what has been driving prices up and it's parasitic.
This is just wrong. Do you have any idea how much landlords have to pay out? There is no money in it so they are forced to raise rents massivley
There is no way to lower costs unless we build more houses
@@sparkymmilarky Yeah they raise the rents, so more people buy houses wanting to cash in on the high rents, its a vicious and self amplifying cycle. The homes will still exist if landlords are not buying them. You can make price invariant perturbations to the market by subsidising a desirable kind of buyer (primary residence) and penalising another (landlords). Buy to let is the only heavily leveraged investment where we don't consider people idiots who deserve whats coming to them when it fails.
@@Dongobog-ps9tz Don't we? I do. But probably because that's what pays my bills xD
@@Bozebo What do you mean?
I live in Spain. A similar plan (rent cap in stressed areas) was introduced here to relieve the housing crisis but it has not been successful and with the housing laws that changed at the beginning of 2023 giving tenants all the rights and owners none. We have a MASSIVE squatter problem (the 48 hour rule giving anyone the right to live in your property if after 48hrs the police have not been informed, it’s unbelievable what’s happening here) owners are scared to rent and consequently thousands of properties are wrapped in cotton wool apparently waiting for the laws to change before considering renting there properties out again. Be careful what you wish for.
I love how Alessandro Manzoni put it in The Betrothed 200 years ago: price control is like "an aging woman who thinks she can be young again by simply altering her birth certificate.”
Thankfully the aging woman now has access to the fertility drug "build-more-housing-as-detailed-in-Labour's-manifesto-axine", so we should all be sorted!
@@georgemangco2526 YES. And it's not about being for or against the free market, it's all about addressing the underlying issue
@@Owain_Lord_Of_Glyndyfrdwy there's a massive amount of housing sitting empty in london, because it works as an investment property because house prices are high, because rent is high, because housing is sparse, because a large amount of housing is sitting empty
@@georgemangco2526 Dream on sunshine, dream on.
@@georgemangco2526Canada announced similar, but they're failing to deliver.
Labour may have announced millions of new homes but in doing so they've made it impossible to deliver, since the price of the goods required will skyrocket.
I live in Brighton. My landlord wants to lift my monthly rent from £750 to £920. As a student working part time, Its either work full time to afford my flat, and pretty much fail Uni, or focus full time on Uni and not have enough money for my flat
I genuinely dont know what to do
Promises to build more houses
Introduces rent controls.
Cant make this stuff up
You missed a few steps. So for more profit, there must be more houses instead of just milking a few houses.
@@randomlygeneratedname7171 what im saying is is that rent controls are a bandaid solution because it doesn’t address the shortage of housing. Rent controls make demand even worse.
@@randomlygeneratedname7171we built about 250k houses last year, and we imported 700k, even if Labour somehow doubles that (which is nearly impossible) it's still not enough.
That's also ignoring that the cost of products required for building would also skyrocket increasing the cost of the houses.
@@aldine_KSP The rich out their money in the housing sector to grow and preserve their wealth as everyone will need shelter. So just stop them extorting people and force them to invest in building more
@@SaintGerbilUK Well, get building then and ain’t women supposed to double and triple the population anyways because they stopped doing that.
Balanced fair video on rent control and good info. Thanks
Don’t introduce rent controls, introduce a Rent Tax. Tax the income that landlords gain on Rent Specifically. Ensure that the tax is high and progressive. This can kill two birds with one stone, as the government can gain a lot of money from this tax while landlords are disencentivised from raising rent.
Yeah this is a much better idea than rent controls
The only tax we need is a land value tax.
I don't think this works, end result will be all landlords raising rent together to compensate the tax, and effectively government is just gaining money from tenants, not landlords
I can see the costs of the taxes being passed on.
Which is by the way different from an haberger Land Value Tax which cannot be passed on consumer.
Rent controls do not work on a markwt with constrained supply, there are far too many immigrants for the rate of house building, we added more people in a year than an entire city worth of housing
Rent controls sound nice on the surface.
But the more you think about them, the worse the idea becomes.
Freeze rents for existing tenants? Expect to see rents rise substantially for new tenants.
Freeze rents altogether somehow? Expect landlords to sell, and then we have even less houses available for rent. Leading to an even greater rental crisis.
If landlords sell, there will be more supply if housing in the market. Supply and demand means house prices will drop, making it easier for people who would rent to buy. Short term worse for renters but long term better
@@jackwillis2963 it is true that house prices would become lower but not likely low enough for everyone to buy one. Bear in mind how unaffordable they are right now
For someone to sell there must be a buyer, so why should we care that anyone sells. If you’re worrying about whether people build new housing, that is more a dysfunction of the financial system than rent control. And people would still build housing because it’d be a way to make money. Heck, most restaurants fail yet new ones pop up all the time. As long as there is money to be made, there’ll be people doing it.
Them selling does not suddenly delete the housing 🙄 I mean the actual solution it to decommodify it entirely.
We need cap on how many properties one can own. There are mtfkrs with +20 houses in their names
Everywhere they have introduced policies like this i.e Scotland and California. It has had the opposite effect as intended. Hold your seat . Rents are about to get even more expensive if this happens
So would that be the rent controls we've had a lot of in history or just the newer ones today you're talking about?
@@Bozebo recent. Would be interesting to see or know the cases that you are alluding to
It cannot disincentivize landlords from maintaining or improving properties, because they're already not doing either. I've three friends searching for units in different parts of the UK, and every property they view has at least one major issue despite asking for absurd rents. Black mold, front doors that cannot close or lock, significant roof leaks, water damage, dead appliances (one was told the appliances in the unit couldn't be changed out, and also that the fridge hadn't worked in two years)
Just look at the Singapore model for social housing. If a tiny country of Singapore can do it, UK can do it too.
Doesn't fit with UK culture. In Singapore you don't have the silly right to live in a specific council area. You get told where to live basically. And they force the demographics of each housing block to be representative of the country to stop ghettos forming. As well as having ultra strict rules on noise and anything to do with social cohesion. And you never outright own the housing. It always goes back to the Government (which is how it should be).
There's no way their system could be implemented in the UK, nor would the population in the UK accept it.
Singapore is known for being a quasi-dictatorship.
Well said. There are a lot of empty homes in the UK, but not in places where people generally want to live. Those would be the places the government would send people. High crime, low income or job opportunity places.
Singapore doesn’t have mass immigration pushing demand to insane levels.
Comparing small countries to big countries will never work. We're more in line with Japan or France than we are a literal city state
We had a rent freeze in NYC for rent stabilized buildings during covid, and the city survived just fine. Rent increase are normally capped for Rent Regulated buildings, and well landlords in return have their taxes waived or greatly diminished in those properties. (obviously, it is not perfect), and whenever a neighborhood is becoming gentrified, regulated buildings are bought by VCs who want to kick people out or make life so unbearable for tenants to leave (rent stabilized requires that the landlord offers you a new lease unless you did something egregious), and then look for loopholes to take the building out from being rent regulated. They also withhold empty apts to force scarcity, and ask for higher rent increases (City this year had to pass a law that fines landlords keeping units out of the market)
6:17 no surprise.
I don’t believe rent control or landlord tax breaks would lower London rental prices in London. Housing supply increase is the only answer
I thought the SNP tried 'housin/rent controls' IN Edinurgh, and rents went up, another 'failed policy' by Labour's Sadiq Karn...
How about we just get rid of Landlords? Worked for that game Cities: Skyline 2 😂
Yeah? You gonna buy the house I rent out to a tenant? It’s £750,000 ish you might have to stop eating avocados on toast for a while….
@@michaelhutchinson2854 I agree its dumb, i prefer renting to buying and so do many others. But if being a landlord was outlawed the property wouldnt be worth 750k anymore.
@@tupo3855 do you think it’s all the landlords fault prices are high??? Okay crazy…..
@@michaelhutchinson2854 You say that like we can afford Avocados or bread???
There are millions in rental properties that could not afford to buy.. The government would have to buy up those properties and what let them live their for free... That would cost Trillions, even Labour doesn't have a magic money tree that big..
As a tenant, I hate paying my landlord's mortgage. It sucks being poor.
🐂💩 maintenance is a LEGAL requirement and not upto landlords discretion
So is accepting people on housing benefit, but landlords still routinely turn such people away. Shit needs enforcing.
That depends. The landlord can do the bare minimum instead of getting ahead of issues.
@@AMGitsKriss Yeah cos they often trash the property. Why should a private landlord be forced to subsidise such behaviour? Council housing should be the sort of thing to provide to these people, not the private sector.
Poor people are the majority of criminals. Fact@fraser-y9r
@@revorocks123if they don't want the troubles of being a landlord I guess they can get a proper job then 🤷♂️
In Ontario, Canada, we have had provincewide rent control for around half a century. It locked down all rents to essentially inflation, and that was the system for around roughly twenty plus years, when it got revised 1) when a site was not continuing under the same renter, the landlord could seek current market rates for the new tenant, although it would be then subject to rent control rates for the duration of that tenancy, and 2) anything new added to the rental stock from that point would be exempt from controls.
That went for around twenty years until the government revised things again and rolled all rental stock built before a certain date into controls. That date was moved forward again more recently.
--
Ontario has developers building new flats at best designed to be held by investors looking to ride property price growth, rather than actual renting. That of course is useless in the actual rental market - eventually they will be renovated into studios or essentially hotels. Someday governments will understand that developers won’t build for the vast stretch of the rental market because it doesn’t give them maxed profits, and realise that the government will need to build its own for the affordable end of the market.
4000 years of recorded history show that price controls lead to shortages. Argentina most recently ended its own price controls and saw a massive surge in supply of rental properties as a result. Rent control is a recipe for disaster.
Sure if you cherry pick history from already failed economies. Instead of say, Britain during the height of the empire.
@@Bozebo No cherry picking. It's the same for every single instance of it.
Need far more social housing, only available to British citizens.
Fourth generation british citizens
I’m a Lefty but screw rent controls. We need to have universal tenant unions to negotiate rents, and require all rental properties larger than a single unit be owned by a domestic REIT, with REIT shares accumulated by the renters of the units. Single units can still be owned and rented out by individuals, but not companies or foreign owners.
If you want the renters to own the REIT why not just have them buy the property?
"Single units can still be owned and rented by individuals, but not companies or foreign owners." Say goodbye to university dorms then, or assisted-living facilities, or any possible economies of scale. Building maintenance and upgrades will also be fun, when everything needs to be decided by a quorum of incessant meetings. "or foreign owners." - now that's just plain xenophobia.
Classic lefty, living in a dreamworld
This is a tough one. The pros and cons are pretty 50/50.
I live in a European city with rent controls. It took me 6 months to find a bad apartment and then 14 months to find a good apartment. But now i pay less in a capital city than my friend in a medium English town.
On the other hand, ive paid absurd prices for extremely substandard places in England, where the maintenance and repairs were awful despite the landlord taking way more money.
Ridiculous that Labour and Tories turned this into a "complicated" issue - the obvious solution is more council housing, but Labour were scared to change taxes in order to pay for it so we're only getting houses built for private renting.
Local rent controls and changes to council tax may be helpful, but they can't solve the issue on their own.
"the obvious solution is more council housing"
LOL! More government projects..Cripes you people are off your rocker.
@@WillmobilePlus tax funded infrastructure?! 😱
It's a data-driven position: we need a lot more houses, ideally at affordable prices, and housing development has plummeted since we stopped building council houses.
@@olb3587 Why do we need more houses?
@@RushfanUK since the decrease in annual house building (lower supply), homelessness and rent prices have increased significantly, because demand for housing follows population.
As a necessity, rather than a luxury, housing does not follow the rules of supply and demand in the same way as most commodities, because supply has almost no effect on demand. The only times that house building has kept up with population growth was during massive council housing projects.
Mate....delete this comment. You're clearly ignorant and have no idea wtf you're talking about or how it works. 😂😂😂
Surely this will have absolutely no unintended consequences
"Bad for landlords" Oh no! My heart goes out to them.
Well then enjoy the higher rents, and dont look for our hearts to go out to you.
@@WillmobilePlus
Where’s these considerate landlords you speak of???
they have to make money to.
@@realxinruz4064 Aren't people supposed to do productive work to make money?
@@OrangeNash Yeah? They are providing you with rental units because you cant afford a real home.
Certainly more than what you can do in that realm.
You want to cop an attitude about them, then get a house or live on the street!
Massively increase stamp duty on purchasing second/third properties. Deregulate construction and planning to allow for taller, larger apartment blocks to be built. This will not be an immediate fix, but rather a 15-20yr plan.
I love the idea that introducing a rent control will prevent landlords from investing in the property and doing maintenance on the property, like they do that in the first place.
From Toronto here, we have rent control for many years now, while I cannot say rent control definably made thing worse I can say it certainly did not help. Rent is going up like crazy and landlord are very unwilling to rent and supply is simply not increasing as no developer is will to build. The sad truth is if the rich don't get richer than the poor will definably get poorer.
"The sad truth is if the rich don't get richer than the poor will definably get poorer." True but the actual rich are people who's actions add wealth when they do things. So people with skills and who put a lot of effort in. There's just unfortunately far too slow a balancing effect for them to take over the cash rich people who will occasionally lose it.
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Together with my girlfriend I pay 2k per month + bills and council tax for a 40sqm 1 bedroom flat in zone 4.
It's fucking awful. A rent control is needed.
It's supply and demand. The majority of population increase over the last 2 decades comes from immigration. Add to that councils and housing associations haven't built enough houses. Rent restrictions will only reduce available properties, as seen with over regulation from the previous govt.
Funny enough we don't have skilled workers, British workers are lazy with a beans and roast mentality. Why nhs filled with coloured.
Limitations on annual increases for existing tenants combined with specific rules around under what circumstances someone can be evicted can go a long way to helping renters without some of the disadvantages of broad rent freezes.
That said, there's other things that need to be done to address the housing crisis as well, such as letting property owners increase density
Taxing land will solve all of these issues
As will ending the right to be housed at taxpayer expense in London or any other expensive area. If you desperately need housing paid for by the taxpayer, why not put these people in the north of England. You could give these people more space at less cost to the taxpayer.
Not for renters, whom the cost increase will be passed onto. And mom and pop landowners who rent out property will be forced to first evict current tenants then sell their properties to corporations who get tax breaks.
How? Why should someone build more apartments because of a new tax?
Err, first of all, sounds like you're advocating to essentially deport the poor to the north, therefore distancing them from their better off family members who could offer support, creating a deeper class divide between the north and south, enforcing that London is for the rich, and just generally disrupting people's lives. That's a terrible idea.
Second, I know from my disabled homeless friend I went to uni with that living in London on state benefits is essentially impossible due to the incredibly high rents that this video talks about. So if the people you're talking about can't possibly live here anyway then that's obviously not in any way related to the housing costs being so goddamn high. I think you've completely missed the point.
@@fabianstoll If you start taxing land developers will be more efficient with how they use that space. They will try fitting in as many units as they can. If you’re taxing a skyscraper the same as a single family home no developer in their right mind will build a single family home
First, when the government passes a law prohibiting an agency from taking deposits on a booking property before signing a contract. The thing is that agencies require a booking fee, but they charge it to many potential tenants, keeping them for longer than three days, sometimes two or three weeks, to finally say that the landlord has decided on someone else. But I might end up on the street.
Definition of fighting the symptoms not the cause as that’s all labour have done so far . The demand is high as people are living longer and immigrations is at sky high and uncontrollable levels meaning the demand is so high and bidding wars start
How can you police this?
Only the council flats can be under such limit, private owners cant be stopped.
Unless you want to have loads of empty flats around...
Bring on rent control. But then also make it so any property found to have no permanent resident is either; bought by the state for council housing, or sold at auction to another private owner that will use it. Done
And here’s a suggestion
Strict property minimums for letting properties no broken windows, leaky taps or shit electric if you want to make money from habitation you had better keep it habitable and address issues swiftly no leaving the heating dead gif 3 months
That is grotesquely rights-violating and tyrannical.
@@jmurray1110so what happens when the prices of boilers, showers, white goods, flooring etc outstrips say a 2% cap?
@@npcknuckles5887 The owner has the choice to sell it or find a tenant. There is a housing *crisis*. I don't know how you can advocate for keeping houses empty.
@@Runboyrun89 well you don’t need to have a second place if you can’t afford the bare minimum in terms of repairs maybe you should rent
If your personal house had issues would you leave it months every time
I’m not asking for a lot just the bare fucking minimum
making laws limiting property ownership would be a good idea too
6 weeks into this Labour government and I already want them out!
Based on what?
Rent control has been scientifically proven to be ineffective in increasing the number of affordable dwellings. It only, sometimes, make the rent cheaper for the people already renting and that don't need to change for a larger apartment for example. And that might also lead to some huge inefficiencies, e.g. older people that used to have children, but children are already adult might stay in the apartment they've been renting, even if it's now quite big and could be used by new families, but they have a nice discount on the rent, so they will stay.
If you have a housing shortage the only real solution is to increase supply, either by more incentives for private developers or by constructing more council flats.
The last thing on Earth I want is to give Sadiq Khan MORE power
Rent Control works quite well if done correctly. Only saying that a rent may not be raised will not work, I agree with that, as that will indeed probably lead to less upkeep etc.
However if you combine this with a point system, where the size of the property, all amenities and the state of repair receive certain points, and a landlord may charge a maximum price based upon the points of the property, then it works very well.
No longer doing upkeep on the property won't work in this scenario, because that would automatically lead to less points, and thus a lower maximum rent that can be charged.
Rent controls are a bad idea and have never worked anywhere. It doesn't solve the underlying problems that caused prices to rise. Competition doesn't end with a cap on rent prices. It ALWAYS takes other forms [long waits, less investment, fewer units available, slower repairs, etc]
This subject is complex concerning consequences. I said this a million times, but here we go: 1) For Rent Control (always starting with a backdated freeze) to work for tenants and expel landlords, it will take at least ten years as houses are an illiquid asset (unlike cash is the most liquid) to either (historical evidence for this) sold to sitting tenants and/or local authorities to be turned back into social housing (1920s after four years rent freeze and 2 + years of Rent controls, 1 million properties sold to sitting tenants). As landlords sell up, the value of the land that property sits upon falls, and a domino effect ensues due to falling yields for landlords (i.e. future gains from land price increases).
2) This needs to be a national RC, as you'll only move the problem elsewhere (US and NY issues).
3) In 1910, 90% of property was rented, and there was no social (it didn't exist in real terms). Owner occupiers were only for the remaining 10% who owned multiple properties, a form of feudalism.
4) After RF and then RC post-1914, the government of the day was forced into provision. This started with the 1919 Housing Act for council homes, followed by a promise for slum clearances from the previous rentier landlords, who would ALWAYS do the minimum maintenance due to 'loss aversion'. Mass private building for owner occupiers for skilled working and middle classes as land fell as a proportion of total value to 3-15% (the other part being build cost inc materials and profit). Aided by the 1942 Beveridge Report linking housing with health (as we have seen recently, damp = mould = respiratory issues, even early death).
5) So even an average income of one earner could buy a 2.5-bed semi on a 25-year mortgage with a 10% deposit; this included postmen and women. Then, the 1947 Housing Act restricted what was known as the uplift of land values when former poor agricultural land was built upon by 100% taxation (too much and frightened the horses), but this meant a win for new towns with the government paying little fo the land, as there was no future uplift (i.e. yield)
6) In 1954 and 1956, major parts of the 47 Act were repealed, allowing for fewer forms of rent control, leading to slum landlord Peter Rackman. Still, housing was being built hand over fist, often of poor quality, by secretive 'free market' large private building companies.
7) By the 1970s, the Private Rental Sector (PRS) had dropped from 90% in 1910 to 7% in the mid-70s. There were surpluses in certain areas, but more slums needed to be cleared. Nobody was crying out for more PRS, just more owner-occupiers and better-quality social housing.
8) In 1970-73, credit deregulation (CCC Act) caused a bubble, but it was abandoned once the oil crisis started in 73, followed by Wilson's re-election.
9) Housing was still affordable, but food, electricity, and petrol were expensive. However, children could independently afford a starter home in their early 20s.
10) In 1979, the big change, the end of affordable housing
We all know what happened next, but one point is worth highlighting. Rent Control was ended in 1988, and the market immediately inflated (aided by the financial deregulation of the Big Bang in 1986), but few landlords reentered. But in 1992, the ERM crisis flattened the housing market, and a buy-to-let mortgage was made legal to revive it. Then, those who benefited from cheap housing got greedy, but in their defence, the welfare state was slowly being chipped away. This led to what is now known as 'asset welfarism'; the issue is if you don't have an asset, you're screwed.
So what has changed? Land values. Remember I said in the 1950s that they were 3-15% of the property's value? Well, now, because the land is a tradable commodity with a house built on top, and what is known as a financialised debt funds this (again due to future yields, i.e. price increases), it is now on average 70%! (Build being 30%).
What type of rent control? Well, there is already an existing rent control; my flat is a do-it-yourself shared ownership property from the early 1990s; the half I pay rent on is controlled by never being allowed to go above RPI inflation (now CPI) and is ultimately governed by the central government. Its original value was based on 3% of the original purchase price. The beauty of this is that there is no need for rent inspectors. So now my rent has fallen far behind market rates. I pay a 50% share in rent at 40% of market value.
Fun Fact: Currently, the PRS is roughly 21% of all properties. If we went back to 7%, that would release 4 million properties onto the market all over the country. No new builds are needed, and the last 1 million can be built over 4 years. A few people have a surplus property to rent, creating scarcity whilst doing sweet FA, the much-hated Rentier Class. It's not clever; it's exploiting people who make and do stuff, i.e. 'key workers'.
All political will no more or less.
This is a fundamental overview, leaving loads out; at a minimum, it's a 10 K-word essay for comparative analysis.
A quick 800 words, for more information Housingresearch *(dot) solutions
*(dot = .)
.
Maybe we could stop importing 500k+ a year?
Maybe actually build houses (preferably up north)?
Shhh don't talk about immigration 😉
Isn't that what brexit saposed to do stop them from coming but where it didn't stop
@@cliffsofmoher4220 you're absolutely right, entirely the fault of our inept government going against the will of the people
@FletcherRZX with brexit you kicked out skilled farmers labour's and replaced them with international students
@@cliffsofmoher4220 again you should be blaming the government whose job was to execute it properly
I wouldn't count on Starmer to do anything actually good
Personally I do not support regulation on rental market because it will often cause more harm than good. For example, if we introduce rent control and make it too unprofitable for landlords, landlords will simply stop renting to tenants and make them Airbnb, then tenants will suffer from housing shortage as a result.
Instead of regulation, I think we can just simply follow supply and demand, and increase supply by making house building easier, or reduce demand by constructing more basic infrastructure in less popular areas.
You can simply introduce a cap on how many properties one could own. Or even have the obligation to live in properties that become available on the market. But ok, in the Anglo-American world, any form or regulation to help society further is directly seen as communism.
The problem with leaving it entirely to the market is it will never reach full housing just as the market will never reach full employment. The natural rate of unemployment in the job market and the natural rate of homelessness in the housing market presuppose there is an equilibrium position at rest where some people are unemployed and some people are homeless. This is the only way to extract profit or rent.
Placing increased taxes on more than one property would be viable - still being profitable but just discouraging one person from owning several properties all being rented out.
“Prices are going up what do you do”
“I know I know what if we make it illegal for prices to go up”
“Genius this guy’s a genius”
"We're not saying rent freezes are a bad idea"
Yeap, rent freezes are a horrible idea.
Want to drive rent prices down long term, remove regulations for both building and renting.
I lived in London in the late 70s when rent controls were still in place. It was the only reason I could afford to live and work there (I was a teacher). If i needed to do so today, with an equivalent income, I would have no chance.
Yeah exactly we had rent controls before, when people could afford to rent and buy a home and start a family and business....
You can't solve a shortage problem by attacking the suppliers.
Landlords aren't supplying shit lol. They're not building the houses. If anything it's better for landlords if houses DON'T get built.
@@patch2792 Without those "evil landlords", the construction companies will run out of money.
@@patch2792 Not true, I know a landlord personally and that is exactly what he does. Rent out a property, Show its profitable, Take out a mortgage using it as collateral, Use that to build another property, Rent out that property and repeat.
😂😂😂 Landlords aren't suppliers, they're scalpers.
They don't, most landlords do not build properties, most either inherit, or they use a mortgage which they then have the tenant pay off and at the end they still own a property that has been paid off by the renter and it probably has appreciated in value, you don't know anything about housing markets.
£2000 a month is the average rent in London?!
My mortgage for my 3 bed house in the north is £650…
Mortgages are also usually cheaper than rent, which in itself should be completely economically impossible - most people will pay more than a deposit of rent before they build up that same deposit in savings taking into account inflation (and still if it included rents). A 1bed flat in a city in the north is often over £600 easily.
"A disincentive for landlords to invest in their properties" 😂😂😂 Most private landlords have been milking the same houses with little to minimum maintenance, let alone investment, for decades while the rents are skyrocketing😂😂
So you're not allowed to make a profit on your own investments?
Hi, a landlord here. I have to say I have never understood landlords who dont maintain their properties. A serious damp problem or electrical issue is going to hit your capital FAR more than the outlay to maintain the properties on a regular basis. The landlords that do neglect their properties end up taking a massive hit either when they sell (if its in bad condition), or end up forking out much more to treat a critical issue (e.g. a mild damp problem caught early might cost a few hundred quid to fix, an ingrained damp/mould problem would cost many thousands if it gets into the walls and floors).
Would they also cap interest rates, property tax increases, and insurance premium increases? It’s unrealistic to force one sector to shoulder the burden while other industries can increase costs.