Rent controls will lead to a landlord sell -off and hurt tenants - NRLA
A third of landlords are warning they will sell up if the government brings in rent controls, research reveals.
The findings from the National Residential Landlords Association (NRLA) found there is soaring demand for rental homes.
Its survey shows that 82% of landlords are reporting strong interest in the second quarter – but the number of available properties is dwindling.
Landlords are twice as likely to have sold properties in the past year as they are to purchase new rental homes - 8% had invested, while 17% had sold.
The NRLA says the trend is most pronounced in the South West, followed by the South East, East of England, and East Midlands.
Renters looking for a place to live
Ben Beadle, the NRLA's chief executive, said: "Whichever way you look at it there are more renters looking for a place to live than there are homes available.
"Ultimately, rent controls would be a disaster for tenants. All they would do is choke off supply further, undermining what little choice tenants currently have when looking for somewhere to live."
He added: "Housing is expensive because we don't have enough of every type of property, be it for owner occupation, social rent or private rent.
"The only way to solve this crisis is to boost supply right across the board."
One-third of landlords are looking to sell
The NRLA says the situation could worsen over the next year as 10% of landlords say they plan to buy - but one-third are looking to sell.
That means the call from some quarters for rent controls to be brought in to restrict rent rises could backfire.
The survey found that 33% of landlords said the implementation of rent controls would lead them to sell some, or all, of their rental properties.
The NRLA points to International Monetary Fund research that shows rent controls are linked to lower housing supply.
It also highlights research from Rightmove which found that - based on the current levels of tenant demand - around 120,000 more rented homes are required.
That's necessary to lower rent growth to an average of 2% per year.
Rent controls would affect their commitment
The NRLA's findings coincide with research from Foundation Home Loans this week which reveals that fears of rent controls outweigh other worries.
It found that more than half of landlords surveyed said rent controls would affect their commitment to the private rented sector (PRS).
The lender's 'Landlord Trends' report also highlights found that one in three landlords would consider selling their properties if such controls were introduced.
Interestingly, landlords expressed less concern about other regulatory changes, such as banning Section 21 'no-fault' evictions, compulsory landlord licensing, or replacing fixed-term contracts with rolling contracts.
'Rent controls would be a disaster for tenants'
The managing director of Accommodation for Students, Simon Thompson, said: "Rent controls would be a disaster for tenants, as the NRLA research makes clear.
"Such controls would further reduce the already limited supply of rental properties, making it even harder for tenants to find homes.
"It would also inevitably mean that rents would rise as a result."
He added: "The only viable solution is to increase the overall housing supply across all sectors - and encourage landlords to invest and remain in the PRS."
