Politics, politics, politics (so long and thanks for all the fish)

[Gutter Boy]

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Very different things. Rent caps one hundred years ago were based on the concept of council houses. It was a very different world.

What you're now implying is that a landlord can perhaps receive £1200 a month rent on a 2 bedder and it is capped. Typically letting agent fees are 10-15% and it's a risky game not using these guys. Say the landlord has a £150k loan and is paying £750 a month on an interest only mortgage. So the landlord has to also pay tax on £14k rental income less deductions. That £14k is on top of his/her salary and likely in the 40% tax bracket. So that's another £500 a month coming out of the £1200.

That rent has to be at £1400 before a theoretical break even is reached. It's probably more like £1600 in real terms because landlords pay leasehold fees like ground rent and maintenance. They also have running costs for repairs etc.

So for landlords the rental cap needs to be around £1800 to give them an incentive to even be involved. Even then, you're probably better off investing your money elsewhere. Nobody wants tenants paying £1800 "dead money" for a 2 bedder on top of their monthly bills. They want them owning houses.

Rental caps will make things worse in my opinion. It has to be a joined up strategy, not a blunt object.

The point of rent caps is to make renting unprofitable for the private sector, so it reverts to the public sector. The 1920s one is what freed up much of the housing stock to enable the creation of council housing. The point now would be to engineer a similar thing, to stop it being an attractive investment