There have been many potential solutions proposed to the housing crisis, particularly the availability of housing. There is a marked shortage across the board with decades of low house building driven by second home ownership.

“Simplistic Rent Controls May Not Work”

According to one housing think tank, local authorities and governments should not be tempted by the pressure for so-called “hard” rent measures like freezes. Many have called for the government to step in during a time of rising food and fuel prices, when belts are tightening across the board.

Instead, the UK Collaborative Centre for Housing Evidence has called for both a longer-term strategy of increasing home building, and softer types of rent control to tackle the issue. They went on to say how attractive rent freezes might be to an electorate looking for quick solutions (and such freezes are fast acting) and because it doesn’t involve a great deal of public resources.

Is Rent Stabilisation the Way to Go?

The Centre recently released a report after an investigation into rent controls. They concluded that blanket freezes do not work. Instead, they strongly recommended steps to introduce rent stabilisation and improved conditions for tenants. This, they say, will make a modest positive contribution to the situation and benefit both landlords and tenants. This will be a great move along with investment in more housing.

They concluded that the first generation of rent regulations like freezes and caps “should be avoided.”

What Are the Other “Generations” of Rent Controls?

Second generation rent controls go beyond the black and white thinking of freeze vs free reign. They permit rental adjustments in line with changing market conditions. Therefore, it takes into account inflation rates, and the cost of upgrades the property. For example, a major upgrade (rather than a simple replacement of worn-out goods refurbishment).

The following rent regulations may be the way to go though:

Some of these second generation rent controls will cap the value or percentage of increase on the past monthly rent payment. This aims to tackle concerns over landlords capitalising on short-term shortages before dropping the rent again.

Tenancy rent controls, also known as “rent resets” are when a tenant or tenants move out of a property, and the new tenant(s) pay a rental rate based on average market levels regardless of what the past tenant paid.

A Political Issue

Finally, the organisation’s report said that years of political infighting was the major reason it had not been solved – interest groups, whether that’s tenant or landlord groups, and even between political parties have only failed to improve the situation.

In conclusion, they said any decision must do due diligence and assess the wider costs to all parties before implementing any potential solution.