With the campaign for rent controls gathering momentum from London Mayor Sadiq Khan and sympathetic pressure groups, a right wing Conservative-backing website has set out the case against.
Guido Fawkes, a right wing political news site, sets out the experiences of Berlin and the Republic of Ireland to demonstrate the consequences of rent controls.
It says: “Berliners had a miserable time at the hands of their rent cap; real estate analysis revealed it crashed supply by 41 per cent and drove demand up to 172 per cent. It also led to the phenomenon of ‘shadow rents’ where landlords and tenants would agree one rent complying with the cap, and a separate rent significantly above it, sometimes paid in cash.”
Guido Fawkes goes on to say that the cap was then ruled unconstitutional by Berlin’s courts and scrapped.
Meanwhile the Republic of Ireland introduced multiple rent pressure zones with rent rises last year capped at just 2.0 per cent.
According to the site: “A report commissioned in May this year by the [Irish] Institute of Professional Auctioneers and Valuers concludes the attempt to control rent rises has “backfired”, with landlords leaving the market and rents rising as a result of the policy. The latest [property portal] DAFT survey found ‘The number of homes available for rent across Ireland has dropped to a new all-time low and led to a further spike in rents around the country.'”
That meant that in Dublin 712 homes were available to rent at the start of this month, less than a quarter of the long-term norm. Rents were up 10.3 per cent and there are now just 716 properties to rent in the whole country according to DAFT.
Guido Fawkes describes the rent cap concept as “insanity”.
