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Tuesday, January 06, 2015

Proposed rent caps in PRS

It's election year and landlords are set to be a key political target / punch bag on the run up to May.

Expect to hear plenty of beefy talk on additional regulation, licensing, tenancy reform and rent caps.

Civitas, the political think-tank haven't wasted any time getting in on the debate, publishing a new report of regulatory recommendations on January 2.

The reports author, Daniel Bentley, accuses landlords of exploiting the housing crisis at the expense of taxpayers and tenants, saying -

‘Unfortunately, the Housing Benefit system, which effectively props up purchasing power at the lower end of the market, militates against fair prices by subsidising landlords’ rent demands. This vicious circle will only worsen as the private-rented sector comes to represent an ever-larger proportion of the housing market and more and more tenants have to fall back on Housing Benefit.’

The report is calling for indefinite tenancies as the norm which are then linked to capped rent rises. Any rent rises that reach beyond this fixed rate would only be allowed if a landlord could prove they had made improvements to a property substantial enough to warrant it. 

In his report Bentley, proposes regulatory exemption of new build property as a means to shift landlords away from investing in the existing owner occupied market and over to new-builds.

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