Why rent controls could end up costing you more ...Middle East

As new rent control laws come into play in Scotland, the debate is heating up about imposing stricter rules in other parts of the UK.

Controls on rapidly rising rents in London and elsewhere are being proposed by figures such as Green Party leader Zack Polanski, London Mayor Sadiq Khan, and in Wales by Plaid Cymru.

Average UK monthly private rents increased by 3.5 per cent, to £1,374, in the 12 months to February 2026, according to the Office of National Statistics (ONS), while a 2024 Shelter-YouGov survey showed that one third of renters are paying 50 per cent or more of their income on their rent.

At the end of 2025, average advertised rents in London hit a new high of £2,736, according to the property listings site RightMove leading to call on rent prices, but some critics argue that rent controls can have unintended consequences.

What rent controls have been proposed?

From 1 April, the new Housing (Scotland) Act 2025 allows for evidence-based rent controls in areas where rents are rising steeply across Scotland.

Under the law, local authorities must assess rent conditions in their area and submit a report to Scottish ministers which will inform decisions on whether to designate a rent control area.

Polanski, who is looking to make gains in London boroughs for the Greens at next month’s elections, has proposed rent controls in the capital, and said at least 50 per cent of new homes in London will be social – properties that are owned and managed by councils or housing associations.

Currently only the Government can implement rent controls but London’s Sadiq Khan and Manchester Mayor Andy Burnham have both called for powers to impose rent caps to be devolved to regional leaders.

Khan has already announced a plan for rent caps on new homes for key workers, such as nurses, teachers and bus drivers, that would save them around £600 a month.

There are no current central government plans to introduce rent controls at the moment, as Labour focuses on its mission to build 1.5 million new homes to improve access to affordable housing.

The Green Party’s plan to introduce rent controls nationally would see individual councils given the power to cap excessive rents for their local market and renters would be given a new right to demand energy efficiency improvements.

Ahead of the Senedd election in Wales, Plaid Cymru has said they support “Fair rent-setting – through limiting annual rent increases to the lower of wage growth or consumer price index inflation, or a clearly defined equivalent benchmark,.”

The Green Party in Wales has also committed to introduce ‘Rent Pressure Zones’, where local rent caps would be set where landlords must ‘deliver genuine improvements to homes’ before they can increase rents.

Could it cause rents to increase?

Despite calls to cap rents, some have argued a cap may force some landlords to hike prices.

The National Residential Landlord’s Association wrote: “A key, but often overlooked, consideration in relation to these policies is that landlords who let below the market rate will be forced in many instances, to increase rents to the market rate at a minimum before these proposals come into force.

“A failure to do so would effectively trap properties below-market rates for the foreseeable future, allowing landlords no means of reacting to increasing costs or market shocks.

“Furthermore, the Greens proposal to ‘freeze rents’ would very likely precipitate exponential rent increases. This is because as soon as the policy would be put forward in the Senedd, landlords across Wales would be compelled to ensure rents cover estimated future costs, front loading costs for tenants.”

A study by Hamptons estate agents in Scotland, which also implemented temporary rent controls during the Covid-19 pandemic between 2022 and 2024, showed that afterwards in 2025 67 per cent of Scottish landlords with the option to raise rents did so, the highest in the UK, where the average was 58%.

Lead analyst David Fell, said: “At best, they delay rent increases; at worst, they set a new benchmark where landlords feel compelled to increase their rents every year by the maximum allowed.

“Faced with uncertainty over future rules, many landlords choose to raise rents little and often rather than risk falling far below market levels.”

What do supporters say?

Advocates see rent control as a way to make renting more affordable for tenants, particularly in cities like London and Manchester.

Despite average earnings rising by 5 per cent in 2025 compared with 2024, the cost of renting in London was swallowing up 44 per cent of the average wage by the end of last year – up from 40 per cent five years ago.

In Manchester, the average monthly rent was £1,337 as of December 2025, an increase of 3.4 per cent on the year before, according to the ONS, with more than 40 per cent of average wages absorbed by rent.

Shelter’s policy manager Tarun Bhakta said modelling they did in 2015 showed caps are “unlikely to have unintended consequences”, adding that “while landlords may decide to increase the rent to cover increases in their costs, many landlords increase the rent simply because they can” when the market is open to it.

But in Paris, where rent controls were introduced in areas of high demand under Francois Hollande, many have seen it as a success. Guillaume Aichelmann from Parisian tenants’ association CLVC said: “The cost of rent is stabilised and in some cases it has decreased.”

Could it affect rental housing stock?

Some also say that it can worsen affordability by restricting the supply of available homes to rent as landlords may sell or convert properties due to lower profits, and developers may choose not to build new housing. Or that it affects the quality of housing as landlords have fewer financial incentives to maintain properties.

Shadow Housing Secretary James Cleverly said “rent controls would only drive more [landlords] away” from the market.

Nationwide rent controls were implemented in Germany in 2013, but in 2020 Berlin voted to freeze rents at pre-pandemic levels for a year. A study by the German Institute for Economic Research found that the median number of rental units advertised fell from around 640 a week to 223.5 per week after it was introduced, affecting supply.

In 2024 the Institute of Economic Affairs (IEA) analysed 196 studies spanning six decades and almost 100 countries, and found that rent controls often had unintended negative consequences.

Editorial director, Dr Kristian Niemietz, said the findings show “rent controls reduce the supply and quality of rental housing, reduce housing construction, reduce mobility among private tenants, and lead to a misallocation of the existing rental housing stock”.

Generation Rent’s chief executive, Ben Twomey, responded saying: “The IEA’s own research is that rent controls do protect renters from unaffordable rent rises where we live – across England this would mean 12 million renters better protected from poverty and homelessness.

“Listed among the IEA’s apparent downsides of rent control is ‘forcing…tenants to become homeowners’… Yes, please!

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