{"id":6962,"date":"2022-11-07T10:26:30","date_gmt":"2022-11-07T10:26:30","guid":{"rendered":"https:\/\/www.citylets.co.uk\/blog\/?p=6962"},"modified":"2022-11-07T10:26:31","modified_gmt":"2022-11-07T10:26:31","slug":"welsh-government-rejects-rent-freeze","status":"publish","type":"post","link":"https:\/\/www.citylets.co.uk\/blog\/welsh-government-rejects-rent-freeze\/","title":{"rendered":"Welsh Government Rejects Rent Freeze"},"content":{"rendered":"

The approach taken by the devolved UK Governments towards rental inflation has highlighted radically different political ideologies. Whereas the Scottish Government has legislated in favour of a rent freeze (September 2022 – Cost of Living (Tenant Protection) Scotland Bill<\/a>), the Welsh Government has rejected a rent freeze (October 2022) with First Minister Mark Drakeford warning it would not be a \u201cpanacea\u201d. The Welsh Government fears unintended consequences where landlords could react by selling-up and leaving the market.<\/p>\n

In Scotland, we have evidence which illuminates those unintended consequences \u2013 and that evidence highlights a far more negative impact on housing supply than can possibly have been imagined. Quite apart from individual landlords, circa 20,000 affordable and private new homes have been suspended across Scotland as a direct result of the Bill; 11,000 affordable homes have been halted by Lord Haughey plus a large proportion of the institutionally funded Build to Rent pipeline of c.10,000 private and intermediate rent homes. The Bill has resulted in almost all scaled investment into housing supply being suspended until there is clarity on the rental rule book in Scotland.<\/p>\n

\"\"<\/a><\/p>\n

A frustration is that whilst this Bill was implemented without consultation, there is already an existing Rent Pressure Zone (RPZ) mechanism which was intended to resolve the exact situations which have justified the current rent freeze<\/a>. Evidence from other cities around the world demonstrates that rent control has had the unintended consequence of curbing supply; the expectations is that the Tenant Protection Scotland Bill will fail those that it is most intended to assist \u2013 the tenant. In Denmark, Berlin, Ireland and certain US cities, well intended rent control mechanisms have been implemented with questionable short-term benefits but with significant unintended (largely negative) consequences in the medium term.<\/p>\n

Intended short-term benefits<\/strong><\/h4>\n