Warning over bringing in rent controls

A PLEDGE to introduce rent controls by Labour could dissuade companies from investing in the construction of homes for rent, two big landlords have warned.

Opposition leader Ed Milliband said last month he would bring in rent controls and longer tenancy agreements if he wins next year’s election, which he said would help the rising number of people who rent rather than own their homes.

“People get very nervous when the words ‘rent control’ get bandied around,” said Andrew Cunningham, chief executive of Grainger, which owns and manages a £1bn portfolio of rental homes. “A lot of institutions take ... fright at hearing those words.”

Robert Noel, chief executive of Land Securities, the Trinity Leeds developer, also said the upcoming election was causing uncertainty in the industry.

He said Mr Miliband’s pledge “would be a serious concern to our industry, it would absolutely put the brakes on residential development which we all know is desperately required”.

A rising number of pension funds and insurers have snapped up or built thousands of homes to rent out over the past two years, betting that a shortage of housing and mortgages will produce a generation of renters rather than owners.