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Do rent cap systems work?

P

PostBrexitInvestor

Member
While there has been constant talk of capping rent for the last few months, nothing so far from the Labour conference. How do you think a rent cap system would work in the UK?
 
D

diyhelp

Active Member
Simple, no they dont.

In the end investors will pull out if the risk/return ratio does is not balanced. How would this leave the current UK housing shortage?
 
N

nmb

Well-Known Member
Once you start pulling at the main threads of a free market, the market will very quickly start to unravel. Restricting returns will by definition restrict capital investment - all in the midst of a new build shortage in the UK and a lack of social housing/private rental accommodation.
 
L

Longterminvestor

Administrator
No!

The state has no money to fund new social housing so why attack investors? It does not make business sense.
 
D

diyhelp

Active Member
The only reason that people are even remotely considering the benefits of rent cap is because it was so long ago since they were in place that everybody has forgotten the dire impact they had on not only the property investment market but investment markets in general.
 
F

FWL

Member
If the rental market was as easy to control as the Labour Party is suggesting, why have successive governments of all parties not made a dent in increasing social housing in the UK? Jeremy Corbyn has been a politician for more than 30 years and more often than not has toed the party line on these types of issues. In reality, governments very rarely make a success of services which can be transferred to the private sector.
 
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