The ASI’s criticism of Labour’s pledge to cap rents features in The Daily Mail and The Sun Online

Deputy Director of the Adam Smith Institute Sam Bowman was quoted in The Daily Mail and The Sun Online criticising Labour’s pledge to cap rents from rising above-inflation for the next three years.

From The Daily Mail:

Sam Bowman, of the Adam Smith Institute think-tank, said rent controls were ‘a stunningly bad idea that could clobber renters’.

He said they would give landlords a huge incentive to raise rents at the start of a tenancy, adding: ‘Labour has unwittingly announced a policy that could devastate cities and exacerbate the housing crisis.’

Read the full article here.

From The Sun Online: 

But experts lined up to savage the left-wing idea, claiming it will devastate the rental market and could even lead to higher charges for tenants.

Sam Bowman, of think tank the Adam Smith Institute, said: “Labour has unwittingly announced a policy that could devastate Britain’s cities and exacerbate the housing crisis.”

Read the full article here.

The ASI’s criticism of Labour’s pledge to cap rents features in The Scotsman and Yorkshire Post

Deputy Director of the Adam Smith Institute Sam Bowman was quoted in The Scotsman and the Yorkshire Post criticising Labour’s pledge to cap rents from rising above-inflation for the next three years.

From The Scotsman:

Think-Tank hits out at Labour rent caps

Labour leader Ed Miliband’s pledge to cap above-inflation rent rises for three years if elected is a “stunningly bad” idea that could hurt those it is meant to help, a free market think-tank said yesterday.

The Adam Smith Institute said it would “shift risk from landlords to tenants” because it encouraged landlords to “price in” rent rises at the beginning of the tenancy.

Deputy director of the institute Sam Bowman said: “Labour has unwittingly announced a policy that could devastate Britain’s cities and exacerbate the housing crisis.”

From the Yorkshire Post:

But introducing rent control was called “a stunningly bad idea that could clobber renters” and “devastate” cities, by the free-market Adam Smith Institute think tank.

Read the full article here.

ASI comments on Labour’s pledge to cap rents picked up by Associated Press

Deputy Director of the Adam Smith Institute Sam Bowman was quoted by The Associated Press criticising Labour’s pledge to cap rents from rising above-inflation for the next three years.

The quote has featured in over 90 local print outlets.

But any rent control was called ” a stunningly bad idea that could clobber renters” and “devastate” cities, by the free-market Adam Smith Institute think tank.

Deputy director Sam Bowman said the Labour proposals were “less harmful” than those criticised by Lindbeck “but shift risks from landlords to tenants.

“They incentivise landlords to price in expected rent rises at the beginning of the tenancy, so if rents fail to rise as quickly as expected, the tenant is left paying more than they would need to.

“Labour has unwittingly announced a policy that could devastate Britain’s cities and exacerbate the housing crisis.

“If Labour want to reduce housing costs for renters, it should advocate planning reform to increase supply so that the price of housing drops in real terms.”

Press Release: Rent caps could devastate British cities and clobber renters

For further comments or to arrange an interview, contact Head of Communications Kate Andrews: kate@adamsmith.org | 07584 778207

Commenting on Labour’s pledge to cap above-inflation rent rises for three years, Deputy Director of the Adam Smith Institute Sam Bowman said:

Rent control is a stunningly bad idea that could clobber renters.

Rent caps come in two forms. The ‘first generation’ kind, which simply puts a ceiling on rents, can utterly destroy entire districts as landlords have no incentive to maintain their properties. These have been deemed by the Swedish (socialist) economist Assar Lindbeck to be “the most efficient technique presently known to destroy a city except for bombing”.

‘Second generation’ rent controls are what Labour seem to be proposing, and are less harmful, but shift risks from landlords to tenants. They incentivize landlords to price in expected rent rises at the beginning of the tenancy, so if rents fail to rise as quickly as expected, the tenant is left paying more than they would need to.

Labour has unwittingly announced a policy that could devastate Britain’s cities and exacerbate the housing crisis. If Labour want to reduce housing costs for renters, it should advocate planning reform to increase supply so that the price of housing drops in real terms.

Notes to editors:

The Adam Smith Institute is an free-market, libertarian think tank based in London. It advocates classically liberal public policies to create a richer, freer world.