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Livingstone aims to solve London’s rental crisis

December 13, 2011 9:11 am

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20111213-091029.jpgIn a speech today, Ken Livingstone will announce plans to tackle London’s private rental crisis. Speaking to the London Policy Conference later today Ken Livingstone will announce that if elected he will:

1. Establish the first London-wide non-profit lettings agency – to put good tenants in touch with good landlords so that both can benefit from security of tenure and reduce the costs of letting.

2. Campaign for a London Living Rent – hundreds of thousands of Londoners pay more than one third of their income in rent. Ken will make that a benchmark which will guide the work of City Hall on housing.

Private rented housing makes up 24% of London households (compared to 16% nationwide), and is particularly prevalent among young Londoners. The cost of renting is not just an issue which affects low income Londoners though. The average rent is now £1,000 and is the only option for many, given that the average first-time buyer property is now over £257,000.

 

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  • guido.fawkes

    Unless he has overturned the laws of supply and demand he’ll find that reducing the price of something decreases the supply. Hot air from Ken.

    • http://www.labourlist.org/mark_ferguson Mark Ferguson

      Buy to let houses are not suddenly going to be removed from the rental sector though are they? That would mean landlords get no return on their investment.

    • http://twitter.com/Newsbot9 Newsbot9

       And that’s why rent caps are necessary, right. Good argument!

      • Anonymous

        But of course all this has occurred due to the social housing  drought, the non building of social housing by labour, nobody else to blame except labour for the shortage of housing in London or the rest of the country

        • http://twitter.com/Newsbot9 Newsbot9

           Really? No, Thatcher was the one who did most of the damage.

          • Anonymous

            Nope Thatchers not to blame even if she was, the non building of social housing is down to a so called new labour party

          • http://twitter.com/Newsbot9 Newsbot9

            Nile. Who introduced buy to let?

          • Anonymous

            ROFL – not Thatcher! People have been buying property & letting it out for hundreds of years.

        • Anonymous

          What about population growth?

          In a densely population area like London, there’s not the land to build masses of new homes. Post-war governments mostly addressed the problem by shipping people out of London, wholesale, into the New Towns.

      • GuyM

        And if rent caps mean a landlord can’t cover his mortgage payments?

        The problem in London is too little housing to rent and too many people looking to rent. You really won’t get around that by driving down returns, all that will happen is properties to rent will get pulled from the market (which of course might lower prices for those looking to buy).

        The only solution is rebalance the market by adding new property to the rental sector.

        • http://twitter.com/Newsbot9 Newsbot9

          Then he loses the house. It also cleans out unrealistically high B2L loans without losing anyone their primary home. Even better!

          Moreover, there’s a simple way around the issue of supply. A hefty tax on empty houses and unused brownfield land.

          In 5 years it might make a difference to the upper middle class renters your way. We need action this week.

          • GuyM

            Invariably they wont lose the house as they’d sell on to a home owner at a 5% or so loss I’d estimate.

            But that removes another property from the rental market and does nothing to increase the ability to own a home in terms of deposit etc.

            Also I suspect placing a rental limit and in effect causing the property owner to face a sure loss on investment wold result in a lot of legal challenges and also electoral damage for whichever party proposes it. It simply wont happen.

    • Dave Postles

      http://www.homeless.org.uk/news/13-increase-in-number-homeless-households

      13% increase in the number homeless families in the last 12 months – what a terrible indictment of this ‘government’. 

      • Anonymous

        It is a disgrace , I have just taken my £20 down to the Salvation army which runs two hostels in my area, labour closed them saying no need for them everyone will get a house or bed and breakfast or shelters, then in my area a shanty town grew up people making homes out of rubbish, so the shelters had to re-open sad reflection on all political parties.

        Build social housing.

    • Anonymous

      Huh? Don’t you mean decreasing the supply of something increases it’s price? This is exactly how monopolies, e.g., De Beers Consolidated Mines hoarding tones upon tonnes of diamonds in order to stoke prices, keep the prices of their products or goods artificially high. In point of fact reducing the price of something most often increases demand and therefore supply, which is why businesses offer discounts on selected items they want to push.

      • Anonymous

        Don’t forget Demand.

        Greater London population rose by 431,200 people between 2001 and 2009.

        Also worth remembering that post-war governments worked hard to move people out of London and into the New Towns, steadily reducing the population of Greater London, reducing the competition for housing. Contrast that with the laissez-faire policy toward population growth over the last 15 years.

        • Anonymous

          Absolutely true. Like fire and ice, markets make good servants but poor masters. Government intervention is necessary in order to address the massive problems associated with housing and by intervention I don’t mean doing senselessly cruel things like cutting Housing Benefit to under-occupying tenants in order to starve them out of their homes, or, as Iain Duncan Smith would say to enable them to make the same kinds of choices as the middle classes.  

      • RRJ

        The things that have created this issue are mainly the result of government intervention into the market.

        Government and their agencies were complicit in keeping interest rates artificially low, thus feeding the housing bubble among other asset bubbles of the last decade. The feelgood, the borrowing against asset that followed fuelled the fake growth of the last decade.

        Government and their agencies were complicit in feeding increasing money into the buy to let market via housing benefit, doubling the bill to an annual £20Bn in short time.  That’s regressive, that’s money going to people with either the wealth of credit worthiness to own the buy to let. It is money perpetuating people in an economic position dressed up as a benefit for the poor.

        The government incentives and interventions into the housing market created the conditions for the buy to let boom and they let it happen, welcomed it. Same went on the the US with even greater direct intervention. It has been disastrous.

        The government needs to get out of the way as far as possible, it needs to cap housing benefit and stop propping up artificially high house prices that are way in advance of median earnings. It needs to make it easier for the private sector to build additional housing, not make it so difficult that only huge companies can do it on any scale, excessive regulation create crony capitalism, distorts markets and incentivises lobbying.

  • Anonymous

    Good tenants to good land lords, nobody claiming housing benefits then, of course how do you know they are good well obviously they will be working have a good solid job with a good solid wage, how do you know this, you do as most agencies do you run a credit check.

    So if your homeless living in London Kens not the person to vote for, if your on benefit obviously Ken not your man.

    Socialism at it’s best

    • http://twitter.com/Newsbot9 Newsbot9

      Most private housing isn’t let through agencies, especially for younger people.

      • Anonymous

        I have spent my youth and my life in social housing, right now I give five hours a week helping those that cannot get a home to find something.

        The word which politicians use, like Blair’s work shy and scroungers, now good tenants against bad tenants, 99% of all tenants are good but of course the one  percent are the ones which hit the head lines and pull the rest of us down.

        I’m disabled and have lived in social housing for 40 years, before that I lived in a tied house a farm, so I will not have you telling me about housing.

        All Ken had to say was I will be working hard to get tenants into properties, but nope he had to state good tenants and good land lords.

      • GuyM

        I remember when I used to rent I really didn’t want benefit claimants to share with. Invariably they had no common interests or viewpoints with me as a graduate and also whilst their rent was paid through housing benefit my experience was endless problems getting contributions for domestic bills etc.

        Sharing with other graduate professionals was almost always far easier in terms of stress and time wasted on sharing out bills.

        It ledme to conclude that like living with like was nearly always the best option.

        • Anonymous

          I’m surprise mummy and Dada did not buy you a house or  flat, you really are a snob mate…..

          • GuyM

            Nothing like ignoring reality and falling back into silly insults.

            I’ve received no parental support since my A level’s primarily because my parents marriage ended in bitter divorce with my father killing himself as a result, my family home was sold and all my belongings thrown away whislt I was away at University.

            As a result I’ve disowned my family and they have no idea where I am or what I am doing. So no family inheritance, no house or flat, no financial support on anything. That rather kills your unpleasant insult doesn’t it?

            And my EXPERIENCE of years renting and sharing, paying my own way, is sharing with people who are generally not in employment, not of a similar income etc. is that there is often problems with shared bills and the like. In the past I’ve wanted to take out a full cable tv package and one person in a shared house who had not had a job for years obviously didn’t want to pay for it.

            In the same way, after graduating and having to start working for a living, sharing a house with students lost its appeal as heading out for a late night at the student union loses the same draw when you need to be in an office at 8:30am the next morning.

            Like sharing with like in my experience works far better and causes less internal house arguments and problems. Now how about you deal with that point rather than behave like a nasty little class warrior?

          • GuyM

            I’d also add quickly that it extends to marriage with the theory of assortive mating.

            I was only going to marry a well spoken, graduate professional with a career and similar social background. That’s what I did and of all my close school friends none did any differently.

            To a certain extent it is a little bit “tribal”, but largely it is down to shared experiences, views and aims.

        • jaime taurosangastre candelas

          @ GuyM,

          I have a degree of empathy with what you are saying, but it does not need to be so stark or so “hunter/hunted”.  It is human nature to associate with those we feel comfortable with, but we can also use that to offer a hand up.

          When I first came to the UK, I got a job at Darlington Memorial Hospital. After a few months of renting, I got a mortgage on a 2 bedroom terraced house for £39,600, and took in a lodger.  My lodger was a colleague from the hospital who for various reasons – mostly student overdraft – was greatly in debt to his bank.  He could not get his own mortgage.  For 3 years, he paid his way, and also paid down his own debt.  When I left to come to Cambridgeshire, he was able to buy the house from me.  We both profited:  me from his rent, him from a fair rent (the agent said £320 a month, I set the rent at £200 a month) and a chance to rebuild his credit.  That was just two individuals, but surely some form of association could act to put like-minded people in touch.

          The only problem was his dog, a Husky and something cross-breed.  He never liked me and would growl.  He went to attack me once when I was dog-sitting over a weekend, requiring a serious man-to-dog conversation and some attitude adjustment.  After that, he kept out of my way.

          • GuyM

            Jaime, but that’s like with like.

            Your lodger was working at the same hospital. Try sharing with someone on benefits when you are working and see how difficult it can be when it comes to bills etc. especially as utility companies don’t like multiple names on bills as it means they have multiple people to chase in event of non payment.

            Having your name on gas, electricity, telephone etc. when another person is long term benefit claimant with no money is a royal pain in the arse when it comes to getting money for shared bills.

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