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No 10 dismisses Reeves’s reported plan for freeze on private rents
TL;DR
Downing Street has rejected a proposed freeze on private sector rents, despite Rachel Reeves indicating it might be a consideration. The government is focused on reducing bills and supporting renters without implementing a rent freeze.
Key points
- Downing Street rejects rent freeze proposal
- Rachel Reeves leaves door open for rent freeze consideration
- Focus on cutting bills and supporting renters
- Proposed freeze would exclude newly built properties
- Aim to address cost of living fallout from Iran war
Downing Street has dismissed a freeze on private sector rents even as Rachel Reeves left the door open to the idea, after the Guardian revealed the chancellor has been considering it as an option to cut the cost of living.
A No 10 spokesperson said on Tuesday freezing private sector rents was “not the approach we will be taking” after sources told the Guardian it was Reeves’s preferred solution for dealing with a spike in housing costs in the wake of the Iran war.
They added: “We have no plans to implement this. Our focus remains on cutting bills and backing renters alongside lower energy prices.”
Reeves, however, failed to rule out the idea when asked about it in the Commons, telling the Labour MP Yuan Yang: “I will do everything in my power and use every lever we have to bear down on the cost of living, including for people in the private rented sector.”
The chancellor was understood to have been considering imposing a one-year rent freeze on private sector landlords as part of a package of measures later this year to help households deal with the fallout from the conflict in the Middle East. The freeze would exclude newly built properties however in an attempt to encourage housebuilding.
The measure would mark a significant reversal for Reeves, who resisted a proposal to include rent controls as part of Labour’s renters’ rights reforms, which come into force on Friday. The news sent shares tumbling in some of the UK’s biggest buy-to-let lenders, such as Paragon and One Savings Bank, but was welcomed by some Labour MPs, who believe the party needs to consider radical ideas to bring down the cost of living.
Economists warn the UK will be hit harder than any other developed country by inflation resulting from the Iran war, which has shut down shipping lanes and sent the price of oil soaring.
Experts say a freeze is likely to bring down rents on properties to which it applies, but push them higher on unregulated properties. They warn it would also reduce the overall supply of rental properties – something that could undermine Labour’s promise to build 1.5m homes during this parliament.
Q&A
Why did Downing Street dismiss the rent freeze proposal?
Downing Street dismissed the rent freeze proposal because they stated it is not the approach they will be taking to address housing costs.
What is Rachel Reeves's stance on the rent freeze?
Rachel Reeves has not ruled out the rent freeze and mentioned she would use every lever available to address the cost of living for renters.
How would the proposed rent freeze affect newly built properties?
The proposed rent freeze would exclude newly built properties to encourage housebuilding while aiming to help households manage costs.
What are the government's current plans regarding housing costs?
The government plans to focus on cutting bills and supporting renters, rather than implementing a rent freeze.
