Ken Livingstone has pledged to establish a London "living rent" and set up a city-wide non-profit lettings agency to challenge the "scandal of rip-off agency fees" and tackle rogue landlords, if elected mayor.

The Labour candidate made the two-pronged pitch in a bid to woo Londoners in the private rented sector facing soaring housing bills. Livingstone said no one should pay more than a third of their income on rent, as he cited figures showing that rents rose by 12% on average in the capital last year with no sign of improvement in the quality of the housing provided.

Boris Johnson's office slammed the suggestion of rent controls as a counter-productive move that would see fewer homes built. The cost and availability of housing in the capital surfaced as a key battleground for the mayoral race next year as Johnson, the incumbent mayor, told a housing conference on Tuesday that he will deliver an additional 45,000 new, affordable homes by 2015 if re-elected.

The new boost to the availability of affordable housing in the capital is laid out in Johnson's revised housing strategy. It comes on top of the 50,000 new, affordable homes originally promised by 2011 – a deadline which subsequently slipped by a year – but which city hall says the Conservative mayor is now well on track to deliver by the end of his first term.

Livingstone used a London policy conference jointly organised by the IPPR and the Centre for London thinktanks to vow to improve the plight of those renting in the private sector, as he highlighted a battery of rising bills faced by Londoners at a time when average real earnings are falling.

He said that Londoners are paying on average over 50% of their incomes on rent in more than half of the capital's 32 boroughs and high housing costs had proved a repeated theme during his re-election campaign as he tours the capital to hear concerns.

Around a quarter of households (700,000) are in the private rented sector compared to just 16% nationally, according to figures released by Livingstone's campaign team, with the average rent now £1,000 a month. For those wishing to buy, the average first time buyer property is now over £257,000.

Livingstone said under his watch he would ensure city hall would "work for ordinary Londoners". "Too many Londoners pay more than one third of their income in rent," he said. "That benchmark should be the indicator that drives us in our work to improve the living standards of Londoners from all walks of life."

He also pledged to "actually intervene" in the private sector as he outlined plans for a non-profit lettings agency to help change the private rented sector "for the better". "It will put good tenants in touch with good landlords across the spectrum of private renting so that both can benefit from security of tenure and reduce the costs of letting," he said.

"It will work with boroughs, landlords' representatives and tenants' representatives to develop a London-wide strategy for tackling rogue landlords and driving up standards. It will tackle a series of issues on accreditation, inspection and enforcement, licensing and energy efficiency as well as tenants' deposits protection. I want to end the churn-and-burn approach of some of the private letting agents, so I will be tackling abuses in this area."

But a spokesperson for Johnson panned the idea of a return to rent controls in the capital. "Whatever the ideological appeal, the mayor does not have the power to introduce them and even if he did, they would be devastating for the construction industry. It would result in fewer homes being built and lead landlords to invest less in their stock." The spokesperson also added that the mayoralty does not possess the necessary statutory powers or government funding to establish a lettings agency.

While Livingstone outlined his plans on housing as part of a wider campaign theme of being the mayoral candidate "for the 99%", Johnson delivered a speech to the National Housing Federation's London Development Conference, in which he announced plans to establish a new "rental standard" that would see 100,000 private landlords accredited by 2016. The standard will not relate to rent levels but the standard of the service delivered to tenants, according to a Johnson aide.

He also unveiled plans to deliver more affordable homes. City hall said Johnson had delivered 40,000 affordable homes by 2011, and under the new round of investment secured from government, he intends to build a further 55,000 by 2015. This includes 16,000 new affordable homes delivered by next April, which will see him hitting his pledge for his first term mayoralty.

Johnson said: "Boosting house building is critical for the economy and for the thousands of Londoners who are yearning to get on to the property ladder. This strategy offers us a golden opportunity to push on full steam ahead to deliver more affordable homes and create over 100,000 much-needed jobs in the process. "With £3bn secured from the government, new powers and affordable homes delivery at record levels, we have solid foundations on which to build and cement London's housing future."