Miliband rent control plan unravels already: Backers of Labour leader's plans to cap rises distance themselves from the idea just hours after it launched

Labour leader wants landlords to offer three-year tenancy agreements



Mr Miliband wants to stop the practice of charging tenants up-front fees

Buy-to-let landlords could be exempt from Labour's rent control plan



Royal Institution of Chartered Surveyors has distanced itself from the plan



Ed Miliband insists that his new plan will not lead to the reintroduction of full-blown rent controls

Ed Miliband’s flagship plan to impose 1970s-style rent controls was unravelling last night hours after it was launched.



The Labour leader attempted to open a new front in his war on the ‘cost of living crisis’ by pledging to cap rent rises in the private sector.



He said landlords would be forced to offer three-year tenancy agreements, with only modest rent increases permitted each year.



Labour said the move would help the nine million who rent in the UK and suggested it was backed by the respected Royal Institution of Chartered Surveyors. Sources said the RICS would help Labour establish a ‘benchmark’ for capping annual rent rises.

But, in an embarrassing setback, the RICS immediately distanced itself from the idea, saying: ‘Arbitrary caps are not a solution.’



It added: ‘RICS is not developing proposals on rent benchmarks for the private sector, and we do not recommend that a government introduce a ceiling on rent increases.’



In a further blow it emerged that hundreds of thousands of properties owned by buy-to-let investors could be excluded from the plans.

David Hollingworth, from independent mortgage broker London & Country, said the vast majority of buy-to-let mortgages specify maximum tenancy agreements of one year. Labour sources confirmed that these landlords would be permitted to offer short tenancies ‘where they are contractually obliged to do so’.

Mr Miliband said he wants to stop estate agents from charging tenants up front fees of up to £500 before moving into a property

Mr Miliband insisted that his plans do not amount to the reintroduction of full-blown rent controls, which have been widely discredited. He said at the launch of Labour’s local and European election campaign in Essex that the needs of the growing numbers in rented accommodation had been ‘ignored for too long’.



Mr Miliband has suffered a significant setback in his plan to control rents

Labour also plans to ban letting agents from charging tenants upfront signing on fees of up to £500.

The rental clampdown was the centre-piece in a new ten-point ‘cost of living contract’ with voters. But industry groups and housing experts warned that rent controls inevitably led to a reduction in the supply of good quality rented accommodation in the long term.



Chris Town, of the Residential Landlords Association, pointed out that official figures show private sector rents rose by an average of just 1 per cent last year.



He added: ‘All the evidence clearly shows that rent controls of the kind being proposed would critically undermine investment in new homes to rent.’



Sam Bowman, of the free market Adam Smith Institute, described Mr Miliband’s move as ‘one of the worst policy decisions in the history of modern British politics’.



He added: ‘Labour has unwittingly announced a policy that would devastate Britain’s cities by creating massive slums and exacerbate the housing crisis.’

Ed Miliband, right, organised a campaign against increasing rents during his first year at Oxford back in 1989



The rental clampdown was the centre-piece in a new ten-point ‘cost of living contract’ with voters. But industry groups and housing experts warned that rent controls inevitably led to a reduction in the supply of good quality rented accommodation in the long term.

Chris Town, of the Residential Landlords Association, pointed out that official figures show private sector rents rose by an average of just 1 per cent last year.



He added: ‘All the evidence clearly shows that rent controls of the kind being proposed would critically undermine investment in new homes to rent.’



Sam Bowman, of the free market Adam Smith Institute, described Mr Miliband’s move as ‘one of the worst policy decisions in the history of modern British politics’.

