A new “loose political alliance” between Welsh Labour and Plaid Cymru is giving serious consideration to whether to implement rent controls for Wales, the parties have said.

This announcement is part of a list of proposals they have agreed to work on together following talks over the summer on “areas of mutually-beneficial join cooperation”.

These rent controls proposed would set annual rent increases capped at inflation.

However, the NRLA say that evidence across the globe shows that rent controls don’t work. They have been campaigning hard to head off rent controls proposals (even prior to the formation of this political alliance). The NRLA says “[Rent controls] make it harder for rents to find an affordable home, encourage rent rises, see housing conditions deteriorate and can lead to a reduction in the overall number of homes to let as landlord leave the market. We would encourage the Welsh Government to resist any moves to introduce them.”

Property media commentator Russell Quirk added “The consequence will be a future shortage of rental homes as landlord exit the sector for a better asset.”

Inflation in September 2021 was 3%. On rent at £750pcm, this would equate to an increase of £22.50pcm – just shy of what would generally be considered to be a reasonable rent increase. Just a month later, however, inflation rose to 4.2% – that’s a £31.50pcm increase – higher than what would generally be considered to be a reasonable rent increase.

The housing market is already stretched thin, and it’s difficult to see how this won’t stretch it further.

The list of proposals forms part of the agreement between Welsh Labour and Plaid Cymru, and is expected to be signed this week, bringing the rent caps into effect.

Sources: NRLA / The Negotiator / BBC News