A general view of housing in Brixton on January 30, 2013. Photograph: Getty Images.
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We need rent controls to solve London's housing crisis

Too many essential workers are being priced out of the capital. Rent controls could address the uncertainty and unaffordability they face.

In an unusual break from the disagreement, dissent and bickering that pervades politics, consensus has broken out amongst policy makers in the capital: London is in the midst of a housing crisis.

The facts are stark. Private rents in London have risen nine per cent since December 2011. Property price growth has returned to pre-2008 levels and is on the brink of exceeding it.Higher rents make it difficult to save a deposit, and rapid house price growth pushes the size of that deposit further and further out of reach. Indeed, those two factors combined mean that the projected average age by which a young person will be able to buy their first home in London is now 52. Sixty six per cent of first home buyers are supported by the bank of Mum and Dad in order to afford a deposit.

London has reached the point where the cost of housing is affecting productivity growth. We are on the cusp of having to bus in cleaners, retails workers and hospitality staff from the Shires because those on low incomes cannot afford London rents. Londoners on average already spend more than half of their income on paying their rent or mortgage. Not only does that disincentivise the best and brightest teachers and nurses from living in London, it also significantly reduces the disposable income of those with the highest propensity to spend, threatening the future of the retail sector in particular and the economic recovery in general.

London clearly needs to build more homes. A report by London Councils found we have 283,000 too few homes in London now, and we will need a further 526,000 by 2021 to cope with a growing population. But building hundreds of thousands of homes will not happen in the very short- term; meanwhile, Londoners are struggling to pay their rent.  With the monthly rent for a one-bedroom flat in Wandsworth sitting well above £1,100, it has become patently obvious that London needs some form of rent control.

But let me be clear about what I mean when I talk about rent control. I don’t mean the old-school "first generation" rent control that was introduced in the UK during the Great War, which prevents any increase in rents, diminishes investment returns in real-terms over time, and discourages people from becoming landlords. I don’t mean the type of rent control that keeps rents so low that they are not enough to pay for the proper maintenance of a home in a liveable condition. I mean rent controls that nod to the market but allow for the realities of what it is to have a home to live in; the type that are espoused by those who could hardly be called left-wing ideologues, including Angela Merkel and Michael Bloomberg.

Currently in London, a family can move into a home at an expensive but affordable rent. The landlord cannot evict them (except for non-payment of rent) for six months. But after a year that landlord can raise the rent as high as he or she would like to; the rent could be doubled without any notice to the tenant family, putting it completely out of the range of affordability. The family is obliged, then, to move house, move their childrens’ school, probably move to a different part of London, and pay another round of letting fees, bonds and two-months-rent-in-advance. The other option is to seek the landlord’s permission to sublet one of their bedrooms to another family, adding one more to the 207,000 London households already living in overcrowded conditions.

There is an alternative. Take, for example, the German system of rent controls. Renters have indefinite tenancies; a tenant can only be evicted for non payment of rent (over a number of months), damage to the property, unauthorised subletting, or to allow the landlord or a member of his or her family to live in the home or to sell the home. It is in the interests of a landlord to retain their current tenant because the costs of letting agents are borne by the landlord.  The initial rent is set by the market, but cannot be more than 20 per cent higher than similar properties in the area. Rents can be raised according to inflation or due to an increase in the landlord’s costs, but by no more than 20 per cent in any three-year period.  Further, proper maintenance of the property by the landlord is incentivised; a tenant only pays 100 per cent of the rent if the home is in 100 per cent good condition. Perhaps a system like Germany’s is exactly what London needs to address the uncertainty and unaffordability faced by tenants in our private rented sector.

A common criticism of rent controls is that they discourage investment in the private rented sector. But British history since the deregulation of the rental market in the late 80s has shown that argument to be flawed; 89 per cent of landlords are individuals or couples, not builders or developers. In general, they buy pre-existing properties as an investment or nest egg.  They aren’t the part of the housing market that builds new homes in London, though they do compete against first homebuyers for existing properties. The fact that more rental accommodation has not been built in London, with its high rent prices, shows the inelasticity of housing supply in London which has more to do with cautious developers, the planning process, and a scarcity of developable land than it does with rent prices.  

To encourage investment in new homes (rather than locking up investment equity in pre-existing houses), there could be concessions to rent controls on new developments. Maybe rent controls should not apply to any new property built after 1 January 2014. Or maybe they should not apply to the first tenant of any new development; that will have the added benefit of encouraging longer term leases by property developers.

We need to start getting serious about how to address the housing crisis in London, because it’s not just those on minimum wage or housing benefit that are struggling to afford to live here. Teachers, civil servants, retailers and service workers essential to the running of our city are all threatened by the crisis. Though not a silver bullet that will singlehandedly solve the crisis, we should think about how rent controls – done sensibly – can be part of a comprehensive plan to ensure that all Londoners can afford a home in our city.

David Lammy is Labour MP for Tottenham

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Celebrate Labour's electoral success - but don't forget the working class

The shutting down of genuine, constructive debate on the left is the great danger we face. 

In the moment when the exit poll was released on 8 June, after seven weeks of slogging up and down the streets of Britain, dealing with scepticism, doubt and sometimes downright hostility, we felt a combination of relief, optimism, even euphoria.
 
This election broke wide open some assumptions that have constrained us on the left for too long; that the young won’t vote, that any one individual or political party is “unelectable”, that perceptions of both individuals, parties and even policies cannot change suddenly and dramatically. It reminded us that courage, ambition and hope are what’s needed and what have been missing from our politics, too often, for too long.
 
We have learnt to tread carefully and wear our values lightly. But in recent weeks we have remembered that our convictions can, as Jonathan Freedland once wrote, “bring hope flickering back to life” and meet the growing appetite for a politics that doesn’t simply rail against what is but aspires to build a world that is better.
 
In this election at least, it seems the final, anticipated fracture of Labour from its working-class base after Brexit did not materialise. Shortly before the snap election was called I wrote that while Brexit appeared to be Labour’s greatest weakness, it could just be our biggest strength, because: “consider what remain voting Tottenham and leave voting Wigan have in common: Labour… We will succeed if we seek the common ground shared by the decent, sensible majority, and more importantly, so will Britain.”
 
But consider this too. The Tories ran a terrible campaign. It was, without any doubt,the most inept, counter-productive campaign I’ve ever seen in British politics. The day their manifesto hit the headlines, even in our toughest neighbourhoods, we could feel change in the air. Arrogance is never rewarded by the British people and Theresa May has paid a price for it. Yet, despite a Tory manifesto that was a full, square attack on older people, the majority of over 65s still came out for the Tories.
 
And despite the growing relevance of freedom, internationalism and tolerance in an era characterised by Donald Trump and Vladimir Putin, the Liberal Democrats managed to become bystanders in the political debate. They stood on a platform that aimed to capture the support of those remain voters for whom Brexit is the major question, but neglected the rest. And they quite spectacularly failed to foresee that those who were intensely angered by May’s conversion to a little England, hard Brexit stance would vote tactically against the Tories. Over those seven weeks, they all but disappeared as a political force.
 
As Bob Dylan once said, "the times, they are a-changin" – and they will change again. The recent past has moved at extraordinary speed. The Brexit Referendum, the rise and retreat of nationalism, the election of Trump and his crushing unpopularity just a few months later, the reversal in fortunes for May and Jeremy Corbyn, the astonishing phenomenon of Emmanuel Macron and pro-European centrism, and the dramatic rise and sudden collapse of Ukip. Politics, as John Harris wrote last week, is now more fluid than ever. So now is the time, for hope yes, and for conviction too, but not for jubilation. We need some serious thinking. 
 
We should be cautious to rush to judgment. It is only two weeks since the exit poll sent shockwaves across the country. There is no comprehensive explanation for the multitude of motivations that delivered this election result and will not be for some time. But there are some early indictors that must make us think. 
 
After seven years of austerity, as John Curtice observes, the Tories made some of their biggest gains in some of the poorest areas of Britain. It is something I felt in all of the eight constituencies I campaigned in during the election. While the Labour vote rose significantly in towns like Wigan, so too did the Tory vote, despite little or no campaigning activity on the ground. As Rob Ford puts it, “Labour, founded as the party of the working class, and focused on redistributing resources from the rich to the poor, gained the most ground in 2017 in seats with the largest concentrations of middle-class professionals and the rich. The Conservatives, long the party of capital and the middle class, made their largest gains in the poorest seats of England and Wales… Britain’s class politics has been turned completely upside down in 2017”.
 
To acknowledge the growing, longstanding scepticism of many working-class men, and women, towards Labour in towns across England is not to take away from the hard work and drive of the activists, advisers and politicians that helped to fuel such a dramatic turnaround for Labour during the short campaign. To have won considerable gains in wealthier suburbs is no small achievement. 
 
But if the future of Labour lies in a coalition between middle-class young professionals and the working class, what is the glue that binds? While there is shared agreement about investment in public services, how are those interests to be squared on areas like national security and immigration? I believe it can and must be done, but – as I said to conference when I was first elected seven years ago - it will demand that we begin with the difficult questions, not the easy ones.  
 
Just a few days before the election, statistics were released that pointed to a collapse in trade union membership. What does the decline of an organised Labour movement mean for who we are and what we can achieve? These are not new questions. They were posed by Eric Hobsbawm in his brilliant lecture, "The Forward March of Labour Halted" in 1979 - a challenge laid down in the year I was born. Now, 37 years on, we are no further down the road to answering it. 
 
The most dramatic finding from this election was the support Corbyn’s Labour party appears to have won from middle-class, young professionals. They said he couldn’t do it and quite stunningly it seems they were wrong. But a ComRes poll last week caught my eye – by a large margin those 30-44 year olds would favour a new centre-ground political party over the current political settlement. In an election where we returned strongly to two-party politics, it appears they moved to us. But what would a dynamic and renewed Liberal Democrat Party, or a British En Marche do to our support base?
 
After a hellish two years we have learnt in Labour, I hope, that unity matters. The public and private anger directed towards each other, whether the Labour leadership, the parliamentary Labour party or elected councillors, is desperately damaging and its (relative) absence in the campaign was important.
 
But unity is not the same as uniformity, and while two weeks ago I felt there was a real danger of historic fracture, now I believe the shutting down of genuine, constructive debate on the left is the great danger we face, and must avoid. No one person, faction or party has ever had the monopoly on wisdom. The breadth of the Labour movement was and remains our greatest strength. 
 
Consider the Labour manifesto, which drew on every tradition across our movement and demanded that every part of the party had to compromise. Those broad traditions still matter and are still relevant because they hear and are attuned to different parts of Britain. Our country is changing and politics must catch up. The future will be negotiated, not imposed.
 
As we witness the age of "strong man" politics across the world, here in Britain our political culture has become angrier and more illiberal than at any time I can remember. The Brexit debate was characterised by rage, misinformation and a macho political culture that demanded that we abandon nuance and complexity, an understanding of one another and tolerance of different points of view.
 
But this is not where the future of Britain lies: it lies in pluralism. It lies in a politics that is nimbler, more fleet of foot, less constrained; a return to the great tradition of debate, evidence, experience and argument as a way to build broad coalitions and convince people; not shouting one another down, nor believing any of us are always right; an arena in which we listen as much as we speak; a political culture in which we are capable of forming alliances within and across party lines to achieve real, lasting change.
 
And ultimately that’s the prize: not just seek power but, to paraphrase a philosopher whose work inspired millions, in the end “the point is to change it”. We could sit tight in Labour and hope to see the current government fall apart. We might even inherit power, we could temporarily reverse some of the worst of the last seven years, but what then? If we have learnt anything from 13 years of Labour government it should be this: that to build lasting change is the hardest political task of all, and it requires now that we do not turn to the political culture, the tools or even the ideas of the past, but that we think hard about where the future of our movement and our country really lies. Now is not the time to sit back and celebrate. Now is the time to think.

 

Lisa Nandy is the MP for Wigan. She was formerly Shadow Secretary of State for Energy and Climate Change.

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