Recently a landlord, Mr Cao, attempted to increase the rent on his central Manchester flat by £50 a month from £1,650 to £1,700. The tenant, Ms Nau, brought the increase to a tribunal under the Renters’ Rights Act, which only allows rent increases once a year and only in line with the open market rent. Ultimately, the tribunal decided to cut the rent by £200, as they believed it had already exceeded the open market rent.

This is rent control by the backdoor; shortages and reduced quality of housing will inevitably follow. Tribunals have no place in second-guessing the true open market rent, nor, even were they omniscient economic planners, would justice warrant stripping landlords of the freedom to set the rent on their private properties anyway. 

Landlords are entitled to their private property and to set whatever price they wish for its use

Landlords are entitled to their private property and to set whatever price they wish for its use

Open market rent obviously changes from year to year. Yet the Renters’ Rights Act, in insisting that rent may only rise to it, has the potential to stop any increases at all. This is because, in deciding what the open market rent is, tribunals will usually look at past figures and not the new ones which might be emerging at a higher rate. Tribunals may try to account for higher demand but this is a fool’s game. The lawyer, surveyor and layman who make up the tribunal cannot see supply and demand curves and any new intersection. Landlords testing the........

© The Spectator