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Labour to announce plans for large scale reforms to the rental market

Ed Miliband will today announce plans for a large scale shakeup of the rental market as part of the Labour party’s campaign to tackle the ‘cost of living crisis’.

The announcement will outlay plans to ban landlords from evicting tenants as a quick way to increase their income and will also ban letting agents from demanding fees from tenants, in the biggest shakeup of the rental market for more than two decades.

The policy is designed to be one of the major elements to the Labour Party’s push to tackle the ‘cost of living crisis’ and will introduce a three-year tenancy agreement with rules to make it more difficult to evict tenants in a bid to increase rental income.

My Miliband will pledge to champion the largely disregarded ‘Generation Rent’ and introduce tough new measures including a cap on rent increases. In the speech, due to take place at Labour’s European and local election campaign in Redbridge later today, Mr Miliband will say, “Generation rent is a generation that has been ignored for too long. Nine million people are living in rented homes today, over a million families and over two million children. That is why a Labour government will take action to deliver a fairer deal for them, too.”

He will add, “One of the biggest causes of the cost of living crisis in our country is the price of renting or buying a home. People simply can’t afford it, they’re priced out, saving for a deposit year after year, decade after decade, or having to look for somewhere to live further and further away from where they go to work or where the kids have always gone to school.”

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Over recent weeks, the leader of the Labour Party has stated that while his plans for reforms to the rental market would make a big difference to his cost-of-living campaign, the proposals do not include any plans for rent control. The policy has been criticized by some, including Tory MP Grant Shapps, who accused the Labour party of planning to introduce a ‘Venezuelan-style rent control system’.

Mr Shapps said: “This is another short-term gimmick – political tampering from Ed Miliband. Evidence from Britain and around the world conclusively demonstrates that rent controls lead to poorer quality accommodation, fewer homes being rented and ultimately higher rents – hurting those most in need. And it’s yet another Labour policy bought by Ed Miliband’s union boss, Len McCluskey.”

Mr Miliband’s plan will have three main elements:

  1. A new three-year lease that will start off with a six-month probationary period. This will allow the landlord to terminate the agreement if a tenant breaches their contract. This would be followed by a two and a half year lease, where, as now, the tenant can give one month’s notice. Landlords would only be able to terminate an agreement (with two months’ notice) if the tenant failed to pay their rent, breached the terms of the tenancy or the landlord was selling the property or needed it for a family member.
  2. A cap and new formulation to prevent landlords from excessively raising their rent. This would be in relation to average rent rises and inflation.
  3. A move to ban letting agents charging tenants a fee to sign a tenancy agreement; instead the letting agents will have to charge landlords any fees.

Main Picture: Locksley McPherson Jnr

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