Rents

In his newsletter this week, Will Hayward has made a point of noting that three areas in Wales have the fastest rising rents in GB over the last 12 months – Newport at 21.2%; Merthyr at 12.7%; and RCT at 12.6%.  And, overall, rents have risen in Wales by 8.2%, which is more than both England and Scotland.  He points out (in the context of a discussion about Wales’ ageing population) that “the two parts of Wales with the highest percentage of kids, are seeing the fastest growth in rent across the whole of GB”.  The WG has published a synthesis of the responses to the White Paper (on 16th July 2025) which contained proposals on rents (discussed here).

The vexed question of rents raises the spectre of rent control or rent regulation – the two are rather different and shouldn’t be agglomerated.  We considered this question/spectre before in the context of the WG’s White Paper on housing adequacy and rents, Plaid’s policy document (here), and the problem of the local housing allowance rate (which informally controls rents of the more “affordable” stock) (here).  In an excellent briefing paper for the WG on rent control, Ken Gibb and Bob Smith have emphasised the contingent nature of rent control and the fact that, although it is often portrayed as a binary decision, there are a range of decisions that need to be made around it which require sensitivity to context, locality, how it might be introduced (including exemptions).  As they put it – and this is a really stark comment – “rent control is not public policy on the cheap”; and ” It is appropriate to ask to what extent the call for private sector rent control is a response to the failure of other housing policies over time”.  My own personal experience, as an 18 year old looking for somewhere to rent with a couple of friends in South London (before the Housing Act 1988), was that I couldn’t understand why there were so many company lets and holiday lets.  In other words, there are unintended effects of rent regulation/control, which encourage “creative” uses of the law (generations of law students who have been befuddled by the lease/licence question will attest to that too).  Generation Rent’s response to the WP argued that “Without regulating rents, it appears the government has no other meaningful way to deliver fair rents in the coming years”.

The White Paper respondents largely agreed with the WG’s proposals.  A large proportion of respondents agreed that rent data should be collected at a local level by Rent Smart Wales, and then mapped and publicly available.  That seems to me to be a no-brainer, and the opposition to this policy (practicality, cost, and market principles) seems overblown.  Most respondents were also in favour of a mechanism for challenging rent increases, but there is rather more nuance here and potential negative outcomes (see pp 60-1).  These include issues with the Tribunal and other unintended consequences (including the possibility that landlords could set higher initial rents to avoid potential disputes).  These are issues which England is considering at the moment with the Renters’ Rights Bill.  However, there are ways of ameliorating at least some of these issues and respondents looked to Scotland’s data driven approach to rent increases.

The short answer is that there are no easy answers.  The issue is a result of the failure of housing policy for many decades, and there is no simple band aid.  Once the rent data becomes available, the WG will be in a much better position to make policy.  In the meantime, however, perhaps the key question is, as Gibb and Smith asked, “To what extent would fixing other policy weaknesses (e.g., the supply and cost) of social rented housing over time reduce the need for interventions in the private rented sector?”.