Government Rules Out Rent Controls Despite Housing Crisis

This declaration follows the Renters' Rights Act, which came into effect in May, marking a clear departure from earlier suggestions by Prime Minister Andy Burnham.

Burnham, during his tenure as Mayor of Greater Manchester in 2023, had advocated for freezes to private sector rents until the cost of living crisis abated.

He had suggested rent controls were an issue under consideration to help address the cost of living.

Rayner acknowledged this historical context, stating, "Three years ago, Andy called for that because there was a significant crisis in the rental market."

However, she asserted that the government's current strategy, anchored by the Renters' Rights Act, already impacts the market substantially.

This impact stems particularly from provisions targeting algorithmic rent-setting, which Rayner believes offer a better alternative to direct rent controls.

These measures address unaffordable housing costs while allowing market flexibility.

Rayner stated, "I don't think that rent freezes, rent controls, is a way forward at the moment."

She further claimed that controls implemented in some areas of the UK over the past few years had not necessarily brought rents down.

Rayner suggested these controls often acted as a "floor" for letting charges rather than a "ceiling."

Specifically referencing past policies, Rayner noted, "That is not something that we're looking to do because we've seen what's happened in areas like Scotland. It hasn't necessarily brought rents down."

She cited evidence from a lawsuit filed by landlords against the New York City Rent Guidelines Board, which alleged data manipulation to justify a rent freeze; similar issues could be present in Scotland's rent control policies.

Temporary rent controls were imposed in Scotland in 2022 but expired last year, providing a recent example of such policies within the UK.

Landlord groups have consistently warned that the imposition of rent controls could severely reduce supply within the private rented sector.

Rayner believes that current efforts to ensure landlords offer fair rents, allow challenges to rent hikes, and prevent bidding wars favorably impact the market for renters.

She stated, "I think the work we've done to make sure that landlords are giving people fair rents, people can challenge rent hikes, making sure that people are not being in bidding wars...is actually having an impact on the market, which is more favorable to renters."

The government maintains a target of building 1.5 million new homes by the end of the parliament in 2029.

Rayner indicated this target has become more challenging to meet, suggesting the government could miss its manifesto pledge.

A projected shortfall of 1.46 million homes by 2029 looms due to surging construction costs and declining property prices, as warned by an audit of Labor’s $10 billion housing fund as of July 24, 2026.

She affirmed, "1.5 million homes is a difficult target. It was when I made the target, but I'm going to keep the target, and I'm not going to be defeated."

Prime Minister Burnham, during his bid to become Labour leader, promised the biggest program of council house building in decades.

He claimed this drive would be the largest since the post-war era, previously suggesting a target of building half a million social homes by 2030, though further details have not yet been offered.

Burnham has also long discussed implementing reforms to property taxes, including stamp duty and council tax, and has previously advocated for scrapping stamp duty.

Rayner returned to Cabinet after 10 months on the back benches, reintroduced as part of Mr. Burnham's reshuffle.

Prime Minister Burnham will work from Number 10 North on Friday, an office he has called "the situation room for making Britain better."

The Prime Minister also insisted that an increase in the personal allowance tax threshold might happen at the Budget, despite initial suggestions from No10 that poured cold water on the idea.