Housing minister Matthew Pennycook (main image) has told fellow MPs that rent controls in England would hit both tenants and landlords negatively by reducing supply and discouraging investment in the private rented sector.

His comments in parliament were in reply to Green Party co-leader Carla Denyer’s (pictured) proposals to the committee scrutinising proposed amendments to the Government’s Renters’ Reform Bill.

Denyer’s Amendment 11, which ultimately was rejected by the committee’s MP for inclusion in the legislation, proposed that a Living Rent Body be established to either regulate individual tenancy prices or local average rents above which landlords would not be able to raise theirs above.

Landlords and letting agents will be relieved to hear that Pennycook was clear in his rejection of such a body and the rent controls that would come with it.

“The costs of administrating such an arrangement, which would have to apply to the approximately 950,000 new lets that occur each year, would be likely to be enormous,” he said.

Rental price

“In my view, it would almost certainly have an impact on the time that landlords and tenants take to agree a rental price.

“If…the body would simply be required to set maximum rents on the basis of broad principles…it would in effect be overseeing a form of rent control.

“The Government believe that would impact negatively on tenants as well as landlords, as a result of reduced supply, discouraged investment and declining property sales.”

During her comments Denyer said that rents control are a normal part of housing policy in similar economies and she understood that there are currently rent controls in 17 European countries.

She added: “Introducing rent controls into our crisis-ridden and distorted market is a challenge, but my point is that it is not one we should fail to discuss and examine just because it is tricky.”