Sadiq Khan will launch his re-election campaign today by pledging to win powers to implement rent control in London if he is returned to the top job.
Launching his campaign at a Hackney housing estate today, Khan will say that his victory would represent an “undeniable and irresistible” mandate to enforce rent controls – a move that would set him on a collision course with builders and landlords.
Powers to implement a cap on rents are not within City Hall’s remit and would need to be devolved from central government.
Khan is expected to say: “Tory Ministers have blocked us from introducing our plans for rent controls in London – and have simply said no.
“They have refused to give us the powers we need to make rent controls happen.
“If Londoners re-elect me as their Mayor on 7 May I want no one to have any doubt that it represents an undeniable and irresistible mandate for the introduction of rent controls in our city.”
Rents have risen by 27 per cent for the capital’s 2.54m renters since 2010.
To combat the problem of housing affordability, the mayor will advocate creating a private rental commission to implement and oversee rent controls and to establish a register of landlords to “name and shame rogue landlords”.
However, free market think tanks and London’s house builders have thoroughly rubbished the idea, with many arguing that increasing housing supply is the only way to deal with unaffordable rents.
Rico Wojtulewicz, head of housing at the National Federation of Builders’s House Building Association, said a cap on rents could hurt the construction industry.
“[House builders] with projects in the pipeline could suffer, as rent caps may push down land prices, leaving many who have already purchased land, with unviable projects,” he said.
Dr Kristian Niemietz, head of political economy at the Institute of Economic Affairs, labelled Khan’s stance “Trump-style knee-jerk populism”.
“Rent controls have never worked anywhere,” he said.
“If Sadiq Khan had any interest in solving London’s housing crisis, he would focus on the supply side.”
Chris Norris, director of policy at the National Landlords Association, said implementing rent controls would crimp investment within the housing sector.
“Rent controls cap the price a landlord can charge, but not the costs they will incur meaning that as the cost of providing homes increases so will the losses landlords are expected to make,” he said.
“Landlords will have no choice but to take their investment elsewhere, making it harder still for households to access the housing they need.”