Rent controls are likely to reduce the supply of homes available to tenants and could push some landlords to leave the market, according to new research from the Institute for Fiscal Studies (IFS).
The IFS states that private renters allocated an average of 28% of their household incomes to housing costs in 2024–25. This compares to just over 11% across households generally.
The report, authored by Matthew Oulton and Tom Wernham, suggests that while controls might decrease costs for some tenants and reduce rent uncertainty, other tenants could be worse off due to difficulties finding suitable homes and a potential decline in rental property quality. Lower-income and lower-wealth tenants may be particularly affected.
Evidence from countries including Ireland, Germany, and parts of the US indicates that landlords became more likely to sell to owner-occupiers or convert properties to other uses where controls were introduced. A major 2024 evidence review found that every study considered showed rent controls reduced the supply of homes available to tenants, with some research also noting lower rates of housebuilding.
The IFS highlights that landlords facing rent increase restrictions may cut renovation or maintenance spending. Additionally, controls could make it harder for households to move, potentially trapping tenants in homes that no longer meet their needs.