The Rental Crisis Has Two Causes. We Only Talk About One.

I started writing this essay convinced that rent control was the obvious next step after the Renters Rights Act. The history changed my mind — or rather, it shifted my focus. The problem runs deeper than rents. This is an attempt to explain how we got here, and what that tells us about where the real power needs to move.

Private renting in the UK is a mess, particularly for the poor. Rents are high, and security of tenure was historically weak. The tenant’s power in the sector has been eviscerated, particularly during the Thatcher years and continuing into the 21st Century. The new Renters Rights Act goes some way toward restoring power to tenants, and a logical next step would be to introduce rent control into the sector. The history suggests we should be careful what we wish for.

Today’s rental crisis is best understood as the result of two sequential collapses in the UK housing system. The first was the collapse of private renting in the early 20th century; the second was the collapse of council housing in the late 20th century. The modern private rented sector has been expanded to fill the gap left by both.

In England, wartime rent controls introduced under the Increase of Rent and Mortgage Interest (War Restrictions) Act froze rents across much of the private sector. While necessary in wartime, their long-term effects were profound. Over the interwar and post-war decades, private rental construction collapsed, landlord exit accelerated, and investment dried up. Rent controls were not the sole cause: taxation, regulation, and slum clearance also mattered — but they decisively undermined incentives for long-term private rental investment.

The response was large-scale council housing. From the 1920s through to the 1970s, public provision effectively substituted for a collapsed private rental sector, providing affordability, security, and system-wide stability.

The second collapse began in the late 1970s. Council housebuilding fell sharply, accelerated by Right to Buy, borrowing constraints on local authorities, and a retreat from public provision. Stock was depleted without replacement, removing the stabilising counterweight in the housing system.

The private rented sector was then re-expanded under very different conditions: a tight land supply, restrictive planning, and buy-to-let finance, without the moderating influence of large-scale public housing or any strong regulation.

It could be argued that this occurred long ago. But the impacts of housing policy take time to come to fruition and to fully unfold, including unexpected consequences. I would therefore argue that this history matters. Early rent controls helped collapse private renting; later, the collapse of council housing left the rental sector overburdened.

Rent regulation can protect sitting tenants in the short run, but UK experience suggests it redistributes security rather than delivers durable affordability unless paired with sustained public supply and structural reform.

Throughout this essay, I have not used the word “market.” All of the changes to private renting have taken place within the market, and it is this fact that is the fundamental problem with housing, both private and rental, in the UK — and the one most in need of structural reform.

Is a place to live a commodity or a right? Does it have an exchange value or a use value? The current view is that your home is a commodity and is treated as an asset in the market, whether it is a private purchase or a rental property belonging to the landlord. We should therefore trust the market to regulate supply and demand. For private housing, market regulation is a distortion; in the rental market, it is a disaster.

To treat a home as a commodity is to make the people who live in it subject to forces they did not choose and cannot control. That is not a market failure. It is what the market, working as intended, produces. The power needs to shift — away from those who hold housing as wealth, and toward those who need it to live.