Labour Is Finally Treating Landlords Like the Spoiled Children They Are

When the online discourse broke about whether landlords are working people, I was busy reading the evidence that a landlord had given in a recent court case about whether a rented flat was unfit for human habitation. “I have never met the tenant,” the landlord explained. “The property has been fully managed, given that I live in Australia.”

There are nearly three million landlords in the UK, which is far too many. They have recently developed a strong sense that they are under attack. But they have responded with the same gracelessness, narcissism and irrationality as those Labour MPs who managed to lose their seats during the biggest swing to their party in decades. They cry “bullying”, but in fact are powerful people being rejected by the public on account of their actions.

Last week’s budget made it easier for landlords to divest, while also making it harder to invest in our homes. In combination with the imminent renters’ rights legislation, landlords are rightly pointing out that it is going to become more difficult to squeeze passive incomes out of us. They say that they will sell up en masse. It is difficult to know whether this is true, but what if we assume it is?

Determined to threaten us with a good time, landlords say that they’re going to shrink the proportion of housing they control. They dare us to imagine a world in which homebuyers aren’t forced to compete with a gaggle of buy-to-let investors, chasing generous yields from a deregulated rental system. They taunt us with the idea that many more people will be paying off their own mortgages rather than their landlord’s.

Before Thatcherism, there was broad consensus that a diminishing private rented sector was a good thing. We know from experience that when the sector shrinks, society tends to gain. During these mass sell-ups the homes must be sold to someone, and it tends to be new owner-occupiers and social housing providers, as landlords are forced to lower their prices to meet these buyers’ means. The near-collapse of the private rented sector in the 1970s – and consequent growth of council housing and owner occupation – illustrates the broad point that landlordism is the enemy of decent, affordable housing and vice versa.

Many have argued that landlords contribute nothing to the economy – they simply drain society of its social surplus and pocket it. This overlooks the landlords’ commitment to bolstering dehumidifier sales, but there is the germ of an argument there.

The housing crisis exists because landlordism (and housing investment more broadly) was designed to become a more attractive form of investment than virtually anything else. Landlordism has more than doubled since the 1990s precisely because rented homes were turned into some of the most competitive financial instruments under Thatcher, Blair and their successors. Law and policy were geared towards ensuring that landlordism is a virtually risk-free money machine, and the driving force behind the runaway value of housing more broadly.

The budget suggests that Labour is beginning to understand how catastrophic these indulgent policies were. The UK is now leading the world in homelessness, while most tenants live in housing that is both too expensive and inadequate. A housing system that is built upon rentierism has caused this. Little wonder that Labour is, very gently and politely, showing landlords the door. It should be noted, however, that Labour’s overarching housing ideology remains essentially Thatcherite: right to buy has been retained, and Labour continues to conceive of the housing crisis as a supply problem to be cured by incentivising property developers.

In 1649, Gerrard Winstanley, a revolutionary thinker during the English civil war and a font of wonderful anti-landlord adages, said: “By their plausible words of flattery to the plain-hearted people, whom they deceive, … [landlords] are lifted up to be teachers, rulers and law makers over them that lifted them up; as if the Earth was made peculiarly for them, and not for others’ weal.” Winstanley’s point was that landlords have hoodwinked us by making themselves seem natural and indispensable.

Today, the landlord lobby has pushed this deception so far that we’re not even allowed to conceive of a shrinking private rented sector. Winstanley had to hark back to the Norman conquest and the biblical kingdoms to argue it was possible to reclaim the world from the landlords – in fact, we only need to look back 50 years. In the late 20th century land was cheaper, homes more affordable, and the state had the capacity to produce new council homes – all because landlordism was waning. If Reeves (a landlord herself) is trying to curb rentierism she is doing a good deed, and not before time.

Are landlords workers? Many absolve themselves of labour altogether by hiring agents, and still make healthy yields. Even the landlords who manage their own properties don’t make a very sympathetic case. Take the average rent and divide it by the amount of time that the average landlord “works” and it comes to an hourly rate that would make the Tony Blair Institute for Global Change blush.

Whatever we make of the budget, it is striking that Labour could drastically reduce spending by regulating rents – as the Scottish parliament is currently seriously considering – but chooses not to. Public spending on landlordism is at a level where – in many other countries – the International Monetary Fund would have intervened. Birmingham, the UK’s second city, is bankrupt, partly because it spends £72,000 per day on temporary housing. Rent controls are an essential part of landlord abolitionism, and – until the government has the courage to impose them – any growth that the UK does manage to achieve is likely to be gobbled up by its rentier class.

We are “not a free people”, Winstanley said, “till the poor that have no land … live as comfortably as the landlords”. We may be turning the corner, but the policies we need to properly release landlords’ chokehold on our housing market are still a long way off.