§ Mr. Peter Shore
To ask the Secretary of State for the Environment if rent officers, in their determination of fair rents for unfurnished private accommodation in inner London, are currently obliged to disregard scarcity; and if he will make a statement on recent changes in fair rents in inner London.
§ Sir George Young
When determining the fair rent for any property, the rent officer is required to follow section 70 of the Rent Act 1977. This requires the rent officer to assume that the number of people seeking accommodation is not substantially greater than the number of homes available for letting: colloquially this amounts to disregarding any element of market rents which is due to scarcity.645W
Fair rents generally have been rising in recent years. This is a matter for rent officers and rent assessment committees, but it seems likely that, among other factors, it reflects the increased availability of evidence about market rent levels and a view that the discount to be allowed for scarcity has diminished following the deregulation of new lettings in 1989.