Earlier this week, The i Paper reported that four tenants who rented a house owned by Ali were sent an email in November saying their lease would not be renewed, and giving them four months’ notice to leave.

However, the property was re-listed shortly after they moved out, at a rent £700 a month higher, the publication added.

The MP for the East End constituency of Bethnal Green and Stepney, who is helping to introduce Labour’s Renters Rights Bill that includes measures to end no-fault evictions, then faced calls to resign.

London Renters Union spokesperson Siân Smith said Ali’s actions were “indefensible” and she “must step down” due to a “clear conflict of interest”.

In a letter to the prime minister, Ms Ali said that remaining in her role would be a “distraction from the ambitious work of this government”.

She added: “Further to recent reporting, I wanted to make it clear that at all times I have followed all relevant legal requirements.

“I believe I took my responsibilities and duties seriously, and the facts demonstrate this.”

Laura Jackson, one of Ms Ali’s former tenants, said she and three others collectively paid £3,300 in rent.

Weeks after she and her fellow tenants had left, the self-employed restaurant owner said she saw the house re-listed with a rent of around £4,000.

“It’s an absolute joke,” she said. “Trying to get that much money from renters is extortion.”

Ms Ali’s house, rented on a fixed-term contract, was put up for sale while the tenants were living there, and was only relisted as a rental because it had not sold, according to The i Paper.

A source close to Ali said the previous fixed-term contract had been ended and the tenants had been told they could stay on a rolling basis while the house was on the market, but they had chosen to go.

The house was put on the market in November 2024 with an asking price of £914,995 but that was reduced in February by £20,000 and The i Paper said it had only been re-listed as a rental because it had not sold.

The government’s Renters’ Rights Bill includes measures to ban landlords who end a tenancy to sell a property from re-listing it for six months.

The Bill, which is nearing its end stages of scrutiny in Parliament, will also abolish fixed-term tenancies and ensure landlords give four months’ notice if they want to sell their property.