Licence To Let Will Hit All Uk Landlords

[pete.hpc]

I would imagine that BTL has to be the biggest money-loser on the planet nowadays.

Why didn't they all sell up when CGT was reduced to 18% and house prices were already falling?

Because it's different this time

BTL changed the world, the rulebook was thrown out of the window

Except it wasn't, of course

[angrypirate]

I reckon that as long as it is "policed" properly and band landlords arent allowed to rent out properties, this can only be a good thing.

LLs dont have an excuse not to pay it - £50 per year is a very small fee in the grand scheme of things.

If a bad landlord gets banned from letting properties out, then it means they will probably end up forced selling. This will then lead to a sudden blip downwards in property prices. Long live the crash...

I imagine it will also make people think twice about whether to become an "accidental" LL to just take the hit on the selling price.

In fact, i think this is the labour government trying to push the crash downwards even faster

[50%deposit]

If a tenant pays their rent, and doesn't trash the place, they should be allowed to stay for as long as they want.

It was good enough for the boomer generation, it should be good enough for our generation.

Of course, this is difficult for most people to get their heads around these days, with incredulous responses like "but it's my house, I should be able to get it back at some point !!!"

Which completely misses he point : it would spell the death of BTL and a return to property ownership by larger corporations who use commercial loans or existing finance to purchase properties and are dependant on rent income, which in turn would see house prices return to historic averages, giving people a choice between renting at their convenience, or buying if their circumstances permit it.

The law is currently designed to encourage speculation, not to provide families with stable accomodation.

This is a fundamental problem in our society currently.

the right to own their property

[Dave Spart]

www.grassonyourlandlord.gov.uk

[pete.hpc]

LLs dont have an excuse not to pay it - £50 per year is a very small fee in the grand scheme of things.

And yet some of them are still so close to the mark financially they are talking about passing the costs on.

Yet more failing to understand market forces and how that would shape up against landlords who don't pass it on.

[Live Peasant]

OECD report is suggesting that UK rents will fall 40% to return to the norm.

http://www.oecd.org/document/61/0,3343,en_...1_1_1_1,00.html

You will see who the accidental landlords were. They will be the ones at the county court handing over 450 notes and asking for the bankruptcy papers.

[BalancedBear]

I would imagine that BTL has to be the biggest money-loser on the planet nowadays.

Why didn't they all sell up when CGT was reduced to 18% and house prices were already falling?

Obviously lots should have, but some only thought property only ever went up, and others had bought many years ago and actually wanted to be a landlord to generate income, not capital gains. That was all I wanetd to do - generate income for the long term. However the BTL boom meant many people got into it over-paying for properties undercutting on rents, jsut to make capital gains. This made life hard for landlords who wanted a long-term business and people wanting to buy homes. If banks had not constantly relaxed lending criteria, the mess would never have been created.

[pete.hpc]

You will see who the accidental landlords were. They will be the ones at the county court handing over 450 notes and asking for the bankruptcy papers.

Maybe they'll be able to call it an "unexpected check-out fee" and charge the tenant?

[Stars]

I think its important to differentiate between speculators and people that buy/bought property as an income.

The reason we come across so many moral distinctions made between different 'portions', of the real estate 'market' is that people who are involved wish to insist that the bit they are involved in is essentially honest in nature and the money that they have collected from their involvement was earned rather than from some gross wealth transfer made at the expense of society at large (they are mostly wrong)

[KingBingo]

I'm amazed at the deluded responses I have seen on this thread. Its just more big government leading to government failures that will be blamed on market failures.

The market will punish bad BTL LL's far faster and cheaper than any new quango.

This is just a backdoor way to force more people to get HIP's. Its a total mess.

[Tiger Woods?]

What a bunch of bloody whiners from the landlord community.

It's only £50, and there's nothing to worry about as long as you're a good landlord.

As a tenant I often have to pay application/ admin fees in excess of £100 when moving... if I have to pay that, then the whiny landlord can shut the f*ck up and get their wallet out too.

Nothing to do with the £50. What they are scared about is the taxman and their mortgage provider having information about their doings. I normally don't approve of the state prying into people's affairs, but in this instance I wholeheartedly agree.

[gotoutintime]

Obviously lots should have, but some only thought property only ever went up, and others had bought many years ago and actually wanted to be a landlord to generate income, not capital gains. That was all I wanetd to do - generate income for the long term. However the BTL boom meant many people got into it over-paying for properties undercutting on rents, jsut to make capital gains. This made life hard for landlords who wanted a long-term business and people wanting to buy homes. If banks had not constantly relaxed lending criteria, the mess would never have been created.

I fully agree with you wanting regular income but why continue to hold whist your capital is going out the window? I cashed in my unit trusts and shareholdings in November and December 2007 as I watched the markets turn south and kept hold of my capital. Maybe it's because I have never been a believer of the Buy & Hold view which has since been proved not to be a good idea.

I know to sell a house you must incur fairly extensive costs and a bit of CGT but I believe in locking in a profit that I am happy with, if I didn't my portfolio would be down around 30% right now.

The BTL Boom is basically "follow the herd" with buyers from that period (goaded on at £3000 BTL seminars) facing huge losses just the same as tech stock buyers did in 2000/01. The investments were different but results look like ending up being the same.

Banks are blamed for too much, they also made bad investments in the wrong assets like property and derivatives but the buyers couldn't see past their bank statements

[Rachman]

Tenants should have the right to security of tenure, reasonable rents, well maintained safe house without fear of harrassment.

Agreed about security of tenure - they do - they can sign up for a minimum of 6 months - and more if they agree it first. What's wrong with that ? If you want 10 years, sign for 10 years but you can't leave early without paying a fee, and he can't terminate without doing the same. Otherwise what's wrong with what we have.

Reasonable rents - the market sets those - if you think they are too high, rent somewhere else. Or are you suggesting controlled rents - for the private sector. If so, get real. That's ridiculous. You can't have anyone subsidising tenants. Plus you can agree the rent for the term when you agree to the lease. If you don't, you're a muppet.

Well-maintained safe house. Agreed. As others have said. Does that also extend to the tenant paying out for damage done to the house. It's a 2 way street - both parties should treat the other as they would wish to be treated. I suspect there's a bad tenant for every bad landlord in this respect.

Harassment. Agreed. What sort of harassment do you mean ? The landlord coming to check up on his house every couple of months or coming round every day shouting the odds. There is a world in your comment - would you care to elaborate ?

I think most landlords offer that - or at least as many landlords currently do as tenants that play by the same rules. I do have sympathy with people who have had to deal with landlords who retain deposits though - I'll give you that one.

I get scared when I see some of the nutty side of HPC, people who genuinely think a 'state control' of all things housing related is good as it will keep their personal costs down but being the same ones who rail against state interference everywhere else.

A balance needs to be struck between landlords and tenants. At the moment, I fail to see where that balance is excessively pro-landlord. Almost all the terms can be negotiated anyway - with some statutory tenant protections - so if one landlord won't give you a 3 year tenancy then go find one that will. Or are you suggesting tenants can leave at the relative drop of a hat but that the landlord can't terminate.

[Stars]

Agreed about security of tenure - they do - they can sign up for a minimum of 6 months - and more if they agree it first. What's wrong with that ? If you want 10 years, sign for 10 years but you can't leave early without paying a fee, and he can't terminate without doing the same. Otherwise what's wrong with what we have.

Reasonable rents - the market sets those - if you think they are too high, rent somewhere else. Or are you suggesting controlled rents - for the private sector. If so, get real. That's ridiculous. You can't have anyone subsidising tenants. Plus you can agree the rent for the term when you agree to the lease. If you don't, you're a muppet.

Well-maintained safe house. Agreed. As others have said. Does that also extend to the tenant paying out for damage done to the house. It's a 2 way street - both parties should treat the other as they would wish to be treated. I suspect there's a bad tenant for every bad landlord in this respect.

Harassment. Agreed. What sort of harassment do you mean ? The landlord coming to check up on his house every couple of months or coming round every day shouting the odds. There is a world in your comment - would you care to elaborate ?

I think most landlords offer that - or at least as many landlords currently do as tenants that play by the same rules. I do have sympathy with people who have had to deal with landlords who retain deposits though - I'll give you that one.

I get scared when I see some of the nutty side of HPC, people who genuinely think a 'state control' of all things housing related is good as it will keep their personal costs down but being the same ones who rail against state interference everywhere else.

A balance needs to be struck between landlords and tenants. At the moment, I fail to see where that balance is excessively pro-landlord. Almost all the terms can be negotiated anyway - with some statutory tenant protections - so if one landlord won't give you a 3 year tenancy then go find one that will. Or are you suggesting tenants can leave at the relative drop of a hat but that the landlord can't terminate.

If people having human rights and independent liberties in your property is a problem for you, get your property out of the way of their liberties -

[Rachman]

If people having human rights and independent liberties in your property is a problem for you, get your property out of the way of their liberties -

do you mind dropping the socialist 'branding' and telling me what you mean by human rights and independent liberties, in the context of a landlord and tenant.

It's no use just chucking about 'ideas' - this may as well be the PFJ or the JPF if that's all you are going to do.

[non frog]

The reason we come across so many moral distinctions made between different 'portions', of the real estate 'market' is that people who are involved wish to insist that the bit they are involved in is essentially honest in nature and the money that they have collected from their involvement was earned rather than from some gross wealth transfer made at the expense of society at large (they are mostly wrong)

That, I'm sure is true of many people's motives for "defending" their personal actions. However, just to remove any confusion, I don't really care whether people feel happy about what they do or not, I like the odd conversation or two on here to see what other folk think of the actual market.

The two distinct sectors of the BTL market (as I see it - please add your views and make an interesting debate) are those who purchased to generate income and those who were speculating with capital values and needed someone to rent the property in order to borrow the money (BTL mortgage).

Ideally when speculating you use your own money. If you borrow to speculate the risk is very high, a sudden downturn of the asset value leaves you with a big loss and indebted with interest to pay on the loss. This very poor judgement is often driven by hyperbole and so idiots enter the market late and provide an easy target for exploitation. This happened in the UK BTL market with property developers building cr@p flats for BTL landlords to buy that no-one wanted to live in. Many such developments now stand empty in part and those that have just come to market remain unsold. The idiot supply has died up.

Flats built to sucker in idiots are now worthless compared to their 2007 prices. Their prices will never recover nor wil they ever become desirable. Some will be knocked down unsold and still new (I believe that most fail to meet the basic standards required for social housing so cannot be bought by the council or housing associations)

Renting out granny's house to pay for her residential care is not the same thing at all.

Chris

[Guest UK Debt Slave]

1. Abolition of private property and the application of all rents of land to public purposes.

4. Confiscation of the property of all emigrants and rebels.

I've been saying for some time that private property right will cease to exist in the New World Order

I've been expecting legislation such as this for some time. It's just the beginning of a multitude of new rules and statutes that will make property ownership too expensive for everyone except the wealthiest.

[Stars]

do you mind dropping the socialist 'branding' and telling me what you mean by human rights and independent liberties, in the context of a landlord and tenant.

The same thing you might mean - no ‘socialist branding’ required - for instance, the right not to be molested or the right to be left alone. Your property, by occupying space, occupies other people's liberty to be left alone by it. From there, you attempt to pretend that you can conduct a free trade with that property as if your property itself was not an intrusion upon the natural rights of others.

This is total hypocritical horsewater, but unfortunately very typical of conservatives

Edited May 5, 2009 by Stars

[Miss Madam]

That, I'm sure is true of many people's motives for "defending" their personal actions. .....

Ideally when speculating you use your own money. If you borrow to speculate the risk is very high, a sudden downturn of the asset value leaves you with a big loss and indebted with interest to pay on the loss. This very poor judgement is often driven by hyperbole and so idiots enter the market late and provide an easy target for exploitation. This happened in the UK BTL market with property developers building cr@p flats for BTL landlords to buy that no-one wanted to live in. Many such developments now stand empty in part and those that have just come to market remain unsold. The idiot supply has died up.

Flats built to sucker in idiots are now worthless compared to their 2007 prices. Their prices will never recover nor wil they ever become desirable. Some will be knocked down unsold and still new (I believe that most fail to meet the basic standards required for social housing so cannot be bought by the council or housing associations)

Renting out granny's house to pay for her residential care is not the same thing at all.

Chris

What he said... with bells on...

[pete.hpc]

Agreed about security of tenure - they do - they can sign up for a minimum of 6 months - and more if they agree it first. What's wrong with that ?

Whats wrong with that is, there may be areas someone wants to live where every landlord in there decides 6 months is adequate. Would you like to live under a cloud whereby you might have to move your family every 6 months and you don't have a choice? The reality of security of tenure these days is one year, most people don't want the threat of moving on every 12 months.

Agreed about security of tenure - they do - they can sign up for a minimum of 6 months - and more if they agree it first. What's wrong with that ? If you want 10 years, sign for 10 years but you can't leave early without paying a fee, and he can't terminate without doing the same. Otherwise what's wrong with what we have.

You're on drugs if you think someone will let to a tenant for 10 years, but regardless, who knows how long someone wants to stay anywhere? why do plans have to be made that far in advance?

The trouble is, every landlord starts their argument at year zero for them, which is when BTL started.

You can see form your responses, you are incredulous that there was a world before BTL. What was wrong with secure tenancies where people could live for as long as they wanted in rental accomodation and have the security that goes with it, but the flexibility to move on if required, and customize how and when they saw fit?

You are from a generation of landlords that believe it is ok to dictate to someone else whether they can keep pets or have children, and that it is your right to enter someone elses home every 3 months to inspect it like some ******ing control freak.

It's pointless discussing with you because you see everything as being based around BTL, an environment of speculation for the few and the misery of being priced out and bullied by landlords who can decide to kick them out for another 50 quid a month.

You are in favour of housing market speculation, and most here are not. Housing market speculation means allowing landlords to use the AST, it has meant increasing prices and priced out misery for millions.

What we need is larger professional organisations owning the homes, low house prices to give people the choice to buy, and those who can't or won't buy have the option to rent a place for as long as they want.

But in this age of amateur speculation, you cannot see any other way other than ASTs and BTL mortgages enabling you to play your little game of monopoly with other peoples money.

Edited May 5, 2009 by pete.hpc

[A.steve]

Agreed about security of tenure - they do - they can sign up for a minimum of 6 months - and more if they agree it first. What's wrong with that ?

What's wrong with that is that it shows an utter lack of understanding of market Nash equilibria. Where 6-months tenancies under the 1988 housing act give disproportionate control to the landlord over the tenant, the result will be that landlords will act as if they are a cartel - without ever having to actually form one. Each landlord can act in their own best interest and a systemic effect is to undermine the tenant and put them at a significant disadvantage in all negotiation. The problem with six months from a tennent's perspective are manifold:

• The tenant is disadvantaged in insisting on repairs if they are contractually obliged to stay put. Similarly, if the landlord acts criminally (breaking and entering, for example) the tenant is at a considerable disadvantage if they are unable even to be assured they will not be pursued in the civil courts for breech of their tenancy agreement if they leave.

• The tenant loses flexibility if they must know up-front how long they want to live in a place. Even owner occupiers are not required to say in advance of moving into their home when they will sell it. This fixing of time-scales fundamentally renders renters second class and leaves them vulnerable to exploitation and abuse (for example, exploitative rent increases.)

• Long duration tenancies are impractical - especially if the landlord's long-term solvency can't be established... yet if tenants are forced to move frequently, they are excluded from the facilities their taxes pay for - for example, a stable schooling for their children - etc.

• A bureaucratic infrastructure establishes itself around 6-months terms - which means tenants who want longer terms can be (and often are) exploited. Similarly, local knowledge by landlords and information gleaned about tenants' personal and professional commitments can be exploited to the landlord's considerable advantage - and the tenants misery.

Edited May 5, 2009 by A.steve

[LondonToManchester]

Whats wrong with that is, there may be areas someone wants to live where every landlord in there decides 6 months is adequate. Would you like to live under a cloud whereby you might have to move your family every 6 months and you don't have a choice? The reality of security of tenure these days is one year, most people don't want the threat of moving on every 12 months.

You're on drugs if you think someone will let to a tenant for 10 years, but regardless, who knows how long someone wants to stay anywhere? why do plans have to be made that far in advance?

The trouble is, every landlord starts their argument at year zero for them, which is when BTL started.

You can see form your responses, you are incredulous that there was a world before BTL. What was wrong with secure tenancies where people could live for as long as they wanted in rental accomodation and have the security that goes with it, but the flexibility to move on if required, and customize how and when they saw fit?

You are from a generation of landlords that believe it is ok to dictate to someone else whether they can keep pets or have children, and that it is your right to enter someone elses home every 3 months to inspect it like some ******ing control freak.

It's pointless discussing with you because you see everything as being based around BTL, an environment of speculation for the few and the misery of being priced out and bullied by landlords who can decide to kick them out for another 50 quid a month.

As a BTL land lord i would love for someone to agree to a 10 year AST. No agency fees for me for 10 years that would be great! Add yearly rent reviews linked to inflation i.e inflation + 3%. I would snap at such an offer!!

[pete.hpc]

As a BTL land lord i would love for someone to agree to a 10 year AST. No agency fees for me for 10 years that would be great! Add yearly rent reviews linked to inflation i.e inflation + 3%. I would snap at such an offer!!

Why would anyone want a 10 year tenancy? no-one would want to be committed for that long, but they might want to stay longer, who knows? how can most of us say what's round the corner?

The point is, before BTL, the focus was on rental income, and tenants could stay however long they wanted

That's a basic freedom we should all have access to, whether you can afford to buy or not

Who knows if some fly-by-night BTL landlord will be in business in 5 years? if you're not, I have to move out

Under the old scheme, it wouldn't matter to me as the property would change hands with sitting tenants who couldn't be moved on, would be priced accordingly, and would provide decent rental income

The AST is there to allow amateur speculation and is totally anti-tenant

Edited May 5, 2009 by pete.hpc

[rw42]

As a BTL land lord i would love for someone to agree to a 10 year AST. No agency fees for me for 10 years that would be great! Add yearly rent reviews linked to inflation i.e inflation + 3%. I would snap at such an offer!!

What mug would agree to inflation+3%?

[tigsrenting]

Harassment. Agreed. What sort of harassment do you mean ? The landlord coming to check up on his house every couple of months or coming round every day shouting the odds. There is a world in your comment - would you care to elaborate ?

I do have problems with the Agent or ll calling in to check on the property every three months. I find it an intrusion and totally unnecessary. They know after a few visits what sort of tenants you are. I never had any of that cr@p renting abroad.

I hope this legislation goes through. It's a start anyway.