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RentingForever

Can Your Landlord Be Your Friend?

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The Obsever ran an interesting report on housing this weekend. In particular, this story was good - how some landlords who rent to friends are deluding themselves about what their actual relationship is.

http://www.theguardian.com/cities/2016/apr/30/generation-rent-can-your-landlord-be-your-friend

"We might prefer to think that two identical 30-year-olds, living in the same neighbourhood, with exactly the same job, income, qualifications and skill set, will have similar economic lives. If A has been helped on to the housing ladder by family wealth and B has not, wed prefer to see that as inconsequential; sometimes its sunny, and sometimes it rains. It shouldnt matter. But if B has no choice but to hand over most of their earnings to A, to buy A an asset and a pension that B will never have, things begin to feel rather feudal."

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We might prefer to think that two identical 30-year-olds, living in the same neighbourhood, with exactly the same job, income, qualifications and skill set, will have similar economic lives. If A has been helped on to the housing ladder by family wealth and B has not, we’d prefer to see that as inconsequential; sometimes it’s sunny, and sometimes it rains. It shouldn’t matter. But if B has no choice but to hand over most of their earnings to A, to buy A an asset and a pension that B will never have, things begin to feel rather feudal.

A renter effectively pays not once but three times: first in rent, second as an unpaid caretaker of an inflating asset, and third with the freedoms they forfeit. With the silent passing of every standing order, their roles, their status – their class – becomes ever more entrenched, and the possibility of escape reduced.

I though it was was quite a good article and found the above part interesting. In my eyes this is a result of ZIRP and once (one day, been waiting 10 years now!) IR return to some sort of normal level, mortgages will be higher than rents and buyers/LL's might start to know what real risk is. We are a long way from that though.

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I've come across quite a few instances of this. Someone who effectively doesn't work because mummy and daddy gifted them a house and they live off their lodger's rent.

It's stuff like this that really brings home that many of us are starting adult life with one arm tied behind our back - and if you are unlucky or even have normal levels of luck/opportunity, you'll never get ahead of someone who is otherwise the same as you but gifted wealth through inheritance/richer parents.

Frankly, if I had a friend in need of shelter - it would never occur to me to charge more than their share of the bills - and then only if they were earning.

Edited by StainlessSteelCat

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Typical guardian softly softly article as its intended audience are the people who actually BTL their places out, so reducing the housing stock in gentrified london..

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I've got a mate in Oz on hard times. I've offered him to rent out my place at mates rates - 2/3rd market value - if he wants it when the current tenants leave. with the negative gearing rules in Australia, it means the government is helping him out as much as me.

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