Will This Make Landlords Dump Btl Properties, Or Just Put Rents Up?

[Bingley Bloke]

Click

[Time to raise the rents.]

Both.

I will add as well that I actually know the guy in the picture.

[BillyShears]

Both.

I will add as well that I actually know the guy in the picture.

Landlords will try to put the rents up. If they don't get away with it, i.e. if the market will not bear the increased rents, then they'll dump the properties. Landlords who haven't had voids will probably insist on increased rents, and possibly their tenants will decide to move elsewhere, resulting in an important lesson for the landlord. Landlords who have experienced voids may back down if their tenants don't agree to the increased rents. Landlords who have a void at present will probably be prepared to swallow increased costs as long as they get a tenant.

Moving companies will be the only ones who are guaranteed to benefit.

Billy Shears

[Guest Charlie The Tramp]

Some local councils may bring other properties into the scheme if they choose

And they will to generate more income to keep the shop profitable.

All regulatory bodies aim for self growth.

[Time to raise the rents.]

Landlords will try to put the rents up. If they don't get away with it, i.e. if the market will not bear the increased rents, then they'll dump the properties. Landlords who haven't had voids will probably insist on increased rents, and possibly their tenants will decide to move elsewhere, resulting in an important lesson for the landlord. Landlords who have experienced voids may back down if their tenants don't agree to the increased rents. Landlords who have a void at present will probably be prepared to swallow increased costs as long as they get a tenant.

Moving companies will be the only ones who are guaranteed to benefit.

Billy Shears

Ringo you speak as though tenants have a say.

[Realistbear]

I hate to say it but it will be a good thing if rents go up because it will cause more homelessness and force NuLabour out of power sooner rather than later. By raising rents recession is that much closer and recession will break the back of HPI harder and faster than any other trigger. The downside for BTLers, and there is ALWAYS a downside, is that the government will introduce rent controls faster than you can say "economic miracle." They are already planning a reversion back to council housing so rent controls will follow.

Either way the BTL market is doomed. Time to sell now while there is still time to get out. TTRTR should sense we are at or just the other side of the top of the market so time is running short. Rent controls and a recession will destroy the BTL market and do so very quickly.

[othello]

TTRTR

Do you think you could change your avatar? How about a big smiley face to represent how good you must be feeling about the property market?

[BillyShears]

Ringo you speak as though tenants have a say.

Voting with your feet speaks rather loudly. Do you make as much money from an empty property as you do from one with a tenant in it? Of course it helps to live in a city where the student rental market is dying, leaving ... pun intended ... a bit of a void.

Edit: I forgot to mention the bottom line. As purchase prices of properties rose, the costs to landlords also rose significantly. If they can just pass on increased costs to their tenants, then why haven't increased purchase costs and mortgages been passed on?

Billy Shears

Edited March 21, 2006 by BillyShears

[Duplex]

Rent is a function of income. If incomes rise rents will rise and vice versa.

[laughing_goat]

Ringo you speak as though tenants have a say.

I think they do have a say, my LL knows all too well that if she insisted on raising the rent, we would move to a different house. It's quite possible where I live as there is an abundance of property to rent (most of which are property that was originally up for sale but didn't sell, often not a typical rental property). The place I moved from (almost a year ago) is empty, for reasons not too dissimular. The LL wanted to raise the rent and tie us into a 12 month contract (as apposed to 6 months with a break clause). Now the LL is getting no income from the property and having to pay for the services (council tax, etc).

I think sometimes you fail to see that buy to let is a business, not a status symbol. Renters aren't just 18 years olds or low income families anymore. They are people who want flexibility and good service and don't see the LL as a higher beeing, but the person who is providing a service. If that service doesn't come up to scratch then we will have no quarms about moving on.

I agree that if LL's start dumping property en mass, then rents probably will go up as there won't be so many places to choose from, but then surely selling prices would be effected (downwards) if this happened? In which case I would probably think about buying a house.

EDIT: It's also worth noting that when I view a place to rent I ask questions about the LL such as, how long they have been in the buisness, how much of a mortgage they have on the place, I'm not interested in renting from someone who can't pay the mortgage (my LL has no mortgage). TTRTR, have you started seeing this yet? (genuine question)

Edited March 21, 2006 by laughing_goat

[non-FTBer]

Voting with your feet speaks rather loudly. Do you make as much money from an empty property as you do from one with a tenant in it? Of course it helps to live in a city where the student rental market is dying, leaving ... pun intended ... a bit of a void.

Edit: I forgot to mention the bottom line. As purchase prices of properties rose, the costs to landlords also rose significantly. If they can just pass on increased costs to their tenants, then why haven't increased purchase costs and mortgages been passed on?

Billy Shears

For TTRTR:

And if you can just raise your rents as and when you see fit then why not just raise them and make your BTLs more profitable now???

Or are you in this as a social, caring and charitable type of landlord?

Ah.... thats right, you can't just raise the rents as the tenants will leave and go to another rental.

I agree that there could be scope to raise rents in some markets where there is not enough BTL property around (not much competition) but how many areas have too little BTL rentals available? And under-saturated markets have probably already adjusted to what they can achieve anyway.

[eurows]

These new deposit laws which apply to new lettings. If you are on a rolling six month tenancy is this classed as a new letting after the six months expires.

another question to TTRTR. Most landlords use the deposits. Do you, and if so do you think that this rule is the worst of all the new rules to be introduced.

If I gave you a deposit of £1800 which I did with the house I now rent. If you save it in your bank for the next two years it is earning you interest. If you use it - it is an interest free loan. If you have ten properties it is a big advance and could even be the deposit on your next btl.

It's quite possible where I live as there is an abundance of property to rent (most of which are property that was originally up for sale but didn't sell, often not a typical rental property).

Exactly the same to me and where I live. There is a real glut of properties to let. Much, much more than 2 years ago. I can go anywhere and would if the rent was raised.

[BillyShears]

These new deposit laws which apply to new lettings. If you are on a rolling six month tenancy is this classed as a new letting after the six months expires.

another question to TTRTR. Most landlords use the deposits. Do you, and if so do you think that this rule is the worst of all the new rules to be introduced.

If I gave you a deposit of £1800 which I did with the house I now rent. If you save it in your bank for the next two years it is earning you interest. If you use it - it is an interest free loan. If you have ten properties it is a big advance and could even be the deposit on your next btl.

Exactly the same to me and where I live. There is a real glut of properties to let. Much, much more than 2 years ago. I can go anywhere and would if the rent was raised.

If the deposit scheme only applied to new lettings, would that be an inducement for landlords to allow clients to go onto rolling ASTs rather than insist on writing up a new fixed term every time.

Billy Shears

[geneer]

Ringo you speak as though tenants have a say.

If landlords could actually put up rents, they would have done so already and at every opportunity.

But wanting alone does not pay the bills and tenants set the price by the ability to walk away from greedy BTL's.

If landlords could get away with raising the rents, there wouldn't be so many clown trousered individuals who can't meet their mortgages with the rental income but stick with it cos houses are an investment - heh!

Edited March 21, 2006 by geneer

[jon]

Both.

I will add as well that I actually know the guy in the picture.

Is it you ?

[CaptainClamp]

If landlords could actually put up rents, they would have done so already and at every opportunity.

But wanting alone does not pay the bills and tenants set the price by the ability to walk away from greedy BTL's.

If landlords could get away with raising the rents, there wouldn't be so many clown trousered individuals who can't meet their mortgages with the rental income but stick with it cos houses are an investment - heh!

Completely true. Tenants, and particularly good reliable longer-term ones have a fair amount of power in these negotiations. I've twice (out of 2 times renewing leases, 100% track record ) been able to negotiate a lowering of the rents (in nominal terms) on renewing a lease.

Saves them a potentially lengthy void period, the costs of looking for new tenants, and the risk that the next lot will screw them over.

TTLTR

Edited March 21, 2006 by CaptainClamp

[Time to raise the rents.]

I think they do have a say, my LL knows all too well that if she insisted on raising the rent, we would move to a different house. It's quite possible where I live as there is an abundance of property to rent (most of which are property that was originally up for sale but didn't sell, often not a typical rental property). The place I moved from (almost a year ago) is empty, for reasons not too dissimular. The LL wanted to raise the rent and tie us into a 12 month contract (as apposed to 6 months with a break clause). Now the LL is getting no income from the property and having to pay for the services (council tax, etc).

I think sometimes you fail to see that buy to let is a business, not a status symbol. Renters aren't just 18 years olds or low income families anymore. They are people who want flexibility and good service and don't see the LL as a higher beeing, but the person who is providing a service. If that service doesn't come up to scratch then we will have no quarms about moving on.

I agree that if LL's start dumping property en mass, then rents probably will go up as there won't be so many places to choose from, but then surely selling prices would be effected (downwards) if this happened? In which case I would probably think about buying a house.

EDIT: It's also worth noting that when I view a place to rent I ask questions about the LL such as, how long they have been in the buisness, how much of a mortgage they have on the place, I'm not interested in renting from someone who can't pay the mortgage (my LL has no mortgage). TTRTR, have you started seeing this yet? (genuine question)

1/ Yes tenants in most areas can now be a bit choosy. That's because of the BTL boom, not because tenants are choosy. Take away the incentives to be a landlord & you will remove landlords & therefore choice in the market will decrease. That has nothing whatsoever to do with tenants willingness to rent.

2/ Such probing questions as what is your mortgage would be offesive IMO. But don't worry, I always tell my tenants if the rent isn't paid, my kids won't eat. We wouldn't want them thinking I just pocket the rent & smile about it would we? Naturally there is always the issue of whether your tenants think you're a nice person & so far I seem to have been in their good books, but that's because they pay the rent. Be a bad tenant & you'll quickly find you're landlords isn't as agreeable as they used to be.

[Levy process]

All regulatory bodies aim for self growth.

That's right. And governments. And organisations funded from the public purse.

[laughing_goat]

1/ Yes tenants in most areas can now be a bit choosy. That's because of the BTL boom, not because tenants are choosy. Take away the incentives to be a landlord & you will remove landlords & therefore choice in the market will decrease. That has nothing whatsoever to do with tenants willingness to rent.

2/ Such probing questions as what is your mortgage would be offesive IMO. But don't worry, I always tell my tenants if the rent isn't paid, my kids won't eat. We wouldn't want them thinking I just pocket the rent & smile about it would we? Naturally there is always the issue of whether your tenants think you're a nice person & so far I seem to have been in their good books, but that's because they pay the rent. Be a bad tenant & you'll quickly find you're landlords isn't as agreeable as they used to be.

1) Yes I agree, the market (to an extent) allows me to be choosy, but I have to say, if it didn't I would not rent.

2) I don't think it's offensive to ask about the financial security of the LL, it is no different than me being credit checked when I sign a tenency agreement. I too have issues with those who renage (can't spell) on an agreement whether it be a LL or the tenant, I don't think you need to justify it by telling them your kids will starve. I have to admit that I once withheld rent but I gave the LL warning (the hot water hadn't worked for two months), my uncle is a solicitor (very handy for conveyencing) and let him know in no uncertain terms that he was breaking the law and got me the second months rent back aswell. Supprisingly he wanted me to stay on when the contract finished (I left). That is the only serious problem I have had with a LL and the only time I didn't pay my rent.

I think as you say, you're nice until they miss rent payments. I, as a tennant, am nice until the LL stops doing what I pay him for. There are both rogue tennants and rogue LL. Neither will be tollerated by a straight but savy LL or tennant.

Edited March 21, 2006 by laughing_goat

[iLegallyBlonde]

Interesting, if my landlord tried to pass on his overheads to me I would refuse to sign the lease, get him to take me to court and then show the judge that rents are actually coming down.

TTRTR - I have been a landlord and once you hand over the keys the tennants have more rights to that house than you do, I take it you haven't had a problem tennant in all your years because you make it sounds so easy, it isn't.

[Time to raise the rents.]

Interesting, if my landlord tried to pass on his overheads to me I would refuse to sign the lease, get him to take me to court and then show the judge that rents are actually coming down.

TTRTR - I have been a landlord and once you hand over the keys the tennants have more rights to that house than you do, I take it you haven't had a problem tennant in all your years because you make it sounds so easy, it isn't.

Maybe it has something to do with me respecting that they do have substantial rights. Most Mum & Dad landlords can't handle that.

However believe me, when it comes to the end of the tenancy period, I have rthe right to raise the rent and all the tenant can do about it is move out. That is no issue to me because I chose an area of high tenant demand, therefore if my tenants aren't paying the market rate, they are free to go if they choose to do so.

Not a days rent lost in 10 years now.

[Given Up]

If you have a good landlord, most people would prefer to pay a small increase (3%) than have the hassle of moving, paying for new credit checks etc. In my experience.

[Guest Winners and Losers]

Most Mum & Dad landlords can't handle that.

And it will be the mum and dad investors who were suckered into 'BTL for pensions' that will suffer the most if there is a crash.

[Time to raise the rents.]

And it will be the mum and dad investors who were suckered into 'BTL for pensions' that will suffer the most if there is a crash.

Couldn't agree more. Ahem....there'll be no crash though....

[Guest Winners and Losers]

Couldn't agree more. Ahem....there'll be no crash though....

Well, I did say IF. But you just keep telling yourself that.

Couldn't agree more. Ahem....there'll be no crash though....

Actually, being an Aussie, I am interested to hear why you think it will be different in the UK, considering the Oz property market is falling? Do tell?