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TODAY'S OTHER NEWS

Government policy on rental sector is a failure says trade body

The government has failed the private rental sector says the Residential Landlords Association.

In a statement released even before the resignation of Chancellor Sajid Javid and the sacking of housing minister Esther McVey, the RLA says the government’s failure is evidenced by data released in recent days.

The Royal Institution for Chartered Surveyors is warning that private sector rents are set to increase by two per cent over the next year as a result of the demand for such housing exceeding supply as landlords quit the sector following recent tax changes.

The RLA says that alongside this it has been disclosed that just 18 individual landlords and property agents and five companies are registered on the database of rogue landlords for offences committed since April 2018. 

The association argues that this means either the number of problem landlords is not as high as many have argued or local authorities are focussing too much time on licensing good landlords instead of rooting out the criminals.

And government figures released just yesterday show that it now takes an average of almost half a year for courts to process claims for repossession of their property.  

The RLA argues that during this time tenants may be refusing to pay any rent, indulging in anti-social behaviour or damaging the property.

John Stewart, RLA policy manager, says: “This series of statistics clearly shows the negative impact of government policies. At the end of the day it is tenants who are suffering. The drop off in supply caused by good landlords who find operating in the market more difficult means it is increasingly difficult for tenants to secure somewhere to live and they are then faced with higher rents.

“Ministers need to change course and instead of attacking the private rented sector, there should be policies and taxation to encourage growth in the supply of rental accommodation to meet the ever increasing demand.”

  • Barry X

    here here.... the government's been an absolute disgrace, particularly from the disastrous period of Cameron and George Osborne onward.

    If you can be bothered to read to the end of this LONG post you'll see I make an important suggestion - I hope that THOUSANDS of landlords and DOZENS of larger agents (maybe HUNDREDS of smaller ones) take it seriously.

    It seem to me the government;

    (a) actually WANT to drive private landlords - whether "accidental" with a single property and in the mind of the government needing deterring from being attracted to remain landlords and maybe buy another property too, or portfolio landlords - like my wife & I - needing to be successively taxed and legislated to death and driven out. They want to replace us with much larger "institutional" companies, like the Build To Renters, Housing Associations etc and seem keen - apparently - for a period of transition where BTL property prices are hammered and some of these companies might pick up our properties cheaply to add to their portfolios - don't believe me? Its happened to us - we used to own a few ex council properties in Churchill Gardens and Lillington Gardens in Westminster.

    We owned them for well over ten years and they rented out well and we got a good returns on them.

    For a variety of reasons - especially legislative e.g. with the successive undermining of s21, the incredible delays in getting anyone to court for ignoring s21s and not going and not paying either (all of which SHOULD be made a criminal offence, if merely not paying a silly TV licence can be) , the now completely useless s8 notices ignored and undermined by the courts (when you eventually get there and they take pity on the tenant who didn't realise that by not paying rent for months and/or behaving so badly all their neighbours always complain about them and that seriously damaging the property all might lead to them becoming "homeless", what a terrible pity so let's give them another chance especially as they tactically paid off £100 of their by then say £4,000 arrears the night before the hearing), the absolutely HORRIBLE Tenant Fees Act 2019 (a dreadful and woefully incompetent piece of legislation with both draconian intended consequences and even worse unintended consequences that will come to haunt us all as they are discovered and start to be exploited by "generation renters" telling each other about them via social medias, e.g. using us as the cheapest and safest "lenders" with no choice - just use your rent to instead pay off your credit card and nothing will happen to you and 3% with no risk of costs is a hell of a lot better than 33% and all the "over your limit" charges and collection costs you can imagine, etc and that's just one of the problems I expect will start to emerge) and so in view of all that and more we decided to steadily sell our ex-council flats in Pimlico off... and guess what? ALL of them sold extra cheaply to a particular Housing Association I won't name! These used to be always-in-demand red hot properties for BTL (and we'd never have sold them - instead occasionally buying one or two more at a high price, not selling at low ones - if the government hadn't totally screwed it up for us and with even worse to come I'm sure). THAT'S an example our personal direct experience of what's going on.

    (b) the Tories, especially since Cameron but perhaps a little before that, have latched on to the idea that pretending to care and focus on "social justice" (a typically grand sounding piece of Blairite Labour-mantra nonsense that sounds good but means next to nothing good) is a real vote winner... the Torry's election strap line should have been "If you like Labour you'll LOVE us because we're not really Torries anymore, haven't been for ages and never will be again we promise, and look - we're gradually adopting all their policies and turning into a softer version of the same!" But sadly they probably wreck our rental businesses, and drive us out of business for nothing because they didn't actually even attract many of the "generation rent" votes (because these people have mainly been trained at their highly politised schools and universities to vote Labour, and if they voted conservative for a change the Torries would probably soon lose their votes anyhow, and not get them back, when these normally not very bright people eventually realise all those gimmicks actually worked against them and nobody really gave them any "free" stuff anyhow).

    and so on with (c) and (d) too but I think that's a long enough post for now.

    I don't think it paranoia or some silly conspiracy theory to believe there is far more to this than just incompetence or a seriously lack of understanding on the part of the government (although there is plenty of both) - because I'd say there is also an agenda behind it all that's been getting steadily amended and becoming bolder and even more anti-landlord and anti-agent as time passes.

    We CAN and MUST do something about this. We should't just grumble to each other about it in blogs like this (although its useful to communicate with each other and share views and ideas). Nor should our trade bodies and landlord associations just make occasional muted and highly polished "professional" comments that are largely ignored will nasty political organisations pretending to be caring charities like Shelter (hiss) get the government's full attention because they are on "the same page"... no, we must DO something that both hurts and worries the government and REALLY GRABS THE HEADLINES.

    Here's what I suggest, and have long thought; we organise a DOUBLE TAX STRIKE, simultaneously coordinating a landlord tax strike and agent one. For example the landlords pay their July 2nd installment STL tax to a proper ring-fenced client account set up by a firm of solicitors, or an agent for the purpose and then send HMRC evidence that they have done this with a covering letter from the template prepared by the strike organiser's solicitors. Agents do the agent version of the same thing. We get frequent maximum coverage in all the major daily newspapers both in print and online carefully but robustly explaining why we're doing this both for the genuine benefit of GOOD tenants and also to stay in business so we can provide the flexible accommodation they need. Whilst at it we also gradually educate them about the real benefirts of a strong, competative private rental sector and how owning your own property isn't always (or probably even usually) the very best strategy in life... flexibility and other ways to invest in more "liquid" but equally strongly performing (usually) assets is an alternative worth considering for some higher earners, and low earners should stop worrying if they have no choice anyhow - why allow misery and a feeling of being cheated and made into a "second class citizen" just because you can't own some crummy overpriced flat that's too small for you and in a "compromise" location to eat up your life? Much better put than I have just now, this should be the gist of our well argued, inspirational eye opening message to some of the smarter "generation renters" and you never know, over time it might percolate down to a few more. It will certainly grab the attention of older, wiser people and there might even be one or two of those (but not too many of the wiser ones) in government, the house of Lords and maybe even the civil service who - let's never forget - are disproportional politically biased and highly (but discreetly) activist and driving the government to deliver their agendas too.

    So there it is... we need TEETH and we need to gnash them if we want to be noticed.

    Here's the sort of things we should be demanding when tax-striking... we want the government to (which they must make a firm commitment to do with a firm statement of a realistic and rapid timetable to implement);

    (1) ABOLISH the stupid 3% "second home surcharge" that hurts the market but probably costs as much, if not more, to administer and police as it actually really collects.
    (2) ABOLISH/REVERS the end to tax relief for loan interest and fully reinstate it as a 100% relief. It is absurd and totally anti-business to tax us on turnover rather than net profit and loan interest is a major and perfectly legitimate business expense for many of us. Imagine if you ran a factory and needed to buy or upgrade some of your larger plant or machinery - can you imagine the government discouraging that sort of vital investment by not allowing tax relief on the major loan you might need to take out to pay for it? Of course not, they'd never even think of it let alone get away with it! But to us, properties ARE in effect our major "plant" and biggest investment and we mostly need to finance the purchase of it/them in order to provide our service and be in business. So why should WE be heavily DISCRIMINATED against in this disgraceful, immoral, illogical way? STRIKE!!!!
    (3) ABOLISH the ridiculous, ill-considered Tenant Fees Act 2019. It's a mess and does more harm for good tenants, agents and landlords alike than any possible good - other than enormously helping bad tenants screw us and creating all sorts of strange loopholes that luckily few have noticed or discovered yet.
    (4) Make it a CRIMINAL OFFENCE for a tenant not to have moved out of a property on or before the end date of a proper, validly served section 21 notice.
    (5) Don't allow the courts to make concessions to tenants served with section 8 notices for rental arrears unless they have paid off at least 60% of the arrears (no matter how bad) at least one week before the hearing.
    (6) Set up a working committee with Landlord and Letting Agent bodies (but NOT Shelter etc) to look at new PRO-LANDLORD/AGENT legislation with a firm commitment to implement it as and when ready, for example to better deal with bad tenants (I'm certain there are vastly more of those than bad landlords and agents who obviously do exist as well);.

    That would be a good start. If they honour it then fine. If not then strike on or again as necessary.

    Any better ideas to get us and our views noticed, and rescue our businesses before this has all gone too far against us and there's too big a mountain to climb back up?

  • PossessionFriendUK PossessionFriend

    Good from the RLA, but too little and too late. ( as always )

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