Inflation linked rent contracts will give people stability(35 Posts)
I think that inflation linked contracts will encourage landlords to put up rents every year. Rent controls will also increase market rents because fewer people will want to let out properties. I have only ever had one tenant who has wanted to stay three years. I would be surprised if many tenants want a 3 year contract. I only ever put the rent up on my tenants when they wanted significant work done which is not legally complusory.
I feel that landlords should have the freedom to put up rent beyond inflation if they carry out a major improvement like new windows or a new kitchen. Otherwise there is no moviation for doing more than the legal bare minimum for maintaince.
In most parts of the country market forces do an excellent job of controlling greedy landlords. There are issues with bad landlords in London where people are desperate for somewhere to live. I feel that rent controls and excessively long contracts will reduce the number of landlords. There will be more tenants chasing fewer properties, pushing up rents. There is no point in telling prospective tenants what the previous tenant paid when in some parts of the UK there are four parties chasing one property.
I am in favour of labour proposals to control
scum letting agents. I would like to see control over who can become a letting agent.
Long term rentals give stability.
If other countries can do it, why can't we?
I'm against rent controls generally. However inflation-linked rents and three-year contracts sound very reasonable to me. I can't see them discouraging reputable landlords.
if labour get in the first thing we will do is put the rent up for both our properties. we haven't done it for several years and we are probably a bit behind the market rate as a result.
if we could only rent via 3 year contracts i would also want a lot more security than we do at present, eg bigger deposit. otherwise we might get landed with a bad tenant and couldn't get rid of them for 3 years
so for our tenants both suggestions would be detrimental
I was toying with the idea of buying a property to rent out to help my pension but Labour's plans would definitely put me off.
No doubt some will think that's a good thing!
I'm not sure it will make much difference tbh. According to the BBC there will still be shorter term (not the suggested 3 -years that Milliband was talking about) flexible contracts for business-people and students, and they won't be subject to the inflation cap. I'd imagine if LLs have concerns about having longer-term leases with a possible problem tenant then they'll just opt for students and business people rather than families.
I do think it's a populist announcement made with an eye firmly on the London and Southern housing market. The situation isn't the same across the country. I'm part of a few different housing networks and I don't know any LL who has increased their rent. They're all happy if they have a good tenant and they wouldn't risk losing a good tenant by hiking up the rents.
dreaming according to the BBC the 3-year leases would have a 2 month notice period so in theory you wouldn't be stuck with a bad tenant but the timescale for being able to evict a bad tenant would probably double.
I'm a LL and have had several tenants stay for three years or more so it wouldn't be a problem for me. I also rarely increase the rent with a tenant in situ (which might be a problem if I have to declare the last tenant's rent to prospective tenants and it is, by that stage, well behind market rates). However, many BTL mortgages preclude tenancies longer than 12 months, so I don't know how that can be squared unless a Labour government makes a law against that clause first .
No, dreaming, it's your response to the suggestions that would be detrimental to your tenants.
Landlords will just make rents more expensive at the beginning if they know they won't be able to increase them as they wish during the tenancy.
3 year contract have to go both ways, if the landlord has to agree to the tenant signing for 3 years then the tenant has to stick it out too. Therefore if you sign a contract for three years and decide you want to move, it's too small, you get a job offer elsewhere etc you need to be contacted to stay or pay for those three years, just like the landlord cannot give notice in that period.
I don't think it's a good idea at all.
I think greater regulation of agents, their often astronomical fees for doing bugger all and poor treatment of tenants would be more beneficial.
hanna not sure if it does work well in other countries - can you let us know which ones you think we should be copying?
I would like compulsory qualifications for letting agents and the ability to strike a bad letting agent off. Bad letting agents are as bad for landlords as for tenants. I also think that the duty to safeguard a deposit should rest with the agent as much as the landlord.
I would like a fitness to rent certificate that includes an inventory to be compulsory and paid for by the landlord. This inspection would be carried out by an independent company and done very three years. I think it would ensure that properties were maintained and tenants kept safe. An independent arbitrator would be able to order the replacement of the threadbare carpet on the stairs. Often maintaince issues are subjective and if you don't live in place it's hard to know what needs doing.
The rental proposals from labour are popularist rather than practical. I don't agree with three year contracts or rent controls. In most parts of the country market forces do a good job. Just like the bed room tax, it is silly to impose one law on the whole country because London has silly pressure on housing.
Long term rentals give stability. If other countries can do it, why can't we?
Because other countries have an entire culture and infrastructure centred around renting. The UK way is to aspire to "ownership", so renting is treated - both politically and economically - as an aberration.
No amount of jiggery-pokery is going to fix the problem, which is not enough appropriate housing. To which the answer is BUILD MORE HOUSES. Proper houses. Where people can have families. Not luxury apartments for "city living".
The problem is more houses=less profit.
Once again, you have to ask yourself, who benefits from a rationed housing market ?
Why would an inflation linked contract be only a few months OP? If the existing tenants stay, the LL can only increase by inflation (or what's the point?). I the tenants leave, the LL can increase rent anyway.
As with any other product or asset, LL will charge what the market can stand, so while people pay and supply is so short rents will be high. That's why right to buy has been such a disaster and why it will be again (if it happens). I live in a town full of 1960s council estates, almost all now private owned and privately let.
The answer is to bring the old council houses back to social housing IMO. By compulsory purchase if necessary.
Right to buy got rid of ghettos of social housing. It meant that there were no longer streets of people who lacked any ambition in life. It meant that schools had a slightly better social mix.
The problem with right to buy was that the houses were bought at a discount and the money was not ploughed back into social housing. I would like to see repossessed properties go back into council ownership. At the moment reprocessed properties often go for a song and it makes families homeless. Maybe families in financial trouble could have the option of the council buying their house and then renting it back off the council. If the house would mean that the family would be subject to the bedroom tax then they could do an exchange.
I would be controversial and suggest that well off council tenants pay the market rate for their property. The extra money raised could go into expanding, improving housing stock and subsiding those who really cannot afford to rent at market rates.
It did for a while ReallyTires but, here anyway, those houses are now in the hands of private LLs and the tenants are much the same social make up as they were when they were council houses.
Maybe council housing/ housing association property needs to be sold with a covenant that forbids renting out privately. Or a covenant that insists that any council property that is rented out is rented out through the council. A simple way of achieving this would be having the right to buy a leasehold rather than the freehold. Allowing council tenants to buy a leasehold of their property would give many of the positive benefits of right to buy.
That's a good idea ReallyTired (sorry, I spelt your name wrong )
Right to buy just makes me uncomfortable. There was a lot of it around here and it helped the wrong people IMO.
Children who owned their own homes already buying their parents' homes for them (i.e. setting up their inheritance), tenants who could have afforded to buy anyway if they wanted to, the private LLs who bought them later and me!
My first house was an ex-council house that I bought as a repossession. Excellent bargain for me and set me off on the property chain brilliantly, but not what council housing was intended for and really didn't turn out well for that ex-council tenant.
I think we have to think what the benefit are of right to buy and who we want to benefit. Tenants want long term stablity and the freedom that owning your own property gives. For example the freedom to decorate your property as you see fit, change the kitchen, windows. The freedom to get repairs done quickly, even if you have to pay for them.
My first house was an ex-council house that I bought as a repossession. Excellent bargain for me and set me off on the property chain brilliantly, but not what council housing was intended for and really didn't turn out well for that ex-council tenant."
If you hadn't bought that property then someone else would have done. You are right that someone's loss is another person's gain. I feel councils should try to buy up repossion properties or allow distressed owners to sell to the council. I don't have a problem with tenants who can afford to buy privately buying the home they love. I feel disagree with tenants getting a discount on a house. Why should the tax payer give council tenants free money?
thank you, reallytired for pointing out that the insanity of London does not apply in most of the rest of the country. I didn't think it was just my town where market forces mean rents are kept within limits.
I also (as a landlord) like the idea of fitness to rent, IF it is enforced. Makes no difference to me, my property is entirely fit, but there are a lot that aren't. No proposed legislation seems to have the teeth to deal with crooked landlords. Also need tenants not to rent places with no gas cert, dangerous electrics, water leaks etc etc just because it is cheap. What incentive does that give the crook to fix anything?
Rather than forcing landlords to have three year tenancies, maybe there could be stamp duty paid by the landlord every time there is a change of tenant. It would make a landlord think twice about putting up rent and they would want to keep their tenant. Stamp duty on new tenancies would also bring in much needed revenue that could be used to police private rentals. Different contracts could have different rates of stamp duty.
I have a friend in Beligium who had a short term contract and he could not find a cheap rental property without a stupidly long lease. He is paying through the nose to live in a "business appartment" in the centre of brussels. Really long leases hurt the tenant as much as the landlord.
Maybe we need different rules and taxes for the management of rental stock in different parts of the UK. Bring on devolution for English regions.
But, under the proposed English system, your friend in Belgium would be able to take a three-year tenancy and cancel a few months in, Really. I think there will also be exemptions for business people and students who may want shorter tenancies.
Join the discussion
Registering is free, easy, and means you can join in the discussion, get discounts, win prizes and lots more.Register now
Already registered with Mumsnet? Log in to leave your comment or alternatively, sign in with Facebook or Google.
Please login first.