Rachel Reeves considering freeze of private rent?

But there is limited help for you as a mortgage payer because you’re gradually acquiring an asset that will likely appreciate. You also may have options such as renting out a room, renting elsewhere and letting out your home, downsizing. Then there’s going interest only or taking a mortgage holiday, or extending your term, whilst sitting in your appreciating asset. The renter has none of those options.

And the renters reform is on yet. So if I had tennants I'd be raising the rent today. Before the 1st of May. Then her proposal would mean nothing at best

I don't understand the hate for landlords and for renting. I myself needed to rent at various points in time of my life:

1. when I was young and straight out of uni
2. When escaping an abusive relationship
3. When moving cities for jobs

Landlords are not all evil, there is a genuine need for rentals.

We're going to end up with only having huge corporations as landlords. Individual landlords pay a lot more tax than a corporation. We all benefit from having more choice when renting.

But if this is what the people want, so be it. I own my forever house now so good luck to all the socialists who think this is going to benefit them in the long run.

This.

Mortgage rates are going up.

I felt during covid that private rentals was slowly turning into government seized assets. Dramatic but it's sliding that way. What with section 21 coming to a end and now this, lots if tennants might be giving section 21s in the next few days while they still can as jumping the btl situation gets harder and harder.

Then evictions (and homelessness) will increase.

Oh that's nice of her to use other people's money like that.

I think she should leave well alone until many more houses are built . They always have to mess up markets .

This is a concern to small, btl, underfunded landlords.

they exist now. If they want to exit the market they can. They are not the only type of landlord. In many countries these landlords don’t even exist. If we are due a disruption to the rental market it wouldn’t be the first or last time. Small BTL landlords barely existed 40 years ago, so they’re not even a long standing part of the market.

I think you are viewing this in a really strange way and as usual completely neglecting the the inconvenient truth regarding the cost of capital which actually explains completely why we have got to where we have got to.

Money doesn't grow on trees and anyone with money will always have a range of options. So right now the average BTL property is worth around 270k. A landlord could make £13.5k in interest alone by selling up and putting this money in the bank. No hassle with tenants, maintenance issues etc. Average rent is currently just over £16k. Can you see why landlords are leaving the sector in droves? The idea that those without mortgages should just be accepting lower rents is obviously nonsense. Half of all landlords are using their properties as a form of pension. Would you be happy to put your retirement fund in some underperforming investment because you don't need the money right now?

Cost of capital also explains why nobody including the government want to build affordable housing. It's too expensive. This is a global issue. Tell me, how would you resolve it?

The more she tinkers the more landlords will sell up. We’ve got rental properties and the demand when one becomes vacant is enormous. She just bumps the rent up and up for landlords

i’m not trying to help your parents- policy decisions aren’t based on individual circumstances but the impact as a whole, long and short term, balanced against alternatives and other influencing factors

I'm sure that will help my parents who after receiving their eviction notice this morning are ringing round every estate agent in their area (they are desperate not to have to change GP surgery due to continuity of care) and apparently being told nothing is available, there are 20 other people on their books waiting for anything new to be listed.

she is such a stupid woman

But the new renters rights act means landlords can only raise rents once a year. So say she does this and it’s applicable from June 1 - any landlord who hasn’t raised rents in the past year will raise it before then. Otherwise it’s not really going to change anything is it?

Its yet to be determined whether it economically a good idea to freeze rents but...it's simply factually incorrect to assume that landlords only increase rent in line with their mortgage repayments or maintenance costs.
Firstly, approx 75% of landlords in the UK do NOT have a mortgage.

Rent increases predominantly follow 'the market'. In other words, the maximum profit a landlord can make from a property.

Rents are higher in some parts of the country simply because landlords can charge those rents - the majority don't HAVE to charge those rents and wouldn't operate at a loss if they didn't. Neither do the vast majority of landlords HAVE to rent out property - its a choice to generate income and profit while retaining a growing asset.

We've buried our heads in the sand about housing for decades - we can tell ourselves we just need to build more houses but take a look at what's been built over the last decade - luxury apartments, often sitting empty, a safe investment vehicle for someone's portfolio.

Developers don't want to build affordable housing.
Landlords don't want to charge capped rents.
Homelessness and temp housing has increased massively.
The biggest cost for many councils is temp housing - pushing those councils into debt.
The number one biggest issue for the cost of living is housing.

Future generations will not only not be able to afford a home of their own - they'll be homeless when they can no longer work. Were already seeing this now.

Noone benefits from any of this (apart from landlords/property investors who will probably be fine).

Isn't floating this plan just going to encourage LLs to increase rents now while they can to counteract any rent freeze?

I fear for the rental market in the next few years. So many small landlords are selling up or planning to. Desperate to get out. It will be mainly the big landlord companies that survive. Rents will sky-rocket eventually.

I’m sure you’re better off having a mortgage in the long term

Mortgage rates were kept at artificially low interest rates for years

I know, and I don't really begrudge the support. I'm just getting sick and tired of always being just outside of the threashold for everything and getting to the point where I can't squeeze anymore. Also, my mortgage is about to jump, so hearing of potential help for others is just making it a bitter pill to swallow for me.

It has been tried before, we have actual proof that it backfires and hurts the people it wants to help the most. The same thing has happened with all price controls. It's just a desperate throw of the dice by an utterly useless, clueless and failing chancellor

https://www.thetimes.com/article/6fb2c425-04b9-4a16-9578-e9c7825ae726?shareToken=5059a4e768ffaedbe0a8a8e38813fc5b

She isn't the first to attempt a temporary freeze either. Look at New Zealand in 2020 for example that imposed a 6 month freeze. It simply led to a delay in rent increases and destabilised the sector.

I think you need to be careful what you wish for. There are more renters than in 2020 and yet rental supply has dropped by quarter. What does this suggest? That small time landlords selling up only decreases supply and whether they're selling to professional landlords, owner occupiers or turning into short term lets, ultimately this isn't bringing down the number of renters in the sector but it is reducing the choice of homes available to them.

Working people pay rent

Trying to out stupid the Greens won’t end well.