I'm a buy-to-let landlord AMA

[accidentallandlord]

I own four flats in and around London - AMA.

Have you any horror story’s?

Can you explain your username?

How do you feel knowing that BTL landlords and investors push up the house prices for families?

What do you plan to do when the buy-to-let tax relief changes in 2020? Would you still keep the properties?

Do you own them outright or with a mortgage?

Do you agree that your tenants right to a safe and acceptable home comes above your right to profit?

Is it your main job?

I've always felt that BTL landlords are given such an unfair reputation as selfish cunts, they're doing a public service in my eyes.

Do your tenants generally respect you and your properties?

How do you feel about the fact other people are working hard to buy you an asset? An asset that has risen in peuve because of people like yourself?

Disclaimer: I do think BTL is dodgy morally for the reasons outlined above but at the same time can see why its tempting as it's probably the most secure investment there is.

@JellyBears Nothing truly dreadful. In my less experienced days of being a landlord, I had a lovely Lithuanian couple renting from me. They asked very nicely if they could get a small dog or cat. Normally I would say no, but it was a ground floor flat, and I wanted them to feel welcome.

They bought a Staffie, locked it in the house all day when they went out to work, and then broke their contract early (at least they told me about it). The (brand new wood laminate) floors were soaked with dog urine and the deposit didn't even nearly cover the loss of rent and repairs. But it could have been worse.

I replaced all the floors and two months later, the upstairs flat had a flood and the whole place was wrecked again!

@ChipsAndMoreChips Username because I never planned to become a landlord. When I moved in with my (now) DH, I already owned property and he didn't. So when the time came to buy somewhere together, I felt more financially secure keeping my old flat, and renting it out, in case the relationship went tits up.

So that was my first property - and then it became more of a deliberate choice.

I do think the BTL market prices first time buyers out of the market (especially in London), but I think there are always upswings and downswings; a lot of (especially older) landlords with small portfolios are selling now, and the market will become easier again for first-time buyers.

@TypsTrycks The tax change has very much been on our horizon. I have always been a Labour voter and don't mind paying tax to support people less fortunate than myself. Labour put their cards on the table and said they would look to further tax landlords. I voted for them anyway. So to then see the Tories (who hadn't mentioned it as part of their manifesto) sneak in landlord tax reforms, seemed underhanded at best.

I actually don't trigger enough income to hit the 40% tax bracket, so the tax reforms won't affect me.

@Tinseltower With a mortgage, although my own home is mortgage free. In a couple of cases, I have remortgaged the rental properties (as they have increased in value) to release capital to either buy another property, or to pay off equity on a different (higher rate) mortgage.

My long-term plan is to sell off one or two of the properties to clear the mortgages of the remaining one. Although obviously that will depend on the market.

@Prettysureitsnotok Absolutely. I pride myself on providing the service I would expect (and I am fussy). I'm not talking about changing a lightbulb (although I have done this for tenants!) but any boiler/heating problem gets sorted as soon as it possibly can. I find it incredibly frustrating when it might take 3 days for a part to arrive (just as it would if you owned your own home).

Some years, an individual property might not make a profit at all, or might even make a loss. Providing a safe and warm environment is the most important thing by far. Obviously if every property was making a loss year in, year out, I would probably think I was in the wrong business!

Would you be prepared to rent to someone who has poor credit but can prove 5+ years of rent payments, has never missed a rent payment (well once but it was 1 day late due to being hit by a car) and has a stable job but no guarantor?

@Hideandgo Sort of. I'm currently a stay-at-home parent who does a little bit of freelance work (not property related). The property portfolio covers our basic living expenses (so long as we don't want a holiday or a new car), enabling DH's income to provide luxuries - or, in the case of this year, a frugally-spent "gap year" with us both at home enjoying time with the children.

@HolyPieter Thank you. I see myself as providing a service - I am no better nor worse than your water company, your electricity company, your mobile phone service... and a lot easier to reach by phone!

Tenants are generally absolutely fine and respectful. I find the worst are students - not because they are raucous partygoers, but because they don't have experience of taking care of a property, so either they will complain about ridiculous things (my favourite was that they couldn't find the sweet spot between hot and cold on the mixer tap), or they will let things get broken and try to hide it, or neglect it. Also, they tend to move out after a year, so they are expensive tenants, because you then have to pay an estate agent to find another.

@unadventuretime I don't shout about my property portfolio, because I appreciate I am incredibly lucky to be in this position. However, not everyone wants to be in this position. Not everyone is at a time of their life when they want to buy a flat, even if they could afford to. So I am providing a service.

It isn't just BTL landlords pushing the price up - wherever there is more demand than there is housing, prices will rise. I believe though I've addressed this more fully in a previous answer.

@OurMiracle1106 Honestly, it would depend on what the poor credit was caused by. The lettings agent usually run the credit report, and will give me a red, amber, green indication of the likelihood of a tenant defaulting on rent.

If you could show me 6 months of bank statements where you were earning more than you were spending, OR be willing to put up 6 months of rent in advance, I would consider it. Very honestly, if a potential tenant with excellent credit made an offer for the same amount of rent, I would likely take the tenant with better credit, as it minimises the risk to my business.

I wouldn't be worried about rent that was once paid a day late. I don't even chase my own tenants until rent is more than 3 days late.

Do you think private landlords have increased the homeless situation by refusing to take Housing benefit and agents only allowing working people to rent in couples not solo, having an income threshold

Are you Victoria Whitlock who writes in the Evening Standard as the accidental landlord?

How are all the tax changes affecting you? Is it still profitable?

It's true that you're providing a service. I've rented myself and it was handy when I was young. But if/when you are renting the same property to a family for years and years, who are basically buying you an asset (paying your mortgage and some extra) just because you could afford a deposit and they couldn't, do you/would you feel weird about it? Especially as you've said you vote Labour - do you think there's some cognitive dissonance going on? (Please don't take this personally! You sound lovely and I appreciate you got into this accidentally. It's just the inequality in our country makes me angry!)

@ivykaty44 An income threshold is necessary to estimate if a tenant can afford the rent (in the exact same way a mortage would be calculated by the bank).

The housing benefit issue is one which I regularly struggle with. As a landlord with a small portfolio, just one non-paying tenant could tip the balance from profit to loss for me, so I tend to be risk adverse. Bigger picture, I don't think this social issue is one for private landlords to solve, as I believe more council housing should be built, safeguarded and not sold off.

I say this with a slight air of hypocrisy as two of my flats are ex-local authority properties (though obviously I bought them once they were already on the private market).

@sleep5 No - that's not me. Though I would love to be a columnist - dream job!

The tax changes have affected my long term plan of buying two more properties, as the additional stamp duty now makes it extremely difficult to make a profit, unless you are very handy and are able to renovate a flat yourself, thus adding value in resale price and rental market price. (I am totally not handy. I am whatever the opposite of handy is.)

It is still profitable for me, as I come just under the 40% tax bracket which is where large portfolio landlords are being hit the hardest. There have been some minor losses (you can no longer claim a standard 10% wear and tear each year, and instead you have to claim for individual items - e.g. new sofa, new washing machine), but actually if you look after a flat properly, it sort of evens out anyway, and it stops greedy landlords claiming 10% wear and tear without actually replacing any fixtures or fittings.

@unadventuretime I haven't actually yet had the situation where I am renting to the same people for more than about three years in a row. I guess perhaps because of the sort of flats I let (1 and 2 bedroom flats fairly central in London), I tend to get more young professionals than families.

I can understand how it would feel unpleasant if you were profiting off a family, but I try to remind myself that I am running a business. I am providing a (hopefully) better service than they would get if they were being managed by a feckless agent. I have felt bad on occasion where the rent has gone up in the area, and a nice tenant hasn't been able to afford the rent increase, and we haven't been able to agree to meet in the middle, and therefore the tenant has moved out... BUT I am running a business.

If I accept £100 less per month than I know I can easily get, then my children have £100 less per month for swimming lessons etc. Property is emotive, and I try to provide an excellent service, but if the flat next door is renting out at £400 more per month than the one I'm renting out, I'm doing something wrong, and using my heart rather than my head.

Do you mortgage or insurance demand you refuse to rent to tenants receiving benefits? If so, why did you accept such a mortgage/insurance? If not, do you impose such restrictions anyway and why or why not?