to think we need new taxes on Buy-to-Let

[AgaPanthers]

Over the last 15 years the number of new homes built in Britain is equal to the number of new homes under private rental. In other words, buy-to-let is in effect taking all new homes (though obviously some existing homes are going into btl and some new ones into owner occupiership so it's not a 100% match).

But there have been vast rises in the number of private tenancies, sharp falls in the number of owners with mortgages, and the consequences are many, from tattier streets (landlords don't spruce up homes with sitting tenants, the tenants don't want to plant the gardens because they might be kicked out next year) to families having to move house mid-school year because the landlord is kicking them out.

Today it's announced that the number of people made homeless from private tenancies has trebled in five years, and that private landlords are now the leading cause of homelessness. www.bbc.co.uk/news/uk-27940701

AIBU to think that this has resulted because of all the people piling into buy-to-let because it is deemed as more attractive than the alternatives (bank accounts, shares, small business, etc.), and that therefore we need new taxes to make buy-to-let far less attractive, given the social problems it causes?

I'm sorry, I really can't generate any sympathy for BTLers who have bad tenants or expensive overheads. Tough. That's the risk you take.

We rent in Belgium where the standard lease is 9 years. It is highly regulated - the rent can only increase according to indexation and if you keep within the terms of your lease, the landlord can only ask you to leave if they, or a member of their immediate family needs to live in the property. I think 6 month's notice is required. I think the UK needs to look more towards this sort of model. All leases are registered centrally.

I am sick to death of Landlords. We own our home but are surrounded by rented properties, two rented houses either side, one behind and nearly all the ones opposite.
We have had problems with noisy neighbours, overgrown gardens, a tree that we asked the LL to do something about many times fell onto out house, most of the houses are rented by the room so there are problems with rubbish, two many cars on the road.
None of them care about maintaining their properties or what it is like for other residents of the street. They only seem interested in getting the rent.

My sister and her boyfriend rent and they have had loads of hassle with Landlords too. Not replacing broken equipment, being ridiculously picky about cleaning, just popping in unannounced, saying they could redecorate the whole house then a week after they had finished saying they were selling up.

There must be some nice landlords out there but I haven't experienced any.

oddfodd - i don't believe i was stupid enough to ask for any sympathy here. But the damage bad tenants cause indirectly comes out of the rent of good tenants - LL's have to make the thing pay overall. And you have to factor in this risk - which obviously affects the good tenant

notso - surely a lot of problems you list have been caused by the tenants not the LLs. I'm sure most LL's would prefer quiet, clean and tidy tenants, but unfortunately they don't always turn out that way

Okay you weren't exactly asking for sympathy but I don't think that fewer landlords would necessarily be a bad thing - if there were fewer BTL landlords around, councils would have to house people themselves.

I'm interested in this argument, both as a landlord (of 1 property), and as a parent of children who will probably struggle to live in this area when they grow up whether they buy or rent.

If increased taxes forced me to sell my btl tomorrow (not to another ll), how would that help anyone? There is no social housing in this area, so my tenants, who've been there for 5 years would not only have to move out of their home, but also the area. They wouldn't be able to buy as they've told me this is a financial impossibility for them. I wouldn't have the pension pot I've worked to create either.

I only put my rent up between clients, so at the moment their rent is about 75% of the going rate. They're good tenants and I want to keep them. When I've had shit tenants I've taken the hit. As oddfodd says, that's the risk.

If btl landlords were competing with good social housing, rents would be lower and standards higher. Bad landlords wouldn't get away it as tenants wouldn't choose to rent there surely.

I have been a tenant too, of a private ll, so I've seen both sides.

The whole private rental sector is largely unregulated, and is a bloody mess in my opinion. I think BTL is a part of the problem, but there are ao many other factors that need to be addressed too. Some things that I'd like to see trialled are capped rents, some sort of licensing system for landlords (and estate agents...!), extended tenancies, notice periods extended etc, some kind of cap on the fees agents can charge, because at the moment it just seems like they have a licence to print money. 100 for a 'reference check' is outrageous. But ultimately the problem is that there just isn't enough affordable housing, and until that's properly addressed then the situation will just get worse.

if there were fewer BTL landlords around, councils would have to house people themselves.
or people would continue to live in properties currently owned BTL, but they would buy/own these properties themselves.

Properties aren't going to disappear for lack of BTL LL's.

It's worth repeating .....

Properties aren't going to disappear for lack of BTL LL's.

Properties aren't going to disappear for lack of BTL LL's.

Properties aren't going to disappear for lack of BTL LL's.

One property per person wouldn't be a problem.

IMO its the landlords with more than that, I know some with more than 10 properties and feel its them that push up the market. If they remortgage properties then they can come up with more and quicker than Mr and Mrs Smith who are scraping together.

However there is a lot of bank and mum and dad going on which artificially inflates the cost of properties IMO. Perhaps more restrictions on this.

Feel in London they should do what they do in Thailand, you have to have a connection with the country to buy property which would contribute towards preventing rich arabians and russians from filtering the property markets.

But what do I know?

"I'm sorry, I really can't generate any sympathy for BTLers who have bad tenants or expensive overheads. Tough. That's the risk you take."

We do know the risks. It is called going into things with your research done and your eyes open. Nothing is risk free and nobody is asking for sympathy. It is a business and an investment, and like any other, things can go down just as they can go up. That's life. You need a long term view.

I first got into property letting after I had had my first baby 19 years ago. We owned and were living in a small flat on the Isle of Dogs in London which was up five flights of stairs with no lift. We desperately needed to move, but the flat was in negative equity (it remained so for some years). The only way we could move was to rent it out whilst it recovered from the negative equity trap. My parents had gifted us some money and we were able to buy a more suitable house out of London.

Some years later we did sell that flat - for twice what we had originally bought it for as opposed to taking a big loss if we sold in negative equity. It was what introduced me to property lettings.

"if you make buy to let more costly for the LL by higher taxes, or put more regulations in place that make it harder to evict bad tenants then you will get fewer LLs. "

Yes that was the point of my OP.

If you look at the figures, we have several million more people living in private rented than we did 15 years ago. 15 years ago the housing market was in a much better shape (in terms of actually housing people, not being a money-printing machine for spivs) than it is now.

The argument that we somehow need all these millions of amateur landlords is laughably ridiculous.

When homes are built to suit the needs of landlords, not residents, then that's a problem for society.

But taxing the landlord isn't the answer aga. There needs to changes about what types of property are built, and who can buy/live in them.

I'm sorry, I really can't generate any sympathy for BTLers who have bad tenants or expensive overheads. Tough. That's the risk you take.^

That's okay. I don't have any sympathy for tenants who have strict rules imposed or can't get a property because they have pets due to the bad tenants or irresponsible pet owning tenants. That's what happens; experience makes things harder for others.

or people would continue to live in properties currently owned BTL, but they would buy/own these properties themselves.

If they could afford to buy and wanted to buy they would have done that already.

I can afford to buy, but choose not to because prices are too high, in part due to BTL.

We live in a mixed market economy. Put simply, the prices of residential property are so are high because everyone wants one! They are in demand! If LLs weren't encouraged then there less buyers out there, the supply would increase and the price of property would fall!!!

The noisiness yes but all the other issues are the landlords IMO dreamingofsun. It is the LL who decide to turn properties made for a family with a two or three children into a property where there are 5-6 adults minimum and it is that which causes the problems.
When they are rented out by the room no tenant seems to take responsibility for the garden for example so it is left to become overgrown.

It's really hard to do major works when you have tenants in, as they get annoyed by disruption! And then they damage the property, and you only get to find out when the tenants move out, which is you cannot afford a void period, means that you have approximately 12 hours to sort repairs/cleaning before the new tenants move in.

I'm not a Landlord at the moment, but I would be ecstatic if longer tenancies were on offer, but in London, most 20 somethings do not want to be tied down, and want to have 6 month break clauses, so wouldn't go for longer...

On a day to day basis, we were subsidising the flat, as it was not covering its costs... and I deliberately didn't raise the rent as high as it could go, as I'm aware it's hard being a renter... An identical flat downstairs was 25% more expensive than ours...

thank you for saying that youbuggerz. It's amazing how many landlords seem to have convinced themselves they're providing some kind of social good, while being oblivious to the fact that their demand drives up prices for everyone

I need to buy but can't because prices are too high.

homehelp - i don't think many LL's think or want to be doing some kind of social good. For most its a business arrangement. However, for prices to fall enough for our tenants to buy, they would need to drop by 50% at least. I doubt this would happen even if all LL's sold, and even if it did, it would cause hardship to many - the property crash of the 90's was bad enough and that reduced prices by about a third

The only thing which will reduce the number of btl properties is building more social housing.

This has happened before, prior to WW2 private LL were common (my aunt had to pay 'key money' as a bribe to her private LL as there was no social housing). After the war, a huge amount of social housing was built and most private LL disappeared, as they couldn't compete on quality, price or service with social housing.

This needs to happen again, more housing is needed. If people have a genuine choice between social housing and private LL, only private LL who offer safe, clean, affordable housing will be able to attract tenants.

There isn't any money for social housing of course, so perhaps ringfencing the money LL pay in tax, or charging banks a tax to provide mortgages (after all, they profit from homeowners and btl LL alike) could be used to pay for a Housing Fund to build homes for the most vulnerable?

I don't think taxes would solve this problem. Looking to the market to solve a problem like this - while attempting to manipulate the market at the same time - is not precise, it is like trying to open your window by repeatedly banging the door shut at the other side of the room. It might force the window open a crack, but you would be better off just opening the bloody window.

In other words: we have big problems that can only be solved by 1. building more houses and explicitly regulating what they will be sold for; 2. regulating private renting properly

TopseyT, I take issue with several of the things you post:

• the long list of costs of being a landlord. So what? All businesses have costs. Why the whiny tone about yours?

• The use of “gifted” instead of “gave”. Why? So ugly and unnecessary. Where has this suddenly come from? Is it an Americanism?

The entire system of housing here is a joke.

In rentals, lettings agents are allowed to rob both landlords and tenants with no regulation.