To think that if private landlords make profit from rentals..

[TheoriginalLEM]

Then why can't local authorities do the same?

People bang on about social housing being a drain on the economy. Well yes, ok, if everyone living in social housing was on benefits then it would be i suppose. People say that these houses then need upkeep. Well yes, they do, people are paying to live in them.

To me this is a no brainer - make social housing work. Make houses that people WANT to live in. Encourage people to maintain them themselves to a degree, provide maintainance and offer updates and charge a reasonable rent.

There is a profit to be made? NO? or alre all private landlords philanthropists?

Even if folk are on benefits, surely the cost to maintain a LA owned property is less than what is being paid to land lords?

That is the answer to the housing crisis - not building substandard houes and charging some poor sap a quarter of a million pounds to buy it. What first time buyer can afford that? You haven't thought this through Dave no surpirse there then

You're basing your argument on the wrongful assumption that Shiny Dave gives a shit about the quality of life of the poor or that people are working 50 hours a week to pay their entire wage packet into some arsehole BTL LL's private pension plan.

He doesn't.

Not all private landlords make profit. Some have to move for work and rent because they can't sell.

this is not a pop at private landlords. many do make a profit and run properly i don't see why social housing can't do the same.

Saucy. you make a good point .

The problem with social housing isn't a lack of demand, but sucessive governments have stacked the cards against LAs even if LAs wanted to provide more. Thatcher started it with right to buy and crucially preventing LAs spending the proceeds on more housing, but it's been carried on. They pay lip service to the "housing crisis" but don't really care. BTW the crisis is very regional, some houses have been sold for £1 each in Liverpool recently.

Aren't the Tories more interested in selling off all LA owned property under right-to-buy than doing anything sensible, though.

YANBU. Given enough council housing they could make money. No chance of this happening on England though what with Cameron extending right to buy.

Might sort of happen in Scotland - there's a lot if new housing being built, but it will benefit Housing Associations rather than the council. Bringing in rent controls in Scotland may also have an impact on things.

Not sure what you're proposing, OP. Are you suggesting that tenants in social housing properties pay so-called 'market rent'? Because that would put you on a par with the pig-fucker, who completely ignores the fact that many private sector tenants can't afford 'market rent' at all and in fact claim, collectively £12bn a year in housing benefit. So yes, the landlords profit, but not because their houses are 'worth' what they are charging, but because the govt is happy to spunk billions into their wallets every year. By contrast, the govt is allocating £1.2bn towards building affordable homes over the next 4 years.

I wouldn't base too much on private landlords making a profit.

We had to move for work and we rent our house out. Our profit is negligable - maybe a couple of thousand a year - ie easily cancelled out by a new boiler, or a bit of maintenance.

If we didn't have a mortgage to pay (and our own rent to pay in another area), then yes we would probably be making a profit.

People making it work as a business will probably have more capital to invest in the first place, and it will be a long-term thing. They aren't going to make a big profit immediately.

It's the same for the government - they would have to spend a great deal of money in acquiring the property in the first place. So it's a long term solution, which may save money in the future but will cost more now. So unlikely to be popular politically, unfortunately. Short-termism all the way if you are actually the ones in power - you don't want to invest lots of money for something your political rivals will reap the benefits from if they get into power in the meantime.

I think that OP is proposing that councils have many council properties that they rent out for a profit (not necc "market rate")

a fair rent to me (probably niavely) would be enough to cover maintenance (or maybe this would be extra?). admin etc . Im not sure market rent would indeed = fair rent. however if there was choice landlords would gave to stop charging like this is a giant game of monopoly.

if of course they hadn't have sold it all off at ridiculous prices in the first place they wouldn't have to be making this investment now.

Council housing and HA housing already pays for itself though, and maintenance/upkeep as well. Even now, it makes more sense to have people living in council/HA homes and keep the rent receipts coming in perpetuity than it does to shovel out £12bn a year to unregulated chancers. So nothing needs to change as such, except that we should be spending that £12bn building more publicly owned housing because it is better for the economy and better for society already. Thing is, that doesn't suit the pig-fucker's agenda, so he's going to sell them all off.

Here's a mental little story from my torrid past.
About 5ish years ago I bought a house, nothing fancy cost about £110k. I put up £30k and mortgage covered the rest. About 6month's later the company I worked for got sold, asset stripped and closed. Bye bye my 13 year career and my £30k a year job. Unemployed I went to the local job centre, got on JSA, went to council house and applied for HB, Council tax support etc.

Long story short, no HB or CTS for me as I paid mortgage and the man at the council said: "we (the council) aren't going to pay your mortgage for you"

Cut to a month later, bills mounting, house not worth selling, took financial advice from a friends accountant.

Long story short.
We moved to rented accommodation, paid for by Housing benefit. We rented out the mortgaged property to a family claiming Housing Benefit.
Essentially allowing the council to pay two mortgages.
I don't think it's right. I think they should stop Buy to let mortgages. If you want to rent property out then you should %100 own that property. That would stop all the cheap houses being bought by landlords and allow FTB back into the market.

"We had to move for work and we rent our house out. Our profit is negligable - maybe a couple of thousand a year - ie easily cancelled out by a new boiler, or a bit of maintenance."

But you still have the property, which should give you some profit on the equity when you come to sell (if you do) Unless you're doing something really wrong, you shouldn;t be losing any money on it, and if you are - then maybe you should sell it

I agree with the OP though, surely they should be making some money on renting out the properties

I don't personally know how much council rent is versus private rental, but surely for those working and earning a large salary should / could pay closer to market rates

(my ex boss had a council house, and he was earning £60kpa+)

so you could claim HB even though you had another property that you weren't living in? that sounds odd, arent there limits on savings and assets?

@little red
Yes because my own property was tenanted. They allow for capital and knock off a small proportion, I believe they said it gve me an income of £12 a month (even though we made a loss of £60 every month hen you consider mortgage, insurance, boiler care etc)

It'll never happen, I agree SaucyJack

I was watching something on tv the other day. About the affordable housing that's been offered in London at the moment, you can get a housing association flat 1.5 million but thats ok because The other flats in the build that arn't AS properties are a lot more money, so you are getting a bargain!

There was a lot to the program, but I was distracted whilst it was on. They were also saying something about a council(London again) owned flat block being knocked down, but a private builder will put less homes up and only % will be council/affordable. Again the rent/price will be in relation to the private market value.

But there is money being made! That is my point entirely. Council house rents and HA rents don't represent a subsidy - they pay for themselves, and for upkeep and maintenance as well. It's a model that works perfectly well. The real drain on the public purse is the money going to private landlords - as well as the £12bn HB bill every year there is also the money that councils have to find in order to issue notices against the 1 in 3 private sector properties that are substandard, the money they have to find to house private sector tenants in emergency accommodation when it all goes tits up and they are arbitrarily evicted, the cost of providing social services support to homeless/inadequately housed families in the private sector - the list goes on. This talk of 'market rates' is misleading - private sector market rents are subsidised, and subsidised heavily. We are all paying, through our taxes, for this monumental thirty year long fuckup in passing the provision of housing from the state to the woefully inadequate (in terms of security and quality) private sector. HAs and councils don't need to follow such a model - they need to distance themselves from it. But instead they are being encouraged if not forced to act themselves like private landlords when anybody who works in housing, particularly people who work on the sharp end eg homelessness etc, knows that it is an unmitigated disaster.

Oh and if there were more council/HA houses available, then fewer of the people living in them would be on benefits because they wouldn't just be available to those who have hit a crisis point in their lives - they would be available to everyone. That is, in fact, how they were in days gone buy. In the council block we lived in when I was a child, pretty much everyone worked apart from the pensioners. There were all sorts of people living there - postmen, civil servants, train guards, teachers - you know, a proper mixed community of the like you rarely see these days.

When house prices don't go up many landlords don't make any profit. We sold two buy to lets at a 50% loss by the way in the 90s crash. It is not a one way bet.
In the rest of the EU such as Latvia pension funds will invest in rentals but in the UK market there is not enough profit in it which is fascinating.

LittleRedSpark exactly my point - the money we will gain from it will come from the increase in equity when we come to sell, but I'm not making much of a profit from the actual rental.

My view is that when someone is in assisted housing, if they get a job or their circumstances improve, then they should pay more rent if they want to stay there.

I dont believe that they should leave their home, and this extra rent should go towards getting more housing

I'm a private LL and I completely agree with you OP. I think there should be much more LA /HA housing available but I don't think tenants should have tenancy for life or right to buy, which is what went wrong under the old system. I would much rather have houses allocated to tenants in lieu of housing benefit with a right to live there for a fixed period, to be reviewed every couple of years. They should be seen as 'starter rentals' to get people on their feet (obviously exceptions to this would be needed for the elderly and people who are unable to work).

But I also think that people need to get over the idea that they have the right to live in a particular area e.g. London. I see a lot of people on MN saying how unfair it is that they are being priced out of London but there are lots of people forced to move from other areas because all the jobs seem to be in London and the SE. DH and I had to move for work reasons, which means living far from family. The one advantage is cheaper housing.

So any housing strategy needs to be developed hand in hand with an economic strategy that redistributes jobs and training around the country, away from the SE. Which means that while Call me Dave is at the wheel there isn't a snowball's chance in hell.

Cross your fingers and pray for Corbyn to be PM