To be irritated at the coverage on hb spending?

[facepalming]

OK so I know this is a bit of a touchy one so I'll try and word carefully!

The coverage I've seen today is all geared towards complaining about landlords lining their pockets with housing benefit money.

Now I'm not a landlord, but I think this is a little unfair on people who are. Most landlords own only one property as an investment and are perfectly entitled to rent it out for money. They have an obligation to keep the house in good standard.

the fact that people renting those homes are claiming hb is not the problem of the landlords surely? They are just providing a service and why should they do that cheaper to tenants on hb?

Of course rents being charged now are ridiculous but so are house prices and so mortgage payments are high too.

Surely the focus should be on providing more social housing (especially of a decent standard!) and creating an economy and society where people don't need to rely on hb??

The ease of Buy To Let (and our relatively lax standards as to who can become a landlord and the laws that restrict what they can do) is a part of why house prices are so high; and therefore why rents are so high; and therefore why we, as a nation, are paying out so much in HB.

It isn't about demonising anyone. It's about pointing out that the economics of our society are structured so that people in certain kinds of work, in certain areas, can never earn enough to pay their rent and are being subsidised by benefits - necessarily. Which means that all tax payers are subsidising certain individuals investments. It really isn't fair.

On average (and I stress that, because there will be exceptions in both directions), being a small private landlord is a very risky business. For someone getting in to the business, as opposed to inheriting a property or something like that, the only likely return is the (taxed) capital gain when the property is sold. On a day - to - day basis the list of costs is massive:

• mortgage
• insurance
• all maintenance charges
• regulatory costs
• Estate agent fees
• allowance for void periods
• punitive (and I do mean that word literally) effective tax rates - private landlords are, as far as I know, the only businesses taxed at least partially on turnover rather than profit.

On top of that there's the fact that the substantial deposit required to buy a BTL property will be earning no interest.

The rent will often only cover that at best. Profiteering? You must be joking.

In many areas, for most types of property, I can't see why people get into the BTL business (and my job is analysing business opportunities).

Rent caps are a ridiculous idea. You end up with a shrunken rental market of increasingly poor quality properties, as Landlords cut investment into the bone. It's been tried in places like New York, Berlin and Sweden and it creates more problems than it solves. It doesn't magically cut the costs but essentially what it does do is make one landlord subsidise the welfare of one recipient.

That some people need (and deserve) subsidy (redistribution) to help with housing costs is unquestionable. There are basically two ways to do it.
One way is to use public money (at the average rate of 5000 houses per £1bn) to create social housing then set up a massive and hugely expensive bureaucracy to manage it, accepting that the costs will far exceed the rental income and let that be the subsidy.
The other way is to let the market provide the housing (accepting that the market will make a profit, otherwise why would it do it) and provide a cash subsidy to the people who need it.

ethelb

Tax properly in what way?

The landlord pays a higher rate of stamp duty on acquiring the property, VAT on most if not all of the costs incurred in maintaining the property, a restriction on the tax relief allowed for mortgage interest that is unique to private landlords (it doesn't apply to companies who let property, or to any other form of business, public or private, company or individual), income tax at the landlord's highest rate on the profit and finally capital gains tax at 18% or 28% when the property is sold.

So how is the landlord not being taxed properly?

Sisyphusdad that's kind of my point. Why should sole property landlords expect to turn a profit? There are many other risky, small business dominated industries where nobody assumes so much entitlement to a profit.

But often they aren't controlling a utility, which is what housing is, so can't just wack up prices as suits them. So they may fail as that's the real free market. Many landlords on here in the past are very picky over which parts of the free market they want to be beholden to

People can't choose to pay less than what landlords charge as they NEED a home.

Dont believe the journo babble, mrsdevere. Outside the holy city of london, rents are capped by market forces. Charge too much, no tenant - as it should be.

Of course i do it for profit, i doubt you work for free. Life is about earning money.

Yes, there are crooked landlords. I am now on the receivng end of the other side and am legally compelled to take it. Tenants can at least choose not to rent from crooks. Being a landlord is the.only business where you cannot stop supplying when the payments stop, and have to pay more to stop supplying. The cost of that risk is factored into the rent.so the good tenants pay for the bad ones.

Its not a matter of sympathy, but phil space the journo is too easily believed.

Rental income should be taxed as income (that would sort out the profiteers from those just starting out) and the VAT threshold should be the same for every business.

House Sellers should pay VAT also, and get rid of stamp duty for buyers, who are in the weaker position.

I can't chose not to rent from crooks. They can vet me, I can't vet them.

ethelb

Rental income is taxed as income.

Ethelb I don't think someone buying one property to set their children up for the future and charging market rate for it is causing others to need help from the state. Even when you multiply that by the amount of landlords with only one rental.

The reason for the situation we are in is the general lack of housing.

It seems landlords are often singled out as being to blame but if there were enough houses, including enough social housing this would all be a non issue.

If landlords stopped buying up property this wouldn't solve the problem would it?

Some people would be at an advantage in being able to afford to buy rather than rent but I don't think that would apply to those claiming hb.

What would your suggested solution be?

jonty I'm sorry but this

Someone commented further up that people shouldn't be allowed to make profit from housing benefit. What about buying food and clothes with benefits money - the people who sell those things make a profit.

is flat out nonsense. They're hardly the same, are they? Given that you generally have a choice where to buy your clothes and food but you don't have a choice about how much rent you pay.

I've said it before on threads like this: Housing policy in this country is schizophrenic. Either we as a country want to promote home ownership for the masses (selling off council flats etc), or we want a "European-style" model of lifelong regulated renting. There isn't room for both.

I feel like I'm in a unique position - a foreigner, living in my (owned) ex-council flat in London, with one BTL property in the South East. (Yes, before you ask, it is literally rented out to a single mum on a low income - she came along to the open day and seemed the most sensible of the applicants.) I feel like I've been able to take advantage of some very friendly policies to land up with what I have, but I don't see any logic or long-term thinking in the government's approach to housing. It's all populist and short-term.

'itsonlysubterfuge I think it's dreadful thay people can be refused a tenancy just because they are on hb. '

Or have children, or work from home, any reason, really.

' Tenants can at least choose not to rent from crooks.'

Hahaha! When you're on HB, even partial, you take whatever you can get. And it's the tenant who is vetted in the rental process, not the landlord.

Before council houses were sold off, they were an asset, and all CHB was paid from one council dept to another.
Now that money goes into the pockets of a private landlord. While social housing has become rarer and harder to get, and rents have gone up, and it has all cost the taxpayer billions.

I seriously dont understand why some people are anti council housing. If you choose to take the attitude that the houses are a financial and social asset, then you can see they make sense.

The article's purpose is to get people riled up about the amount that is spent on housing benefit, ahead of the upcoming cuts. It's got sod all to do with the landlords. It's a subliminal "look how much is being wasted" message. Because benefit claimants are - AGAIN - being demonized.

As an aside we live in an average house. We had to move (landlord selling) and this was the only suitable place available in this area. When we moved in, another person moved in a few doors down. They had bought. Houses are identical. I get on very well with them, and in a discussion it came out that we are paying more than double in rent what they are paying in a reasonable mortgage. How is that acceptable? My landlord as an individual is nice - based on what interactions I have had with them - but the system itself is astounding.

Few years back rents were cheaper than mortgages - i had tenants with huge earning power who were happily renting because it was much cheaper. No one screamed to change that.

Another factor in the btl boom is low interest rates. Speak to mark carney.

Do we have enough housing for our rocketing population? I dont know if anyone knows. Removing vat on renovation would bring a lot of derelicts back into use, rather than current policy of incentivising building tatty little houses on flood plains and growing land. We still need more schools, hospitals, gps etc - but that means putting up taxes and gpvernment has the balls to do that.

Some landlords arw registered/ vetted - some areas have a useless registration scheme. There are also laws about rental property.

There are no laws stopping a tenant trashing a place.

With houses in high demand, it doesn't matter how high the rent is, or how shitty the property is, as long as someone has the money and are in desperate need of a home, they will rent it

This is possibly to soften people up for THIS.

speye.wordpress.com/2016/08/13/no-job-no-house-begins-7-november/

Too many people, not enough houses.

Fun to blame it all on landlords, but it is decades of terrible housing policy, too low taxes, wrong incentives.

*owever, what we also really need is for those who are currently living in subsidised social housing but are no longer low earners to pay a more market price in rent.

It shouldn't be a cliff edge (eg once you're earning 20k your rent doubles), but it should taper so that by the time you're on the average wage you're paying the full market rent for the property.

That would mean there was less money being wasted subsidising those who don't need it, and then more money to build new SH properties*

Christ I swear I'll be glad when pay to stay comes in next year i if it punches a hole in the tired fucking drum above. Well except the extra money is going to the government not back into housing.

Of course if as a private landlord you stipulate 'no benefits' or 'no HB claimants' or whatever..

You are also an evil fucker.

Rents in London are ridiculous, yes.

Private rental elsewhere is not ridiculous.

Yes there should be more affordable housing, lets take a look at the planning departments and the rules around development of new housing which allow developers to build a fuck ton of expensive houses and do eff-all in reality to provide affordable housing - its a MASSIVE fiddle and always has been.

Council housing (not talking about the newer housing association owned and built stock that is generally under 20 years old) stock is old, tired, and has been poorly maintained for the last 50 years or so - the rents they recieve for those properties do NOT in ANY WAY begin to cover the actual cost of renovating, maintaining those properties.

Thats one reason why they are quite happy to sell them off.

I object to this idea that private landlords are all evil bastards lining their pockets with ill gotten gains - property DOES cost more to maintain and manage than social housing rentals can actually pay for and private landlords cannot (or, should not) get away with the same shit councils pull ...

'oh, sorry your kitchen is falling apart around you because its 50 years old, and you have no double glazing even though it was due two years ago.. but we ran out of budget before we got to your street so TOUGH SHIT... '