To think private rent increases should be limited to inflation only

[Fancymice]

We are currently applying to rent a 2 bedroom house for £785 a month. The same house was up for rent previously 2 years ago for £695.

The seems like a massive increase, and other houses for rent on the area seem to have gone up by the same or even more. We're currently in a 3 bed for £850, but it has a dreadful damp problem. No doubt our landlord will paint it and put it back up for £900/£950.

Aibu to think private landlords should be limited in how much they increase rent? I understand that there is limited supply, so landlords are taking advantage of this to put up prices, but like most people my wages are not increasing on real terms and having a somewhere to live is quickly becoming unaffordable!!

Friends in Italy Milan live in rented properties, the state of their place is shocking although rent controlled the landlords spend nothing on them nor are expected to. They're both in highly paid work live in slumlike conditions four days a week but own. A beautiful home in the mountains where they ski in the winter and walk in the summer n. They won't spend a penny on their cheap rental

@HarrietsChariot

Rents shouldn't be based on inflation, no. They should be based on the monthly mortgage repayment the landlord has on the property, up to 90%. That way people who invest in property still benefit from price rises and only have to find a relatively small amount out of their own pocket each month, but they cannot exploit renters. Obviously once the mortgage is payed off, rent would decrease to zero.

But when, say, the boiler breaks the landlord should just find this money out of thin air?

In my area there are loads of houses for sale with tenants in situ. I have never seen this before...the odd one, yes, but not loads like there are now!

@Shitfuckcommaetc

A few years ago my landlord gave us notice as they said they were selling up. Fine, no problem at all.

We'd been there 8 years and only had minimal rent increases over that time, we were paying £900pm when we left.

It was never put up for sale. 6 weeks after we left it was let out again at £1400pm.

that pissed me off a bit!

Are you sure it wasn't just a private sale to another landlord? A nearby property to me was sold without being advertised.

The UK's attitude to property is the problem. Renting is common in many places in Europe and people stay for several years in a property with legal protections in place. Being an amateur landlord in the UK was an option for far too long before some tax restrictions have made it less profitable. The whole 'market rate' arguement ignores the fact that house prices have been inflated by buy to let landlords who do not maintain their properties. Legal protection for renters in the UK is woeful.
Of course lots of landlords will pile on and say how great they are and have horror stories about tenants. But surely that is the risk involved when you choose to become a landlord? Obviously it is not ok for tenants to trash a house but neither is it ok for boilers not to be fixed, cheapest possible fixtures and fittings and for tenants never being able to feel the space they pay for is their home.

@willstarttomorrow

The UK's attitude to property is the problem. Renting is common in many places in Europe and people stay for several years in a property with legal protections in place. Being an amateur landlord in the UK was an option for far too long before some tax restrictions have made it less profitable. The whole 'market rate' arguement ignores the fact that house prices have been inflated by buy to let landlords who do not maintain their properties. Legal protection for renters in the UK is woeful. Of course lots of landlords will pile on and say how great they are and have horror stories about tenants. But surely that is the risk involved when you choose to become a landlord? Obviously it is not ok for tenants to trash a house but neither is it ok for boilers not to be fixed, cheapest possible fixtures and fittings and for tenants never being able to feel the space they pay for is their home.

Why do you think landlords are responsible for house price inflation? That doesn't make sense. Landlords only buy houses if they're cheap. Ask any estate agent and they will tell you BTL investors drive the hardest bargains. House prices versus rent is usually a stable differential and BTL investors need to buy the property cheaper than a buy-to-live buyer would. Lots of landlords have sold because of the new unfavorable conditions and yet house prices continue to increase.

House price inflation is because two-person mortgages are now the norm and interest rates are extremely low. When I first bought a house I remember thinking 5% interest rates are the norm and I should expect rates to be around that for the entirety of my loan.

The higher house prices are, the lower yields BTL investors receive.

@Lavender24

Yeah it's insane. The house across from me has just gone up for rent for £595. I think that's a lot for a tiny 2 bed terraced house in the north east. Back when I lived in rented accommodation (pre 2018) I'd have paid no more than £450 pcm for a property of that size.

What’s insane is that the eight similar properties to rent in my town are all £1200+ a month. Which is why so many adult children in the SE are still living at home.

House prices versus rent is usually a stable differential

Sorry, what I meant to say is that usually this is a stable differential, so when house prices go up new landlords (do the ones buying) get less return on their investment. Because of the way rental stock has reduced due to less landlords rent prices are going up. This is not usually the case and high house prices aren't usually what landlords who want to increase their portfolio want.

We need more social housing. Lots of it.

That is the solution.

What’s insane is that the eight similar properties to rent in my town are all £1200+ a month. Which is why so many adult children in the SE are still living at home.

If it was insane nobody would pay it. So the demand is there and the landlord who sunk £100k into the property will get a return on his investment. He could have put it into shares instead and received £10k a year and be stress-free.

I prepare to be flamed for this but personally I don’t think property should be a profit exercise. I don’t believe it should be turned into a business. It will never happen but I’d prefer there not be so called private landlords and a better system put in place that prevents buy to let. I’d also be for a scheme that prevented second homes. I say this as a woman in her mid 20s who is unable to move out from home as there is simply nowhere affordable in the local area.

Even if people don't care about others, social housing will save the taxpayer money.

The current UK public health housing and homelessness emergency costs billions - both directly (eg. expensive homeless accommodation, very high housing benefit bill) and indirectly through the knock on affects.

@Tealightsandd

We need more social housing. Lots of it.

That is the solution.

Here here

Friends work for a housing association they're doing their best within strict budgets which are improving they're buying within new estates but builders have to go through planning a long process it can take two years from inception to a front door key

@Tealightsandd

Even if people don't care about others, social housing will save the taxpayer money.

The current UK public health housing and homelessness emergency costs billions - both directly (eg. expensive homeless accommodation, very high housing benefit bill) and indirectly through the knock on affects.

Let's get rid of private landlords then! It would involve tax hikes to pay for the properties the government will need to buy. I don't think current landlords would be too upset...they'd just sell and get rid of the headache.

@17TheHouseILiveIn sorry I meant in a historical context so this ship sailed several years ago. BTL is not as lucrative as it once was as the prices have jumped. In my city huge swathes of certain postcodes were bought up to rent to either students or people claiming housing benefit which pushed prices up. The city centre also saw loads of apartment blocks by the river spring up which amateur landlords from out of town bought without seeing or understanding the market. Most were not in great areas and not particularly nice so can be snapped up quite cheaply now.

I am a landlord and I have x invested in a rental property. The profit I make is my return on my investment, as it would be if I invested in some other investment vehicle such as a pension or shares.

We don't need to get rid of all private landlords. We just need to return to a better balance.

Some people want private renting. It suits them. Young people just leaving home for the first time, students - people still living a transient less settled life. Also people on short-term job contracts or in-between house moves. Things like that.

However, older people, the disabled and long-term sick, and families need stability. They need to feel safe and secure in their home, be able to afford the rent, and have the opportunity to settle down and put down/maintain roots.

It's about balance.

Private landlords shouldn't be allowed to own more than one rental. And perhaps focus that market mostly on people who either inherit a property or who keep their home when moving in with a partner/upsizing/work post in a new area.

Yes taxes will be used to pay to buy and build the much needed social housing - but it's cheaper than taxes used to pay for expensive homeless accommodation, housing benefits for private rents, and the knock on consequences of the public health housing emergency.

The consequences include the huge and growing bill for mental health treatment, social services, the criminal justice system, and so on.

It's not just a moral issue. It's a financial one.

I'm all for better tenant rights and regulationrenting is awful in the UK because there's no protection for long term tenants, unlike many European countries. It's absurd to think that tenants shouldn't pay towards long term costs, however. "The landlord should cover it"from what, their own pocket? Unless someone is assuming that the tenant is paying all at once for the boiler that's going to last a decade or more.

Rent has to include a cushion to pay for all those long term costs and to cover vacancies etc. If the council were your landlord, they'd have to cover that too; they'd just eliminate the profit.

Investing is a tricky topic as it covers many formats from turning flats to AirBnBs to massive property portfolios to a BTL investor owning a single unit to someone who's split a large property into two units and rents one out to help cover the mortgage.

@HarrietsChariot rent zero? You are absolutely ridiculous. How do you maintain a house with zero money???? Clearly you do not own a house 🤯😳

@dameofdilemma so I work hard to buy a property to rent. It is my investment and my pension. I don't force anybody to rent from me. Houses have always been an investment. Being a landlord is a job like any other.

renting should be cheaper than owning a house, but that really doesn't seem to be the case.
Why should it be cheaper? Because you want it to be, and it would suit where you are in life at the moment? That's not how things work.

Now many people have the prospect of giving all their salary to a landlord with little hope of owning their own homes.
Giving it to a landlord? Like you give it to the supermarket for food?