There should be an upper limit on rental prices

[HereLiveIAmNotACat]

Am I the only one that thinks the property investment industry is horrendous and shows how awful, greedy and selfish mankind can be? Surely there should be laws around this? Or caps on the maximum profit a homeowner can make per month relative to any mortgage on the property?
How can it be right that rental prices are ludicrously above mortgage prices purely for the homeowners to benefit from someone else paying off their mortgage and make a pretty penny on top.. then moving on to their third, fourth houses etc..meanwhile renters are stuck forking up more than they can afford with little chance of ever making it onto the property ladder due to the impossibility of saving up whilst paying rent.
Unless you were fortunate enough to have a property in the 80s before inflation/money from family you’re screwed really.
Just means less and less rental properties being available. The rich getting richer the poor getting poorer. And it’s always ‘oh it’s brilliant we’ve paid that mortgage off and are making such and such per month renting out..we’re now moving to a much larger house in a much nicer area’ as if that’s something to be proud of?!

(Yes- bitter renter here)

OP I am a landlord and I can understand why you feel the way you do, they are expensive. It’s also expensive owning a property though and returns are not as stable or high as you might think after expenses.

Of course it does or it's no longer a viable business!

That is true, but rent is not based on the cost of those things. It’s not decreased if the cost of those things decrease, is it? Most LLs charge enough to cover all those things but it doesn’t have to at all.

@MaryAndGerryLivingInDerry what do you mean “rent covers the market cost of the property”?

Putting an upper limit on rents can't work. If someone is prepared to pay $41,000 per month for this 4 bed flat, who am I to stop them?
www.rightmove.co.uk/properties/116739710#/?channel=RES_LET

the only solution is to BUILD MORE HOUSES and to BUILD MORE FLATS. Then purchase prices and rental prices can come down (or at least stablize). As long as there is high demand and not enough supply, prices will stay high.

@MaryAndGerryLivingInDerry - sorry you said “rent covers market rate of the property” not market cost. What do you mean by that?

If the rent doesn't cover the Landlords costs, it's hard to see why he'd let a tenant live there?

He?

Anyway, yes in most cases the landlord won’t continued selling the lease if it’s not profitable. Despite what many on here claim.

Or caps on the maximum profit a homeowner can make per month relative to any mortgage on the property?

I don’t have a mortgage on the property I let. Should my tenant not have to pay anything?!

By the time the letting agent has taken 12%, I’ve paid 20% tax and paid my own rent, I have £90 left. It costs £360 to do the paperwork for each new tenant, so I’m not “making” anything for the first 4 months. Then there’s repainting, new carpets, and any repairs that need doing.

[quote SonicBroom]@MaryAndGerryLivingInDerry - sorry you said “rent covers market rate of the property” not market cost. What do you mean by that?[/quote]
The market rate for a property of that type in that area. For example where I am a 3 bed terrace will be between £600 -£700 per month. A 3 bed semi will be around £750-£900 per month. Two years ago those rates were about £200-£250 lower. The market rates have increased.

I’m not sure why a landlord doesn’t know what market rate means.

@MaryAndGerryLivingInDerry

I’m not sure why a landlord doesn’t know what market rate means.

Do you mean market rent?

If you mean rate you need to say the rate for what.

You sound very salty, @MaryAndGerryLivingInDerry
Landlords can only charge what the market will take

@GreenLunchBox

You sound very salty, *@MaryAndGerryLivingInDerry* Landlords can only charge what the market will take

Surely taste salty? Otherwise the metaphor fails.

Signed a metaphor pedant xx

Do you mean market rent?

Rental rate, yes, obviously.

This sort of posts really make me laugh.
I am an accidental landlord I live in my husbands property and rent my own.
I rent my property to a person on housing benefit who couldn't find anyone to accept her for a year.

Per month the rent is £1000

• mortgage £470
• property management (flat) £92
• insurance £61

My tennant has children and other neighbours were complaining of noise so to get noise cancelling underlay and carpet £2200.

Tennant left immersion heater on which caused my hot water system to fail £1100.

To be honest it sometimes doesn’t cover costs I keep the property because I feel its the best way to invest money long term however some months I am definitely out of pocket

Not to mention my previous tennant who didn't pay any rent for eight months and I had to take to court to evict.

@GreenLunchBox

You sound very salty, *@MaryAndGerryLivingInDerry* Landlords can only charge what the market will take

Ooooh! Didn’t that die out a couple of years ago?

Anyway, you’re supporting my point. Thank you.

I am an accidental landlord I live in my husbands property and rent my own.
I rent my property to a person on housing benefit who couldn't find anyone to accept her for a year.

Wow, and that all happened to you by accident?

But what do you think those rates are based on @MaryAndGerryLivingInDerry ? They’re not plucked out of thin air, they’re largely based on the amount that’s needed to cover a landlords costs and probably make some profit as well (which I think is the part that the OP is referring to). They’ll be generally summed up as a total yield. In the time frame you’re talking about, property prices have increased (which underlie the size of the mortgage a landlord might expect to take out), as has the cost of maintenance and some of the costs associated with renting / taking on new tenants. True they’re not formally tied to each other because there are a lot of complex factors involved, but they’re absolutely related to each other. Just because a landlord doesn’t have a mortgage it doesn’t change the value of property from the perspective of a rental valuation.

I think it would be better to ensure ll are responsible for properly maintaining a property.

So you’d be happy with someone telling you how much money you can make out of your biggest asset? Should there also be salary caps in case people dare to charge employers too much for their skills?

No one owes anyone else anything at a certain price.

@parietal

Putting an upper limit on rents can't work. If someone is prepared to pay $41,000 per month for this 4 bed flat, who am I to stop them? www.rightmove.co.uk/properties/116739710#/?channel=RES_LET

the only solution is to BUILD MORE HOUSES and to BUILD MORE FLATS. Then purchase prices and rental prices can come down (or at least stablize). As long as there is high demand and not enough supply, prices will stay high.

£41000 a month and the advert is full of typos..

But yes, capping rent doesn't work. By the same argument, it would be fair if we were all paid the same.

@MaryAndGerryLivingInDerry have you not heard the term “accidental Landlord?” It applies to people who at the time of buying a property did not intend to rent it out. Which would be me.

BTL mortgages are interest only (not saying every LL has a BTL mortgage, but I would imagine most do). You aren’t ‘paying off their mortgage’

Not true. Interest only mortgages are common with BTL purchases, but by no means universal. Mine is a repayment mortgage.

Just because a landlord doesn’t have a mortgage it doesn’t change the value of property from the perspective of a rental valuation.

Umm, exactly. And someone having a high mortgage doesn’t change the value of the property from the perspective of a rent valuation. If the government dropped 100k new social housing properties tomorrow, demand for rentals would plummet, rentals rates would fall, but the mortgages any landlords had would remain the same.

[quote Kathers92]@MaryAndGerryLivingInDerry have you not heard the term “accidental Landlord?” It applies to people who at the time of buying a property did not intend to rent it out. Which would be me.[/quote]

Oh I’ve heard it alright.

Signed a metaphor pedant xx
No, not a metaphor, just a commonly used slang term
You know you're losing the argument when you start picking on someone's use of language!