To think rent is so bloody unfair

[Tar19891]

My rent is 800 per month. A mortgage on the same value flat would be 450 per month. Not in London obviously. It’s not fair is it?

Landlords have to make money. That's why they do it. But they have a lot more overheads. Electric certificates, gas certificates, EPCs, repairs, management Fees etc, they'll have to pay to redo the property if a tenant leaves - and cover their own mortgage if a tenant does not pay or leaves.
If you're not happy about it look for another property.

[quote Tar19891]@Chestofdraws I pay tenants insurance already. I appreciate that I don’t have to pay for cost of repairs but TBH they’re not 4.2k per year are they?[/quote]
New boiler can cost £2k
New roof can cost £10k+
New fence £4K+
New bathroom £6k
New kitchen £10k+
Etc.

It’s rubbish, I was stuck renting for ages, but I for sure had more disposable income whilst I did. All the above are things I’ve known be replaced either whilst I rented or to someone I know who was renting out.

I am a landlord. I don't have a mortgage on two of the places I rent out.
It's how I decided to invest my money (life insurance after my husbands death). Would you say the same if I was getting a profit from stocks and shares (which may well be invested in property)? Probably not.
I provide a much needed commodity. I rent to students, a couple who are here from another country and have no desire to buy, and someone who can't afford to, but can afford s much nicer place by paying rent.
I live off the income, I'm not wealthy, but I am business minded. I really don't see your argument - what the mortgage amount is, if any, is irrelevant. I charge the going or below market (see below). And there are always people who need to or prefer to rent.
But that's a pretty good return on a £120k investment, two of my properties are worth about £225k and I get £620 and £800 ( though they are currently paying £550 due to losing their higher paying job during the pandemic). I also pay £2000 in service charges on the latter.
@Jobseeker19 they would have to - it's a condition of a mortgage to have insurance. A requirement of the head lease (if it's a flat) to pay for insurance too. I've never we met a landlord who doesn't have insurance.
@BambinaJAS I don't see your point either. Of course I am building equity. It's a business, what idiot would invest with just the 2-4% return of most rentals? I'm tying up my capital in property - the whole point is to build equity. And provide an essential service. Of course there are bad landlords. And bad tenants. And bad doctors, waiters, plumbers and so on. But most are good and trying to keep their head above water too (I can only speak for individual landlords, not company Ives, though this thread seems to be anti anyone who rents a property out).
Blaming landlords for high rents is pointless. I don't set the market.
And @BambinaJAS you can't say it's homeowners who control the building of new homes then say it's due to planning. I have nothing to do with who sets planning regulations nor who builds what where.
OP, presumably you were credit checked when you took on your rental, so you can afford it. If you think you can't now because of inflation, I'm not immune to that myself.
@SwanBuster what are you talking about? Of course landlords are taxed and always have been - it's income. And interest only mortgages are at a higher rate than repayment and the money has to be paid back eventually.
People do seem ignorant of the facts of how this all works. Meanwhile, if there were no properties to rent, where would people live? Even if all property was 'affordable', there would be many who do not want to buy.

@SwanBuster

It should be abundantly clear. The government - whichever coloured ties they wear - and existing asset holders do not give a fuck*. They will happily siphon every penny they can (‘t print 😉) to support their rentier economy.

• full disclosure - I own a lot of assets and am utterly disgusted at how things work.

This is my impression as well.

Its very much us vs them in the UK. Its also an inherently exploitative relationship in many cases.

I have never seen a society so fractured and I have lived in many countries due to the international nature of my job.

How are you sure?

Do you have proof of that, given the evidence on MPs and second homes. MP's on both sides have extensive external business interests. I cannot think of a business person who does not have some form of proprietary interest in at least one other home. Whether it is a city dwelling for work, a BTL or a holiday cottage. Not one.

Why are you so 'pretty sure' that MPs do not have second homes?

Is there some kind of register of interests that confirms MP's residential property ownership? Because I cannot see it.

It is what it is. I think council tenancies for well off folk are even more unfair.

People do seem ignorant of the facts of how this all works

Unfortunately for you, we know all too well. Inconvenient, isn’t it?

@LeonardoDiwitchy

Landlords have to make money. That's why they do it. But they have a lot more overheads. Electric certificates, gas certificates, EPCs, repairs, management Fees etc, they'll have to pay to redo the property if a tenant leaves - and cover their own mortgage if a tenant does not pay or leaves. If you're not happy about it look for another property.

Its precisely comments like this that are tone deaf.

Renters do not exist to pay your mortgage.

If you cannot pay your mortgage without a renter, you should not be a landlord.

Why are you so 'pretty sure' that MPs do not have second homes?

Some do, some don’t. I’m taking issue with your assertion they all do.

2 or 7 billion is peanuts. That is quantitative- especially when you are given the very relevant figure of 22 bn dished out in benefit. Or are you deliberately being obtuse? It’s dwarfed by other revenues. And you still defend it!

I'm sorry @SwanBuster, the figures in your post were based on guesses and assumptions (to be charitable). One of your core assumptions was that landlords pay 40% tax on their profits. You want to get your assumed tax take up from around £5bn to around 20? Short of raising tax rates from 40% to around around 160% I don't see how you will close that gap.

(Or maybe your figures are flawed )

Why would they do it if they don’t profit at least to a degree? Don’t like it? Buy your own property 😊

@ukborn - where did I say landlords are not taxed?

I said that the revenues raised through taxation are a joke compared to the bill paid out on benefits - which is just funnelled to those asset holders.

My point on interest only mortgages for BTL was thus - the ability to get IO mortgages was the privilege of the Borrow to let landlord. This allowed them to be tested on affordability differently to potential owner occupiers who had to meet the MMR regulations - and thus allows them to outbid those potential owner occupiers.

That’s what I’m talking about.

It is easy to blame landlords for the problem but without them there would be no housing stock.

The real problem is the profound inequality in society and the lack of decent housing stock on the public sector.

I'm not a landlord but I feel for them always being the butt of all the abuse. Shout at your MP instead.

@TeaMilkAnd2Sugars

YANBU

I pay 1000pcm for a shitty little flat in London, nowhere near the size I actually need. The problem is all my money goes into paying the rent so I can't even afford to save to move.

My friend has a 2 bed flat locally, housing association, her rent is 500pcm.

Private landlords are greedy fuckers.

They say it's based on need getting social housing. Think big lie cos serious domestic violence did refuge and can't even get on waiting list. Councils legally meant to house domestic violence victims but in London they more or less tell us to fuck off and die. Say find private when even slum landlords lots don't take benefits. If council accepts homeless duty they banish victim far away from home in unsafe slum temp left to rot for years isolated.

Victims are sold lies of recover rebuild and very cruel lies. Don't know what magic happens to have chance of life in social housing. How people get the flats and houses and envy them everyday their luck. Don't see how it's based on need cos being at risk of murder and pushed to suicide if that isn't high need don't know what is.

Completely agree

@DownToTheSeaAgain

It is easy to blame landlords for the problem but without them there would be no housing stock.

The real problem is the profound inequality in society and the lack of decent housing stock on the public sector.

I'm not a landlord but I feel for them always being the butt of all the abuse. Shout at your MP instead.

MPs are also landlords.

Circular argument completed.

I’ve been a renter for years, but have recently got onto the property ladder. But, I was glad that there were private landlords out there. Otherwise, what would have been the alternative for people like me who wouldn’t qualify for social housing? Because of anti landlord ranting, the scales have been heavily weighted in the favour of the tenant, meaning it’s just not appealing to become a landlord. Where I live there are hardly any rentals, and any that go on the market have a dozen or more applicants. Never the case when I was renting. The problem is banks being totally inflexible on mortgage applications, using any slight blips with credit files as a stick to destroy people’s dreams of home ownership, and who don’t take into account someone who has been paying rent for years, on time, at double monthly payments than what’s been asked on a mortgage. I get that mortgage companies have to be careful, but surely they should start assessing each application on its own merit instead of using tick box policies.

As it's a flat, your landlord will most likely pay a quarterly service charge and ground rent too.
Some service charges are staggeringly eye watering.

Lineofconcepcion

The service charge on a property I own is £2200 a year. Once I factor in expenses I earn around 3k a year on my investment of £100000. That's 3 percent. Once interest rates reach 3 % I'll be selling up.

Do you live in a really poor housing market or have you failed to take the increase in value of the fixed asset into account?

Over the last 10 years, house values have risen on average by more than 4% per annum.

@MummyPigsKnickers

As it's a flat, your landlord will most likely pay a quarterly service charge and ground rent too. Some service charges are staggeringly eye watering.

Then those properties are a poor choice for rental.

@LardyDee

2 or 7 billion is peanuts. That is quantitative- especially when you are given the very relevant figure of 22 bn dished out in benefit. Or are you deliberately being obtuse? It’s dwarfed by other revenues. And you still defend it!

I'm sorry @SwanBuster, the figures in your post were based on guesses and assumptions (to be charitable). One of your core assumptions was that landlords pay 40% tax on their profits. You want to get your assumed tax take up from around £5bn to around 20? Short of raising tax rates from 40% to around around 160% I don't see how you will close that gap.

(Or maybe your figures are flawed )

Sigh.

I was helping you by inflating the tax take by using that 40% figure - which - as you well know - I said was of course total rubbish - just to make the point that even if we charitably overestimate the revenue taken from taxing landlords - it’s still nothing in the grand scheme of things.

At this point - I’m baffled - you seem to be arguing with yourself. What do you want - high revenues or low revenues?

Why not just think of it as a range that shows that landlords are parasites no matter how you skew the numbers? Does that work?

@ukborn

That is very charitable of you. What profit do you make after insurance and mortgage interest? If you have £450k of property and getting your mid-range of 3% that is £13.5k a year before costs. Then your service charge, insurance and repairs. You are making nothing. Business minded bollocks. Essential service rubbish. You are hoarding property at the price point where young people want to step in and you and others are denying them of housing.

You cannot even access the equity. You can only do that when you step off the housing game and sell up, but like all residential property investors you are too gutless to do that. Your Midas logic is flawed and 40% of what you own is going to HMRC eventually.

@Jobseeker19

I have yet to meet a landlord who pays insurance.

I have to meet one who doesn’t. Especially if there is a mortgage on the property, it is mandatory and they check.

[quote TargusEasting]@ukborn

That is very charitable of you. What profit do you make after insurance and mortgage interest? If you have £450k of property and getting your mid-range of 3% that is £13.5k a year before costs. Then your service charge, insurance and repairs. You are making nothing. Business minded bollocks. Essential service rubbish. You are hoarding property at the price point where young people want to step in and you and others are denying them of housing.

You cannot even access the equity. You can only do that when you step off the housing game and sell up, but like all residential property investors you are too gutless to do that. Your Midas logic is flawed and 40% of what you own is going to HMRC eventually.[/quote]
Applauds 😁

That is £160 tax on rental income, so £640 to your landlord, who already put a deposit down on the mortgage and has some other running costs, so it is less than £200 to them, really, if you can afford to buy then do it by all means.