Small landlords selling off isn't a great news after all

[Goingindrain]

My landlord is a small landlord, just owns his house and the one where we live. He is a nice man and charges us below the market rate rent.
He is fed up of all the anti landlord rules and has decided to sell. It seems he had an offer from FTB and then a big corporation put in an offer 10k over and he's selling it off to them via the agents.
I am worried about the rent going up and it's not a great news for tenants.

Yep, house prices may drop slightly if there is more on the market for buyers. Which will benefit some. But the resulting reduction in rental properties will push rental prices up. Friend of mine is a landlord and she says the competition for her houses when she puts one up for rent is insane, people are writing begging letters, offering to pay more than what she has asked for, offering a year's rent in advance, etc.

Not just the odd person - but 20-30 applicants in a couple of days. She has her pick of who she wants. The person with a job in an industry she sees as being a bit insecure, or no previous rental history, or a temp cpntract etc isn't getting a look in.

So many brilliant landlords on the internet. Meanwhile most rented houses I visit are mouldy and delapidated, with conditions nobody would tolerate in their own home - and largely owned by "small" landlords too.

I think that idea failed, and the latest promises pre-election, about forcing developers to include affordable housing developments has gone the way of most promises from Labour:

https://inews.co.uk/news/leaked-memo-reveals-labour-plan-slash-affordable-homes-target-3980810

I don't know. But it is going to destroy student lets, as now landlords can't be certain they will have the property back at the end of the student year. Which means they won't be able to advertise for the academic year ahead. Corporate, purpose built student lets will be exempt from this legislation. So supply of student lets will decrease and there will only be the very expensive, purpose built end of the market available.

I've been on the peripheral of the prs for 30 plus years and practised housing law for 20 both in the prs, social housing and mortgaged property.

Perhaps you could expand on how you think landlords within the prs are to blame for the current crisis in housing? Because from where I'm sat it is entirely of the making of successive governments starting with Thatcher in the 70s. In my experience landlords respond and react to market forces of which the law surrounding the sector dictates those responses. Laws are made by governments not landlords.

The prs has carried out a function of housing people. If you think that housing people should not be the responsibility of private enterprise blame the governments for failing to step up when landlords have. The prs is little different to supermarkets which provide food.

I'm selling off, as I need the capital. FTBs bought the first one. The agent said rental firms would buy but only for 70% of the value - and this is a highly geared area, with rents of £800-900 on £200-250k houses. Also dozens applying for each rental and offering more than rental price (mine are in good condition).
But the bank of mum helped with the deposit. People living in that area don't have jobs that can save for deposits, but they would easily afford the mortgage repayments.

I rented privately in London for 14 years, mainly from small landlrods. Some were fine, some were bumbling amateurs, some were greedy, incompetant twats. Some friends had the misfortune to rent from outright criminals.

The problem is you are never sure which type you are going to get. Leaving supply of an essential services to a small time investors who may be ignorant of their legal duties and woefully undercapitalised feels a sub optimal way to supply a life esssential service to millions of people.

I mean you wouldn't want your energy supplied by Mr Jones who has a side hustle in in energy retail to supplement his pension.

I support a well regulated private rentsl sector alongside socially rented housing. Renting a property out is a service business and should be regulated as such. It is not some sort of favour you are doing for people unfortuanate enough not to own a house and landlords need to understand that. So I am not going to cry for incompetant "accidental" landlords or people who see tenants as interchangable mortage paying units if they have to leave.he market.

Didn't even think about student lets! Good point

DD is in a student let. Im not convinced their LL isn't making a profit. The combined rent is nearly 50k/year (on a house that cost 360k and has squeezed in more students than original number of bedrooms) and from the photos she's sent of "repairs" theyre not spending a lot on maintenance!

@smallglassbottle - As long as the house has an EPC of C or above then you won't need to do anything. And if you get one done say immediately regardless of how old your current one is, that will cover you for the next 10 years.

There are also grants available to cover the costs if you did need a heat pump.

Our neighbours were landlords. House was a family home, I think their parents or grandparents. Recently sold for £650k not to local people, but to second home owners. 🤷🏻‍♀️ Not that most local people could have afforded it anyway. I’m very grateful to the landlords who allowed Dh and I to rent privately at a reasonable rate for the 10+ years it took us to save to buy a house.

Owning a house is expensive though. I don’t blame anyone for not putting themselves into debt to keep rents low. And I live in a place where locals are often priced out of the market by second home owners. Everyone likes to whinge about non-locals pricing locals out of the market. But no one likes to sell at prices locals want to pay. If I had to sell up my family home to afford retirement, I certainly would sell to the highest offer too, so can’t say I blame them. It’s not greedy. It’s a sensible financial decision, no matter how angry it might make Bob down at the pub.

There's no shortage of houses to buy! Just look on Rightmove. Rentals, on the other hand are in short supply...
Not everyone wants to, or is able to, buy.

Unless of course the Government move the goalposts and change the criteria required to obtain a C rating...which is more than likely.

@MadinMarch They already have since last year and it will change again probably next year. And hence why I said do it now so it will last 10 years

I'm not surprised as have family in an area where literally nothing is available to rent. It's a real struggle.

But rent in advance won't be allowed anymore, and neither will over bidding.

Yes, the leftys would soon complain if these people were housed by them.

I think this is very likely to happen. The fall out of around 30 per cent of rentals (much higher percentage in London) suddenly becoming unlettable would be too disastrous. And of course it's 2028 for new lettings, not 2030. I'm pretty sure the criteria will be changed to make a C much easier to attain.

Even if landlords want to get the changes done, at the moment there is no clear guidance on how to achieve the higher ratings as it's known that the criteria are to be changed. And in any case there aren't the skilled workers available to suddenly do all this work on millions of houses within probably an eighteen month period.

I sold a 2-bed last December for £267k and the day we completed the guy had it up for rent for £1350 pcm (and it let in days). Even though he said it would need work to bring up to spec (it didn’t and I think that proves it). Shocking in Hants/Surrey border area.

I don’t think it’s that simple.
they need to get generation rent out of the private rental market before they retire.
the universal credit bill is going to be massive and it’s all going to go into private landlords bank accounts.
They need people either in council houses so the money stays within the council or owning so there’s no bill. With a chance of claiming some of that to pay for care if needed.

if rent rises more people need to claim benefit, or need council houses. They need to stop that without crashing the market completely. It’s a really difficult balancing act.

bailing out the housing market in 2008 was the second biggest mistake after selling off council houses.

Good points. But what these policies seem to be achieving is driving out small private landlords, to be replaced by large rental corporations. That's not going to help the issue at all.

My owned house is not a C

I think some of the 'standards' which people are insisting on for private rents is not realistic. No one is saying people should or will live in a broken dangerous hovel but the reality is most of us live in houses with things that need doing. Its life.

I supposed the concept of 'funding an old age' is fairly modern. When state pensions were first put on the table, it was thought to cover the last few years of someones life.

Life expectancy was much different then, so you would end work and perhaps live another 5 years

Now we live much longer past retirement age, although not always in good health

So now we all (me included) want our pensions in our 60s but will be living until our late 80s.

But assuming Ive got a sell by date of around mid 80s, I wouldnt be able to work until my late 70s at all.

I think student accommodation is one of the areas provided for in the new legislation. It will be treated differently to single lets and HMOs

@thecatneuterer but large corporations are less likely to want to liquidate their buy to Let asset to pay for retirement.

Thanks!