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.

When we moved to a Scottish island many of the residents were moaning that the English were coming up here offering over the odds for the houses. They wanted locals to get them. As I quickly pointed out, the owner can sell to who they want, and especially to a local if they are happy to accept less, but greed gets the better of them and they take the highest offer usually from an incomer. It's only human!

The tax thing is killing it for me. I have a large mortgage in the property so I'm effectively taxed on profit Im not making and thus operating at a loss year after year. Sadly i plan to sell up and evict my very good tenant, a lone woman. Where would she go? The rent will only go up for her.

Would you pump 1000's a year into something for zero gain? Can you afford to? I can't. And yet I'm being accused of being a greedy landlord.

People who accuse landlords of being greedy generally are ill informed on how the sector works. They’ve drunk the Shelter/Guardian kool-aid.

It's not zero gain. You still own the asset (via a mortgage). You have outsourced the payment for your debt (eventual fully paid off asset) to your tenants.

There is insufficient housing in the country. Had the social housing not been sold off, and the money raised been ring-fenced for building more social housing, we could have at replaced a small percentage of it. Just remember who was in Government at the time!

Competition to buy houses and their scarcity has caused prices to rocket. Many saw the BTL route as a nice little earner. They added to the competition for the small available housing stock thus inflating the prices. However much LL congratulate themselves for making a rental property available, it was hardly an altruistic move. It was mostly to secure their future or that of their offspring.

I was in the position of renting a property because the Building Society said that a mortgage would not be affordable for me, despite the fact that I was paying more in rent than I would have in a mortgage. My landlord had several properties and a (small businesses) industrial estate, and lived with his wife in what could only be considered a country pile. They controlled the heating, so the place was always cold. They increased the rent every 6 months to the maximum that the market would stand. They did the minimum of work necessary to keep the place habitable. They never addressed the vermin problem. I was glad to move out in the end with my excellent reference. I thought that it was the least that they could do.

The govt is shafting private landlords every which way, ostensibly to give tenants more rights. In fact tenants are now at more risk of being evicted than ever. Labour didn’t think the changes through.

You’re so right

They did this a few years ago in Wales. The result here a lot of homeless women and children, old people and vulnerable people. Our council ran out of places to put them so rented in England and relocated them.

The Welsh government ran courses to be licensed as a landlord £££. Three years later another course £££. You have to give six months notice to evict a bad tenant. So much property came on the market and was bought up by landlords in England and overseas. These properties have deteriorated, landlords out of the councils and courts reach.

It's been a disaster. Rents have gone up hundreds of pounds a month.

Is there open discussion about the situation in Wales or is it ignored / blamed on the remaining landlords?

Labour government for you. There will be a massive lack of rental accomodation soon.

Totally agree. The country is immobile. Even if you can stomach the moving costs you need a spare house (or a relative) in case the new house isn’t quite ready. Heaven help you if the sale falls through and you have exchanged on yours.

Ditto building work. Those who can still afford to do the big extension project can’t find a 6 month rental anymore, or at least one that that doesn’t add 50% to the final cost.
A long term hotel is the only option and there is less choice as the government is using them as temporary housing.

There is nothing the governments (this all started with George Osbourne) of this country can’t make worse for the people. It is all deliberate and is a simple transfer of wealth from the little people to the mega rich with their snouts in the trough… by which I mean Tony Blair, George Osbourne, Nick Clegg, Jeremy Hunt and David Cameron (am sure Starmer will feature on this list in 10 year too).

Do you understand inflation? That is most of the profit. CGT on long term rentals is basically government theft. Profit is no longer adjusted for inflation and the tax breaks that replaced this have been eroded over the years to the point that they no longer exist. Most landlords would have been much, much better off selling up 10 years ago and putting the money in the stock market. Even 2 years ago that would be true.

Small landlords are thin on the ground now. The government are silent. But friends who work for the council and housing associations are very critical. They're one the front line desperate to house people where they have a family support network so they can work. Instead they're living out of suitcases, in rooms, kids torn from their homes, schools, families

it's so hard to get back home when you get over 100 applicants for every property that comes up.

I go on Rightmove see second rate housing at crazy prices.

The government wants heat pumps in all properties, solar panels energy rating minimum C. Even if the houses fabric and orientation makes it a futile effort. Thankfully that's on the back burner until after the election.

If labour/plaid alliance get in they might push again. But their new dream to get money is do the same all over again with Airbnb accommodation. Licence all properties. You'll have to do courses £££. They'll then come up with other wheezes. So more property will come available for overseas landlords.

That profit is a myth here. You retire, ill health so look into downsizing, find that the properties are dearer than your family sized home. So you either stay put which most do having costed, stamp duty, solicitor, estate agent costs. Or you do move, if lucky have a nest egg left. But further down the line you may need a nursing home. That'll see paid to the rest of your money. But you haven't cost the state anything. And you'll be sharing this nursing home and subsidising the elderly who never bought a house, never earned much.

Still at least your children won't have the headache of inheritance tax.

Don’t know why people are blaming the current government for this situation when it was started under the last government? I’m not defending Labour at all but this situation has been going on for a long time. Renters need to brace themselves for the shitstorm that’s about to hit them.

But the previous government considered banning section 21 and then realised the shit storm it would cause and, sensibly, abandoned the idea.

Mine don’t either - currently one is building their own house, one is on a FTC for work and one has separated from his wife

@thecatneuterer I’ve been a landlord for a long time. The Renters’ Reform Bill was introduced under the previous government, but as it wasn’t far enough along in the process to be agreed by parliament it didn’t complete the process before the election.
The Renters’ Rights Bill is similar to the previous Renters’ Reform Bill, both wanted to abolish section 21 and fixed term tenancies but the previous bill was looking into court reform, the Tories had already said they were abolishing Section 21, never once said they were abandoning it. They just got voted out!

The Renters Reform bill dropped the abolition of Section 21 as one of its aims until such time as the court system would be in a position to be able to cope - aka never. The Renters Rights bill was going ahead without the proposed removal of Section 21 but ran out of time.

I'm a small Ll I rent my old house that wouldnt sell during covid , lovely tenants charge below market rate because they are so good and I don't feel raising rent every year is fair. New laws are coming in here too it means when this tenant chooses to moves out I don't think I'll look for another . It doesn't make a profit really once maintenance and tax is taken into account and I hate being a landlord. Ideally I'd sell now but i wouldnt put the tenants in that position. I can see why a lot of small landlords are selling .

I'm seeing a lot of opinions like this. On the one hand, damning new legislation for pushing out small, private landlords, on the other, complaining about slumlords.

How on earth do you think slumlords can be prevented, if not by introduction of legislation which sets minimum benchmark standards for the condition, upkeep and energy efficiency (including both energy affordability for tenants and sustainability to meet environmental / net zero targets)?

You cannot have it both ways.

At least when they did this in 1965, a huge amount of AFFORDABLE, on one wage, houses were being built.
Current new build figures are woeful.

I don't think anyone objects to enforcing standards (although an EPC C minimum is overkill).

There are already minimum standards, particularly with the widespread use of local authority licensing. But making it extremely difficult and incredibly expensive for landlords to get rid of problem and non paying tenants certainly isn't going to improve standards. It will only reduce supply.

There’s already plenty of legislation to address slum landlords. The council just don’t implement it. Possibility for lack of funds or being scared that they will have to re-house the people living in the slums?

This is not at all what tenants wanted, they wanted the right to be able to buy their own home rather then paying off a landlords house extension and trips abroad.

Being at the mercy of a landlord (whether a corporation or private) is not exactly a wonderful environment for the people living salary to salary.

Yep, this is exactly why we sold our rental last year. We were excellent landlords and kept the house in very good repair. We had a good relationship with our tenant and even offered the house to him to buy at slightly below the market rate but sadly he couldn't get a mortgage.

So yeah we sold up and invested the money elsewhere because we were sick of all the new red tape and government nonsense. But at least all the rabid landlord haters are getting what they wanted.