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.

I will always remember my very lovely accidental landlord crying to me that she couldn't afford to solve the rat problem or fix the leaking water pipes in our basement flat so we'd just have to cope. We moved out instead.
Licensing landlords is a great idea.

@soupyspoon the govt grant is worth £7500 (which is open to landlords too). If you have a new build property with a recent wet heating system (eg gas) then you shouldn’t need much additional work beyond the HP being installed which is probably around £10-12k, though could be less if very simple install. So in terms of your cash outlay 2.5-4.5k, ball park same as a boiler. If your property is older and needs more pipe work doing then yes it could be more.

I would give notice now then and start to make enquiries, are you on a rolling tenancy?

No a fixed tenancy for another year hence being happy about the bill... it means we can hand our notice in May rather than having to wait.

Both myself and DH own a BTL, due to different circumstances. Both properties are let at below market rent to really lovely tenants. As soon as they decide to move on we'll be selling. It's honestly not worth the hassle.

Yup! Small landlord here, just given my lovely tenants notice after 9 years because frankly I'm terrified of falling foul of some regulation or another. I charge them less than 2/3 of the market rent and I make no profit but accept that I've made a big capital gain. Which I'll pay a huge amount of tax on. They will really struggle to find somewhere locally as nice and I feel so guilty but I don't need the stress and so all that taxable rental income will now stop and the proceeds stashed in tax free wrappers. Result for the Treasury, well done Angela and Rachel!

I'll assume you have never rented or not recently.

Agencies are getting dozens of excellent potential tenants per property & the Tax Payer already guarantees rent payments to the LL for those that you assume are not excellent.

Corporate LLs will still have to have houses up to new standards, which is why they don't touch (Generally) older properties.

There are almost 5m privately rented properties in England, Lloyds Banking aims to have 50,000 properties, Blackstone just 17000, which cost them £4 billion.
The idea most rentals will be owned by Corporations is for the birds.

@jasflowers Do you think that many small private landlords will stay in the market then? Surely they won’t want to/be able to bring older properties up to the new standards either.

@jasflowers - there could be other structures that encourage indirect investment in professional landlording via individuals. So tax incentives to buy into a fund that acquires and lets properties fairly to tenants, guaranteed income back stopped by the Government for some or a short amount of time. Anything is possible with the right will. I guess they are starting off with this and will see how it goes.
If you can get a 4 per cent tax incentivised return on a rental to families, why would you not do that if less hassle than letting it out yourself?

That's an incompetent landlord, and not very lovely!

To my mind the only accidental landlord is someone who inherits a rental property, and they only have that status of "accidental" for the time it takes them to go through the process of giving notice to the tenant. Anyone who decides to rent out a property is a landlord - nothing accidental about it.

NC for this.
1.Well done to some fantastic contributors on here. Been lurking so thought to add my voice due to the genuine contributions made.
2.Where to start: moved out when I got married. Have recently worked out as I charge too lowly rent, I might as well stop bothering with tenants; but keep my home as a weekend pad and fork out 85k from my job plus for the privilege, as I still fork out the same currently as tenants only pay 40k with me making up the massive difference and paying 40% tax on their rent (rental profit which is not really). How is that for ‘more properties coming back on market for first time buyers?!
3.For the one btl flat which brings in an income, I made a profit and had good tenants. I charged them 60% below market rent and stayed there without an increase for years. As soon as RR thing started circulating, I could not risk being there before May, so last year, my lovely tenants had to choose to have rent increased to 90% of market rent in one go MAINLY because I couldn’t risk being found rock bottom by RR. I had previously tried to make them increase it gradually as I knew I was subsidising them too much when mortgage interest had increased! Luckily, last year when o gave a clear choice, tenants had the foresight to value their wonderful home and wonderful landlord ( all repairs done within 24 hours) so they upped the rent. I will now need to keep increasing it every year just not to be caught out.

Again, how is that for …..

I too am not complaining and excited to be throwing £85k up the wall for a weekend pad I do not need, thanks to taxation in this country and RR.

I think many with mortgages will leave the sector, i do not see how they can make a worthwhile return, esp if a 40% tax payer.

HMRC rules are that money spent on Solar etc is not yearly tax deductible, only offset if when house sold.

i think the Govt will u-turn on many of their proposed changes, the impacts on rents and availability are going to be huge.

Thats what Labour want in their ideal little socialist world. Not worth the ordinary little person trying to make money. I won't be voting for them again. Second and third homes are for MP's.

You know this was Tory policy? The bill was put in place by them, it would have happened anyway

I thought many councils are now charging at least double council tax on second homes?

Also a lot of people with one or two rentals sitting on massive capital gains were planning to go live there for a couple of years at some point to treat it as main residence at that point, to avoid capital gains tax.

This is a shift towards treating rental property as an income asset not a future discounted capital gains asset. So all tenants need to expect rents to go up in line with financing costs and inflation. However, equally, normal people benefitting from avoiding capital gains has also cost the taxpayer especially if housing has become too expensive for all and the taxpayer is having to subsidise via UC. Housing is an essential, should not be used to make money especially on a limited island, other than a reasonable yearly return.

Not if they are rented out, the tenant pays the council tax.

The term 'accidental landlord' is a nonsense. Yhey may have found themselves in a position where they unexpectedly had a property which could potentially be rented out, but they still made the deliberate decision to be a landlord.

No, it's not always that simple. I was moving 300 miles for work, had given up my job and packed up my house. The sale fell through on exchange. I had no choice but to go to my new job. Tried to sell the house again but there was no interest. After four months of paying the mortgage and council tax as well as mortgage and council tax on my new place I had no choice but to rent it out or be repossessed. So I guess I could have chosen repossession to avoid being an evil landlord.

I'm not evil by the way.

No surprise really, supply has been building for quite a while.

Effects already being felt.

https://www.msn.com/en-gb/news/insight/landlords-slash-rents-as-demand-collapses/gm-GM32661A8F

Landlords are struggling to get tenants now, why would Big Corp suddenly "have their pick of tenants"?

Because despite what you keep posting, I have to say this is not what Im seeing on the ground and I work with a transient and vulnerable client group who cannot afford full rent of course, whose benefits do not cover the full rent

Perhaps its sporadic around the country.

What I am posting though is headlines from MSM, it is not my opinion, although I believe that falling housing costs are the best thing that can happen to ordinary working people, obviously not if they are already deep in mortgage debt, but for wider society it is the best thing, saying that you are finding it hard to find housing for a specific "client group" without saying what their needs are isn"t a good argument against the obvious changes going on in the rental sector.

Well their needs are they are poor and reliant on benefits. So Im not seeing rental prices come down is what Im saying. Or that landlords are champing at the bit to get them, and their kids, and their pets. And their rent top up that they can barely scrape.