To think rent increases “because of inflation” are immoral when many landlords own outright?

[RentRealityCheck]

I keep seeing rent hikes justified with “inflation”, even where the landlord has no mortgage and their costs haven’t meaningfully increased. At that point it feels like pure profit-taking, passed directly onto tenants who already have no leverage and with huge knock-on effects for stability, mental health, family life and society more broadly.

AIBU to think this isn’t just market forces but greed and that pretending otherwise ignores the damage being done?

So it's not a good thing to set out to provide well maintained safe housing for those who need it?

Of course inflation is a justification. If rents didn’t rise by inflation, then the value of the rent collected by the landlord would reduce over time. That’s how money works. A rental value of £1000 in 2016 is equivalent to an inflated £1400 today. Not raising rents by inflation effectively cuts someone’s rent year on year. Why should landlords do that?

The question of whether people can afford it or not is a different matter which opens a whole load of complex questions about wealth inequality and why our assets are being bought up by the wealthiest people in the world, paid for by the poorest. It requires delving in to micro and macro economics to work out how we got here and how to change it. It means unpicking the entire financial sector and risks destabilising the worlds economy even further.

Deciding landlords are to be targeted for adding inflation when every other business in the world works the same way is not the answer.

All of this.

I'm a landlord. I have a flat I cannot sell because prices dipped right after I bought it. My mortgage has gone up by 30% and the service charge has doubled from £250 per month to £550 per month in the last 3 years. I know a couple of people who are also landlords and they are in the same situation.

Maybe in cheaper areas of the country landlords own outright but in London no one does (except big companies).

It seems everyone just wants Lloyds Bank to buy everything so we can all have a corporate landlord. Good luck with that.

It’s capitalism. That’s how it works.

You think that’s why individuals choose to invest in property?

If so why does the situation OP describe exist?

Hate to break it to you. We live in a capitalist country. Landlords let for profit. They don’t owe tenants free money.

Sorry, what has morality got to do with capitalism ? Since when has that been a thing ?

There has been extraordinary - way above inflation- rises in the costs of any repair work since Covid and Brexit; and there is also very expensive insurance to pay. In some cases there is also money to pay for management. There is tax to pay on the rent too with no rise in the threshold.

I am not sure why you say properties are owned outright as in very many cases landlords have mortgaged properties.

But agreed, rents are expensive.

I agree with your sentiment OP. I also get other people's POV.

I think one issue is: some people don't agree with rentierism and others think rentierism is fine.

In an ideal world, I don't think homes should be part of a profit generating market. Housing is a fundamental need and the cost of renting is extortionate, most families in the UK probably couldn't afford market rents in their town without financial support (e.g. housing benefit etc.). Housing isn't "productive" and investing in housing saps investment money from productive parts of the economy. But I know the real world doesn't work like that. We are in the system we are in.

For example, think about the median salary in the UK (around £35000): a small 3-bed semi where I live costs around £1800 per month to rent. How many people actually pay that for a mortgage on their own home? Rents are increasingly unaffordable. I live in a small market town not in London or South East. If housing cost less benefits bills would be lower, minimum wage could be lower helping small businesses etc. - it feels like a win-win for all.

When I stopped renting a few years ago the landlord wanted to increase the rent from £1000 per month to £1300 per month, with 60 days notice. So that is £3600 less discretionary spending per year for the local economy.

With this context, I completely get your point of view. Obviously for other folk a market is a market - landlords have costs to cover and want to maximise profit.

I have:

Landlord registration with the city council
Building factor fees
Letting agent fees
At least one new ‘white goods’ every year or two
Repair men/electricians/plumbers/etc. 2/3 times a year
Buildings insurance
Property inspections
Legionella (!) testing, etc.
Repaint every 3 years or so.

All of these go up every single year. The price of trades alone has gone up by at least 40% over the last 5 years. The simple fact is that if you are a responsible landlord who wishes to comply with the law, offer your tenants a comfortable and secure home, and maintain the quality and value of the property then that costs money. Yes, I make a profit, but it’s not loads, and I’m taxed on the income (and yes, I comply fully with my tax responsibilities)

So yes, it should go up regardless of whether there’s a mortgage on the property, particularly if you want the quality of the home to remain high.

As a previous landlord I'd say our annual costs rise with inflation and we need to put enough money aside for the repairs that arise in the future. Add in a load of regulatory changes (EPC being a big one) and taxation changes that have rolled out (we are taxed on gross rent and at marginal rate rather than on our net after expenses) has made it nearly impossible to keep rent increases below the level of inflation. I'd say, small landlords aren't really making profit and their gains are subject to capital gains tax - anyone I know who holds on intends to one day live in that property. It used to be a good nest egg and often a downsize so a place to retire. The government has really made it so unfavorable for private citizens to do it so I suspect it will be all run by corporation's soon. I think the public sees companies running blocks of flats and making profit differently than their neighbour. The small landlords I know are good, responsive and try to keep rent down. Corporate landlords have a bottom line and no one expects them to do anything besides turn a profit.

So, yes, I think rises in line with inflation are reasonable and no different than any other service being provided... Housing is essential but not different than food or water which we expect the costs of to rise when inflation rises.

What a load of entitled twaddle. People make investments to make money. Bring a provste landlord is not some social enterprise. A Landlord has living costs, costs of running the rental business (repairs, accountancy, agents fees) they might have a mortgage on their own home the rental income is covering. Utterly bizarre

I think landlords have raised prices.... because they can. It's supply and demand and not so much to do with cost of living.

For example, neighbour rented a flat, 1 and a half bedrooms at £1,100 per month, no bills included at all. The landlord then increased the price to £1,500. She had to leave as could no longer afford to live there. The landlord now rents it out via the council as emergency social housing at a higher than market rental income.

£400 increase is far higher than it should be imo and I think it was a way to push her out and the plan all along was to rent to the council. The tenants moved in a day after the neighbour moved out and the property never advertised.

With increasing population there's more demand for rented properties. Supply and demand dictates that landlords can and do put their rents up.

If our population increases year on year (and information about how much food is being bought, pressure on our sewage and reservoirs suggests the UK population is heading towards 100 million), well, rents gonna rise.

I don’t rent but see the price of renting is sky high! There will be loads people saying poor landlords they have outgoings too but i do think raising rents just because you can is doing damage. The amount of housing benefit/UC being paid out to landlords is huge! When they start considering cutting state pensions but let landlords make profit using housing benefit i think we heading for trouble

The price of rents is high because the price of property is high and because there's not enough social housing. Once government instructs councils to stop selling off council houses and start building new ones, the price of rents (and therefore housing benefit) will come down.

I always find it amazing that in mumsnet world it's immoral to let out a property to people to live in but second homes and buying a house to air bnb are AOK.

Somewhat unusual but I rented a farmhouse on the private estate of Lord X for 8 years. In that time I paid in excess of £120,000. He owned many other properties in the village and surrounding area - there was a local campaign when he sold a field to a property developer for £2m with no thought to road access (single track) or impact on local school or GP.

The house was run down with threadbare carpets and single glazed windows with rotting wooden frames (plus rat infested as the ground staff were breeding birds for the next shoot in an adjacent barn with plenty of feed left out).

Despite these facts and the landlord not paying to maintain the property the agents would turn up every year with print outs of similar sized well maintained properties trying to justify an increase in rent according to ‘market value’ of several hundred pounds per month. Obviously there was no mortgage and the bare minimum was spent on repairs - not maintenance. It was made clear that the costs of maintenance would not be funded through past profit but would result in a huge hike of around £500 per month (just for repairing and painting window frames).

Private landlords seek to maximise profit and minimise outlay regardless of their own need. This impacts ‘tax payers’ as the low to average paid workers can’t afford ‘market rents’ to return profit to landlords without claiming top up benefits.

Essentially the state/tax payers are subsiding the profits of landlords who charge high rents and employers that pay low wages.

They are not charities 🤷‍♀️

Do you have a problem with people working in Tesco, because they're making a living out of people needing food?

The government has done so much to get rid of small landlords that the rental market is now awful. There used to be a choice over where to rent but now it's really hard to find somewhere. Those who can't or don't want to buy are the ones who are suffering from a lack of landlords. Fewer landlords doesn't equate to fewer tenants, it just makes it harder to find somewhere to live.

There's no shortage of houses to buy. A tenant could theoretically become a home owner but there are many reasons why people rent, for example they are in an area for only a year or 2, maybe they claim benefits, maybe they needed to move in a hurry. Without landlords, where would you like them to live?

If things continue, there will be almost no small landlords left. When the only landlords remaining are banks and politicians, how will that benefit tenant?

I have a flat that is let.
second floor sea front
I had the windows painted last year
£ 10k half of which was scaffolding
I have no mortgage and the windows and regular costs added up to more than I made in rental income

OP take your views and go away

What does having a mortgage do with it?

Rent is income.
Income pays for outgoings.
Cost of living is an outgoing.

if the cost of living goes up, outgoings go up, so income needs to go up.

But if they are only raising it by the amount of inflation, they are keeping the rent at the same value. What is wrong with that, I think you are being ridiculous.

Windows don't need painting every year and you should set a decent chunk of the income aside to cover expenses. That's just basic business common sense

I became responsible for my late mum's rental property, when she died. I was amazed to find that, despite owning it outright, she hadn't made a profit in three years. The rent was £500 a month and after insurances, letting agent fees and repairs and maintenance, she'd either broken even or lost money. £6000 pa doesn't go far.

I don't know why anyone would be a buy to let landlord. I also don't know why people think they're rolling in money.