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BTL landlords should fear the prospect of a Corbyn-led government - claim

The prospect of a general election is looming large after Boris Johnson signalled his determination to trigger a snap vote on October 15 as the Brexit mess continues. 

But before people are potentially asked to cast their vote in what would be the third election in just over four years, ARLA Propertymark is warning that ‘landlords would be hit by a Labour government’. 

The trade body for letting agents refers to research made by the Financial Times which concluded that the UK’s 2.6m landlords would ‘face a moment of reckoning’ if Labour won the next general election. 


The concern comes after shadow chancellor John McDonnell said he wanted a “right to buy” scheme for private tenants as well as higher taxes on landlords.



ARLA Propertymark believes that the Labour leadership, which it describes as ‘the most left-wing in modern history’, is determined to shift power away from landlords and give it to tenants.

The shadow chancellor has told the FT that he wants to “tackle the burgeoning buy-to-let market” by introducing a new “right to buy” for millions of private tenants.

To add, he suggested the sum paid by tenants would not necessarily be the market price. 

He said: “You’d want to establish what is a reasonable price, you can establish that and then that becomes the right to buy.

“You [the government] set the criteria. I don’t think it’s complicated.”

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Poll: Are you worried about the prospect of a Labour government?


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    I fear a labour government but am hopeful that with Mr Corbyn as leader they are un electable, just as they were in the 90s with Mr Kinnock as leader.


    Hi Andrew.
    I do hope you are right, but nothing is certain unfortunately.

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    • 05 September 2019 09:22 AM

    The problem is that the mere fact that this ridiculous idea seems to have been accepted as something that ISN'T bonkers means that the risk of a Labour Govt makes BTL or any letting on an AST as unviable.
    Far better to sell off BTL properties and reduce to unencumbered residential properties where lodgers can be taken in.
    There is no restriction on how may Residential homes one may own.
    Lodgers may be taken in for all of them and the RFRA would work for all if them.
    But the AST game is now too risky.
    Lodgers are risk free but obviously need Residential mortgages for the properties.


    You can only use a lodger agreement on a property in which you reside. You must be living there the day the lodger moves in. My niece is currently going through a lving nightmare trying to evict a non paying tenant because she used a lodger agreement when she wasn't living there as well.

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    • 05 September 2019 09:53 AM

    But there is no legal requirement that forces a homeowner to reside permanently at a particular home they own.
    So of course a lodger would only be taken on while the homeowner is in occupation.
    Two days later the homeowner can go off to another home they own or anywhere they choose to go.
    Providing all bills etc for that home are in the name of the homeowner then it matters not how many lodgers the homeowner has in his various resi properties.
    Lodgers are easy to get rid of.
    If they refuse to vacate after the relevant agreed notice then you just wait for them to go out and then change the locks.
    Any attempt by the lodger to gain illegal entry is breaking and entering.
    Police may be called to stop this if the lodger attempts to gain illegal entry.
    Lodgers have NO tenure rights beyond that which was agreed in the lodger agreement.
    All lodgers should be given a Lodger Agreement which will detail the LL requirements especially the notice to vacate period.
    Usually this is 1 month by either party as usually 1 month's deposit is taken.
    The home would be a fully furnished property with the lodger only needing to provide their own food and laundry requirements.
    The homeowner provides all other normal domestic facilities.
    There is nothing to prevent a LL selling up his BTL properties and replacing them with residential properties possibly purchased with Residential mortgages.
    Providing the income is there then a LL can have as many Residential properties as he can afford.
    Obviously this means very few LL can afford more than one resi property.
    But the lodger strategy would be quite attractive to LL who have a lot of equity spread across multiple BTL properties.
    Some LL might even convert BTL mortgages to residential ones.
    Also solves the problem of Labour forcing LL to sell to tenants.
    Lodgers aren't tenants!!

    A Lodger agreement is the correct document whether the homeowner is there a lot or not.
    1 day per tax year is sufficient.
    Providing all aspects of the home are in the homeowners name then no lodger can claim a Lodger Agreement is a tenancy agreement.
    It is perfectly possibly to take on a Lodger and not see them for 355 days.
    On the 356th day the homeowners arrives and stays overnight and then goes off for another 355 days!!
    The only slight issue is regards buildings insurance.
    Most resi insurance policies require no more than 31 days absence at any one time.
    Though of course there must be insurers who will insure multiple homes where clearly the owner may be absent for longer than 31 days at a time.
    Probably would require a higher premium!!

  • icon

    Yet a 'no-deal' Brexit, more possible of course under the current PM, could harm the economy so much that rental values are significantly depressed.......... Did ARLA consider this when warning about Labour?

  • icon

    brexit will save the UK billions yearly--UK contributes 200 billions a year to eu project

  • icon

    The one and only time I can agree with Phillip Hammond. " I would sooner boil my head than have Jeremy Corbyn as prime minister."

  • icon

    A whole generation has grown up since the likes of Arthur Scargill, Red Robbo and the Winter of Discontent. Unaware of what that type of socialism did to our country. Corbyn is attractive to many. Given that there are many real injustices in the UK.

    Corbyn's Labour Party is Marxist and ant semitic in nature. "Our friends in Hamas etc. Evil people can get into power. On the 80th anniversary of the outbreak of WW2 we are so reminded.

    Anyone who has worked hard for what they have and aspires for their family should worry about Corbyn's Momentum Socialism. And like the Soviet elite there is a gap between what such people say and how they live. Having seen the luxury homes of the Soviets in the 80's.!

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    The day they announce a right to buy all landlords should give their tenants notice, how many people would that make homeless?

  • Suzanne Morgan

    I agree. If this policy were to be considered as likely to be implemented then I think too there will be mass eviction notices issued. I own my rental property outright and I would soon burn it to the ground than have it forceably taken from me.

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    • 05 September 2019 21:02 PM

    LL should advise their tenants not to vote Labour.
    If they do they will be homeless as the LL will be selling up!!
    Tenants should vote either Tory or BrExit Party if they wish to avoid homelessness.
    Tenants need to be assured as to what their LL would do in the event of a Labour Govt coming to power.
    Most tenants would prefer their LL didn't sell up!!


    While I agree with you Paul I don't thing Mr Corbyn will get in, and if he does I don't think he will get these policies through parliament.

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    • 05 September 2019 23:38 PM

    @andrew Townshend

    I hope for all our sakes that you are proven to be correct.
    Never in the past 50 years has such an attack on property rights occurred.
    Property rights are the fundamental underpinning of the UK economy.
    Property provides valuable security on which lenders of all sorts are able to advance credit.
    Without credit the UK will suffer a depression far worse than happened in the USA in the 20's.
    What the looney Labour Party proposes is nothing short of a mass expropriation of property equity and title.
    This usually only happens when there has been a revolution.
    Doesn't usually occur with an elected Govt!!!
    The mere fact that this threat has been made along with rent control proposals means that remaining an AST LL is a very risky prospect.
    Had this threat existed 12 years ago when I first became an AST landlord there is NO way I would have bothered.
    If I wouldn't have bothered then with the situation not changing I certainly don't intend to bother now.
    So as an incumbent LL I have little alternative that to end letting to tenants on AST.
    AST tenants are now a serious threat to a LL wealth.
    There are of course many other ways of being a LL that don't involve letting to tenants on AST's.
    There is simply no way I can cope with the future with the threat of rent controls and expropriation by tenants of my rental properties.
    So by default to avoid that risk I need to leave the AST market.
    This will require considerable adjustment to my business model.
    I am persuaded by the efficacy of the lodger strategy but there are many others that are worth exploring.
    FHL being a significant one.
    But AST lettings are now a busted flush as far as I am concerned for as long as there are the looney Labour proposals.
    The mere fact of these looney proposals mean it would be extremely foolish to invest in the AST lettings market.
    Somehow I have to extricate myself from the AST market and achieve the same income levels with other forms of property investment.
    As long as Labour has these proposals then it just ISN'T worth investing in the AST lettings market.
    For the past 19 years no Labour Party has ever suggested this and many other lunatic policies.
    There is NO guarantee that a Tory Govt will remain in power to prevent the most looney housing policies being instituted.
    It is bad enough with the ridiculous policies the Tories have imposed.
    Labour policies would be absolute destruction of my business.
    This I am simply not prepared to risk which means I have to leave the AST lettings market.
    So while you are hopefully correct for the short term of Labour not attaining power this DOESN'T put off that risk permanently.
    Such a risk is something I CAN'T risk.
    Investment timelines in the PRS are usually long.
    The threat of even more bonkers property policies than the Tories makes such AST investment strategies as pointless.

  • icon

    many labour mps are btl landlords--funded by our money

  • icon

    Its great the Labour party do not want to govern. This hairbrain idea,Along with their other plans for us that stupid gutless labour women on Question Time last clearly says to all intelligent people that labour know they would never win an election and dont want to.


    I am absolutely petrified of Corbyn and McDonell getting into power.
    If they get their way, they will crucify landowners, property owners and landlords.
    They would need a terrific amount of money to fund their projects and they will get it through punitive taxes.
    The feckless, work shy and the naive youngsters will all vote Labour.
    The way the BBC (especially Radio 5 live) are attacking Boris Johnson, it appears that it is open season on those that dared to vote Brexit.
    The remainers are quickly seizing the initiative, together with the traitorous Tories that voted agains the government.
    The majority may have won the vote, but they certainly haven't won the battle.

  • icon

    I have voted labour my whole life and have invested my retirement funds in 4 rental houses. They do give me a good return, but they are predominantly an investment for my children and have taken every penny I have!
    I will go to prison before I allow the fruits of 30+ years as a teacher to be taken away from my children!
    I will never vote labour again!! But now I haven't got a clue who to vote for??

    • 06 September 2019 20:29 PM

    Hold your nose and vote Tory or BrExit Party.
    I have already advised my tenants not to vote Labour and vote Tory or BP.
    Voting for Labour will cause them to be evicted as I shall sell up immediately.

  • icon

    As a new Welsh landlord I'm amused by the fear of a Labour government, we already have one! It's easy to criticise, but overall its not bad. We may eventually replace the AST with Occupation Contracts one day, whether that will change anything only time will tell.
    I know I won't be affected as I won't use an AST, there are many other ways to receive a rental income, albeit at the expense of increased borrowing rates.
    There are plenty of opportunity for landlords, governments only restrict the choice, its up to us to make the most of what's available. As Norman Tebbit famously said of his father "He got on his bike and looked for work, and he kept looking till he found it."

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    • 08 September 2019 11:13 AM

    Gary; mate RTB is very bad.
    It is just not something that can be adjusted to.
    Now you have developed some shrewd alternative strategies but very few existing AST LL could do as you are doing.
    But I reckon that many AST LL will look to follow your strategies.
    It is clear that with the Labour RTB possibility it would be economic madness to remain an AST LL.
    Even if Labour DOESN'T get in this time they might in 5 years time.
    As that is a potential reality it would be pointless investing further in AST lettings unless one sold up before the following GE in 5 years time.
    That simply doesn't make any sense in the property market.
    The only way a LL might be confident to invest further is if the looney left cabal in the Labour Party is booted out and a 'normal' Labour leader elected.
    I'd prefer Blair back as at least he had some commonsense to not destroy markets.
    But as long as the looney Labour Party has these bonkers proposals it makes little sense to invest in conventional letting property using an AST.


    There is a certain irony that it was Margaret Thatcher that introduced RTB to the SRS back in 1980 and this year Welsh Labour have successfully abolished this right. Scotland have done the same and Northern Ireland appear to be going the same way, they just need to sort out a government first.
    The devolved governments of Wales and Scotland appear to be functioning, but Westminster is a shambles. All of that time wasted to vote in a new PM and as soon as he makes a decision there is a call for a vote of no confidence. I really don't think any of the parties are capable of implementing any significant change currently.
    The alternative strategies have always been there, many relatively unchanged for decades. It's the lender's criteria for cheap borrowing that creates the obstacle, not the current government.
    Having said that, governments will interfere with the PRS, but there is very quickly an alternative strategy to combat it. How many landlords have incorporated, converted to FHLs or SAs since the introduction of S24?
    RTB in the PRS will possibly see an increase in leasehold rental properties with the landlord being in control of the freehold company - just keep issuing short leaseholds and wait for the property to revert back to the freeholder or charge the market value for a lease extension.

  • icon
    • 09 September 2019 08:49 AM

    I have further considered this RTB issue and have come to an assessment which I believe other LL have concluded as well.
    My understanding is that RTB could only be for single households on one AST.
    You could hardly have 4 unrelated sharers on one AST each with a RTB of a 4th of the property!!!
    Therefore I believe that such a bonkers Labour RTB policy will only apply to where there is one household on the AST.
    This must surely impact those LL with existing HMO which have been adjusted to fully comply with Mandatory HMO licensing.
    The reason!?
    Well lots of LL wishing to remove the risk of RTB will remove single households on one AST who would qualify for RTB in the event the ridiculous Labour RTB policy becomes law to be replaced by multi-occupancy tenants who presumably could not qualify for RTB if on one AST with say 4 other unrelated tenants in a 4 bed house.
    This must mean that with LL getting rid of single AST households that more of those properties will become available for unrelated sharers.
    If LL keep to no more than 4 unrelated sharers they also avoid the new Mandatory HMO Licensing though of course with more than 2 unrelated sharers they would not be able to avoid Additional Licensing where in force.
    But even taking these additional costs into account moving to an unrelated sharers AST would remove the possibility of RTB by those 4 unrelated sharers in a 4 bed house.
    There would potentially be a reduction in rent that could be charged for HMO Mandatory or otherwise as there will be far more multi-occupancy circumstances available.
    Of course this begs the question as to where all the evicted single family households are supposed to live!!!?
    Personally I couldn't care the less; not my problem.
    Clearly those LL with 4 bed properties are in an excellent position to get rid of single household tenants and replace with 4 unrelated occupiers avoiding Mandatory HMO Licensing.
    It is highly doubtful that with BTL lender conditions that in such sharing situations that LL could have individual room AST as most lenders specify only one AST is permitted.
    So I cannot see how apart from single household tenants that RTB could apply to any other tenants.
    So for safety I can see lots of LL getting rid of single household tenants and replacing with unrelated sharers.
    4 bed properties will increase in price as they hit the sweet spot of no HMO licensing apart from possible Additional Licensing maximising the potential of such 4 bed properties.
    It makes little investment sense in investing in a 5 bed property as they would mostly be subject to Mandatory HMO Licensing.
    Of course any form of multi-occupancy letting involves more work than a single household letting mostly because of the turnover of the individual tenant sharers.
    But that has to be worth it if the risk of RTB is removed.


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