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Graham Awards

TODAY'S OTHER NEWS

London’s Labour Mayor, Sadiq Khan, and the Baroness leading the Generation Rent campaign have called for powers to control rents.

Khan claims rents in the capital could increase by almost 20 per cent over the next five years, unless he is given powers to control the market.

The forecast is based on his team’s analysis of a Savills prediction that London rents could rise 19 per cent by 2025; applying this forecast to the latest Rightmove figures for new tenancies, average asking rents could rise to £2,289 a month Khan claims.

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He adds that even now Londoners are paying on average 35 per cent of their income on rent.

And he claims polling undertaken last year suggests one in four of London’s private renters were struggling to pay their rent during the pandemic or expecting to do so shortly. 

He’s been backed by Baroness Alicia Kennedy, the director of Generation Rent, who says: “Unaffordable housing is stifling London. Over the past decade it has become impossible for many people to live close to their workplace or support networks they rely on, while others cannot afford to start a family.

“Without urgent action on rent levels, more Londoners will face these dilemmas in the 2020s and quality of life will deteriorate.”

Meanwhile Khan himself claims: “Nearly a third of Londoners are private renters, but all too often their calls for support and fairness on rents are overlooked by both landlords and the government.

“I was re-elected on a pledge to redress this balance and to stand up for London’s renters by transforming tenancy laws and wrestling back control of runaway rents. Todays’ analysis paints a stark picture of the next five years if landlords are allowed to increase prices unchecked.

“This is a matter of fairness, but also crucial to the future of our city. If we want the next generation of nurses, police officers, transport workers and key workers to train and work in the capital, we have no option but to keep a check on spiraling rents.”

In May’s election Khan argued for a London Private Rent Commission which would be responsible for designing and implementing rent controls. He wants powers to freeze private rents in the capital to protect renters from the ongoing financial impact of the pandemic.

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  • George Dawes

    Rent control don't work , not unlike the utterly useless khan

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    Mr Khan talks about balance, how about a control on landlord licencing fees, rents increase because of costs imposed on landlords the same as any other business, it's called inflation, I'm noticing the price of diesel at the pumps is rocketing, will their be a price cap there or will it be controlled by market forces just like everything else .

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    If you want to control the rent, buy a house!

    I remember paying 30% of my income on a mortgage, that's life. stop whinging

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    Worth remembering that Khan can only bring these in if the Tory govt gives him permission to. For once, be grateful for Boris! The fact he trots out this stuff as though it is an option for him to do is pretty outrageous

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    never trust boris or esp. his wife.

     
    PossessionFriendUK PossessionFriend

    Boris isn't running the country, Mrs Nut Nuts is.

     
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    I have had to put my rental prices up purely because I have now had to pay for an electrical report and energy certificate. The consequence of imposing ever more hoops for LL to jump through is the cost will rise for the tenant. Previous to this I had not increased cost for 3 1/2 years. I have told all of the my tenants in my 6 btl houses this price increase is down to government increasing legislation and costs for me.

    Mathew Argument

    Yeah this is a ridiculous point!! I know it adds more but come on, who are you trying to kid?

     
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    MA

    If you read this regularly you would know that many of us don't increase rents for good tenants but then need to reset to current market rents when new tenants move in.

    Good tenants are worth retaining and we try to do so by freezing rents for them as long as possible.

    New tenants are an unknown quantity and increasing rents as much as possible is how we get rid of bad tenants whilst leaving good tenants on the original rents.

    Contrary to what is claimed by Generation Rant and the misnamed Labour politicians (who only help non workers) there is no such thing as a No Fault eviction.

     
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    How much are an electrical report and separately, an energy certificate?
    The electrical report only has to be repeated every five years and surely an energy report is a one off.
    How can you justify a rent hike, which surely amounts to more over 5 years than a one off 2-3 hour report? (dependent on size of property)

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    They are not free, do need to be paid for.

    Consumers always pay in any free market.

     
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    Don’t forget there is increased admin also

     
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    May I ask your line of business / work Grace

     
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    Andrew Townshend. I'm a retired barrister.

     
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    So probably well able to cope with any financial losses caused by rogue tenants?

     
  • PossessionFriendUK PossessionFriend

    @Wendy -- not forgetting that the then RLA And NLA Both sold Landlords down the River, by agreeing with Govt that EICR should Only apply to PRS. !
    ( No change since they've merged either. )

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    I am fine with controls on rents so long as it is fair proportionate and LLs are NOT overburdened with a load of arbitrary Legislation and licensing laws. Here are three areas Mr. Khan and his predecessor Boris can apply pressure to those who matter:
    1. Control the Banks racketeering on interest rate, Base rate 0,25% lending rate should not exceed +2 to 2.5%,
    2. Apply similar standards for social LLs houses? Oh no that is not going to happen is it, because we cannot spend our friends' money!!
    3. Stop non-UK residents buying investment residential property especially in London as well as well as other pricey areas. Another never to happen situation!
    The real problem is that none, or far too many, in authority DO NOT seem to have joined up thinking, i.e. their action and its resulting consequences?!!

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    When do the rights of privately owned property stop and state control begin? It’s the government that has caused this with poor boarder controls and poor forward planning for housing needs. I wonder how they will get on when we all pack in due the trade no longer being viable.

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    This is ridiculous, and as usual try and squeeze landlords who find it harder to get out of the sector.

    But I know so so many landlords who have left the rental sector, I wonder who the government will blame then - once stocks of housing dips. Rents will increase even further, because of their ridiculous policies.

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    Wendy, I have same problem but not new. I am here like a lemon waiting for sparks for 10.00am appointment just hoping & praying he will turn up. I have 4 need re-doing that have all been done before several times which incl’ the 5 year DICIR one’s as well as the annual ones, smoke / heat system certs, emergency light Certs, Pat tests the lot so how much will it cost & how many pages to write, so I will be £1’000 poorer tonight and lost my days work & had plenty other things to deal with, I hope there isn’t any remedial work to do !,

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    Michael. £1k on a yearly basis is nothing compared to your rental income over 12 months...plus, of course, your day job.
    Your properties have very probably increased over the past 3 years so you are in fact, quids in.

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    Are we not allowed to make a profit on the investment we have made? We are not charities, we are businesses and we have invested our hard earned money into BTLs and provide homes for many happy customers. One bad tenant can leave us thousands out of pocket and the costs of running a decent BTL have gone up hugely in recent years. I also pass on all extra costs to my tenants. If you want not-for-profit housing get yourself a Council House!

     
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    Grace, you really don't have a clue do you? Do you have any experience of running buy to lets paid for by your own hard earned cash?

     
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    Shane S. I only have one property that I let and it was my family home which was part of my divorce settlement. It's been let to the same family for just over 10 years. I moved to a 2 bed unfurnished flat where I have been ever since. Only seen the landlady twice in that time (when she inspected new guttering) We have a great relationship as I'm a perfect tenant. I pay for anything that needs doing after texting to chat about it and email her the bill which she reimburses via BACS.
    My income from the let far exceeds the rental on 'my' flat. A win/win.

     
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    Grace

    Most tenants are like you but one bad tenant can negate the profit from many decent tenants and potentially bankrupt a vulnerable landlord just making ends meet.

    There are many such landlords currently.

     
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    * meant to say that your properties have increased in value, not number.

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    Rent control - Please hurry up Mayor Khan and bring it on (finish the job of ruining London) Guaranteed annual rent increases, brown envelope bribes to be offered property over the uninitiated. Increased sell off to Owner occupiers, limited rental stock. The rents will go up whilst property value will slow down.
    GR will still wonder why they have to pay to stay. My solution for them is to buy a tent/caravan live in a field

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    Grace, not like that it’s not a £1k every year as the DEICIR IS every 5years. What’s next this year is HMO Licenses renewals money for Authorities for old rope fee £1200 / £1310 app’ fee alone. My day job as you put it produces no financial reward as its all spent fixing things after Tenants.
    There has been no capital growth on my properties in recent years this is L’don.
    How about my 40/45% tax and taxed on my personal allowance and taxed at high rate on my miserable pension just to contribute £85’000 income tax pa to the Treasury for working 59 years, never drew a penny from the State to be abused by people not fit to be in control and treated as Criminals, dream on I live in the real World.

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    Thanks for explaining that Michael. I am both a tenant and landlord. I let my 6 bed family home as too large now children are adults and I rent a 2 bed unfurnished flat in a different area of Surrey (11 years in Oct) so I see both sides of the coin. I don't have an agent, I see to the letting myself and it's been rented to the same family for as long as I have been in my present flat.

     
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    You are wasting your time folks these hatemongers are not the least bit interested in facts they are motivated entirely by bigotry prejudice and hatred ,these gangs masquerading as tenants rights activists have no scruples about stripping others of their rights they don't even show any originality in their hate speech they just recycle NAZI propaganda (perhaps they would describe the reuse of
    NAZI propaganda as eco friendly ). they even attack landlords and children in their own homes .The fact that they consider child abuse to be an acceptable means of furthering their agenda tells us everything we ever needed to know about them

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    GR and Sad Dick Khan still being economic with the truth. They give the impression of the LL's simply increasing the rents in order to line our own pockets. The reason for the increases is down to the following:
    - Increase in costs associated with being a LL and maintaining compliance
    - Introduction of removing the ability to offset mortgage repayments against rental income even though it is a legitimate expense
    - Lack of housing and rental stock, market forces.

    The government and these so-called pressure groups all play the sympathy card but really, they are wolves in sheep's clothing. These policies will simply mean that more and more LL's will sell up and leave the sector, the prices will not change and affordability for buyers will not change. So the net result is less stock available, and demand & supply kicks in. This means rents will simply increase.

    The solution is relatively simple:
    1. Build more housing. At least make an effort to meet the 300,00 annual target which has NEVER been achieved and allow the councils to actually build some of their own property again with the funds they secured from their selloffs.
    2. Stop with the prohibitive legislation for the LL's, remove the tax grabs and give something back to the LL's.
    3. Give the debt burden C19 Tenants loans or grants to clear their rent arrears and help the LL's reduce their losses.
    4. Actually WORK WITH LL's rather than against them. Any decent LL will want to keep good quality stock for their tenants and maintain them. Remember, the property is an investment and needs to be maintained to draw a good value.
    5. Bring back the direct to LL payments for those on benefits to encourage LL's to go rent to this sector.

    There has been a deliberate precision attack on the PRS for some time now and all that has happened is the pitting of LL's against their tenants and the general public. The public have been fed a red herring making the LL's the bad guys. Yes, there are some rogues out there but I promise you there are more rogue tenants compared to rogue LL's. The numbers speak for themselves with GR claiming that 1,000's of people are going to be made homeless. If that is the case, why? If the vast majority have been on furlough, still being paid 80% of their normal wages, why are they unable to pay at least 80% of their rent? Far too many have simply taken advantage.

    It is long overdue for the truth to be told and for the media to stop fanning these flames and pitting the general public against those who are actually propping up the market for homes for people. If the PRS was not around the levels of homelessness would be a much bigger problem!

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    Many on furlough have taken jobs which are under the radar. I know of many who advertise on Nextdoor for gardening, cleaning, driving and handyman (person) jobs earning upwards of £10ph, more usually £15-18ph for cleaners and £16-25ph for gardeners. None of these individuals are necessarily skilled in the service they offer.
    Others making mega bucks are dog walkers and childminders, as lots of people still WFH and need kids looking after and sundry other help around the house.
    Certainly not all furloughed workers but definitely a larger proportion are working for cash than those who are not involved in these tactics.
    I call them tactics as some may not be paying their full rent yet are often better off working for cash whilst on 80% furlough and even cheekily getting referred to food banks.

     
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  • Theodor Cable

    Does anyone actually think that this rent control system will work?
    Scares the hell out of me if it does!!!!!!!
    And if it does would it not have to cover the whole country?

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    They have never worked in the past and won't work in the future due to market forces prevailing with a shortage of good rental properties.

     
  • Bill Wood

    My properties are in Essex, not London, but if rent controls come in for Essex, I will be delighted. It would mean I can morally increase rents, which are currently only 75% or so of market value.

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    Careful Bill what you wish for mine are only 75% of the market or less and in L’don, there is the issue of what your Tenants can afford, its only Councils that think LL’s & Tenants are full of money, they don’t know the difference never have to earn any.

  • Bill Wood

    Thanks for warning Michael. The Government's definition of 'Affordable Rent' is 80% of comparable rents in the locality, so increasing my rents by 5% to put them in line with 'Affordable' should be ok!
    I wouldn't do this however, there is no need.

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    Why jump on Rent controls with our putting your own house in order first. The DWP tells us about Benefit & State Pension over payments / Fraud amounting to £8.4 Billion in last financial year is anyone in charge of this Department. 2 of the biggest ones working / Claiming, other claiming to be living alone. Sadiq Khan & Generation Rent looking for rent controls can they not look a bit closer to home. Sadiq Khan takes a huge chunk of C/tax putting pressure on Rents the Mayor also have a levy on people doing work £60.00 per m2 for nothing it’s a penalty plain & simple, community infrastructure levy (CIL).
    Are those your supporters who have plenty of time to protest and go marching.

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