A property company director is telling landlords to show compassion when they consider rent rises, because of the cost of living crisis.
Stuart Collar-Brown, director of the online My Auction service, says landlords must do what they can to help tenants cope with the cost of living crisis, although they need government support:
“Against this backdrop of interest rate rises and the cost of living crisis squeezing families, landlords can do their bit to support tenants and help ease some of the strain” he says.
“Of course rental rate increases are necessary from time to time. After all, many ‘accidental’ landlords will be in the same situation and find there is now very little profit from their rental properties.
“But any decisions around a rent increase should ideally be made with a degree of compassion for the situation a tenants find themselves in. We saw this level of support during the Covid pandemic where a large majority of landlords made the decision to freeze any rental increase, valuing a tenants loyalty over a 10 per cent price increase.”
Collar-Brown accepts that in recent years landlords have had to endure rising costs caused by stamp duty increases on second properties as well as the withdrawal of tax relief on mortgage interest.
“Couple this with the same cost of living challenges facing tenants and its inevitable that at some point the rent will need to go up. The question is, by how much?” asks Collar-Brown.
He says the government needs to step up and support landlords and tenants to avoid investors exiting the market and indirectly triggering rent rises because of a stock shortage.
But he then adds: “There is a real opportunity here for landlords to play their part (if they are able) in helping to ease the financial strain that is impacting the lives of so many but they need the support of the government with fast and immediate action. Those that play the long-game and take an approach that appreciates the sensitive situation tenants are in are likely to reap the rewards.”
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How about the government showing some compassion to its citizens ?
I need the government and rent activists to be compassionate to me, the landlord. We need them to rethink the section 24 tax regime, the only business sector where we are forced to pay tax on non existent income as we can’t offset our mortgage interest . Seriously, my tax bill was unpleasant. It will be higher this year too and I am stressed about paying it. It will cost me many thousands to restructure myself to help offset these extra costs
We are attacked at every corner with extra regulations, the councils are loving the selective license income and then there are enormous price increases for raw materials and my repairs bills are just crazy
I’m always compassionate to my tenants but I will have to put up my rents as I have no choice.
I must have my own self compassion as I am a business and shouldn’t be forced to sell or refinance my portfolio to cover my costs
Well said Karen, I am in exactly the same situation. We've also had to budget with the electrical inspections that have come in and now insulation in the future. The Government definitely need to re-think the section 24 as I am putting my rents up. That said i'm not doing it by 10% as is written above!!
Plus i'm also selling. I have also looked at fixing mortgage deals on some properties for 2/3 and 5 years. I was pleasantly surprised to see some very good deals out there.
Tough times need careful planning!
Do the supermarkets show compassion? Or the utility companies?
With the dwindling size of the PRS (about to shrink abruptly if EPC C comes in) only those who can afford high rents will be able to secure a home, compassionate LLs or not!
A great comment Karen D. I have shown endless compassion to a tenant during his 4 yr tenancy having increased his rent only once and taken his precarious circumstances into consideration many times. He has 'repaid' me with rent arrears of almost £10,000 and ongoing legal fees in trying to evict him!!!!! His rent is just £600 for a lovely 2 bed 2 bathroom flat.
Been there got the tee shirt Karen, you show compassion and get stabbed between the shoulder blades, it 's a hard world out there and getting harder by the day.
I think a lot of us have been in this situation Karen, as Andrew has said been there and got the T-Shirt. Lesson learnt!
I will show compassion by doing my best to ensure that I can continue to afford to be a landlord and provide homes to my tenants.
Higher mortgage rates and ever increasing costs and regulations imposed by Government, threats from the many anti decent tenant rabble rousers etc. all conspire to make this more difficult and rents must rise to protect the capability of my tenants to stay in what they regard as their homes for as long as both parties can afford to maintain the status quo.
I think the Government hasn’t shown us much compassion this last 16 years with so many anti-landlord laws, costs as well as moving our Business from Civil Matters to Criminal law that’s not very compassionate.
Then Introduced PCN’s can be anything from £5’000. up to £30’000. even without a Court Case or you can have your day in Court pay the expensive lawyer and get an unlimited fine, so they are not very sympathetic towards us, my goodness I don’t know what they think we are.
I think this comment is very pot, kettle, black…we have put off a number of rent increases on some of our properties over the past two years to help our tenants , whilst similar properties come onto the market around us with significant higher rents, however as per everyone’s previous comments, we are shown no sympathy by the utility companies, supermarkets etc and the local council are a complete waste of time particularly in relation to EPC assistance and of course holding firm on council tax increases, there comes a time when we have no choice..it’s the law of the jungle I’m afraid !
So bored of people trying to be virtue signalling against other peoples businesses and money. Notice all the people demanding the world from landlords, do nothing personally to improve things. They don’t personally buy property and operate it in the way they demand - because it’s easy (and free) to jump on the landlord bashing bandwagon and pretend they’re doing something good.
This article is from the director of an auction house - who should think about cleaning up his own industry first - I’m sure there’s plenty on here that could share stories of real cowboy behaviour from auction houses, and improvements the auction industry could make. Not an industry that is renowned for showing compassion when people struggle to complete their purchases on time or take half a step outside the lengthy terms and conditions auction houses have.
Auctioneers, they run the bidding bouncing bids off the wall, sell properties to their mates prior to auction taking large back handers, I would wind my neck in if I were you boy, you are talking to landlords here who buy from auctions we know first hand all about your shady dealings
I wish the petrol companies would show me some compassion when they're thinking about raising prices again.
Its not the petrol companies Gordon, Oil is cheaper per barrel now than it was in 2008 when petrol was £1.04 a litre. Govt Tax & VAT account for Over HALF the cost of fuel.
So their ' 5 pee ' isn't very generous !
Over a twelve year period with up to 5 houses rented out I think we have only put up rent on an existing tenant twice and withheld a deposit once. That said, if the digital tax system means I will incur additional costs, and maybe extra mortgage costs, these will be passed on. EPC C will only cost me in capital gains tax when we sell up, which we have now started to do.
Andrew, what I thought was amusing about Auctions was when he said its against you Sir on the telephone you were never quite sure.
Compassion, in the last 30 years I have tried to be fair and honest as a landlord but there is no compassion from authorities towards the property landlord. Personally I now take the view that I run my business on fair and balanced principles but I do run it for profit and I am not at all ashamed to see it that way. There are many tenants and suppliers that rely on our success. So our friend from the auction house can take a jump. We pay our tax and that’s the only public service we have to provide. Gone are the days when we were charities.
All my compassion has been used up! All we have received for it is a constant stream of criticism and more demands.
I am all compassioned out ! They must be desperate to trot this story out.
As reflected in all comments above, the vast majority of landlords have run out of compassion by now. Being hit by increasingly restrictive legislation & tax changes with more in the pipeline whilst being bashed from all angles by rent activists and similar (along with letting agents) means they've simply had enough.
Why should a landlord apologise or feel guilty for making a profit? It provides a service at the same time, they aren't charities and the private sector has helped hugely with housing people where social housing has failed epically to do so.
Perhaps some encouragement for landlords in the PRS is in order since there is no meaningful amount of social housing available and without the PRS landlords I fail to see where people are supposed to live as not everyone is able to buy or wants to buy.
I rarely increase rents on long-term tenancies but going to have to get tough thanks to this incompetent government.
We're all screwed with this section 21 nonsense. Our houses will crash in value if we're unable to remove sitting tenants. Surely they will have a clause in there allowing us to give a notice if we wish to sell? If not, surely the only sensible option is to sell up now especially with the EPC disaster looming in 2025. They are well and truly trying to kill off private landlords, yet we're expected to show compassion? Compassion won't pay for the upgrades to reach level C on the EPC, which this silly government will insist on.
Dani, very difficult times try and hang in there not an easy business to get out of if you have substantial equity in there you’ll get hit with capital gains tax which tears the heart out of it. The value of your disposable income is down 2.3% and inflation going mad 7/8% so the money you will have left after tax etc won’t be worth very much.
Section 21 should be reinstated no question or we’ll be back where we were before it came in, with sitting Tenants paying 4 shillings a week, property worthless, un-saleable and economy stagnant.
I don’t contribute to the idea to be able to get vacant possession if we want to sell.
Its Private Freehold Property and it’s none of their business whether we want to sell, keep, give away or raise to the ground, why should it be up to them what we want to do with our own Private Freehold Property. We didn’t need their advice when we bought or build the property or get any financial support or Public funds, so what now gives them the right to make our decisions.
I don't know what is worse Michael, the scrapping of section 21 or the EPC farce? How can this government lecture the world and preach stability? Even third world countries are not this unstable that a government would just take a monumental decision that basically doesn't allow you to sell your asset and leaves you stuck with someone that can stay there and make life a misery because of ''human rights''. I'm all for the protection of normal tenants that respect and look after your property, but these laws will protect the bad guys and someone should have the right to get their property back if they wish to sell it.
The EPC thing is equally as bad. All my properties are renovated to a nice standard, but it's simply not possible to always reach C when you're talking about properties over 100 years old. You put the low energy lighting, the boiler with thermostat, the double glazing, the loft insulation and they still rate you D! Then tell you have to put cavity wall insulation which may lead to damp problems. What kind of logic/brains are taking these appalling decisions!??
Irrespective of the commentator or the sentiment of his message, why is it that rented property and the payment of rent always gets singled out for this treatment? Why dont we hear messages about Thames water being told to be compassionate with its price rises to its water customers, or councils with residents, or Shell with drivers, or Barclays with its mortgagees, or EON, or BT, or British Gas or Royal Mail all of whom are making eye watering increases and making gazillions in profit and/or paying their execs monopoly money? Why is rent often singled out as discretionary in its value or commitment to be paid without remedy, almost as if the PRS has become a social housing service? And thats all before we get into the conversation about 7% inflation.
The problem is that non home owners have the impression that all property owners are rich and making loads of money. They think the rent they are paying is all profit as they do not understand what is involved in being a landlord.
Matthew & John make good points people wants to count the income as profit with no reference to all the huge costs that have been added this last 16 years and on going, you can’t compare renting to purchasing without counting all the costs and don’t forget S.24 either.
The other thing that bugging me is Insurance Policy’s. I believe we used to have good Policy’s for decades then all of a sudden they tell LL’s them Policy’s are no good but you must have specialist Insurance. I fail to see what’s good about them everything is extremely limited & restricted getting more exclusions added every year plus never ending terms & conditions. How can they loose with a cap max claim on most things while making more exclusions year on year and premiums are high. The latest one they used to say are they working Tenants or on Benefits, we’ll I used to say both because I don’t know when their situation changes, even that don’t do anymore they now have 4 categories, are they Working, are they on Benefits, are they Retired or are they Students. That shouldn’t be allowed and you are only allowed 2 categories, either the Property is Insured or it’s not and Tenants come and go, not allowed to Discriminate against them because of their different situations, so why can Insurance do this.
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