Baroness Alicia Kennedy, director of the Generation Rent group, is warning that millions of tenants may not be able to pay their rent this coming winter following energy price hikes.
The group claims that a survey it has conducted shows 45 per cent of private renters who had lived in their home for longer than a year had been asked for a higher rent at some point.
Of those, 81 per cent are paying what their landlord asked for, with 14 per cent having negotiated a lower rent.
Generation Rent claims 20 per cent of those who faced a rent increase in their current tenancy were asked to pay more than £100 extra per month; some 13 per cent allegedly chose to move out.
People who faced a rent increase are more likely to be most concerned about paying the rent (32 per cent) compared with paying energy bills, than those who have not had a rent rise (20 per cent).
Well over 40 per cent of tenants - whether or not their rent had risen - described fuel price hikes as their biggest concern.
People getting state support with their rent have been more likely to have been asked to pay more rent in the past year, despite Local Housing Allowance being frozen since March 2020. Generation Rent says 46 per cent of private renters on benefits who responded to the survey were asked to pay more compared with 43 per cent of private renters not receiving benefits.
“With energy bills about to shoot up once again, renters cannot afford to be blindsided by an increase in their rent. The country faces the real prospect of millions of people being unable to find the money to cover rent, heat their homes comfortably and put food on the table. Renters are terrified, knowing they face a winter of destitution” says Baroness Kennedy.
“Ultimately that will lead to a further rise in evictions and homelessness. The government must intervene and temporarily stop landlords from raising the rent, as well as pausing evictions to keep renters in their homes.”
Her group wants the government to protect renters from in-tenancy rent increases by freezing rents on existing tenancies, suspend no-fault evictions, and making all other evictions discretionary, “to stop people who fall into arrears for reasons beyond their control from being made homeless.”
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Tenant stops paying rent? so pause evictions. Once again, just like covid. State appropriation of privsate property with the owners picking up the bill because the government cannot house the homeless and won't pay the cost themselves.
I am sure they will, even where their rent hasn't increased in the last 2 years, and landlords will be expected to put up with it, again.
Non paying tenants & another pause in evictions will only drive more LLs out. The tenant groups & this Govt are destroying the PRS. Where are people going to live?
No doubt by the time we get to inflation of 18%, as predicted, together with rising cost for energy, the tenants will have to make a choice between heating, feeding and rent paying. This government will, as before, put a stop on possession and eviction proceedings. Otherwise, the alternative will be families living under motorway bridges. On top of all that come the new legislations. Rent cap, open ended tenancies, more and more licensing , abolition of Section 21 .. For these reasons I, like many other landlords will leave the industry. Completed the sale on one yesterday, after 3 months from the day I accepted the offer. Just waiting for my accountant to give me the signal to ask another tenant to look for alternative place to live.
They will kill the golden goose if an evictions ban comes in, once and for all, there will be millions homeless, Covid was a one off, anything else is too much.
The PRS is dying. Time to get out, leave the government and councils to sort it all out. I’m sick of the mess they are making of the PRS. Tenants have always had rights but now the landlord is expected to house them, their cat, dog, budgie, snake and cockroaches for free. If the landlord objects they must take them to court at landlords expense. It may interest the government/councils to know that being a landlord is costly. Licences, accountants, insurance, repairs, replacements etc plus the worry that the tenant is being given more power than the landlord helping him to legally refuse rental payment. What a crap system the PRS is/has become. I’m out of here.
This woman is ridiculous. Treating the symptom rather than the cause as usual.
It’s all about that tenant. The rest of reality doesn’t come into it with her.
As said above the government and these champagne socialists continue to make a mess of everything all appropriating private property so they and the tenants can take control of an asset owned by us!
I’m out of here as well!
People who have lived in their home for more than a year is a bit unspecific. They may have lived there for 5 years, 10 years, 15 years?
They had been asked for a higher rent at some point. Again a bit unspecific. Was that increase last month or 3 years ago?
£100 a month increase could either be seen as chunky or a bit of a bargain depending on how much the rent was in the first place and when it was last increased. On a £600 a month one bed flat it would seem a lot, whereas on a £2500 a month house it would be quite reasonable.
The frozen LHA is causing huge problems. It is far lower than market rent in some areas. Even if we keep fairly close to it for existing tenants there's a complete lack of available housing for people to move into if they newly find themselves on UC.
If you flip it, more than half (55%) of renters who've been in their property for more than a year HAVEN'T been asked for asked for a rent increase at any point, even though their landlord has the right to request an increase every 12 months and despite a rise in the market and increased financial demands on landlords. Sounds like a lot of tenants don't know how lucky they've been. Why are landlords the bad guys again...?
Suck it up... All your wealth been stolen and given to Ukraine.
I take a years rent up front , where I am ( PCL ) the demand is ridiculous and supply minuscule and expensive .
If there wasn't so much CGT to pay i'd sell up tomorrow , too old for all this $£%£
George - If you are too old for this $£%£, then it may be exactly the right time to sell, what use will you have when the 'time comes' with all the CGT you have saved ! The graveyard must be full of lots of property rich individuals. If you don't spend it, then i can guarantee someone will.
I moved out of the UK so I only pay CGT in the change in value from April 2015. Prior to that there was no CGT for overseas residents until G Osborne got his sticky fingers on it.
Thankfully we have homeowner working guarantors on the vast majority of our tenancies now , but for sure the burden is going to fall on landlords to carry tenants or pay the cost to move them on
Baroness Kennedy
As reliable as the speaking clock but far less accurate
Baroness Alicia Kennedy is not a member of the government and nor is she a renter and nor is she housing any tenants. She has never been elected as an MP. She was a Labour councillor in Lewisham, but she resigned in 2016.
Labour did not win the last election; the Conservatives did.
Perhaps it is time for the abolition of the unelected members of the House of Lords?
Rents will need to increase , we do not operate in a vacuum. Is she going to stop all wage increases.
I can't see an eviction ban coming in, if it does and a tenant refuses to pay their rent then it's ''money claim online'' and CCJ s handed out wholesale, bailiffs reprocessing their cars and processions to be sold at auction, '' there's more than one way to skin a rabbit'' Alicia
Better solutions:
- reverse Section 24 tax changes
- implement tax benefits for landlords who commit to long-term investment in the PRS
- increase LHA to be more representative of market rents
- level the playing field when it comes to short-term holiday lets vs PRS
- make it easier for landlords to regain possession of their property when they need it, not harder - landlords don't evict good tenants for no reason.
Rent controls, rent freezes and a ban on evictions are mere sticking plasters to patch up a gaping wound and ones that rip the skin off at that.
Spot on
Re-introduce taper relief. That way the George's of this world will be a lot happier selling off their stock. It used to exist before Gordon Brown got his sticky fingers all over it
Can you be the next Housing Minister please?
I want to like this post twice!
Of course if the Baroness would also like to harass Government to freeze interest rates along with the price of licence fees, tradesmen charges, building materials, motor vehicle fuel, gas, electricity, council tax and so forth, then maybe she'd have a point.
Are these people really so short sighted? Can they not see they are the problem?
I think you have identified the problem, government cannot see that it has caused all the turmoil in the PRS, turmoil that was not there before George Osborne started this attack.
There is no problem so bad that government interference cannot make worse.
More Bla bla bla from yet another group that houses absolutely no one.
Ah Generation Rent - when literally every other business in the economy is raising its prices because of inflation they think rents should be the one exception because reasons.
Their simple way of looking at things reminds me of talking to a 5 year old who can’t understand why we can’t all just have the same.
There are plenty of grown up solutions to all this - but that would involve thinking, a basic understanding of economics and not treating landlords like the enemy. So I’ll not hold my breath.
One of them is company owned and unfortunately it was bought over 50 years ago , my accountant informed the CGT would be ridiculous now .So basically it's not worth selling , unless I don't mind paying quite literally millions in tax ...
In a few years time it'll probably be worth nothing too ...
Oh bother , wheres the gin and tonic ?
George, if you search for "tax when you sell property" and go to the gov.uk website, there is a calculate capital gains tax calculator at the bottom of the page (the green button) and you can see exactly how much capital gains tax you would have to pay. It is an anonymous service, so no harm in trying.
Ellie do you really believe that any on line activity, including this blog, is anonymous as far as the government is concerned?
The calculator doesn't ask for name or address etc. It is just based on figures that you enter. It gives you an idea of how much capital gains tax you would have to pay if you bought property a long time ago.
I have no doubt that you are right that the Government can monitor everything.
George sell shares in the company not the property, 0.5% tax.
If you’re going to have to pay millions in tax, you will have made millions more in the growth in value of your assets. This kind of moaning just reinforces the greedy landlord stereotype.
Scottish Landlord. You forget that any allowance for inflation in CGT calculations was removed by your compatriot Brown.
This is one of the things that makes me laugh when the moronic lefties yell about how the German system is so much better. It certainly is. Interest relief available, tenants do much of their own maintenance and CGT FREE AFTER 10 YEARS!!! I could get on board with that!
And even better in the German system. If renatal payment stops by just 1 day, there is a right for the LL to force the police to go and collect the rent, and if not paid on the spot, the police will even evict the tenant there and then.
It is a brilliant system and it works every time.
Never a rent default.
Let's have it here. Would save billions in the courts too.
George your main residence is not subject to CGT ! Most accounts font cover property.
Should have said, most accountants do not cover property! Apparently it's a legal thing.
Scrap the WHITE PAPER now, it’s the owners business whether he wants to keep or sell, private property.
We didn’t need their advice when we bought or get any financial support from them. So why do they think they have the right to dictate to us what we should or shouldn’t do.
Zoopla came down on the side of Tenants against Landlord’s in recent times instead of staying neutral, now back peddling with Crises a right pair of Charlie’s.
Assets owned before April 1982 31 March 1982
That’s a bit of good news , thx everyone !!
You lot really are the best ❤️
George this seems to be out of context, can you elaborate please?
Exactly what I was thinking.
George, please tell us what you mean and where this information came from?
How about if you give half the property to your spouse just before selling it? There is to GGT when gifting to a spouse. The spouse has no gains and you sell it for half the value, so if the value is less then double the purchase price, minus expenses and allowance there is no GGT to pay. Am I right?
I don't think you are John, but you do get 2 lots CGT allowances which I think is around £12k each £24k in total
George, what I am turning over in my mind. I think 1982 is a cut off point for going back, anything before that has a value put on it at this date and work forward so your 50 years is 10 years prior to come up with a value at that point.
The Indexation / taper relief was done away with in 2008 so can you claim the relief from the beginning up to 2008, that’s 36 years of taper to be taken off if possible. Those were the laws & rules at that time that you complied with so based your business plans & decisions on them. Surely they can’t expect the new rules that now exist to be applied to how you conducted your business and complied with the law as it was all those years ago.
Just thinking to myself will someone enlighten me.
Many thanks
Michael - I'm pretty sure the entire gain is treated under the current rules. Lots of us bought before 2008 when taper relief existed and based our whole business model on that method of taxation. The rules changed and we have had to adapt. CGT is horrendous on properties we have owned for a lengthy period (often over £100K tax bill for every property we sell).
I think you have it right about 1982, Michael. If you bought the property before 1982, they want to know what its market value was on 31st March 1982 to work out the gain.
Then I think the gain is as Jo says.
You also get credit for what you have spent on extensions etc on the property.
Alicia. What are you telling us, is it that the Policy’s that you have been pursuing is a serious factor in the cause of this driving out landlords, also causing remaining LL’s to increase rents to survive the additional burdens being unfairly placed on them, are the chickens coming home to roost ?.
Jo, I can’t see how they can retrospectively enforce tax rules that didn’t apply back then. Even its 4-6 years back for tax investigation now and for fraud 20 years max the reality of how it’s been, and there was no computers then either, if it’s the way of your thinking there’s a case to be challenged here.
Unfortunately the government can and does make tax legislation retrospective (section 24 for instance applies to all non corporate loans). I do not know what the situation is in the current conversation but I bet my boots it is disadvantageous to landlords.
TheMaluka, my friend Section 24 is not Retrospective how could it be, past Accounts were done and dusted before it came in, while I agree they do whatever they like and treat people differently which is blatantly obvious with the current rules.
Michael, Section 24 is retrospective in that it applies to existing mortages which were taken out under a different set of tax laws. If it had applied only to new borrowing then it would not have been retrospective.
The article is pretty vague, as has been commented on. But nowhere does it mention the recent mortgage interest rate increases which directly increase the costs to many landlords, and of course only basic rate tax relief is available on mortgage interest.
TheMakula, fair point I’ll give you that one but it can only be applied from the time it was introduced going forward and can’t charge you extra tax on what’s gone before.
The Capital gains tax has changed the rules after the event going backwards but debatable how far back very unfair and no option to remedy what had already happened.
Section 24 which is outrageous I know, you had the option to form a Company or sell up which many thousands of Landlords did,
did someone say now shortage of supply ?.
Let us agree on semi retrospective?
As to shortage of supply this is what Shelter et al inadvertantly requested and the government has given it to them with more to come.
TheMaluka, shortage of supply, I have a 2 bed Victorian terrace in Dereham (a market town central Norfolk) now gone online with the agents, last rented £625, now advertised at £775, will be interesting to gauge the response this week
Andrew I get about 100 espressions of interest for every flat. This is soon whittled down to half a dozen when the find I require them to fill in an application form and provide evidence of income.
My Rents are seriously under valued, the Flats I referred to yesterday the ground floor 2 double bed room with garden for example £1200. pm.
Similar 2 double bedroom Flat without garden advertised in
Same Rd, £1895. pm + 5 weeks Deposit (£2’186.53) on top where as I don’t have Deposit since they changed the purpose of the Deposit to protect the Deposits not the Property that’s how much I hate this Shelters Scheme forced in, in 2007 based on a pack of lies when they alleged up to 44% of Deposits were withheld by landlords, I never kept anyone’s money.
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