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Tenants increasingly worried about arrears or homelessness - claim

A new survey suggests large numbers of tenants are worried about the risk of falling behind with the rent or even becoming homeless.

The study, by a discount service, looks at 2,674 UK renters over the age of 18.

All respondents were first asked how real the prospect of homelessness was to them in their current financial situation, revealing that more than one in five UK adults (21 per cent) consider the idea of homelessness within the next six months a ‘real concern’. 

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When asked why they consider their current situation to be as perilous as they do, the top factors given were a lack of affordable housing, rent levels, energy bills, inflation, and wage stagnation.

The study then asked what lengths people have gone to in order to keep up with rent repayments on their current property, to better ascertain the level of crisis facing the average renter. 

The top responses were borrowing money, selling items, skipping meals, doing second jobs or even stealing from supermarkets.

When asked if the respondents blamed the government for the current financial situation, 93 per cent said ‘yes’.

Julian House, managing director at Myfavouritevouchercodes, which commissioned the research, says: “We are currently teetering on the precipice of national economic disaster – with the energy price cap set to soar in October, inflation set to increase, wage stagnation rampant throughout all business industries, and the state of the rental market creating a backdrop of despair.

“The government have a number of issues to address, that much is clear, but the cost-of-living crisis as an entity in itself, must be a priority for any incumbent leadership candidate. With homelessness such a real worry for this number of people, in a wealthy country like the UK, it is truly staggering that this is an issue that people are in fear of not escaping.”

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    Arrears = eviction which often leads to homelessness

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    I know my opinions are not going to be popular as a tenant amongst landlords but not listening to us and just kicking the problem down the road hoping to avoid taking responsibility yourselves as landlords proves my point that landlords are mostly greedy. Yes if people don’t pay they get evicted. But we’ve paid without fail and still face the prospects of being homeless. We all need to take responsibility so what are landlords doing about theirs?

    By the way, our landlords are selling because they need a house as their circumstances have changed. They've been really great landlords.

     
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    Landlords have worked to save for deposits to invest in properties to make their situation better, and provide financial stability for themselves and their families. You can call this greedy, but that would be a communist viewpoint. Every business works on this principle. A shop buys stock to sell at a profit - they won’t continue to give you goods once your money runs out - are we going to label every business as greedy? What other businesses would continue to provide their services after you stop paying or can’t afford their prices?

    Our responsibility is to provide good safe properties in good working order, and to keep them in good repair. The tenants responsibility is to look after the property they live in and pay their monthly rent in return for benefitting for having use of an asset worth well over £100k in most cases.

    I say all this having been a tenant for over a decade - at one point I did lose my job, had no savings and it took me three months to find another job - homelessness was literally weeks away when I got my job offer. This was my situation and was not the landlords responsibility to do anything - claiming the landlord had a responsibility to help me would have been avoiding my own responsibility to pull my finger out and sort my situation out - and quickly.

    Things are becoming unaffordable, not because of “greedy landlords” but because of a raft of government interventions that have led to landlords selling up, and there now being a lack of available rental properties. The cost of living crisis has been caused by the government spending huge quantities of public money which has led to huge inflation. Tenants have a right to be angry but their anger and fury should be aimed at the government that have created this situation.

     
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    As a tenant of 27 years I wasn’t asked for my opinions in this survey but here they are. My wife and I raised our family through renting over 27 years. We’ve never missed a payment, even through lockdowns. Current landlord is selling our current “home” of 7 years. We have no place to go. Been looking for 4.5 months just one roadblock after another. I fear being made homeless as our deadline is end of August 2022. It’s a very real and dreadful feeling. I run my business which will also be affected by our house move. The biggest immediate problem I see is landlords screwing tenants for higher and higher rents. It’s pure greed driving prices up. Not all landlords are greedy but most are demanding the highest possible rents they can get away with. Do you not realise that your greed will lead to some tenants not being able to afford to pay you or are you so indifferent you couldn’t care less because there’s always another tenant ready to take their place? Bout time each landlord started to consider the impact they are having crushing tenants who simply can’t afford to be screwed any further. Sure you want to make money and that’s ok but when is higher rents enough? Or is the Lust of more money never going to satisfy you? The market is only high because most landlords are demanding higher rents. You don’t have to accept agents suggestions of ever increasing profits you can get away with.

    As a tenant of all my adult life, I am disgusted by the greed I have seen since looking to move. It will not end well for anyone. You can help people by reducing your rents to a more sensible and affordable level, after all your mortgage is being paid for, you’ll come off wealthy in the long run. Better to be fair than greedy, it benefits everyone. In the past two houses we’ve rented landlords have pulled away from agents and managed their property themselves. They saved money and so did we. Agencies are also a massive part of the problem!!

    And to those landlords who do not demand the highest “market value” but are fair with your rents - thank you, we need more like you.

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    Paul your anger should be directed at the government who are (in your words) screwing landlords, the more government stick the knife into our backs the more tenants will pay, you say your landlord is selling your home, I expect like many landlords he's just had enough and who can blame him, there is a shortage of supply which will make it difficult for you to find a new home, good luck

     
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    I feel for you but Andrew is right. The government have caused the current supply crisis by inventing taxes specifically for landlords that no other industry pays, such as Section 24 and super enhanced rates of SDLT on purchasing additional rental properties.
    The risks for landlords are higher now than at anytime since the 1980s. Fines for newly invented offences, the risk of not being able to regain possession of our properties, ever increasing regulations and associated costs.

    I operate in the lower to mid market and when we advertise available properties we have dozens of enquiries within a few hours. Several of those applicants will be in exactly the same situation you're in.
    The government need to wake up and stop attacking landlords. Winding back the tax situation to somewhere around 2001 would be a good starting point. Listening properly to both sides regarding eviction also needs to happen. Getting to a point where landlords don't feel that selling up is the only option needs to be the goal.

     
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    Anyone who is worried about paying their rent needs to:
    1. Read the priority payments list on the Stepchange.org website
    2. Apply to their Local Authority for a Discretionary housing payment. If you don't ask you don't get.
    3. Cancel any unnecessary subscriptions or memberships
    4. Ask for a pay rise or overtime. Even better is to get a second job as there's a second NI free allowance.
    5. Make an appointment with Citizens Advice or the local Housing team to ensure all financial options have been applied for.
    6. Learn things. Learn how to cook, how to budget, how to understand a utility bill.
    7. Communicate. Lots of people are feeling the pressure so there's no need to feel embarrassed. Creditors can offer various assistance if they know about a problem before payments are missed. Friends may welcome cheaper socializing suggestions.

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    As I go around I see jobs advertised everywhere, part time in petrol stations, pubs, restaurants, farms need labour, there is away of getting through this cost of living crisis, work.

     
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    All great suggestions but why don’t landlords also consider lowering the rents they charge? Or is this one area we don’t talk about? I agree, we all have to trim our belts and prioritise what’s important. Paying our rent is top of the list in my opinion. But I am convinced 99% of new rental prices today has a massive profit margin for landlords and agencies. Why don’t more landlords consider managing their properties themselves and pass on some savings by cutting out the agencies? It has to be part of the conversation.

     
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    Paul you could ask tradesmen to lower their hourly rates, solicitors to lower their fees, councils to lower their licencing fees, ain't going to happen is it ?

     
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    Paul - has it occurred to you that landlords costs have gone up a lot over the last couple of years? Increased taxation, Rises in interest rates (some mortgages now double the cost they used to be), licensing schemes, green targets, tenant fee bans, the ever increasing regulations for health and safety. Add to that the things a landlord has to pay for in every day life have gone up for them just as it has for you. So why would landlords be the only business in the economy that doesn’t raise their prices with inflation or supply and demand?

    The government has brought about this situation and caused huge amounts of landlords to sell up which has caused the increased rents and shortages of properties that you see now. The blame lies with the government and it is the government that should be facing all this anger.

     
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    Andrew, there’s a difference between charging for your work vs pushing rents up beyond what most people can afford. I’m not suggesting for a second landlords rent below cost but it’s the excesses that I take issue with but after all, you do walk away from renting making excessive profits. Your mortgage gets paid by us and you make profit by the increased value your tenants have helped you gain. But that’s not enough as more profit is expected on increased rents.

    Why rent through an agency? That’s a saving right there? Direct renting to tenants has gone out of fashion as landlords choose the easy road of agencies doing the hard work and the cost gets passed onto the tenant.

    I am fully aware the government which has tried to help tenants has made things worse. Increasing regulation has to be paid for and in part that’s pushed prices up. The ones who lose are tenants - every time. But here we are in a housing crisis and changes need to be made. Lowering rents as much as is possible has to be considered.

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    Hi Paul,

    I don't know whether you are in London or not, but have you tried a housing association? A tenant of mine asked for a reference for Network Homes who charge the London Living Rent which is lower than market. They have some new build flats. I don't know anything about Network Homes though so can't reccommend or criticise them in any way.

    I charge below market rents (probably £1000 per month below market for new tenants) and do consider affordability, but there are other factors, too, that I am considering. One is return on the capital in the property. In London that can be less than 2% and you could get that in interest from a good savings account, and no hassle with management issues and regulations etc.

    Another factor is depreciation of the capital in the property. The impending change in the law will give tenants an indefinite right to stay. The landlord will have a right to regain possession in certain circumstances, but whether possession is actually granted has become discretionary in Scotland. Selling with a sitting tenant would reduce capital value significantly perhaps to 50% of the vacant value.

    This is why supply of property has fallen dramatically and rents have risen. Landlords may be less inclined to let to families/mature people because they may not want long-term tenants -many are biding their time and deciding whether to sell or not. They are waiting to see what the final legislation will look like.

     
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    Paul my tenants don't pay my mortgages because I don't have any, physical work, I do that as well, I've just spent the past 6 weeks working 6 days a week on one of my properties, replaced kitchen ceiling , repairs, improvements, painting and decorating, I'm not complaining I love what I do and have a great bunch of tenants, all too many out there have the false idea that we sit watching the money flow into our bank accounts, as I said earlier it's government causing the problems here

     
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    Hi Paul I have read your comments with interest.
    Unfortunately a lot of the issues have been caused by section 24. This means that the mortgage payment the Landlord makes is taxed. This is the first time in history that a business has been taxed on a loan payment. This is the principal reason that rents have increased. A lot of Landlords still work, therefore the rental income soon puts a Landlord into the 40% tax bracket, however realistically the Landlord is not as he has to pay the lender the mortgage amount. So, for a £500 mortgage the Landlord will have to pay £200 in tax making a total of £700. The rent may only be £795, when you take off maintenance, gas safety, epc etc you can see why rents have gone up.
    I can see now that I was too slow to put my rents up. I thought with interest rates being so low that it would be greedy of me to put up rents too soon. I was wrong. I am now having to sell in order to keep my balance sheet in the black. In one property, with the latest hike it will cost me £50 a month to let the tenant stay, how is that for madness and I can assure you that this is the truth of the matter.
    With house prices being so strong I will be able to use the equity to pay back some of the buy to let mortgages and I will stay loyal to tenants that have been with me the longest and looked after my property.
    Reality is that this government has let us all down with their short term thinking, I am sure if any other party was in it would be no different.
    In my younger days I rented and know the problems this entailed.
    I hope that you get your self sorted with a new property, but simply saying it is the fault of Landlords is too simplistic. Yes you are probably right that some Landlords are greedy but i don't think it is a high percentage. Some are led by over enthusiastic letting agents but in the main most of us are hard working decent individuals.
    Best of luck

     
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    Paul - the excesses are less than you think.

    The landlord has had to put in a huge amount of money before the first tenant moves in. Usually a 25% deposit or more, SDLT, any repairs or improvements, etc. If they hadn't put the money into a rental property it would be getting a return on the stock market or some other investment.

    If landlords don't use an agent they have to manage the properties themselves, which means they have less time to go and earn a PAYE income elsewhere. So effectively the money they're not paying an agent replaces the money they're not earning elsewhere. Landlords do actually need to eat. Rental profits aren't that high in the early days and may even be negative.

    Capital growth may or may not happen depending on when you buy and sell and where the property is located.

    Costs have risen hugely especially for tradespeople. Pre pandemic it was usual for tradespeople to charge between £125 and £150 a day. Now between £200 and £300 is standard. It will vary around the country but just about everywhere will have seen similar percentage increases.

    The talk of rent freezes is making the problem worse as landlords need to ensure any frozen rent is at least at a viable level so blame Generation Rent and Shelter for that one.

     
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    Paul- are you registered with the Devon Home Choice housing register?

     
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    Paul,
    you have hit the nail on the head. Landlord selling because his circumstances have changed or put it another way the Regulators have changed his position. De-Regulation Act, Section 24, Section 21, Deposits Scam, Now bringing in indefinite Tenancies that’s to exclude owners rights. Its a very clear cut case why Rents became unaffordable and you acknowledge Regulation’s are part of cost in increased Rents. Just add licensing Schemes, Fines & Penalties taking millions off Private LL’s, Section 24 income tax on Property loans that you already give Banks/ lenders to keep a roof over your heads. So its not the greedy Landlords making your Rent unaffordable its your friend the Government such propaganda and hypocrisy.
    Best wishes.

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    I’m not aware fully what landlords go through, and whichever side your on we all think we are right. I get frustrated for landlords when you hear horror stories where tenants abuse the place they rent. It is a two way street for sure. Governments fix one problem but cause 2 more. Over regulation is what makes Britain RipOff Britain I believe. So I’m sure the problem is complex but I still can’t accept landlord can’t lower rents somewhat . 7 years ago we left a 3 bed Victorian house with a garage. Rent was going up to £750 pm from £700. Now, if that house was up for rent the market value would be around £1100pm. I live in Plymouth, it’s gotten very expensive to live here. I’ve seen other 3 bed houses (usually 2x doubles and a useless box room) in other parts of the country go for much less. I understand if you buy high the rent will be higher but many landlords have been doing this for many years and so keep milking it because it’s a landlords market right now. But this is part of the problem. No one wants regulation but human nature is greedy and not many want to curb their own rates then regulation comes to curb a problem but creating many more.

    Everyone deserves secure affordable place to live without tenants being farmed for excessive profits. I don’t beleive landlords are financially struggling right now but new tenants are.

     
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    So Paul you live in Plymouth, my youngest daughter went to uni there, lots of student houses aren't there ? I did look at houses there 10 yrs ago but decided against it as I live in Norfolk, a 6 hour drive away, her and her boy friend have a 3 bed terrace there which they now rent to one of her old uni friends, I don't know what rent they charge, they now live in Lanner converting an old barn, I do know from them that there is a big problem for tenants down there

     
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    I’m not able to reply to each of you because there’s no “reply” button when someone reply’s to me.

    Reading your comments has been very interesting and shocking at same time. I’m shaking my head in disbelief how you are taxed on a mortgage! It looks like a right mess and looming disaster! Thanks for your posts, sorry if Ive come off angry, I feel very frustrated with what’s going on and see no end in sight. I’ve even thought about speaking to my MP but doubt it will make any good.

    Here in Plymouth it’s very difficult. One house I visited had over 100 enquiries I was told. I got in early with 10 min of the ad going live but because we have a Cockerpoo the agency had to check if the landlord accepted pets despite no mention of “no pets” in the ad. Because of the delay in waiting for landlord to respond I didn’t make the viewing list and the house was let! I was furious with the agent who denied doing anything wrong despite making promises they never kept! That’s just the tip of the iceberg of issues I’ve had with various agencies.

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    No need to apologise Paul you have every right to be frustrated, we can see it from both sides, it's been interesting reading your comments mate

     
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    Paul, I just wanted to pick up on the question you asked about why landlords use agents.

    I went with a letting agent because I was a first time landlord and wanted to make sure I did everything right, for both me and my tenant. I also have a full-time job so don't have the time to drop things at short notice if my tenant needs something (and, short of building an IKEA bookcase, I'd not be much help either!).

    Before I joined this forum I'd only heard bad things about greedy landlords, but regularly reading the comments I've seen a very different side. I haven't raised the rent for my tenant in any of the time she's been there, even though my costs have continously gone up - both associated with the rental and my own household bills etc. and this is mirrored by so many landlords who post here. There are limits to what we can absorb though. And of course there are bad landlords out there, just as there are bad tenants, but hopefully we have given you some faith back.

    Good luck with finding a place, I hope everything works out for you and your family.

     
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    I get the impression that most landlords do not raise rents very often with good tenants. I have a very good tenant and I haven't raised the rent since they moved in in 2016. Also another property, the tenant moved in in 2013 and I have only just had a slight increase in rent. So with inflation, the rents have come down. When I have good tenants who look after the properties and pay on time, I like to keep them by not increasing the rents.

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    John - quite a few of us work that way. The tenant pays market rent for the first year but then it stays at that figure for several years. Some of mine haven't had an increase for over 5 years. If they moved out tomorrow the rooms would be advertised at around £75 a month more and I would expect in excess of 50 enquiries per room. Some of my self contained properties are more than £200 a month below market rent because the tenants look after them and I haven't felt the need for an increase. I don't know if the tenants are aware of the discount they're effectively getting but it feels like a nice thing to do.

     
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    Ditto to both comments above with exception modest rent increase last 2 years, but still way below market rates.

     
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    Its not just the Tenants that are increasingly worried it the Landlords as well, the headline should have taken that into Account.
    The sad part about it all it was all caused deliberately by Government, Councils, Shelter, Generation Rent etc. I hope they are be pleased with themselves, for sure no Tenant or Landlord is happy with such an attack on going and sustained on Private Rented Sector.

  • Mandy Paterson

    I have written to my MP, had a reply and my comments being taken to parliament. I am Incensed that the rental reforms include things like dictating the need for landlords to replace kitchens, bathrooms, flooring etc before end of life and expecting tenants to take pet insurance covering landlords property from pet damage when I can’t find any policies that offer this. I ve been a landlord for 7 years and have my fellow landlords reaching a point where enough is enough! My property, my risk, my decision on what and when I spend money on, not the government! Why should I replace the kitchen that is damaged by the tenant burning the worktops… dps arguing that’s wear and tear, nope it’s damage! Sorry, vent over!

  • Mandy Paterson

    To add, landlords may be forced to sell if the rents don’t keep up with the market rates…. If the rents dont keep up, when the properties are due for re mortgaging the lenders reduce the mortgage amount and if the gearing isn’t maintained, that could put the landlord into a forced sale situation unless the landlord can make up the shortfall in mortgage advance. Speaking from experience, we are not talking hundreds of pounds, we are talking £20 to £50,000! My tenants long term security is shored up as the rents keep pace, whilst ensuring the houses are well maintained and lovely homes to live in.

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    Micheal, it's just another shakedown !

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    Mandy
    I too have had a similar problem. I have been a landlord for over 20 years and this is a new develpment to me!
    House prices are high in Cornwall and rents are not! House worth £250K+, rent £800, Max advance only £125k as rents don't support higher borrowing.
    I will have to write to my MP again. Perhaps if enough of us put our points of view some semblance of reality might percolate through. No one seems to be putting the landlords case forcibly enough.

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    To both Mandy and Paul, I too write to my MP, and get replies, though not always what I want to hear. Can you give me the names of your MP so that I can send them to my MP in the hope that they cross notes. The larger the noise the better. My MP is in Maidstone and is called Helen Grant.

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    I've written to my MP, George Freeman, that was of course a total waste of time

     
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    I have written to George Freeman as well and supplied a local audit I did showing that after S21 announcement about 30 to 36% of 2 bed rentals coming onto market were ex rentals - he just isn't interested

     
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