A council is attempting to woo landlords to lease their properties for up to 20 years in return for a guaranteed monthly rental income and a full management service.
Leasing Scheme Wales is funded by the Welsh Government and managed by Pembrokeshire county council and is being launched formally next week.
It says it wants to access “affordable and good quality homes” in the private rented sector for people who are on low income and at risk of homelessness.
It means tenants will be able to access longer term, settled accommodation for up to 20 years, with rents restricted to local housing allowance levels “to ensure affordability to tenants on low incomes and/or benefits.”
Homes to be taken on board by the scheme will need to meet a specific standard and Pembrokeshire council says financial assistance will be provided to enable landlords to bring homes up to scratch.
A spokeswoman for the council says: “We want our tenants to be happy, healthy and settled and we will support them to maintain their tenancy by directing them to sources of help if they need them.”
She adds that the scheme also gives peace of mind to landlords.
“Landlords will not have to worry about the condition of their properties after a tenancy as we will be responsible for the maintenance of the property and will return it to the landlord in the same condition as it was before the tenancy started. We will also be responsible for all the void work - the work done on properties in between tenancies.”
Landlords are offered leases of five to 20 years with guaranteed rental payments for the length of the lease at the relevant Local Housing Allowance rate.
Where necessary a grant of up to £5,000 is available to bring properties up to an agreed standard and/or to increase the EPC rating to level C. Additional grant funding of up to £25,000 is available for empty properties.
The council will repair any damage to the property made by tenants covered, subject to reasonable wear and tear, and the landlord’s liability for structural defects. This would form a term of the lease.
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I would just say, Be Careful.
I let Property to Bristol City Council years back now.
There promises came to nothing when I had issues with the tenants, they just didn’t want to know.
It cost a lot of money to get these tenants out and repair damages done.
Make sure your solicitor checks out the form of agreement that the Council want you to sign.
Beware.
Alternatively...just don't bother
None of us know the political landscape that far in advance. I wouldn't sign up anyone, least of all a council, for 5 years.
It nice to know they have plenty of tax payers money to splash about.
They still don’t recognise that they themselves are the problem that has caused the high rents with a mammoth of regulation & requirements
forcing up rents.
Are we being Nationalised. Suppose we had rented our property to them 20 years ago a fat lot of good it would be getting it back in that condition now, with all the changes and requirements that has happened in the meantime.
One of the main culprits head of HMO’s in Brent comes all the way from Wales to impose him ideas on us and ruthless I have attended the Brent so called consultations, where he was speaking.
"rents restricted to local housing allowance levels". Hollow laugh !!
Why don't they just buy them? Only a fool would get involved with this.
Exactly. If you can lease for 20 years, surly it's cheaper to buy.
The more tightly you keep control of your properties, the fewer problems you will have.
Many if not most landlords can’t now make tenancies work at straight LHA rates, which are woefully below even a reasonable margin let alone market rates.
The same LA will doubtless advise your tenant to ‘stay put’ and force court action when it’s time to reclaim your property for whatever reason. Then you’re unlikely to get your property back in any kind of fit state to re-let or sell.
It all comes down to trust and U.K. LA’s have utterly blown it with the PRS. If you value your sanity give LA schemes a very wide berth.
Good quality properties at LHA LOL, that's not how it works, you get what you pay for, LHA = rubbish properties
😂😂 These articles cheer me up…. As a landlord you would have to have suffered a recent bang to the head to sign up to this . They must be desperate 🤔 here’s an 💡 idea……. Build MILLIONS of social properties, then you won’t have to try and steal ours.
Totally agree, there is no barge pole long enough. You'd have to be mad. As for doing all the repairs, they don't even maintain their own properties.
I would not trust any councils at all. Their contracts or liabilities do not mean anything. They are in to make money for themselves. No transparency.
I would not trust any councils at all. Their contracts or liabilities do not mean anything. They are in to make money for themselves. No transparency.
Oh look they've changed the rules , sorry we're taking the property off you but you can keep paying the mortgage
Have a nice day
If we entered into these agreements they would have to be on a totally commercial basis and we would never use their agreement.
If however you can get a decent return on a full repair/ insurance basis I can’t see an issue as this would be an excellent covenant
It’s worth looking into but you have to have the right commercial solicitor
Knowing most landlords especially the ones I come across they are usually too frugal to pay for decent advice
You also have to find that ''right commercial solicitor'' most have long since retired and the replacements are about as much use as a chocolate tea pot
There maybe solicitors out there whom could dot the i's etc but getting it enforced would be a different story.
Anyone whom would consider doing this would be extremely naive.
In simple terms either the tenant or the Council will have all the control and the poor Landlord would end up with all the bills, missed payments, maintenance, Court costs and the list would go on.
I can imagine the yearly meeting, sorry we can't put rents up as we just do not have the budget, however tenant has complained about mould can you spend a few thousand pounds as tenant can't manage to open a window occasionally.
DON"T DO IT
Theoretically getting LHA rent with no voids and someone else paying all the maintenance costs is a reasonably attractive deal for some properties. Those harder to let or sell properties with issues. Things like noisy neighbours, no parking or ex Council flats. Obviously it's a rubbish deal for the more desirable end of the market but I don't imagine for a second Pembrokeshire council expect anyone to offer them anything that is easy to let for market rent.
The main issues are that mortgage lenders don't usually allow contracts of more than 3 years so it pretty much rules out mortgaged properties. Also 20 years is a long time. Realistically how many of us are likely to still be alive in 20 years time? That may be a good thing for the landlord but how does it affect probate?
For anyone who has pretty much given up on being a landlord, has some bottom end unencumbered properties, wants a passive income, doesn't want to pay CGT and is likely to die before the end of the contract it may be an attractive deal.
Theoretically yes, in practice doubtful
That's the hook, that they will do all the work. In reality either the Council will be knocking on your door, or the tenant or if you're really unlucky neighbours or the Police.
I get what you mean about bottom end houses, but think who will be going in them.
If I know Council mentality you'll have ex-offenders in there. Don't forget 80% re-offending rate in this country for ex-offenders. A very sobering number!
No don’t do it. If they were honest in their intentions they would get commercial finance and ‘buy’ a property for a 20 year commitment. They just being dishonest
Jahan is correct , I’d trust my council about as far as I could throw the town hall
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