Fifth of landlords not raising rent despite interest rates and inflation

Morning Ellie, I was exactly the same train of thought, good tenants so leave the rent alone. But since the RRB announcement and direction of travel I have changed my mind. My letting agent instructed to put annual increases in all agreements, If they do not agree then they have to leave. Sounds very harsh but how can landlords protect their investment against ever rising costs and militant action groups stoking the tenants to not pay rent or be downright difficult.

Good morning Peter.

If you are carrying on letting after the legislation is in force then you would probably be wise to have an annual increase in rent.

However, I would not let under the RRA irrespective of the rent that I was receiving. I am not going to lose control of the property. That is not something that I would entertain doing. It would be out of the question for me to let for an indeterminate period. I do try to accommodate my tenants now regarding how long they wish to stay, but the legislation goes far too far for me to continue as a landlord.

The right to evict in order to sell will always remain so no need to evict good tenants until time to sell. I am not selling but not letting to families any more either.

Tenants should not be insulated from the real world and should pay market rents.

Landlords not charging market rents are doing no one any favours and will receive no thanks from anyone.

The right of eviction to sell did not exist in the past. You had to sell for a pittance with a sitting tenant on a controlled rent. As Nick said this morning, I think our rights could diminish further with time.

Ellie

I am telling you what is the current situation in Scotland and it will definitely not be worse in England when the new law comes into force.

No lender would ever agree to not being able to secure vacant possession of buy to let properties. We will not go back to the bad old days of sitting tenants where only cash buyers could buy those properties, as you say, at a pittance.

Sorry Robert, I only just saw your post. How awful that you have to sell your property to get it back - that is quite ridiculous in my opinion.

Also, don't forget that it was previous Labour policy to force landlords to sell to tenants at a lowish price - that was John McDonell's right to buy scheme.

In the more distant past landlords with mortgages were still subject to the same rules regarding sitting tenants. You couldn't ask them to leave to sell the house.

Ellie

There are still quite a few ways to get your property back in Scotland without having to sell and England won't bring in more severe legislation than the loony SNP and their little Green helpers.

The point I am making is that there is no need to panic and evict good tenants in case they turn bad with Section 21 removed. Landlords can wait until problems arise and will always have the nuclear option of selling if all else fails.

Incidentally you could sell to a limited company that you own as that's a separate legal entity and get better tax treatment afterwards as well. There's also no compulsion to sell at any price so after trying to sell, it would be quite legal to change your mind if you can't get an acceptable sale price, although care must be exercised to avoid future repercussions.

You are more of a risk taker than I am Robert - and that is probably why you are very successful. I am afraid that I defintely am not prepared to let to anyone unless I know that I can get my property back at the end of a fixed term tenancy.

I will get all my properties empty before the Renters Reform legislation applies to them.

That sounds like a great idea about selling to one's own limited company - would that count as a reason? You might be able to do it once.

When you let to students have you ever considered a head lease with a/the local university - wouldn't that mean that they HAD to leave after a fixed term?

Ellie

I now only rent to groups of students each with a solvent guarantor who values their credit rating.

I no longer rent to families or young professionals who might want to stay long term.

I regard students as much lower risk tenants now than young families and many others now feel the same.

My main frustration now is students not getting their act together and giving a decent amount of notice so it's a mad scramble to get tradesmen organised and new tenants lined up to avoid any voids.

The Scottish PRS legislation only helps rogue tenants and harms young families in particular.

Market forces have also allowed me to increase my best rents for a 4 bed flat in Glasgow from £1600 in 2017 to £2100 in 2018 and now to £2800 per month.

I am very grateful to the SNP and their little Green helpers and won't be selling up, but equally won't be buying more with the SNP 6% stamp duty penalty and mortgage rates of over 6%.

God help Scottish tenants because the Scottish government certainly isn't!

English tenants have all this to look forward to!

Jahan, last month, you said you are having to "consider rent increases for some of my properties due to mortgage rates". Earlier this year, you claimed you are "taxed more than what we earn", implying you're making a loss as a landlord after tax. It sounds like you're having a hard time managing money and struggle with taking on debt to pursue a lifestyle and career you can't afford. Have you considered speaking to Citizens' Advice? They can help you make a budget, figure out what to cut back on and identify any benefits you might be entitled to in light of your financial situation.

Ah Shimon, I do love banter. So I must say your comment has made me laugh today, put a right smile on my face that. Now the only response I can give to yours is as follows.
"consider rent increases for some of my properties due to mortgage rates" - Yep thats correct & I have done & that means as a business I am still solvent & that also means the tenant has a roof over their head so will not be getting their hair wet.
"taxed more than what we earn", implying you're making a loss as a landlord after tax. - Again that is true as this is due goverment interference. Its called Section 24. (Probable reason why your rent has gone up)
It sounds like you're having a hard time managing money and struggle with taking on debt to pursue a lifestyle and career you can't afford. - Thank you for your concern. I'm alright though. Told the missus we have to shop at Lidl & Iceland from now on.
I make no assumptions about your lifestyle but I assume you are only responsible for one roof to keep over your head whereas I am responsible for a lot of families roofs.
Now as for speaking to Citizens Advice. I will leave their services for the likes of you but bear in mind if you take amateur advice you will get amateur results. I pay professionals hence why I get professional results which in turn keeps my tenants with yes you getting the drift now. A roof over their heads.

Some friendly advice take it or leave it. Instead of being a cheeky sod, show a little respect for the people who have made something of themselves, gain some of their knowledge, work on your skills, re-read 'How to win friends & influence people' by Dale Carnegie, save a deposit & stop ordering from Deliveroo