Good Old Fergus!

michaels

Whilst i am generally free market in my thinking it does seem unfair to terminate the contracts of all his tenants who are on housing benefit because a proportion have not paid their rent on time. Don't forget many may have paid a whole bunch of fees to start the tenancy which will have to be paid again when they rent elsewhere. By all means terminate any who have been in arrears, don't take any more and terminate those who go into arrears going forward but there are some who can and do manage their finances, why should they suffer?

HAMISH_MCTAVISH

Graham_Devon wrote: »

"The market" is doing what it should, maybe..... But you are only looking at it from a monetry perspective. .

No, I'm looking at it from a practical perspective.

If there are only 50 houses available and 60 households (be that one or more people per household) wanting a house, then 10 will be homeless or need to share.

It's simple maths.

And no amount of bleating about 'social welfare' will change that.

HAMISH_MCTAVISH

michaels wrote: »

Whilst i am generally free market in my thinking it does seem unfair to terminate the contracts of all his tenants who are on housing benefit because a proportion have not paid their rent on time. Don't forget many may have paid a whole bunch of fees to start the tenancy which will have to be paid again when they rent elsewhere. By all means terminate any who have been in arrears, don't take any more and terminate those who go into arrears going forward but there are some who can and do manage their finances, why should they suffer?

Wait a minute....

Some people on here are always saying it's right and proper that people who fit certain risk profiles (regardless of whether or not they've actually defaulted themselves) should be excluded from getting mortgages, as banks have to manage risk.

Don't landlords have a similar obligation to manage the risk in their business?

michaels

Ok and I stated going forward that was reasonable but with existing clients, surely the known history should be balanced against the risk? They have 1,000 properties of which 200 are socially rented, surely it is possible to make a case by case decision given those volumes, rather than the sort of 'head office has decreed' type decisions a bigger business would have to make?

ruggedtoast

HAMISH_MCTAVISH wrote: »

What exactly did you think would happen?

Rents have been rising so as to ration the limited supply of housing through price. There are not enough houses to go around, so some people must be excluded.

This is the market working exactly as it should.

As I recall, all three of you supported the changes to housing benefits that have caused this situation.

You are conflating two unrelated issues. That of maximum rental payments and that of late payments.

As a working person who used to rent, I was in favour of people who didn't work and were in receipt of housing benefit not being able to outbid me on the open market because the council would give them a blank cheque to pay the landlord with; whereas I had to pay rent from my salary that I earned.

But this is not about the Wilsons refusing housing benefit tenants because they can't make the market rent. I doubt in the segment of the market the Wilsons operate in that they would be able to charge above the ceiling for HB payments anyway.

This is about them throwing single mothers out on the street because they might default. Which most people are in equal condemnation for.

Most people apart from you apparently.

HAMISH_MCTAVISH

michaels wrote: »

Ok and I stated going forward that was reasonable but with existing clients, surely the known history should be balanced against the risk? They have 1,000 properties of which 200 are socially rented, surely it is possible to make a case by case decision given those volumes, rather than the sort of 'head office has decreed' type decisions a bigger business would have to make?

From the article....

Our situation is that not one of our working tenants is in arrears – all those in arrears are on housing benefit."

A key factor for Wilson and other landlords is that it is impossible to obtain rent guarantee insurance for a tenant on housing benefit.

With tenants on benefits the number of defaulters outnumbers the ones who pay on time," he said.

HAMISH_MCTAVISH

ruggedtoast wrote: »

You are conflating two unrelated issues. That of maximum rental payments and that of late payments. .

Also from the article.....

He says the move is purely an economic decision and points out that private landlords are running a business.

"Rents have gone north, and benefit levels south," he said.

"The gap is such that I have taken the decision to withdraw from taking tenants on housing benefit.

ruggedtoast

HAMISH_MCTAVISH wrote: »

Also from the article.....

The weekly cap for a 2 bed property is £290. I cannot find any 2 bed properties within a mile of Ashford that are listed for more than £800 a month. Well below the cap with room to spare.

Maybe they just don't like people who can't plan their money very well. But wait, maybe Fergus and Judith aren't very good at planning their money either:

http://www.theguardian.com/money/2010/mar/06/buy-to-let-fergus-judith-wilson

From 2010.

Defaults by newly unemployed tenants jumped as the recession began to bite, and he admits October 2008 was the crisis point, when nearly 100 of his properties, 13% of the total, were occupied by tenants who were not paying all or part of the rent. "We asked for a meeting with our lenders. I said, if you think you can run the show better than me, you can have them all back. They said no. They were determined that we shouldn't go under. If we went under, then everyone went under."

Every month the couple have to meet huge repayment commitments. They don't disclose their total borrowings, which are spread across many institutions, but say that for one lender alone, Mortgage Express, their monthly payment is £353,000. Mortgage Express was part of Bradford & Bingley, one of the banks whose loans are now in the hands of the taxpayer. So we all own a share of the Wilsons' properties.

What saved the Wilsons was, curiously enough, the collapse of Lehmans. In 2008, with banks pulling the plug on buy-to-let lending, the Wilsons were struggling to refinance their borrowings. But after Lehmans collapsed in September 2008, the Bank of England slashed its base rate to 0.5% and the Wilsons found on nearly all their loans they could revert to base rate plus a fixed percentage – typically 1.5% – at the end of the fixed period.

"We were going to be, to put it bluntly, stuffed. The reason we were saved was the drop in interest rates,"

Not saved from having any foresight, or a sustainable business plan, or having the wherewithal to innovate. Saved from a giant hand out and a leg up based on the fact that a lot of banks who couldn't plan their money either didn't want to get found out squandering tax payers money.

Well the tax payer has lost out anyway because in addition to this farrago of incompetence and celebration of weird inverted greed, we now have hundreds of vulnerable families to rehome.

LydiaJ

michaels wrote: »

Ok and I stated going forward that was reasonable but with existing clients, surely the known history should be balanced against the risk? They have 1,000 properties of which 200 are socially rented, surely it is possible to make a case by case decision given those volumes, rather than the sort of 'head office has decreed' type decisions a bigger business would have to make?

This is what I thought.

I am usually not a vindictive person at all, but I find myself hoping that they won't be able to find 200 non-HB tenants all at once, and end up with lots of voids.

Graham_Devon

All of the tenants will be in arrears as that's how housing benefit is paid.

Fergus will have known this. I would expect all 200 to be in arrears. But that's not to say payments are being missed, it's just that housing benefit always pays that way. As I understand it anyway.

Hamish, with respect, you appear to be talking about something that isn't here. He's not stating they can't pay, just that they "might not". Therefore evicting en masse.

This isn't about shortages of homes. It's not about tenants not being able to pay the market rent. It's about fergus serving them notice "just incase".

This will give the council, not to mention the families and children a massive headache.

Thing is, theres so many other ways to go about the same thing. The way he has chosen, and the language used suggests A) he's enjoying it and he's probably hoping the reaction from the council will be a bribe as they can't handle the volume of new homeless. The voids will be massive if he does this, so in all honesty, on reflection, I guess this might be him puffing his chest in the hope of something being done to protect him. Just as happened with his mortgage company.

It's just unethical behaviour, and it would be difficult for any of us to justify it.

Chuck out people if they fall seriously behind on rents (outside of the normal housing benefit arrears period), sure. But evictions en masse? Theres just no need.

And as an addition, I don't think I have ever denied there is a housing shortage?