Two thirds of private rental landlords will leave sector if Labour win

jjlandlord

The private rental sector works in England.
There is no market issue: no collusion, no dominant player but rather many small players, prices follow market conditions, etc.

The issue is that in many areas the demand for housing exceeds supply and that drives prices up, rents and purchase prices.

This is not a rental sector issue, this is a housing sector issue. Assuming that this is an issue at all.

Not enough homes are built in these areas, or too many people want to live there, or both (depending on how you look at it).

NorthFin

CLAPTON wrote: »

it is a general observation that people engage in business to make money (profit).
If rent controls are introduced this will reduce the potential profit. This will encourage people to sell the property the currently rent out and will discourage people from entering the rental market.

The overall effect will be fewer rental properties being available.

Depending upon the precise wording of any rent control legislation, it will probably be that the maximum rent will also become the minimum rent due to the shortage of supply.

This is just the free market working things out. Whoever appeals to the renter will get the most votes.

Then it will swing back the other way whoever appeals to owners will get the most votes.

Loughton_Monkey

jjlandlord wrote: »

The private rental sector works in England.
There is no market issue: no collusion, no dominant player but rather many small players, prices follow market conditions, etc.

The issue is that in many areas the demand for housing exceeds supply and that drives prices up, rents and purchase prices.

This is not a rental sector issue, this is a housing sector issue. Assuming that this is an issue at all.

Not enough homes are built in these areas, or too many people want to live there, or both (depending on how you look at it).

I tend to agree.

The 'market' will be forced simply to sort itself out. Set out any scenario you like in which (say) landlords see no likelihood of profit, then surely they will erect 'For Sale' boards en mass. In turn, this will put downward pressure on prices, tipping some people into the arena of being able to buy rather than rent.

Over time [assuming little change to local population or number of houses built], it's a static number of properties and a static number of people forced to house themselves somewhere/somehow. The only change is the proportion of owners to renters.

The degree of local 'housing crisis' [if exist] will persist.

antrobus

Loughton_Monkey wrote: »

.....The degree of local 'housing crisis' [if exist] will persist.

It's all down to simple supply and demand.

Tinkering with the composition of supply won't effect the overall 'housing crisis'. What you need is more supply.

Zxcv_Bnm

Loughton_Monkey wrote: »

I tend to agree.

The 'market' will be forced simply to sort itself out. Set out any scenario you like in which (say) landlords see no likelihood of profit, then surely they will erect 'For Sale' boards en mass. In turn, this will put downward pressure on prices, tipping some people into the arena of being able to buy rather than rent.

Over time [assuming little change to local population or number of houses built], it's a static number of properties and a static number of people forced to house themselves somewhere/somehow. The only change is the proportion of owners to renters.

The degree of local 'housing crisis' [if exist] will persist.

More likely get worse.

HMO will become just houses with fewer people in them.

Thus we might have 100 houses, 70 owner occupied by 2 people and 30 tenanted by 3 people. Total 230 people.

Now 20 of the tenanted houses are sold to the 20 richest tenant couples.

We now have 90 owner occupied housing 180 people and 10 tenanted into which the other 50 have to fit.

Problem gets worse not better

Minrich

My gripe with LL's and BTL's is that they don't pay back any of the capital with their mortgages and hence don't really take into account the price and pay above the odds imho . They just see house X and £X Rent for that property , then pay asking price or over just equating the interest to be paid and the rental income received ! This in my view has inflated prices dramatically - I would hope that this practice is restricted soon .

chucknorris

Minrich wrote: »

My gripe with LL's and BTL's is that they don't pay back any of the capital with their mortgages and hence don't really take into account the price and pay above the odds imho .

Why should I pay it back? I prefer to invest it elsewhere, my mortgages are just under £600k and I have over £600k invested in shares, it is my money to do with what I wish, and I preferred to invest it, rather than repay mortgages. I have also paid into other investments too.


Of course I took into account the price that I paid, the more I pay the higher the mortgage payment is.

jjlandlord

Minrich wrote: »

My gripe with LL's and BTL's is that they don't pay back any of the capital with their mortgages and hence don't really take into account the price and pay above the odds imho .

Isn't it wonderful when people with clearly no clue want to tell others how they should run their finances?