Autumn Statement discussion

Crashy_Time

Pixie5740 wrote: »

Do you not think that Scotland has rental hotspots in cities such as Edinburgh? In fact until recently property prices and rents in Aberdeen were rising faster than in London due to supply and demand.



If the costs are absorbed into the rent then tenants will only be paying those increased costs once they have secured their new home. None of this parting with £££ in the hope that you will pass whatever hoops the letting agent wishes you to jump through first.

Besides, not all landlords use letting agents. There will be a market cap on how much a particular size and style of property in a particular area can be rented out for with or without the changes to letting agency fees.



Reduce supply of what? The number of letting agents? Only the fit will survive as with any business.

Reduce the supply of rental properties? I don't think so. Would landlords start selling up because of this new policy?

And we know what happened to that paradigm don`t we? :rotfl:

sheff6107

I'm not a Telegraph reader but they are 100% on the money with their campaign to tackle stamp duty.

https://www.google.co.uk/?gws_rd=ssl#q=telegraph+stamp+duty&safe=off&tbm=nws

Hammond better do something to give the stagnant housing market a kick up the backside this afternoon.

Crashy_Time

gordon_harris wrote: »

This is wide of the mark for three reasons in my opinion. The first is that this scenario is actually an improvement on the current system even if the rent increases are exactly the same as the fees currently being charged. The cost to the tenant is identical (so nobody is losing out) but the fees are posted upfront as part of the rent and it's far easier to shop around knowing what you're going to get. What typically happens at present is tenants choose where to live based on the rent, find out it's going to cost them £300+ in fees, and then they pay these fees because they feel like they don't have a choice.

Second, individuals who move frequently are highly disadvantaged under the present system. Letting agent fees effectively act as a barrier to people moving to different properties. You not only have to deal with the practical hassle of moving, you also have a one off £300+ (some agents charge "check out" fees as well of £100 or more) to add to the bill. If all of these fees are simply added to rent then there is no barrier to moving. That's another improvement.

Third, and most importantly, you're operating from the assumption that these fees are fundamental running costs that have to be recuperated one way or another. What they actually are is a product of an under-regulated market that allows businesses to charge over the top rates for services that can be achieved far more cheaply. Market forces will eliminate those fees that weren't necessary from the system and drive down prices for everyone. That's precisely what happened in Scotland and I see little reason why that won't happen here so long as all of the loopholes are removed from the relevant legislation.

Exactly. Very satisfying to see the government clamping down on BTL and the parasites that attach themselves to it.

Crashy_Time

sheff6107 wrote: »

I'm not a Telegraph reader but they are 100% on the money with their campaign to tackle stamp duty.

https://www.google.co.uk/?gws_rd=ssl#q=telegraph+stamp+duty&safe=off&tbm=nws

Hammond better do something to give the stagnant housing market a kick up the backside this afternoon.

They are going to allow, or even cause, a house price crash, and we know they have form for this. This is the only way that banks can get lending again and the EA`s and agents etc. can make money. The young will thank the Tories at the ballot box and shares in the DIY chains will soar. Brexit/Trump is the perfect cover, but they also know that many many people want it now.

BarryBlue

ognum wrote: »

I am a LL, I am happy that tenant fees are being removed. As a LL factoring in referencing and start up fees should be part of your buisness plan.

I use an agent, they charge nothing, yes, nothing for a contract renewal. Nothing to me and nothing to the tenant. They say all it is is altering a couple of figures and date and printing, they absorb this into the 8% I pay them each month.

We need to change our way of thinking, stop fleecing tenants and start providing a good service.

If there are costs involved in vetting tenants, they have to be factored in somewhere. Increased costs will be reflected in rents. It has occurred to me that some checks will be omitted, and landlords will just be more choosy when they can afford to be, by excluding, for example, people without British passports.

Your agent sounds very much like mine, and I do agree that the cheapest are not necessarily the best. I am happy that mine gives both me and my tenants a fair deal, I would be reluctant to lose them.

Crashy_Time wrote: »

And as sure as selling up follows new tax liability increased rents mean increased voids. They scrapped agents fees in Scotland years ago, and rents went nowhere. Most London rent is set by HB levels, and that is surely under pressure now as well?

It depends where you are. Where my properties are located there are plenty of prospective tenants and properties are let almost immediately. There is a shortage of housing here that isn't going to change any time soon. I can't speak for London, nor Scotland. I don't need to let to HB tenants and never have.

Guest101

Miss_Samantha wrote: »

I note that they talk about increased competition.

They should therefore make it easier to set up shop as a letting agent instead of more difficult (mandatory redress scheme, possibly mandatory client money protection, and now fewer income streams).

In any case, tenants feel the pinch because of the lack of available housing. So they should really work on that instead of these political decisions which actually reduce housing supply.



Quite obviously one has to deduct all costs in order to work out profit...

My point was a letting agent has numerous income streams, but deducting all business expenses against one stream to show a loss, they are making a larger profit on the other streams....

Crashy_Time

https://twitter.com/Rickmanprop?ref_src=twsrc%5Etfw

RuthnJasper

ognum wrote: »

I am a LL, I am happy that tenant fees are being removed. As a LL factoring in referencing and start up fees should be part of your buisness plan.

I use an agent, they charge nothing, yes, nothing for a contract renewal. Nothing to me and nothing to the tenant. They say all it is is altering a couple of figures and date and printing, they absorb this into the 8% I pay them each month.

We need to change our way of thinking, stop fleecing tenants and start providing a good service.

100% agree. There are good agents and bad agents, as in everything, but hopefully this new position will weed-out the grasping little Fagins and direct custom towards the better examples as mentioned by Ognum.

jimjames

I think it's great news that fees are to be banned and I'm a landlord. It does mean that there is less differentiation between me and a landlord using an agency now which I guess is a downside - until now it's been a selling point that I don't charge fees for tenants.


It does seem to be something that has gone crazy over recent years, when I was renting 20 or so years ago I don't recall any fees for tenants. Landlords paid 15% for management fees which covered it all. Seems now that agencies want to have their cake and eat it too by charging both parties so stopping them fleecing tenants is a good move.

jimjames

Miss_Samantha wrote: »

Oh so there are significant rent increases after all...

But not related to agent fees as you are claiming.