MSE News: Three-year minimum tenancies could be introduced for renters

Cakeguts

Wongus wrote: »

Fully support that tenants should receive better protection, we also need to think about what the role of a landlord is? Are they operating to maximise their own profit, or are they providing a social utility? Arguably we can't operate without landlords, so perhaps they are providing a social utility? So in conclusion, this is leveling the playing field for the tenant.

Which tenants? Most of the tenancies are ended by tenants so which tenants need better security? If most of the tenancies are ended by tenants and not landlords then this new idea suits a minority of renters. How can anyone think that something that only suits a small number of tenants can be a good idea? What about the majority who don't want it?



I also think that most people assume that people who rent from private landlords have to do this because they can't get social housing. There are a fair number of private tenants who are not eligible for social housing. They rent from choice not necessity.

buglawton

Everyone seems to have missed the point that in other countries where landlords have to give very long notice, tenants don’t. Rather obviously because the disruption to a tenant if given notice is much larger (or so the politicians assume) than to a landlord.

The rule in Germany for example is that the landlord can reclaim the property if it’s needed for personal occupation, if that can’t be proven then the tenant has a lot more security.

The current BTL market grew up on the Assured Shorthold Tenancy. Tax rules have already been tipped against small landlords. If other rules change adversely for landlords then one can expect the supply side of rental accommodation to dry up. Unless of course the government can think of another way to boost supply.

Uxb

ripplyuk wrote: »

Why does this put landlords off? In the olden days, weren’t all tenancies secure? 3yrs doesn’t seem very risky compared to that. Or maybe there was hardly any landlords and tenants back then and everyone owned instead of renting.
Just curious!

I had relative/ancestors who were small landlord during that time via inheritance.
Rent were controlled at a low level by the "fair rents acts"
So your rental income was basically determined by the government/local council.
You could inspect the rent register at the council offices which would give for each rented property its details and rooms/bathrooms etc, the tenant's name, landlord owner/address and the fair rent which had been determined for that property.
Profits were so low even when you owned the property 100% outright that, as a previous poster said, there was no incentive to do anything other than the minimum repairs possible.
Any improvements unless very substantial would not be met with an increase in rent permitted.
I think rents were re-assessed every 5 years - though my memory may have faded on this one.
So yes properties basically became slums and barely fit for human habitation even by the lower standards of 40 years ago and when you eventually got the tenant out (usually when they died!) who might have been there for 50 years then you exited the market by selling the property.

A long forgotten lesson in that when HMG tries to intervene to improve a market sector it invariably makes things worse.

Norman_Castle

Cakeguts wrote: »

I can't see the point. All it will do is force landlords to keep tenants that are a problem for longer.

It gives the tenant security. A friend told her tenant they needed to move back to their house. A month later changed her mind, two months later decided to move back there, then changed her mind. The tenant left because of the lack of security.
Some landlords are fickle which makes life difficult for tenants.


What about tax incentives for landlords offering longer tenancies?

westernpromise

Norman_Castle wrote: »

It gives the tenant security. A friend told her tenant they needed to move back to their house. A month later changed her mind, two months later decided to move back there, then changed her mind. The tenant left because of the lack of security.
Some landlords are fickle which makes life difficult for tenants.


What about tax incentives for landlords offering longer tenancies?

There'll be a price incentive, in two ways. First, it will presumably be permissible for the tenant to opt to take less than three years at the outset. Those tenancies will be cheaper to obtain than three year tenancies, for obvious reasons.

Secondly, landlords don't have to let to any Tom, !!!! or Harry. If someone's going to take over a property for three years, they're going to have to be more credible than someone who only wants it for a year. So I'll be looking for references from current landlords, guarantors, that sort of thing.

If you have a prosperous mother and father who can guarantee the rent you'll still be able to find somewhere, but the tenants towards the bottom of the barrel will struggle.

I can remember back in the 80s Capital Radio used to do slots in the afternoon called Capital Flatshare, and if you tried to find a room out of the paper you had to hang around the Standard's building at 10am to grab a copy and be the first to phone. We're headed back towards that, I reckon.

Norman_Castle

First, it will presumably be permissible for the tenant to opt to take less than three years at the outset. Those tenancies will be cheaper to obtain than three year tenancies, for obvious reasons.

Why will they be cheaper?

Crashy_Time

buglawton wrote: »

Everyone seems to have missed the point that in other countries where landlords have to give very long notice, tenants don’t. Rather obviously because the disruption to a tenant if given notice is much larger (or so the politicians assume) than to a landlord.

The rule in Germany for example is that the landlord can reclaim the property if it’s needed for personal occupation, if that can’t be proven then the tenant has a lot more security.

The current BTL market grew up on the Assured Shorthold Tenancy. Tax rules have already been tipped against small landlords. If other rules change adversely for landlords then one can expect the supply side of rental accommodation to dry up. Unless of course the government can think of another way to boost supply.

The houses don`t disappear, they are still there, just the price they change hands for and whether they are rentals or OO changes.

Crashy_Time

westernpromise wrote: »

There'll be a price incentive, in two ways. First, it will presumably be permissible for the tenant to opt to take less than three years at the outset. Those tenancies will be cheaper to obtain than three year tenancies, for obvious reasons.

Secondly, landlords don't have to let to any Tom, !!!! or Harry. If someone's going to take over a property for three years, they're going to have to be more credible than someone who only wants it for a year. So I'll be looking for references from current landlords, guarantors, that sort of thing.

If you have a prosperous mother and father who can guarantee the rent you'll still be able to find somewhere, but the tenants towards the bottom of the barrel will struggle.

I can remember back in the 80s Capital Radio used to do slots in the afternoon called Capital Flatshare, and if you tried to find a room out of the paper you had to hang around the Standard's building at 10am to grab a copy and be the first to phone. We're headed back towards that, I reckon.

No, in the 80`s not everyone and their brother had a BTL, if what you say happens we are headed for a LOT of landlords with lengthy voids and a VERY big increase in property for sale.

Cakeguts

Norman_Castle wrote: »

It gives the tenant security. A friend told her tenant they needed to move back to their house. A month later changed her mind, two months later decided to move back there, then changed her mind. The tenant left because of the lack of security.
Some landlords are fickle which makes life difficult for tenants.


What about tax incentives for landlords offering longer tenancies?

Here is another problem. Not all landlords are the same. I am a landlord. I don't want voids that means I lose income. I am not going to give notice to a good tenant. This is why we have two properties where the tenants are on rolling tenancies that have gone on for something like 14 and 15 years.



The problem is landlords who are letting their home while they are working away or wanting to sell it and only want to let it for a short time. Not the landlords like me who want tenants to stay as long as possible. However we do start tenants off on 6 months in case they turn out to have lied and are not going to do what they said they wanted to do.



What this new rule would do would be to force landlords with awful tenants including those who have been evicted from social housing for antisocial behaviour to keep them for 3 years. Poor neighbours.



What this will do is to end the short lets that people do when they are working away or trying to sell and properties will be left empty instead. They won't be sold they will just be unavailable on the lettings market so the supply of rented property will reduce.



People talk a lot about Germany but the lettings system there is different. You get an empty property. If you did that here you would get complaints from the local council about the lack of fitted kitchen and floor coverings. In France the kitchen needs to consist of one cupboard and a sink. Many properties do have fitted kitchens but they don't have to. The tenant provides their own light fittings. The property comes with a bulb on the wire from the ceiling. The leases are 3 years minimum but the tenant can give notice sooner if they need to. Can you see councils allowing properties to be let without fitted kitchens and with bare floorboards in the UK?

westernpromise

Norman_Castle wrote: »

Why will they be cheaper?

Because if three year tenancies are more desirable, they must be worth more.