Right to buy on privately rented homes

Green_Bear

Cakeguts wrote: »

The interesting thing is that we have rented property in a different EU country where the rental leases are 3 years minimum and there we have had one of the shortest rentals ever of only 1 year. The tenant can leave when they want to. A year for us in the UK is short. We have also had tenants leave at the end of the 3 year period. 3 years is short for us in the UK. To me offering 3 year tenancies or even open ended ones is a complete waste of time and effort unless you are in the business of trying to buy votes because most tenancies are ended by the tenant not the landlord.



I contacted our main letting agent about the S21 situation and they said that they have never had a no fault eviction. That is over all the properties they manage over all the years they have managed them. There has always been a tenant fault. So all you are doing by removing the S21 is allowing tenants who have created a problem to stay on longer creating the same problem whatever that is.

I think your agent may be using technical terms a bit loosely here.
If a S21 is used for eviction, then legally that is a 'no fault' eviction.
Now your agent may not be happy with the tenant, but if they have only ever evicted due to a tenant being at fault, then all their evictions should have used s8.

Green_Bear

MobileSaver wrote: »

Huh?!?! So in the above scenario the bank has a £90k charge against the property, the tenant only pays £80k so the outstanding £10k charge is transferred to the new owner (i.e. the tenant!) How does that work?


Of course the whole discussion is moot as the original proposal for Private Ownership RTB involved the State making up the £20k difference so the LL doesn't make any loss... :beer:

Well, it would depend on the law. If the law was termed as for repossessions:

Landlord owes the bank £90k.
House sells for £80k.
Landlord loses £10k deposit.
Landlord still owes the bank £10k debt.

Tenant buys the house for £80k with separate arrangements (cash, mortgage etc).

Green_Bear

MobileSaver wrote: »

Huh?!?! So in the above scenario the bank has a £90k charge against the property, the tenant only pays £80k so the outstanding £10k charge is transferred to the new owner (i.e. the tenant!) How does that work?


Of course the whole discussion is moot as the original proposal for Private Ownership RTB involved the State making up the £20k difference so the LL doesn't make any loss... :beer:

Or
The law could be termed to protect the bank:

House 'valued' at £80k
Deeds transferred to the tenant.
Bank retains charge of £90k on the house.
Bank pursues landlord for £10k. If successful, bank reduces charge on the house to £80k.
If bank cannot get the £10k off the landlord, the £90k charge remains on the house.
Therefore tenant has a house worth £100k, with a total charge of £90k on it.

westernpromise

Cakeguts wrote: »

most tenancies are ended by the tenant not the landlord.

Well, yes - tenancies can be ended by the tenant or a court, but not by the landlord. If the landlord serves a S8 or S21 notice but the tenant refuses to leave, you need a court to force them to do so.

Cakeguts

Green_Bear wrote: »

I think your agent may be using technical terms a bit loosely here.
If a S21 is used for eviction, then legally that is a 'no fault' eviction.
Now your agent may not be happy with the tenant, but if they have only ever evicted due to a tenant being at fault, then all their evictions should have used s8.

That doesn't prove there was no fault. Section S8 takes longer so landlords use S21 because it is easier. What the agent was saying is that in every case they have had to deal with the tenant has done something to cause the eviction.

Green_Bear

Cakeguts wrote: »

That doesn't prove there was no fault. Section S8 takes longer so landlords use S21 because it is easier. What the agent was saying is that in every case they have had to deal with the tenant has done something to cause the eviction.

Yes, that's what I thought they meant.

Cakeguts

The question that no one seems to know the answer to is what will happen to the tenants who have been evicted from social housing for some reason? You have to have done something really serious to have been evicted from social housing. These are the tenants who get the shortest private tenancies because they are still doing the whatever it was they got evicted for in the first place.



So some politician somewhere had a good idea. To stop these tenants from being moved from landlord to landlord all the time because no one wants them and they can't get social housing again removal of S21 would make it more difficult for private landlords to evict them. I feel very sorry for the neighbours.

Green_Bear

Cakeguts wrote: »

The question that no one seems to know the answer to is what will happen to the tenants who have been evicted from social housing for some reason? You have to have done something really serious to have been evicted from social housing. These are the tenants who get the shortest private tenancies because they are still doing the whatever it was they got evicted for in the first place.

So some politician somewhere had a good idea. To stop these tenants from being moved from landlord to landlord all the time because no one wants them and they can't get social housing again removal of S21 would make it more difficult for private landlords to evict them. I feel very sorry for the neighbours.

I suspect removal of s21, would lead to private LLs becoming much more cautious about who they let to.
I would expect the problem tenants you mention to end up in some kind of guest house or lodgings. They would have a license to occupy, rather than a tenancy. They could be evicted at short notice.

Quite a few former pubs near me are now converted to this type of accommodation. They house asylum seekers, ex-prisoners, drug addicts, sex offenders etc. Blackpool is a popular location for them too, due to the tourism trade reducing and more guest houses available.

Green_Bear

MobileSaver wrote: »

Huh?!?! So in the above scenario the bank has a £90k charge against the property, the tenant only pays £80k so the outstanding £10k charge is transferred to the new owner (i.e. the tenant!) How does that work?


Of course the whole discussion is moot as the original proposal for Private Ownership RTB involved the State making up the £20k difference so the LL doesn't make any loss... :beer:

When RTB was introduced for council properties, I think many councils had debts secured on these properties.
Likewise, when extending RTB to HAs, I'm sure those HAs also had debt secured on their houses.
So however it was handled in those cases, would probably give some ideas about how it would be implemented for private tenants. Ultimately though, someone has to lose the money - be it the tenant, landlord, bank or taxpayer.

With regards whether this proposed policy is a serious threat, I would suggest looking at what the banks do. They will be looking closely at their exposure to this risk. If they start to make margin calls to increase their equity buffer on BTL loans, then probably a sign that they are taking the threat seriously.

Of course, s24 may already be helping them with this by encouraging LLs to reduce their mortgage debts in advance.

Maybe George Osborne has just been fattening up the BTL goose, ready for Corbyn to kill it...??

Thrugelmir

Green_Bear wrote: »

Maybe George Osborne has just been fattening up the BTL goose, ready for Corbyn to kill it...??

Tax rules on interest tax relief are yet to fully hit home.