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

Crashy_Time · 3 July 2018 at 1:20PM

Cakeguts wrote: »

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?

Or more likely the financial burden of an empty house will focus people`s minds on dropping prices to get a buyer. This is what the government want to happen, there are votes in getting more and cheaper properties on to the market, but they are doing it by the back door i.e attacking the BTL/Just rent it out mania that has appeared in recent years.

parkrunner · 3 July 2018 at 1:50PM

Maybe landlords will have to offer a number of possibilities, ie 6 months, 12 months, 3 years etc with the tenant being able to choose the 3 years if they wish. Can't see it working otherwise as many tenants won't want the three years.

buggy_boy · 3 July 2018 at 2:32PM

Crashy_Time wrote: »

Or more likely the financial burden of an empty house will focus people`s minds on dropping prices to get a buyer. This is what the government want to happen, there are votes in getting more and cheaper properties on to the market, but they are doing it by the back door i.e attacking the BTL/Just rent it out mania that has appeared in recent years.

Your a broken record, im sorry but you and your HPC lot were saying it was a conspiracy that the government increased house prices, now they want them to fall.... Yet interest rates are still rock bottom..

Your right in the political parties are attacking BTL as a blame for high house prices, with the introduction of the extra stamp duty and extra taxes has reduced significantly BTL yet what has happened to house prices? The number of properties available to rent in some areas has fallen to nothing... Its causing homelessness, but they are blaming landlords for that also.

Norman_Castle · 3 July 2018 at 2:58PM

westernpromise wrote: »

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

There might currently be a premium for offering longer tenancies but if three years becomes standard they are no more or less desirable than optional shorter tenancies.

Cakeguts · 3 July 2018 at 3:07PM

Crashy_Time wrote: »

Or more likely the financial burden of an empty house will focus people`s minds on dropping prices to get a buyer. This is what the government want to happen, there are votes in getting more and cheaper properties on to the market, but they are doing it by the back door i.e attacking the BTL/Just rent it out mania that has appeared in recent years.

https://www.rightmove.co.uk/property-for-sale/property-74095826.html

This is where your idea falls down. This property is advertised as suitable for a 1st time buyer or investor. 1st time buyers will not buy in this terrible area if they can get a house somewhere else. It won't matter how cheap it is. This is the kind of area where you try to escape from. If you can afford a house you don't want to buy one here. There are council house estates like this all over the country. The only people who want to live on them are council tenants and that is because they have no choice. So this house is either going to be a private rental or a social rental it isn't going to be privately owned. If an investor doesn't want to buy this house it won't sell. Houses like this only sell if they have the council discount to the tenant no one else wants them. There is no shortage of houses for sale in this general area at this price.

So what happens to houses on these estates if investors leave the market? First time buyers don't want them they can get a shared ownership house for the same price on a new estate in a much better area or they can buy a slightly smaller terraced house for the same price in a much better area. Remember there isn't a shortage of houses for sale in this area.

https://www.rightmove.co.uk/property-for-sale/property-54073656.html Now here is another one on another council estate in the same town which has been on the market since last year.

Here is one not on a council estate and it is sold https://www.rightmove.co.uk/property-for-sale/property-63963568.html

buglawton · 3 July 2018 at 5:47PM

Cakeguts wrote: »

https://www.rightmove.co.uk/property-for-sale/property-74095826.html...This is the kind of area where you try to escape from. If you can afford a house you don't want to buy one here. There are council house estates like this all over the country.... Houses like this only sell if they have the council discount to the tenant no one else wants them.

Big assumptions there. The council estates here in Berkshire have had a long history of tenant buy outs then changing hands. In my corner of this originally council estate 80% are now privately owned. I'd estimate prices are at about 95% of the private equivalent (better built and larger rooms than any private developments since the 70s). Agreed, some mega-estates are unattractive and have problems. But by no means all council estates do. Don't make assumptions before you tour an area and maybe view.

buglawton · 3 July 2018 at 5:51PM

parkrunner wrote: »

Maybe landlords will have to offer a number of possibilities, ie 6 months, 12 months, 3 years etc with the tenant being able to choose the 3 years if they wish. Can't see it working otherwise as many tenants won't want the three years.

I'll repeat what I said in my earlier post: It's almost certain that it's the landlords that will have to give the long notice. The tenants might have to go up from the current rolling AST standard of 1 month to maybe 3 months notice to the landlord that they want to leave.

seven-day-weekend · 3 July 2018 at 6:00PM

tom9980 wrote: »

As a Landlord I have always given a 6 month contract to see how things go with new tenants then allowed the contract to roll over into a periodic tenancy while telling the tenant this is your home for however long you want it (the longer the better) assuming the rent is paid and the property is treated as their home.

This proposal and other recent regulation have simply made me become more business like and hard nosed. Rent tends to be reviewed more regularly and increased rather than allowed to stay the same, a shame for my tenants because rents and house prices at the lower end of the market have increased a lot around my area in the past few years.

I can foresee it becoming very hard for some tenants to find property now, there is simply no scope for a landlord to take any kind of risk when they are forced into 3 year tenancy contracts where they have to rely on a flawed court system and the s8 process.

If and when my next tenant moves on i may be inclined to sell rather than deal with regulation which offers Landlords nothing in return.

I agree with this post. I only have one property. My last tenant was there for over two years, with a rolling contract after his initial six months expired. He would have stayed longer if he had managed to avoid being detained at Her Majesty's Pleasure. He was a good tenant inasmuch as he paid the rent on time and kept the place clean and tidy and could have stayed as long as he wished.

The property is now vacant (from today) and the new tenant will have an initial six month's contract. And why not? For all I know they may wreck the place or expect me to sub them for six months. If they are unsuitable, I want to be able to evict them when their six months finishes. If they turn out OK, then they can have a rolling contract and can stay as long as they wish.

If this becomes law, I shan't get another tenant when the next one leaves. I shall sell up. I'm sure a lot of small landlords will. And that will be a lot of rental properties out of circulation.

seven-day-weekend · 3 July 2018 at 6:05PM

Owain_Moneysaver wrote: »

..........

The buy-to-let market is a major customer for many new apartment developments, and if landlords are put off investing in rentals those flats won't sell to FTBs, because FTBs can't afford them. It's more likely those flats won't be built, making fewer houses available in total and further depressing the construction sector.

My flat was on sale for several month before we bought it for £85k. I don't believe I was depriving a FTB. The seller dropped the price the day before we viewed it.

pinklady21 · 3 July 2018 at 7:44PM

Why are they not looking to Scotland? We seem to be ahead of the game slightly here.

Already banned Right to Buy sales, to protect the remaining public sector housing stock.

New PRTs. Private Residential Tenancies with a model tenancy agreement that allows a landlord and tenant to agree terms came in on 1st Dec last year.

As a landlord, I was wary of these - they have a start date, but no end date.
The Notice period varies depending on the length of time the tenant has been in residence, and is a longer period for the tenant than for the landlord.

There is, however, built in flexibility - so if the landlord needs to move into the property, or intends to sell it, these are mandatory grounds for a possession order to be issued.

We have also done away with court proceedings, and now all hearings are before a "first tier tribunal".
It will be very interesting to see how it all works out in practice. Especially if rent controls come back in as the government has threatened, but not done yet.

I have not got any tenants on the new tenancies yet, but have just signed one as a tenant. And it seems fine to me - at least, so far!

Agree though, I would prefer less regulation on private sector tenancies, and I hate the new landlord tax regime!
However for the market to work effectively, it needs to be fair to both tenants and landlords. The decent tenant is rewarded by having reasonable security of tenure, while the rogue landlord is put out of business.

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

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