Mortgage-free landlords are under the spotlight following a report that more than two-thirds have raised rents despite being “unaffected” by interest rate hikes.
The figure comes from a poll of more than 1,000 landlords commissioned by housing charity Shelter, which was shared with The Guardian.
The survey found that seven out of ten landlords who own their rental properties outright increased rents on new or extended tenancies in the past 12 months as their average profits rose to more than £800 a month.
According to the newspaper, this practice of “cashing in” has “triggered windfalls for hundreds of thousands of investors at a time when tenants are paying more despite shrinking amounts of space in flats and houses”.
Ben Twomey, chief executive of the campaign group Generation Rent, told The Guardian that “debt-free” landlords were “cashing in simply because they can” and warned that without government intervention, “the cost of renting crisis will continue to uproot families and fuel homelessness”.
However, Ben Beadle, chief executive of the National Residential Landlords Association (NRLA) hit back, telling the newspaper: “Our data shows landlords without mortgages are half as likely to increase rents as those with them and are much more likely to keep rents the same. Data from Savills shows investor profits, including those without a mortgage, at their lowest level for 16 years.”
The story in The Guardian is the latest in its series on ‘Living hell: Britain’s rent crisis’. Earlier this week, Clive Betts, the chair of the levelling up, housing and communities select committee, told the newspaper that rental homes should be confiscated from private landlords who repeatedly break the rules and exploit tenants.
According to Betts, handing courts this power would create a “significant deterrent” to landlords who treated fines for letting out squalid, unsafe and overcrowded homes as simply a cost of doing business.
So increased costs of workman/goods/council taxes mean nothing to generation rant.
We are along way from stable times, I believe far more Landlords are leaving than joining so blame the government.
I’m now insisting on two property owning guarantors on a joint and several liability agreement.
This is a business and not a charity.
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Gas safe, electrical checks and landlord insurance have gone up too. Between tenants my rents go to £50 BELOW market rate, during a tenancy annual rises are usually around £15 – £25 per month. Less than 3% – but the headline would still say I’ve put rents up despite being mortgage free.
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Twomey and Bleat, firstly it is NONE OF YOUR BUSINESS how my business is funded. My rents match the local market rate. How is Shelter funded, apart from by Nationwide, when they do not house anyone apart from Polly Bleat. Hardly a HOUSING charity. As for Generation Rant, what exactly do they do apart from moan?
These two and their useful idiots in Parliament, have done more “to uproot families and fuel homelessness” than landlords. I presume that by “government intervention” they are referring to rent caps. Keep going you two!
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OK I’ll say it
The issue here is a complete and utter misunderstanding – or lack of attempt to understand – the housing market, which is not one housing market, but several individual markets.
The media likes to confuse the social market with the private market, and is making private landlords appear responsible for the problems social tenants are facing.
The BIG issue here, is landlords do not have a voice. Everyone speaks up for the tenants, but the lack of voice is the reason for the lack of understanding in the media. And I must admit I’m sick of it.
So who is going to provide the voice?
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Beadle not about?
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F the left wing rag
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In most societies where there is a suggestion of confiscating property, particularly real estate, would be totalitarian regime. Communism or dictatorship – clearly the political ambition of the Labour Party if this is how Clive Betts were to have anything to do with it. Perhaps something of his should be confiscated if he breaks any of the many rules politicians impose. Perhaps a life sentence for breaking Parliamentary rules plus confiscation of all his assets? Do we really need these kinds of extremists in politics? Just posing the question. There are already many punishments and extreme fines even banning orders to deal with the criminal landlords.
Then we look at the Housing Crisis a housing crisis caused by Government, Shilter and Generation Rant. These organisations have excellent spin doctors (paid for from the public funds and charity donations) to make it sound as though property investors are the problem; yet they have between them scared off investors thereby reducing the supply of rental property thus causing scarcity; the natural result is increasing rents by supply and demand. Fools. Back this with ignorance of the media like the Guardian, BBC etc and you fool most of the people most of the time. Most people, if you ask the, think Shelter provide housing! They are shocked when they are told they do not. The property markets is not the business understood by the wider public, they do not understand and believe the propoganda they read & hear; just the anti landlord propoganda peddled by the people who really caused the housing crisis for political gain. Perhaps I am wrong I have only spend 55 years of my life working in the property profession? What do you think as a property professional?
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The remarkable thing is that it is almost never a landlord who states “I must put the rent up.”
When I was a letting agent, every time a rental contract came up for renewal I would discuss the situation with the landlord. “They’re good tenants, they’re looking after the place, it’s better to have a happy tenant. Yes the flat across the road has rented for £100pcm more but it would cost you that if the tenant were to leave.” And then I would suggest a rise of just £50pcm instead of £100pcm. And 99 time out of 100 both the landlord and tenant were ecstatically happy with that.
If (or when) a tenant handed in notice, it was then time to raise the rent for that particular flat to the full market price.
But rent rises are always dictated by what tenants are prepared to pay.
I have a contractual duty to my landlord clients to make sure that the rent they sign up to at the beginning of a contract is the “best possible rent”. “Best possible rent” may not be the highest possible rent, but it would be quite rare to be a low rent…
I have a fiduciary duty to the tenant. I understand that this duty requires me to be act with care, loyalty, good faith, confidentiality, prudence, and etcetera. Whilst this means that I should not act in a way that would “rip off” the tenant, it does not require that I ensure the landlord does not get the proper rent.
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Debt free landlords? What are they? Does Ben, I’ve got an important title for an insignificant organisation, Twomey mean landlords without mortgages?? If so how does he know and also what the hell does it have to do with him? Does this horrid man sit outside Tescos shouting at them to reduce the price of bananas because the wholesale price has reduced?
These poorly educated idiots need to button their lips because every time he or polly bleat open their mouths to spout more rubbish, more landlords are vilified and decide to give up and put their money into safer investments!
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So the rental property may not have a mortgage on it, but what about the landlords who have a mortgage on their own property and need the extra income for that? Or the ones who used available equity on other rental properties to buy the mortgage free one? Plus the extra costs for workmen etc.
Nothing exists in a vacuum.
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