In 1998, Mrs Thatcher de-regulated private landlording to good effect, with "assured shorthold tenancies". It led to a big rise in private provision of rental accomodation. But her work has steadily been undone in various ways by more recent British governments
Governments worldwide get enthused from time to time about steps they might take to "help" tenants. Sadly, what they often come up with (restrictions of various sorts) makes life more difficult for landlords, which is pretty brainless. If you chase landlords away, you make it harder for tenants to find a place to stay. And what remains will inevitably cost more. You can't lower prices (rents) by reducing the supply. Only a Leftist would think you can
Anita Parkinson has been a landlord since 2009. The 62-year-old used to own six properties but she started selling them off three years ago. She is now waiting for her remaining tenants to move out so she can get rid of her last two.
Ms Parkinson, who asked for her last name to be changed, said the “final straw” was a proposed change that would require all newly rented properties to have a minimum Energy Performance Certificate rating of C by 2025. She said upgrading her properties to meet the standard would cost between £14,000 and £17,000.
“It got to the point where there was so much legislation that it was just becoming untenable,” she said. “I’m absolutely done.”
Ms Parkinson is part of a growing wave of landlords selling off rental properties, hit by increased regulation, soaring mortgage rates and spiralling upfront energy efficiency costs. Some 16pc of all property sellers this year were landlords, according to estate agents Hamptons. In London, the figure was 19pc. These are the highest levels since 2018.
Even those heading for the exit face punitive charges. Landlords will lose thousands of pounds in sale profits under proposals. Thousands who cashed out reaped the benefits house price growth, but the Government is now poised to take a bigger slice of their profits.
The number of rental properties on the market is at its lowest level in three years, according to research firm TwentyCi, indicating landlords are divesting – with a knock-on impact on renters. The total number of rented homes fell by 258,000 between 2016-17 and 2020-21, equal to 5pc, Hamptons found.
Ms Parkinson initially became a landlord to supplement her income, but said she is no longer making any money because of the Government’s crackdown on buy-to-let. She started selling her properties after requirements were brought in for new electrical checks. She had to spend nearly £6,000 upgrading the wiring on one of her properties, which wiped out her profits.
“I have a small pension but this was my income,” she said. “In the last two years, unfortunately, there has been nothing because every single penny that’s gone in has come back out in costs.”
Ms Parkinson, from Huddersfield, West Yorkshire, is also terrified of plans to ban no-fault evictions which would make it difficult for her to remove troublesome tenants. She said she is fed up with the demonisation of good, responsible landlords like herself, whom she describes as “social pariahs”.
“I just feel as if the Government’s out to destroy me,” she said. “I feel incredibly upset.”
For other landlords, it is rising interest rates that are proving to be the final straw.
Karen Smith, 36, from Esher in Surrey, bought a second property with her husband during the pandemic and started letting out their first home. They had secured a fixed mortgage rate of 1.75pc, which has ended recently. They have now moved on to a variable rate.
“It’s going up and up and up,” she said. Ms Smith, who asked for her last name to be changed, said her payments have been increasing by £100 a month because of soaring interest rates. Her tenants are moving out in December and she is anxious to find a buyer before they leave. She cannot afford to keep paying the mortgage if the flat is empty.
“I can’t be in a loss situation; it’s really stressful,” she said.
Another reason she decided to sell was because she feared that new tenants would end up in arrears. Ms Smith, who works in PR, said she has been lucky but has heard “horror stories” of tenants owing thousands because they cannot pay.
“Because of the rights that tenants have, it’s very difficult to take action,” she said. “I’m not a property portfolio person – I have a job, I just happen to have a property that I rent out. I simply would not be able to afford two mortgages just because somebody can’t pay their rent.
“I know that means that a rental property is being taken off the market in a housing crisis, but it’s not fair that everyone is expecting landlords to have deep enough pockets to pay mortgages endlessly.”
David Fell, of Hamptons, said landlords selling up is likely to mean higher rent payments as the same number of tenants chase fewer properties.
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