Rent controls - good or bad?

[Hippogriff]

I'd hope so, as it's that bit that worries me much more than the talk of a 3 year tenancy (in that I'm not overly concerned about that at all, sure there'll be some protection for both sides of the relationship).

 

Not worth worrying about until after the election, but an interesting discussion here nonetheless.

 

---------- Post added 05-05-2015 at 11:29 ----------

 

Are you arguing for no mechanism to control rents at all?

 

I'm arguing, I suppose, that what exists today is probably fine.

[ubermaus]

As much as the market will bear. So long as your profit is made legitimately (ie without price fixing, or avoiding responsibilities).

 

Should be increases in line with everything else, just not 15% per year. Someone will rent under those conditions giving an impression it's the market finding a level, but too much and it's inflating the market for families etc.

 

The cap on rents would be based on average market rents. Labour said that the Royal Institute of Chartered Surveyors was working to establish what the “appropriate benchmark might be”.

 

---------- Post added 05-05-2015 at 11:39 ----------

 

I'd hope so, as it's that bit that worries me much more than the talk of a 3 year tenancy (in that I'm not overly concerned about that at all, sure there'll be some protection for both sides of the relationship).

 

Not worth worrying about until after the election, but an interesting discussion here nonetheless.

 

---------- Post added 05-05-2015 at 11:29 ----------

 

 

I'm arguing, I suppose, that what exists today is probably fine.

 

The 3 year tennancy will suit some landlords and tennants. Other's not so much. What if you want to sell the property?

[Hippogriff]

I also believe that RICS said they were working on no such thing at the time that came out, which was a little embarrassing for Labour.

 

http://order-order.com/2014/05/01/rics-deny-labour-claim-they-are-helping-with-rent-caps-policy-rent-caps-were-not-part-of-our-recommendations/

 

RICS actually said - "Capping rent inflation through three-year fixed tenancies is likely to impact investment into the quality of homes already being rented privately and could force smaller landlords to exit the market – thus limiting supply at a time when the UK faces a chronic shortage of homes across all tenures." - which doesn't exactly sound very supportive (to me).

[Cyclone]

Should be increases in line with everything else, just not 15% per year.

No it shouldn't. The economy doesn't work like that.

Someone will rent under those conditions giving an impression it's the market finding a level, but too much and it's inflating the market for families etc.

Too much according to what?

The 3 year tennancy will suit some landlords and tennants. Other's not so much. What if you want to sell the property?

 

Selling was one of the specific exclusions for the 3 year guaranteed tenancy.

 

---------- Post added 05-05-2015 at 11:45 ----------

 

What's the difference between profit and profiteering? if a landlord thinks they can get a lot more rent, some may go for it at the expense of their tennant. Under the current conditions.

 

If Tesco's think they can charge a bit more for a product and still sell it then they will. That's running a business, not profiteering. Price rises are always at the expense of the purchaser.

[ubermaus]

No it shouldn't. The economy doesn't work like that.

Too much according to what?

 

Selling was one of the specific exclusions for the 3 year guaranteed tenancy.

 

---------- Post added 05-05-2015 at 11:45 ----------

 

 

If Tesco's think they can charge a bit more for a product and still sell it then they will. That's running a business, not profiteering. Price rises are always at the expense of the purchaser.

 

We are back to supply and demand again. In a nutshell you can't compare the housing market to selling milk.

 

---------- Post added 05-05-2015 at 12:00 ----------

 

I also believe that RICS said they were working on no such thing at the time that came out, which was a little embarrassing for Labour.

 

http://order-order.com/2014/05/01/rics-deny-labour-claim-they-are-helping-with-rent-caps-policy-rent-caps-were-not-part-of-our-recommendations/

 

RICS actually said - "Capping rent inflation through three-year fixed tenancies is likely to impact investment into the quality of homes already being rented privately and could force smaller landlords to exit the market – thus limiting supply at a time when the UK faces a chronic shortage of homes across all tenures." - which doesn't exactly sound very supportive (to me).

 

Labour are going for the 9 million renters vote...so RICS don't set the level, someone else will.

[loraward]

That would imply that people in receipt of HB live in smaller households than those not in receipt.

 

Why would it and what relevance does it have?

 

I said 1/5th of household claim HB, you countered it by saying approx 1/10th of the population (5 million people) are in receipt of HB. Only one person per household claims the benefit meaning about 1/5th of household claim HB.

 

---------- Post added 05-05-2015 at 12:05 ----------

 

What will encourage people who rent property out to build more homes? A government telling them what to do and coercing them and generally legislating to make it more and more difficult. Or a government who is a little more laissez faire in its outlook. One that tries to fight the market or one that enhances the market?

 

The banning of buy to let and encouraging build to let.

[RonJeremy]

 

The banning of buy to let and encouraging build to let.

 

No one is going to build to let if they're building an unsaleable asset.

[loraward]

No one is going to build to let if they're building an unsaleable asset.

 

They wouldn't want to sell it in the short term because its an investment which is meant to deliver a regular income, in the long term there is no reason why they couldn't sell it to another investor that is looking for a regular income in exchange for a capital investment.

[psynuk]

Being a Landlord (however small) is being in business. It must be treated like a business, otherwise you will get all the unsavoury, unprofessional types who are clueless to-boot.

 

In business, I don't think that "profit" should be a dirty word. Profiteering being entirely different.

 

I think the nub of the 'problem' lies here.

The great big sell off of council properties and the subsequent lack of replacements has allowed business to encroach onto what was formerly a social housing policy.

If someone wants to buy and let a flat in St Pauls tower then I'm not sure there's any argument for dictating rent or increases in any way, charge a million pounds a week if you like- it's business- and after all supply and demand will bring you down to earth.

 

But if and when someone wants to take excouncil housing stock and makes that into their business model it irks somewhat. Because in many cases the rent and therefore someones private business is going to be subsidised by the taxpayer.

Also that is one more house taken away from the ideals that caused the thing to be built in the first place.

This would all be a moot point if the stock of social housing was maintained to something approaching a suitable quantity.

[ubermaus]

Buying ex-council houses and putting them on the market at +33% the former rate is a problem. Sub-letting council houses is a problem and illeagal. Tennants are then exposed to excessive estate agent fees and private market forces, driving rents upwards of what they can afford.

 

Just more and more reasons why we require government intervention / cap rents / stimulate builds / not too sure about the 3 year rule but it's a step in the right direction.

Edited May 5, 2015 by ubermaus
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