Rent controls - good or bad?

[Cyclone]

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

Yes you can, supply and demand affects both equally.

 

---------- Post added 05-05-2015 at 13:15 ----------

 

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.

 

You could just provide a source for your assertion.... You know, the evidence...

 

---------- Post added 05-05-2015 at 13:15 ----------

 

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.

 

Except that you've already banned BUY to let. So purchasing it would be illegal.

[Hippogriff]

Buying ex-council houses and putting them on the market at +33% the former rate is a problem.

 

Why? Surely it's the selling of them cheaply that is the real problem?

 

A house is just a house. It doesn't matter who built (or commissioned) a house 50 years or so after it was built, whether that be a Victorian mill owner or a Council, it's still just a house, an asset (maybe Council houses are even a commodity?), a physical thing that exists in reality.

 

It has a value. That value in a free market is defined by the market. Maybe the real nub of the problem is that social housing exists and ever existed at all 'cos what people seem most annoyed by is that ex-Council houses are being used by some Landlords to profit from the misery of Tenants who are forced to rent from them.

 

I don't agree that renting is a misery and I don't think good Landlords (of which there are many) would profiteer or do anything bordering on illegal. I just don't see that Government has to meddle in something like this - but I completely understand that it is going to be popular move. Governments 'intervening' just never seems to work out well because the people we have in our Governments are not too bright.

[ubermaus]

Yes you can, supply and demand affects both equally.

 

equally? wheres your evidence?

[Hippogriff]

What would have happened in this country if there were never any Council Houses? There must be countries across the world where the idea never came up... are they all crackpot countries that we wouldn't want to live in? I don't know the answer, but I wonder...

 

---------- Post added 05-05-2015 at 13:21 ----------

 

Interested me anyway...

 

http://en.wikipedia.org/wiki/Council_house

[loraward]

You could just provide a source for your assertion.... You know, the evidence...

 

Except that you've already banned BUY to let. So purchasing it would be illegal.

 

I don't need to because you agree with it.

 

Buy to let generally involves buying property that is currently not a rental property, it was formally a private residence in which the owner lived, I agree that I wasn't very clear.

 

I would have two type of property, rental property and property that can't be let, both subject to planning. Someone applies to build some houses and they have to say if they will be rental properties or properties for people to buy and live in. Once built they can't change status without planning consent.

 

---------- Post added 05-05-2015 at 13:26 ----------

 

What would have happened in this country if there were never any Council Houses? There must be countries across the world where the idea never came up... are they all crackpot countries that we wouldn't want to live in? I don't know the answer, but I wonder...

 

---------- Post added 05-05-2015 at 13:21 ----------

 

Interested me anyway...

 

http://en.wikipedia.org/wiki/Council_house

 

They would mostly still be owned by an elite few, Maggie changed that and made it possible for the majority to be home owners, if only she had insisted on a covenant which stated the owner must be the occupant.

[Cyclone]

equally? wheres your evidence?

 

Would you like evidence that gravity affects apples and oranges in the same way as well?

 

You're the one disputing basic economic theory, not me.

 

---------- Post added 05-05-2015 at 13:29 ----------

 

I don't need to because you agree with it.

If by agree you meant I tried to look it up, couldn't find a figure for households, but found an entirely different figure for the population in general.

Buy to let generally involves buying property that is currently not a rental property, it was formally a private residence in which the owner lived, I agree that I wasn't very clear.

BTL can just as easily be the purchase of a property that is already being let. It's not Convert to Let, it's Buy to Let. As opposed to Buy to Live In.

[ubermaus]

Why? Surely it's the selling of them cheaply that is the real problem?

 

A house is just a house. It doesn't matter who built (or commissioned) a house 50 years or so after it was built, whether that be a Victorian mill owner or a Council, it's still just a house, an asset (maybe Council houses are even a commodity?), a physical thing that exists in reality.

 

It has a value. That value in a free market is defined by the market. Maybe the real nub of the problem is that social housing exists and ever existed at all 'cos what people seem most annoyed by is that ex-Council houses are being used by some Landlords to profit from the misery of Tenants who are forced to rent from them.

 

I don't agree that renting is a misery and I don't think good Landlords (of which there are many) would profiteer or do anything bordering on illegal. I just don't see that Government has to meddle in something like this - but I completely understand that it is going to be popular move. Governments 'intervening' just never seems to work out well because the people we have in our Governments are not too bright.

 

First point is these houses were never built to be profiteered from. The value of the house is retained by the state, not a private landlords pocket or a bank.

 

Second point is, with social housing it's rental value is not market force lead for a good reason. It was and is essentially affordable housing for people on low incomes (lots of people currently in the UK).

why push the illusion that everybody in the UK earns a certain amount and can 'afford' to rent privately from private landlords i.e. with or without assistance?

I think the latest figure is 1/3 cannot afford to rent privately UK wide.

 

third point is, renters are 'forced' if there is no social housing like today.

 

---------- Post added 05-05-2015 at 13:58 ----------

 

Would you like evidence that gravity affects apples and oranges in the same way as well?

 

when milk stores are raided due to bad weather does that automatically push the price of milk up? because when I went to the local store a few days later this winter I'm sure it was the same price.

Edited May 5, 2015 by ubermaus
.....

[Hippogriff]

First point is these houses were never built to be profiteered from. The value of the house is retained by the state, not a private landlords pocket or a bank.

 

Understood, but I said "in a free market". Therefore you can't expect House A and House B (of much the same size, features, situation, construction, location) to be much different in price - in that free market - just because one was built by a Council in the 1960s.

 

What they were built for and what they might be now are ostensibly different things - but they are, now, just houses and if they're on the market then the market decides their price (for purchase and rental). What I think is the real problem is that the Councils sold them off at a lower price than they should... therefore it's perceived that - at some point - someone made a killing on them.

 

But I would think that person probably wouldn't be a BTL Landlord as they may have picked up the house one, two, three or more transactions down the line? With the introduction of Right to Buy legislation, all the Council Houses weren't just snapped up in their droves by moustachioed Landlords wearing top-hats.

 

BTL Landlords may, today, buy ex-Council Houses because they might be a little cheaper than houses that have always been 'private', or because they have good-sized rooms, or are well-built, or are in actually quite desirable locations, but they aren't getting the deal of the century today, are they? The person who got the good deal is probably long-gone, the original Tenant, the BTL Landlord, today, is paying something more like market value.

[GerryBooth]

Thats true. i bough an ex Council flat. The tenant who bought made £90 a week profit in the 6 years she owned. In the 4 years I have owned it, it has made me a Capital loss of 14k

[ubermaus]

Understood, but I said "in a free market". Therefore you can't expect House A and House B (of much the same size, features, situation, construction, location) to be much different in price - in that free market - just because one was built by a Council in the 1960s.

 

What they were built for and what they might be now are ostensibly different things - but they are, now, just houses and if they're on the market then the market decides their price (for purchase and rental). What I think is the real problem is that the Councils sold them off at a lower price than they should... therefore it's perceived that - at some point - someone made a killing on them.

 

But I would think that person probably wouldn't be a BTL Landlord as they may have picked up the house one, two, three or more transactions down the line? With the introduction of Right to Buy legislation, all the Council Houses weren't just snapped up in their droves by moustachioed Landlords wearing top-hats.

 

BTL Landlords may, today, buy ex-Council Houses because they might be a little cheaper than houses that have always been 'private', or because they have good-sized rooms, or are well-built, or are in actually quite desirable locations, but they aren't getting the deal of the century today, are they? The person who got the good deal is probably long-gone, the original Tenant, the BTL Landlord, today, is paying something more like market value.

 

Ok, I was comparing council housing rents to its free market counterpart. They should never have been sold off in the first place.