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Unintended consequences - house rental

Community Veteran
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Registered: 21-03-2011

Unintended consequences - house rental

New rules for rented houses in Scotland could see some unintended consequences. Effectively, unless the landlord is selling the property, once a tenant puts a foot through the door they have a life time tenancy. While I can understand the need to protect tenants from unscrupulous landlords, I wonder if the pendulum has swung too far.

I don't see landlords investing their money in properties unless they get a higher rate of return to cover the increased risk of bad tenant behaviour.

Now Zen, but a +Net residue.
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Re: Unintended consequences - house rental

@AlaricAdair

Not sure if what you say is totally correct.

The way I read it is that the tenancy is on a yearly contract and can be ended by the landlord for various reasons, sale of the house, wanting to live in the property himself, refurbishment etc.

As I understand it a tribunal will deal with other issues such as non payment or late payment of rent etc.

I am fortunate not to live in rened property but would be very anxious if I was in rented property from a private landlord as he could have me evicted with minimum notice evn though I was not in rent arrears.

In my opinion that is no way for people to live, all rented property should be state controlled through housing associations.

Investors should look elsewhere to invest thir money.

Equally property should not be sold to those who reside in other countries simply for investment and profit thus forcing the price of property and rents up even further.

I hope the Law is Scotland starts to apply here.

Cumbria is one area where locals are being forced out due to the high number of holiday homes and villages are becoming ghost towns as young people are forced out.

The whole topic of housing needs addressing urgently.

Scotland has made a good start

 

 

 

Community Veteran
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Re: Unintended consequences - house rental


AlaricAdair wrote:

I don't see landlords investing their money in properties unless they get a higher rate of return to cover the increased risk of bad tenant behaviour.


And when there are so many people who can't afford their own homes (or ever increasing rents) because of the parasitical landlords, is it such a bad thing if many of the lazy "go and work harder" preachers decide to get out of the "business" ?

Frankly I think most landlords should be ashamed of themselves.

There was a program on TV the other day about house swapping with the landlord. The landlord moved into one of his tennants properties for a week after gloating how he liked the business because it was basically income for no effort. Effectively milking the very poorest in society to live a cushy lifestyle. He wouldn't be so keen to boast about doing the same on benefits.

I need a new signature... i'm bored of the old one!
Jonpe
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Re: Unintended consequences - house rental


gleneagles wrote:

@AlaricAdair


Equally property should not be sold to those who reside in other countries simply for investment and profit thus forcing the price of property and rents up even further.

 Hear, hear!


 

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Re: Unintended consequences - house rental

Yes but that business model, as bad as it is (morally) doesn't just apply to property.

I know of an electrical item I wouldn't mind for Christmas.

So what happens is:

  1. Manufacturer doesn't make enough of them. They usually do it in case the item is not successful. So they'll only make some, to assess the demand. If it is good make some more. Otherwise they have produced too many they can't sell and have lost money.
  2. When stock comes in people buy them at £x.
  3. Sell them on eBay brand new for £4 * x.
  4. Easy 3x, especially if you have bought move than one. 3x multiplied by quantity bought.
Community Veteran
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Re: Unintended consequences - house rental

Our holiday cottage is in a terrace row of low cost houses. We run it as a business, this entails overheads and also work to clean it/ meet and greet/ maintain. Ignoring the purchase price but allowing for refurbishing, we think it will break even next year, its fourth year in business.

Meanwhile either side of houses are two other houses. One is rented property, which has undergone major refurbishment, is occupied.

However the third property is private accommodation, but has been empty for over three years. The place has been on sale on the property market all the time, but it needs a lot of work to be a home. There's a financial trap. If a young couple on normal wages wanted to buy the place they'd only get a low mortgage valuation and they'd face spending upwards £20,000 to refurbish the place. Hence the place does not sell.

Sometimes you need people with capital, who can bypass the mortgage system, to bring property back into the market. The recent change in taxation against "buy to let" have reduced the number of those willing to invest. If further legislation is brought in, the incentive to finance rental property is further reduced. Meanwhile such houses will remain empty.

Some will say the local authorities should borrow more to to purchase and release properties into accommodation. I'd point to the £520 Billion the taxpayer has recently spent on government debt.

Now Zen, but a +Net residue.
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Re: Unintended consequences - house rental

Quite true that the government has spent vast sums of money on the national debt but it's a matter of priorities and there are a number of things we could all point to that cost billions and were totally unnecessary, getting involved in wars and trying to impose our values on other countries is just one of many examples.

I would suggest we should concentrate our resources on those who live in this country and spend the money on essential things such as housing, health care, education, transport services etc.

Refurbishment of houses is not that difficult, people have been doing that for years and I expect there are a number of retired people who may not have the energy to do the work but could supervise a number of younger people who had gone through some basic training in a local college to undertake the work, accepting of course that electrical or plumbing would have to be undertaken by a trained professional person.

What seems to be lacking these days is the lack of initative and thinking outside the box, less meetings, wringing or hands, negativity and more action.....that's what's needed

 

Jonpe
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Re: Unintended consequences - house rental

@AlaricAdair  People who are good at DIY look out for properties like that when they want to move.  The overseas investors seem more interested in new-builds, often buying off-plan.