Greedy Landlords Part 3

 Assuming there are still Landlords renting to tenants when Labour's equivalent of the Renters Reform Bill becomes law - expect rents to rise.

Labour is set to introduce a range of measures to punish Greedy landlords. We already know that the real winners are Banks, the tax man - everyone except tenants and landlords.

Labour is planning to do two things

  1. Introduce rent controls - ie cap the amount rents can increase each year
  2. When you evict a tenant a judge can decide if they would be worse off if you evicted then and force you to keep the tenant
One of the few things I have learnt in life is "Measurement drives behaviour".

These are measurements which Landlords now need to be very aware of.

Let's take the second one.  Let's assume your tenant has been living in your property for a number of years.  They have been paying rent on time and you think they are a good tenant so you decide as a good landlord (not a greedy landlord)  not to increase their rent each year. However the tenant now has a new partner and they are now taking drugs and have decided not to pay their rent regularly - drugs are a higher priority than rent.  You decide to evict them, pay the £350 fee - wait a year or more for the amazing UK court system to hear your case  and then it finally ends up in front of a judge.

When you started renting to the tenant their rent was £900 per month.  You thought they were good tenants so the rent stayed at £900 for 4 years.  Now market rates are £1100 per month - £200 a month less than you are charging. The tenants have looked around for somewhere else to live because you wanted to evict them and they realised they would have to really cut back on their drug taking as their rent would be £200 per month higher! 

Thankfully the Judge comes to their rescue.  The judge realises that their rent is £200 less than the market rate so they would be worse off if they are evicted.  Sure they do a bit of drugs but drug-dealers would be worse off if the Judge decided to evict them.  He tells the tenants to make sure you're up-to-date with your rent and dismisses the case. The tenants can stay.

So the landlord decides to increase the rent to the market rate.  However that's a 22% increase. He decides to proceed with the 22% increase and files the relevant Form 4 notice for a rent review.  However the tenants take it to Citizens Advice who advises them that it's illegal to increase it by 22% to the market rate and he's only allowed to increase it by 3% due to rent controls.  

The poor landlord will never be able to restore the rent to market rates because of rent controls and will never be able to evict these now problematic tenants.

Scotland introduced rent controls in 2022 - capping rent increases to 3%. Yet rents in Scotland are rising the highest in the UK - 10.5%.  There is provision to increase higher than 3% if the rent is significantly below the market average - but it's still capped - you cant raise by 22% for example.   

Rent controls when introduced mean that Landlords will increase rents whenever it's possible - regardless if the tenants are nice.  Landlords  don't want to be in a position where it's illegal for them to increase rent and create a situation where it's impossible to evict the tenant.

Letting Judges decide if the tenant will be worse off if their rent is low means Landlords will do everything they can to increase rents to align to market rates in order to avoid getting stuck with a problem tenant if it ever needs to go in front of Judge Rinder/Judy.

Labour think they are helping tenants - not really - they are encouraging Landlords to be "Greedy" in order to protect themselves.  The losers are Tenants.  The Landlord is unlikely to be the winner - rent increases usually benefit the tax man - not the Landlord.

It can be said that regular "small" increases in rent are better for the tenants.  I can kind of buy that - if you don't increase it regularly and then have to make a big increase on an infrequent basis , it's harder for the tenant to accept.

Measurement drives behaviour after all.

Anyway the real message is evict all your tenants and sell-up.   Killjoy Starmer wants to sieze your property as part of his communistic "Great Reset" and Greedy Land grab.


- POST ARTICLE COMMENT

Well it seems the real Greedy ones are Labour.  "Free Gear Kier" likes taking free  clothes donations,  thousands of pounds for glasses,  free hospitality boxes at football.  The list goes on.  This greediness is not limited to Starmer - it seems all of the Labour ministers are at it. He's taken more "freebies" than any other Prime Minister within a few weeks in office.  Yet he vocally voiced his anger when he was opposition leader when there was a hint of this in the conservative party.  Yet the scale Labour are taking "freebies" is clearly unprecedented.  Clearly Labour are hypocrites and "Out of Touch" with reality.

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