7:42 AM, 6th March 2016, About 9 years ago 31
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Dear Campbell Robb,
You may recall a letter you received from a landlord called David in October 2015. In fact, I wrote the letter upon his request and published it on-line; you can see it here, along with comments from others.
http://www.property118.com/campbell-robb-ceo-shelter-open-letter/81625/
Time has moved on and it has now become clear to many others that the Chancellor’s attack on private landlords is going to greatly damage the private rented sector and the economy as a whole (as we, at Property118 predicted months ago). In addition to numerous economists (including Paul Johnson at the independent IFS), the Institute of Chartered Accountants, the Council of Mortgage Lenders and so on, the Treasury Select Committee has now also voiced its concern, as has the Bank of England, at this assault on private landlords.
Yet still you continue to attack us in your public statements, making the common mistake of thinking that by attacking private landlords you assist private tenants. In the Daily Mirror on the 3rd of March you are quoted as saying that private tenants ‘pay through the nose for something they can never call their own.’ The figure of £40,000 being paid on average in rent every 5 years is given. I don’t know why 5 years was the period chosen; one could equally say that the average rent is £22 a day for a 2-bedroom house. That seems quite reasonable; however, I rent out several 2-bed houses for around £300 to £320 per month. I also rent a house for £500 a month, housing 3 working adults. Were they to want to buy, it would be eminently affordable. These tenants are also not paying through the nose.
Many landlords cater for this ‘lower end of the market,’ charging very similar rents to those charged by social housing providers; with the big difference however that we then have to return a portion of the rent received to the Government via taxation, meaning that in many instances we provide cheaper housing than Housing Associations. I notice that you don’t attack them for ‘taking’ £40,000 over 5 years, which ‘could have been a deposit.’ Can you explain this differentiation?
It is evident to me that there is a strange implication behind these anti-landlord comments, namely that you seem to imply that we should provide the housing for free as then the tenant would have the £40,000 in their pocket for a house deposit. Not even publicly-funded Housing Associations and councils do this, but you criticise us implicitly for accepting payment for the housing we have funded out of our own money; we have often worked hard at creating these homes and have taken great risks in the process. But in your world it is as though landlords have no associated costs with these rentals (in fact, landlords lost £9 billion last year through arrears and damages, in addition to much of the rent often going towards the mortgage).
Regrettably, you have also promoted and supported the removal of our right to offset the finance costs of our business. When are you going to realise that this is not only grossly unjust to landlords but is going to be extremely injurious to the tenants you purport to represent? It appears to me that you have in fact abandoned the millions of tenants in this country who do not want to become owner-occupiers at this stage in their lives or simply will never be able to afford it, as my parents couldn’t, having been reliant for many years on benefits.
When this levy on finance costs was introduced in Ireland, rents skyrocketed, as I have outlined in my article here:
http://www.property118.com/uk-rents-set-sky-rocket-osbornes-tax-grab/83275/
So, don’t blame us when this happens here (landlords are already upping rents in order to build a war chest for when we have to pay tax on ‘fictitious profit’). We won’t be benefiting from this money – we shall merely be collecting it for the Exchequer. This is why it is being called a ‘tenant tax.’ When are you going to stop supporting it?
It is clear that nobody is speaking up for tenants, except for private landlords. You are certainly not helping with your continued slurs against landlords, which is just feeding into the anti-landlord juggernaut and assisting the Government in its agenda of trying to tax private landlords into oblivion whilst promoting the institutional building of accommodation which will be expensive and Orwellian in its sameness (unsurprisingly, yet scandalously, there is evidence of links between these institutions and the funding of the Conservative Party). Not everyone wants to live in a box though; many people want to rent in their communities and have gardens and space – something many of us private landlords provide. Take a look at this article and you will see the extent of the danger ahead for tenants:
http://www.property118.com/new-landlord-tax-could-affect-tenants/83886/
Neither Shelter, nor Crisis, nor the Government, nor anyone seems to be taking this impact on tenants into account. Whether you loathe us or not (you certainly seem to), you need to wake up to the collateral damage of this ridiculous and evil onslaught on the private rental sector, before it is too late. I have pointed this out to several Labour Party politicians and told them to note, as I tell you, that these letters stand as public testament to the fact that you have all been told what the consequences of this unprecedented attack on the PRS will be; so none of you can plead ignorance later. The letters are here:
http://www.property118.com/rob-marris-mp-and-sir-roger-gale-same-party/82156/
I believe both you and many politicians have lost sight of the principles which should guide you all. Rather than criticise housing providers (but only one section it seems – private landlords; not institutions, not social housing providers and not councils) I believe you should start working constructively with them instead and/or start providing ‘shelter’ yourselves.
Private landlords’ confidence and trust has now been so damaged that we are effectively halting any expansion or development. You may have noticed this week that house-building has taken a nose-dive. As private landlords have often provided the seed finance for new-builds, this slump is not unexpected. Is this what you want?
I think it is time you clarified what the aims of Shelter now are as you have lost your way.
Yours sincerely
Dr Rosalind Beck
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Russell Thomas
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Sign Up13:33 PM, 7th March 2016, About 9 years ago
Reply to the comment left by "Steven Burman" at "07/03/2016 - 12:25":
Don't quite follow your logic as how Siobhain McDonough a Labour MP is a lapdog to the Conservative Chancellor George Osbourne?
Markb
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Sign Up13:43 PM, 7th March 2016, About 9 years ago
Reply to the comment left by "Ros ." at "07/03/2016 - 00:06":
Ross. What an excellent letter.
We should look to crowd fund it an the obvious spin offs as open letters in the Telegraph to various people. Lets not leave getting a reasoned substantive reply to chance.
Let's do it openly and ask for a public response too.
We should also pick a high profile safe conservative seat and go after that MP to state their position on Tenant Tax too. Again, by open leter in the press. Can you imagine if Liam Fox or Ian Duncan Smith or another vocal outspoken Tory seats were threatened by the Tenant Tax.
With the budget and the EU referendum looming we will never have a better opportunity to get a repeal of the Tenant Tax!
terry sullivan
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Sign Up13:58 PM, 7th March 2016, About 9 years ago
Reply to the comment left by "Markb " at "07/03/2016 - 13:43":
stephen hammond -Wimbledon is one of very few london tory mps
Diana Seymour
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Sign Up14:28 PM, 7th March 2016, About 9 years ago
It is ludicrous to suppose that private landlords are depriving first-time buyers of property. We own 2 flats - one is rented by a Portuguese family who will only be in the UK for a couple of years, and the other is rented by 2 Australian and one Candian girl who will be leaving in the summer! None of those people would be wanting to buy, yet they do need somewhere to live whilst working and adding to the UK economy. Osborne and pals are just playing politics - saying what they think the public want to hear so they can get re-elected. It is nothing to do with improving anything at all.
Jon Pipllman
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Sign Up14:56 PM, 7th March 2016, About 9 years ago
It isn't just individual LLs that are kicking off now. I wonder what Mr Robb's view is on the potential impact on elderly and vulnerable tenants of Housing Associations
Here the CEO of the York Housing Association talks of a "perfect storm" of cuts that will put risk the supported housing of hundreds of York's elderly, disabled and vulnerable residents
http://www.yorkpress.co.uk/news/14324901.Housing_for_hundreds_of_York_s_elderly_and_vulnerable_people_under_threat/
Dr Rosalind Beck
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Sign Up9:37 AM, 9th March 2016, About 9 years ago
Answer just received from Campbell Robb:
'Dear Ros,
Thank you for sending on details of your most recent letter to me. While we support the changes to landlord tax relief (see our blog here), they have never been one of our campaigning priorities. Our current campaigns are to
· Increase the supply of new homes, particularly affordable homes
· Defending the housing safety net
· Improve the regulation of the private rented sector, such as giving councils more powers to take on rogue landlords
We value the good job done by the overwhelming majority of private landlords. As part of this, Shelter has been at the forefront of doing objective research into the landlord sector and the views and priorities of private landlords. With this in mind you may be interested in the recent publication of the results of our landlord survey, which is the largest of its kind. You can find them here.
Yours sincerely,
Campbell Robb'
Big Blue
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Sign Up11:09 AM, 9th March 2016, About 9 years ago
Typical issue-dodging response.
Does he not recognise the link between C24 and increased rents/evictions? If he does, then how does he square that with Shelter's existential purpose?! It absolutely beggars belief for him to claim tenants and secure homes are Shelter's priority whilst simultaneously supporting a policy that causes the harm he seeks to avoid.
Hypocritical, stupid, unbelievable. If he wants to be seen as credible then he needs to start providing some detailed answers on C24's cause and effect and how he sees Shelter's aims fitting in with those things. If he doesn't or can't reasonably express his true position, then his opinions, and Shelter generally, should be treated with suspicion and contempt.
Paul Cummings
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Sign Up12:24 PM, 9th March 2016, About 9 years ago
Reply to the comment left by "Markb " at "07/03/2016 - 13:43":
I think it may be more prudent to pick marginal seats. You may get more reaction from a Tory MP scared sh**less of losing his/her place on the gravy train. For example, I live in Bury North. Below are the 2015 and 2010 election results.
2015
Conservative: 18970 (41.9%)
Labour: 18592 (41.1%)
2010
Con: 18070 (40%)
Lab: 15827 (35%)
It wouldn't take much for David Nuttall to lose his seat. Landlords themselves could swing this to a loss by either voting Labour or not voting Tory. By pointing out to all tenants the effects on them of forced rent increases due to the Tory tenant tax, thus encouraging they vote against Conservative.
Monty Bodkin
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Sign Up13:03 PM, 9th March 2016, About 9 years ago
Reply to the comment left by "Ros ." at "09/03/2016 - 09:37":
"With this in mind you may be interested in the recent publication of the results of our landlord survey, which is the largest of its kind."
Which was carried out immediately before the summer budget, making a lot of it meaningless.
Can't blame Shelter for its incredibly bad timing but it does show that like us, they had no idea this was coming.
The biggest tenant welfare organisation in the UK and their opinion was not even asked for.
(Just as well IMO, as it seems to me their opinion is they don't give a damn about the consequences to tenants just as long as landlords are getting a good kicking.)
Where is the Shelter research and surveys into the effects on tenants of Clause 24?
Gareth Wilson
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Sign Up17:27 PM, 11th March 2016, About 9 years ago
A landlord friend of mine has also been writing to Shelter, and has given me permission to post the below main body of his latest letter:
"I hope this email finds it way to you and please accept my apologies for writing to you directly however I am very concerned that Shelter may not understand the probable implications of the government's Clause 24 in the Finance Bill 2015.
First of all I would like to give my sincere support to the service that Shelter provides to vulnerable people and state that I have many friend who work for Shelter in Nottingham on the front line of the service.
Having written to my local MP's I was surprised to see that the responses from different MP's from different parties, all of whom shared concerns that Clause 24 won't be effective in making homes more affordable for first time buyers and that it would also push rents up, were hiding behind the fact that Shelter has apparently given its support to the change. I am hoping that this is MP's spinning a lie as if it isn't I am concerned that Sheltermust not have understood the effect of the change.
I am a landlord who owns 30 properties in Nottingham. All of my properties are in the poorer areas of Nottingham and my typical tenants are either lower income working families or unemployed families. I own the properties in partnership with my Dad and they are a business that we have built up over the past 10 years. All of our properties are owned with buy to let mortgages and the business does not generate a huge profit or keep me in a flash lifestyle. I pride myself on providing a good quality home that my tenants can be proud to live in and I try to do so at an affordable rent. Most of my tenants have lived in my properties for an average of over 5 years. Being a buy to let landlord I am not on a level playing field with a home owner. I have annual safety checks to carry out, I pay a premium interest rate on my mortgage for it being a buy to let property whereas homeowners benefit from beneficial rates, I have to pay for public liability insurance on my properties, I have to apply to rules and regulations that normal home owners do not.
Under the changes being brought into place under Clause 24 the profit that my Dad and I declare on our portfolio (last year jointly £42,000 or £21,000 each) will be completely wiped out and I may even have to pay tax on money I don't get. This is my living, and i work at it full time (I think you would agree that £21,000 a year is not an exuberant earning and if interest rates go up this figure will dramatically reduce). Under the changes, I will have only 2 choices.. Either I will have to evict my long term tenants from their family homes and sell the properties to those who are privileged enough to be in a position to buy. Or I will have to put my rent levels up (and quite a lot to cover the loss this change will cause) What is more, at the current interest rate under the planned change, my profit is reduced to at least zero. Every time the Bank of England puts the rate up, as rates start to rise, I would have to pass on the rate rise to my tenants.
I would also like to point out that this legislation does the opposite of leveling the playing field as it only taxes those of us property owners who purchased our buy to let houses with mortgages. The old money landlords who bought their properties years ago ans who own their portfolios outright with no lending (who are in turn the ones who really make the big profits as they do not have the legitimate interest costs that we have) will not be affected by any tax increase at all. In fact they will benefit from even bigger profits caused by the average rent levels being forced up across the board by the huge number of buy to let landlords who have no choice but to increase their rent levels in order to pay their tax bills.
I apologise for the long winded nature of this correspondence however I think it is hard to explain quite the dramatic effect that this legislation will have without going into some detailed example.
I really do think that Shelter should more closely analyse the effect that clause 24 will have on the desperately needed supply of affordable homes that it's core service users rely on as I think it can only act to reduce the number of affordable homes available by landlords having to sell out of the industry or put rent levels up at a time when benefits payments are coming down.
I also think that once doing so Shelter should come out and openly withdraw it's support for the government's changes as to continue to support Clause 24 seems to go against one of the core principles of Shelter.
If you would like to discuss this matter further I would be only to happy to openly show you how this change will affect my modest portfolio. I also manage several other larger portfolios for landlords (both family and friends) numbering 300 properties in total, mostly in Hull and having analysed their portfolios they will be affected even harder than me and will definitely under the new scheme have to pay more tax then they actually receive in profit."