10:51 AM, 27th September 2024, About 3 months ago 15
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While landlords are distracted by the nonsense that is the Renters’ Rights Bill, the biggest elephant in the room is a pledge for PRS homes to meet an EPC minimum rating of C.
Ed Miliband, the so-called (big fat) net zero minister, claims that rented homes that don’t meet this criteria will be banned from the PRS.
Really? Just the PRS and not social housing or owner-occupier homes?
It now turns out that the ‘consultation’ will cover social housing but I’m saying right now that the sheer cost of upgrading social homes will make this a non-starter.
The big fear, I suspect, is that Labour really doesn’t understand economics, landlords or the PRS.
There’s a frightening prospect looming and until we know what the ceiling on the upgrade spend is, I’m guessing more landlords will quit.
For landlords that have the equity then selling up now before the claimed Capital Gains Tax rise comes in makes sense.
It also makes sense to bail out now before the RRB becomes law and we get lumbered with tenants who don’t want to leave. Or pay rent.
And if your property needs a fortune spent on it to save the tenant a couple of quid per month then, yes, selling up is the right thing to do.
That’s three very painful assaults on landlords now underway and for those who have been in the sector for years, this is the thanks you get.
We have always been the bad guys, having invested in providing a home for tenants when investment was needed.
But guess what Labour? Investment is still needed but you’re frightening the investors away.
There will, undoubtedly, be a long-term potential for investing but I’d say it’s now for those who are buying with cash or have low LTV BTL mortgages.
For everyone else, there’s a reckoning coming, and you’ll need to get your calculator out now to see what 2025 will look like.
So, my big issue is this: We don’t discuss the fact that the UK pumps out around 1% of global emissions – and what is the PRS’ share of that?
Are we really as a country prepared to sacrifice half the PRS for a Labour Party soundbite?
For complying with a nonsense target that won’t make a jot of difference to global warming? Not a jot! Nada.
Without China and India on board, nothing will change. If you want change, add tariffs to imported goods so they have to make a change.
Don’t punish landlords in the mistaken belief that our homes are melting the glaciers, you absolute tools.
While the glaciers will be around in a few years, can the same be said for PRS landlords? I doubt it.
I’m really worried that this is a continuation of the Tory move to shrink the PRS and the number of small landlords.
What other explanation is there?
It doesn’t help when the likes of Miliband say that a lot of the country’s poor are living in ‘cold, draughty homes’ and that many PRS homes are ‘below decent standards’.
Despite this claim, the worst examples of poor quality homes are those provided by councils and social housing associations. We don’t hear MPs having a go at them, do we?
But there is so much wrong with the EPC plan for landlords it must be by design.
It will cost £24bn to upgrade PRS properties to an EPC C rating – but we don’t have the money or the workforce to do it.
The majority of landlords offer decent homes so it’s nonsense to say they are cold and draughty.
That’s a big brush you are painting us with there Mr Miliband.
The EPC grading system is a joke with bizarre ideas of boosting a rating. Wind turbines? Insulated floors? Solar panels?
These are expenses that don’t repay for years – and solar panels have a life of 25 years. So, do we have to do it all again in that timescale?
It’s expensive and as landlords will repeat – tenants always pay for the upgrade with higher rents.
But with fewer homes to rent thanks to Miliband’s barmy EPC notion and Two-Tier Kier’s Renters’ Reform Bill, the writing is on the wall.
For tenants that is, it’s always the tenants.
And it’s a shame that the organisations representing them – Generation Rent and Shelter – are as clueless as our politicians about the impact a sound bite can have.
You have a home to rent and soon many of you won’t.
Give your Labour MP a sound bite of your own when you can’t find anywhere to rent at a price you can afford.
I can give you some ideas but don’t blame us when this fall-out occurs – we’ll be out of it, taxed to the hilt and bruised from the experience, but we’ll be gone.
Until next time,
The Landlord Crusader
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Renters' Rights Bill - Government reveals full details
Steve Rose
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Sign Up11:04 AM, 28th September 2024, About 3 months ago
Reply to the comment left by Ian Narbeth at 27/09/2024 - 12:30That's relatively simple, there are two definite alternatives, with a possible third:
1) If a tenant has an active tenancy, you would be expected to pay for alternative accommodation during the works. The cost of this would obviously form part of the works, therefore be part of the £10k maximum. You would also be bearing in mind the cost of this in your rental increases now, so that you can allow for it.
2) You decide to sell up, for which you will still be able to use Section 21. Thus making the tenant homeless.
3) If the law makes it illegal to rent a home that isn't a grade C, I don't see how a court can refuse an eviction notice if it means that the Landlord is breaking the law against his own wishes. This a Section 21 served two months before the implementation date should be valid.
We don't know the full details of the scheme yet, but my suspicion is that the housing department will be able to offer temporary exemptions where the Landlord is proposing option 2.
Steve Hards
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Sign Up14:15 PM, 29th September 2024, About 3 months ago
Reply to the comment left by Cider Drinker at 27/09/2024 - 16:10
Never mind which lodge...I think we will see the rise of 'landlord friendly' EPC assessors who are prepared to massage the rating upwards in return for a backhander.
Ian Narbeth
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Sign Up11:17 AM, 30th September 2024, About 3 months ago
Reply to the comment left by Steve Rose at 28/09/2024 - 11:04It is not just alternative accommodation. It is dealing with the tenant's belongings - storing them and facing claims of loss and damage. OK so a complete inventory can be taken (at what cost and how long will it take?) Alternative accommodation is not straightforward. Needs to be flexible as the timetable for the works may not be fixed. We will need to see what Labour come up with but the cost of alternative accommodation may not count towards the £10,000 (or whatever figure is proposed).
The court can only evict if there is a specified ground. The fact that a landlord will be fined for something he is not responsible for ought to be a ground but I am not aware of any such ground. The courts do not have a general discretion to act fairly. I am sure many Labour MPs and tenant groups will be quite happy to see landlords punished in such circumstances.
When I studied jurisprudence, an example of what is called legal positivism was put forward by Hans Kelsen - that the law could compel someone to do something and yet punish him for doing so. Landlord and tenant law is moving in a totalitarian direction and I have no confidence in this Government to prevent such egregious injustice.
I suspect your option 2 (but using s8 as s21 will have gone) will become the norm.
Steve Rose
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Sign Up13:44 PM, 30th September 2024, About 3 months ago
Reply to the comment left by Ian Narbeth at 30/09/2024 - 11:17
To be clear, I believe my Option 3 is still valid.
Under the proposals, both Ground 6 (Redevelopment) and Ground 6a (Compliance with enforcement action) are Mandatory Grounds for possession.
I agree with your concerns about option 1, but it will still be an option where both parties choose to go down that route. We have one tenant in a property that would need internal insulation, I would rather pay for her to move elsewhere temporarily than lose her as a tenant. (Though, as stated originally, my preference is to do nothing until 2030)
Susan Darke
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Sign Up16:26 PM, 30th September 2024, About 3 months ago
As a small landlord of 4 warm dry flats in Wales that will never achieve EPC C but will be required to have internal wall insulation (risking damp and mould) to justify "all works done", I often refer back to this part of the exemptions from achieving EPC standards:
Consent requirements:
"If consent is required for an energy efficiency measure, the landlord must demonstrate that they sought consent and that it was refused or granted subject to a condition they couldn't comply with. If consent can't be obtained from the current tenant, the exemption will only be valid for as long as the tenant remains in the property"
Hopefully the government won't throw this out...
When the madness comes into effect I will offer my tenants the choice of their flat being torn apart around them and their rent having to be raised to save them a few pounds a year in electricity or refusing me their consent. My guess is they will choose to refuse.
As my tenants would find it almost impossible to rent anywhere as cheaply, as I value them and keep their rent well below the market rate I sleep a little easier.