Points and questions for my Labour MP – Have I missed anything?

Hello, I am having my first video call with our local Labour MP later this week. I have sent an email before our discussion. Let me know if I have missed anything?

Please see the email below:

Government policies are inadvertently contributing to homelessness and increases in house prices and rents

Landlords operating in the PRS should be encouraged and not vilified for political reasons. Landlords are selling up and new investors are not coming into the market to replace them for many reasons, some of which are as follows.

Section 24

An old Tory tax raising policy that Labour are happy to continue to benefit from. This is the only system that taxes a business on turnover and not profit! Landlords can make an actual loss but still have to pay tax on a fictional profit. No wonder very few people see being a landlord as a viable business proposition.

SDLT (Stamp duty land tax)

Once again, landlords are being single out, and treated differently from any other business. In the Budget, Rachel Reeves announced stamp duty surcharge on additional homes would  increase from 3% to 5%. They are taxed at a massive extra rate when buying an investment property making new investment un-viable. Another reason not to invest your money into the PRS and to look elsewhere.

Section 21 abolition

Nearly 70% of property professionals have issued S21s due to rent arrears (NOT for dodgy reasons). When we have to give a reason it will become apparent what the actual scale of rent arrears are in this country.
S21s are also used when an anti-social tenant scares all the others in a block. The good tenants will not go to court and stand as a witness if using a S8. They just leave instead!

The courts have massive backlogs and are not ready for the massive influx of S8 notices. All evictions will require a written reason and have to be heard in court. It takes many months to regain possession of a property (even now) and the tenant will often not be paying anything and causing problems with the adjoining flats.

The courts are not ready for the change and this will cause chaos. The landlord is faced with massive debts for repairs and cleaning and have no recourse to recover unpaid rent.

Universal Credit—Housing Benefit

The High Court has declared the Department for Work and Pensions’ (DWP) method of deducting rent payments from tenants in arrears from UC recipients unlawful. Apparently, it’s because the claimant felt “unempowered”. Who would rent to a tenant on UC if you can’t use a UC47?

Selective Licensing

This is used by local councils as a revenue collection tool. It does not require a landlord to do anything new that is not already covered in law. The fee is payable up-front for a 5 year licence and cannot be moved to a new owner. If the license is against the landlord, why does he have to apply and pay in full for each property he owns? More reasons to leave the PRS.

EPCs

Requiring landlords to meet and EPC C targets by 2030 will make a massive part of the rental stock unrentable. Owners cannot afford the upgrades and there is a national shortage of contractors to do the work. The current EPCs are not fit for purpose and do not reflect the true value. Also, what about social housing? Once again, landlords are being scapegoated and singled out for discrimination.

Forcing landlords to accept pets

Whose asset is it? Ridiculous.

Notice periods and periodic tenancies

When the Renters’ Rights Bill comes in, all tenancies will be periodic from the start. A tenant will be able to give 2 months’ notice on day 1 and the landlord will still have to give at least 2 months notice.

Using the S8 route, it will take many months to regain possession of a property with a bad tenant. There is no security for the landlord and he/she risks having to pay all the costs of finding new tenants and repeated void periods. If a landlord needs to realise their investment (plans do change) they cannot use this ground of the Section 8 until the tenant has had 1 year’s occupancy. Any other investment gives you control of your assets.

Rent Controls

Fortunately, we have not (yet) had rent controls enforced upon us as a sector, but we are aware of calls from many agencies demanding this, including the Mayor of London and the likes of Shelter and Crisis. Rent increases are a consequence of increased legislation and taxation. If controls are put in place many landlords will have literally no choice but to sell up and leave the PRS. Why would we go through the vilification and victimisation for being a landlord, only to make a loss at the end of the year?

Professionalism

Apparently, this is all moving the PRS into a more professional era. This means larger corporations taking over the sector and small, private landlords leaving en-masse. After all, Sir Kier Starmer said that landlords “do not fit his definition of working people”. What an insult. Just try working with us for a day and see what we do as ‘non-working’ people!

More Landlords Selling

54.5% of Landlords are exiting the PRS. Only 11.9% of these properties are being sold to other landlords. Where will everyone live that’s being evicted?

Landlords will be required to give longer notice periods to get their property back, or to increase the rent. Tenants will be able to query ANY rent increase which will delay it (and it cannot be back-dated to when the increase should have been from). Just another way to reduce any profits a landlord may be making.

Renters’ Rights Bill

Clauses 13 & 14 will severely affect tenants on low incomes, with poor credit history or self employed or people on variable income. Clause 13 prevents collecting several months’ rent in advance and clause 14 prevents collecting a month’s rent before signing the tenancy agreement.
Who would take tenants that may not be able to pay their rent? Once again, this will adversely affect the people it is meant to protect.

Is it time for a Landlord Equity Bill?

Discrimination takes many forms but financial discrimination is S24 where landlords are treated more harshly than any other business.
The ridiculous claim that tenants are not responsible and contributors for many of the issues like damp and mould need to be addressed.

An energy assessment system that works and isn’t based on false and incorrect assumptions should also be adopted.

Recognition that non payment of rent is tantamount to theft, and in many cases more stressful, as landlords are open to repeated thieving.
A recent court case awarded a tenant £5000 for illegal eviction when they owed £17,000 in rent. Such laws need to be changed to bring a balance as this can’t be seen as equitable.

The Bank of England should be brought to book for raising interest rates to double its own affordability rules. Then, instead of supporting people with borrowings, they scrapped their own affordability rules and allowed lenders to feast.

Lenders have created huge problems, like The Mortgage Works, by raising interest rates to more than 8% in a so-called SVR after deals end.

Equality would prevent them from hiking rates by more than, say, 2% or the current BoE interest rate.

Many landlords go through hell when they are up against difficult tenants, the pressures often appear unbearable. A support system needs to be made available with fair and fast resolution.

Any other suggestions?

Thanks,

Mark

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