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Nearly half (46 per cent) of landlords and letting agents are more likely to remove some or all of their investment in the private rented sector as a result of the Government’s plans to end Section 21, ‘no explanation’ repossessions.The findings come from a new survey by the Residential Landlords Association of almost 6,500 landlords and letting agents, their biggest ever response. The research also found that over 40% of landlords are waiting for other planned changes by the Government to become clearer before they make decisions on their ability to provide homes to rent.The figures come just weeks after the Royal Institution of Chartered Surveyors warned of private rents increasing by an average of three per cent a year over the next five years as a result of landlords being less prepared to rent property whilst demand from prospective tenants increases.In April, the Government announced plans to end Section 21 repossessions, alongside proposals on improving the process known as Section 8, under which landlords can repossess properties on grounds such as rent arrears or anti-social behaviour. This process requires landlords to apply and be granted permission to repossess via the courts yet official data shows that it takes over five months on average from application to repossession.According to the survey, of those landlords with experience of such repossessions, 79 per cent did not consider the courts to be reliable. Almost 91 per cent of landlords supported the establishment of a special housing court, bringing together all housing disputes under a single body.With concerns that landlords selling property will usually require tenants to be evicted, the RLA’s survey found that 48 per cent of respondents said that they would be encouraged to purchase a property to rent with a tenant in situ if they could reclaim the three percent stamp duty levy on the purchase of rental homes on the condition that the tenants can remain in the property for a year or more.The survey also found widespread support for new grounds to be established upon which landlords can regain possession of a property. This included to sell a property and to ensure tenancies can best meet the needs of certain groups such as students, who do not require the indefinite style tenancies being proposed by the Government.David Smith, Policy Director for the Residential Landlords Association, said:“Security of tenure means nothing unless the homes to rent are there in the first place. With the demand for private rented housing showing no signs of slowing down it is vital that landlords are confident that they can quickly and easily get back their property in legitimate circumstances.“Whilst the system should clearly be fair to tenants, it needs also to support and encourage good landlords. Our survey shows how complex it will be to ensure that the grounds on which landlords can repossess properties are both clear and comprehensive. This needs to be underpinned by a court system that is fit for purpose and properly resourced. At present it is neither.“It is vital that the Government’s planned reforms are carefully considered to avoid finding ourselves needing to reopen this whole issue later down the line.”SEE ALSO - Section 21 - curated threads, news, & videosUP NEXT - Section 21 - Are landlords under attack?DON'T MISS - Number of private landlords in declineNOW WATCH:
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
I find the results interesting
I would like to know which sector of the PRS will sell as S21 goes
My guess is it will be the accidental Landlord who rents an old home or smaller Landlords
None of us know what the Govt will come up with to replace S21
For me personalty as long as lenders lend it will be ok
I think larger Landlords who run BTL as a business not an investment will be happy to have tenants stay longer
This is where the opportunity will come in BTL as we see Landlords leave and a new breed of LTD Co landlords will replace the ones who leave
The process of change is in force now it - just depends on what Business Plans you have for the coming years ...
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
Observation - The number of poor condition ex-rental properties being offloaded in Auctions is shocking.....feel sorry for the renters who lived in those conditions.
Mine is in good condition according to the agents who've taken it on for me. I was glad to hear that considering the thousands I've spent on maintenance in the last couple of years! From the photos though I can see the tenants have repainted a couple of rooms and painted around wardrobes! Nightmare but the agent doesn't seem to think that will put people off buying it (I'd asked him to let me know if he thought it best to do any work before putting it on the market).
Yes I agree
I feel likewise sorry for the number of landlords whose tenants shockingly dont look after their rental properties and punch doors when they get angry and dont report leaks and the like . I also feel sorry for tenants and LHA landlords where the tenants migrate to UC and get overwhelmed by the complexities of the system and the LL doesnt get paid due to the shockingly awful DWP systems so has no choice but to evict . I`ve got 3 Sec 21 `s ( while its still a valid document ) going through at the moment because of UC . The rise in the amount of homelessness is shocking . I feel sorry for the tenant when they end up in a shocking condition B&B 30 miles out of town as the Gov hasnt built enough houses to house them . And they also let their current old stock fall into shocking disrepair with damp and mould and leaking roofs and ancient CH systems which constantly break down and leave my tenants with no CH for a month
A workable efficient viable Housing Court cannot come soon enough for the benefit of all parties
Jonathan Clarke. http://www.buytoletmk.com
I'm an accidental landlord in the UK. I moved to France and was unable to sell my UK property. A tenant just left and I was going to put it up for let again but via an agent this time because so much has changed since the last time I let it. However, with S21 going (worries me even though I've never had to evict a tenant) and lettings relief going next April and the halving of the period allowed as PPR for the last period of ownership, it just feels like it's best to get rid. I wanted to sell it originally but in the last few years I've felt glad I didn't, partly because of the income it's given me but also partly because I've known it's there to go back to if I needed to. I have a 44% mortgage (based on what it's on the market for at the moment) though and talk of property prices crashing doesn't help - they haven't moved in ten years in my area of N Yorks as it is (I've just put it on the market for less than I had it on at 10 years ago, to try to get a quick sale). It's a huge house and far too big for me nowadays anyway (family of six is now mainly two). It'd be ideal for a HMO or holiday let and the return would be better but that's not easy to manage from abroad.I doubt I'll stop being a landlord altogether. I still have property let in France and I won't want to bring the cash from my house over here with the current bad exchange rate so I'll probably look for investment properties in the UK - smaller and cheaper and more, so the risk is spread. I'll look at whether it's better to set up a company when I'm at that point, rather than buy in my own name. If I get it sold soon I'll try to hold off until it's clear what the new rules are going to be. A change in government to the Labour party could have a massive impact, from what I've been reading of some of Jeremy Corbyn's proposals.
IF the government does what it says (improve S8, speed up the process) then I don't think it should be too much of a problem.