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  • Buy-to-Let

    Labour plans to sell your BTL to your tenant!

    It’s all just politics, labour have come up with an easy way of suggesting they’ll give tenants the chance to get richer for nothing, the perfect political gift as it doesn’t cost the taxpayer much at all. But beyond the simple suggestion there is no detail as they’ve not done any real thinking on it. So anything said can be taken with a pinch of salt. 

    Its a desperate gambit to suggest such ideas as it implies they have no real plans to improve the UK’s lot, if labour gained power selling to your tenants will be one of lesser worries, any move to bring in such legislation would instantly crash the property market, overseas owners of UK homes would be somewhere on the hit list, you’d expect owners of short term lets to be targetted also, tenants being able to buy would collapse the first time buyer market for new builds.
    In such an environment lending criteria would tighten considerably and the UK’s overall economy would collapse as there would be no appetite for investment, if private property can be targeted companies would have no confidence in their own safety from the suggested workforce ownership plans. 
    If we woke after a general election to find Labour were at the helm , you’d see the pound plummet and the FTSE in freefall. Nothing (politically/economically) could be worse for the country. As a result its very unlikely to happen, if it even looks vaguely likely join the queues outside your bank in the weeks running upto election day get your money in cash , then turn it into dollars or gold and ride out the storm, any such labour government ( in the unlikely event it got in) would not last 2 years if it tried its madcap schemes.
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    ...did Brexit not happen?  Did the pound and FTSE not freefall?  It could happen.  Did the Jewish elite in early 1930s Germany etc., not think that what actually happened was inconceivable?  We are in unchartered territory, ANYTHING can happen.  Be prepared.
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    So many unworkable consequences of the concept of private RTB...

    Won't this simply lead to landlords taking out equity and remortgaging properties upto the max? 85%?? Surely a property cannot be sold at huge discount if a property is encumbered by significant debts? 

    Landlords also are probably not going to be so inclined to refurbish kitchens and bathrooms to a high quality if they know a tenant will be able to buy a huge discount? Far better to refurb with bog standard fittings thus reducing the quality of rental supply.

    For leasehold properties there's no incentive to extend a lease (at significant cost) knowing that a tenant can snatch the property from you! Far better to just let a leasehold start to drop below 85 years thus making it an unattractive buy for the tenant!

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    His interview the other day says investors would be ‘protected’. And properties would be bought by tenants at market value. He’s obv done his DD and realise what’s it actually entails.

    If they are paying market value, quite frankly they can have them all tomorrow! If you bought at a 30% discount surely you’re laughing?
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    TLDR, 
    So, any lawyer firm could advise me to add to the tenancy that tenant not going to exercise rights to buy the property?

    I am about to have a 3y long tenancy drawn up. I know there is no legislation re tenant can buy on discount, I basically want to stop my tenant buying my property. Irrespective if a y legislation comes od not.
    Surely I can decide on it, right? After all it's my property. I can choose who I want to sell it to.

    Thanks.

    I pay for the advice for the legal firm, not looking for a free lunch.
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    I highly suspect that you wouldn't be able to put anything into a TA that could protect against legislation that doesn't even exist yet. 

    There is also nothing to stop the government writing legislation that would bypass anything you were to write.
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    I really do find some of the responses puzzling, our decisions are all based on our view of risk, does anyone really believe that the  risk of a labour government and rtb legislated for the prs sector is greater than the economic downside of a socialist government. I’ve seen 2 downturns of significant proportion since i first bought property, i fully expect to see another before my days are done, for me the risk of the next one is multiplied exponentially by a labour government,  but will happen in the next 20 years anyway. The threat of prs rtb will be enough by itself to crash the market long before it could be actually legislated ( if it were ever possible to do so)
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