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  • Buy-to-Let

    Landlord "fit and proper" person register?

    Yes, they probably do have an AST, albeit on a verbal agreement and there is a financial consideration although there may not be a taxable profit. Neither of these appear to be enforced, although that could change at any time. What I find more interesting is that this arrangement is driven by the tenants looking for an alternative to the usual channels rather than the landlord looking for an easier option.

    I'm also aware of similar arrangements in the SRS along the lines of a R2R agreement, but that's a different line that has been crossed.

    The bottom line is that there are tenants, possibly increasing in number, that do not want the increased legislation within the PRS and are looking for alternatives.

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    What reasons would a tenant have for wanting to avoid an ast? Curious as i can’t see any downsides from a tenants point of view. Or are you talking about those in the country illegally who wish to remain “hidden”.

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    Its nothing sinister, the handful that I have spoken to are mainly motivated by cost. If they can rent directly , the rent is likely to be significantly lower, there are no arrangement fees and usually no deposit. A secondary concern is a fear of credit checks and whether they would qualify.

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    That really makes no sense, what they are really seeking is a landlord willing to rent deposit free and avoiding credit checks and references, which means  they are seeking to avoid the responsible part of the sector. So you’re suggesting their should be a legal two tier system , one in which legislation is complied with and a secondary cheaper sector where the law is overlooked?

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    Its an observation more than a suggestion but it is possible to be compliant. There are already many tiers to the legal system regarding renting property and when one doesn't suit it may be possible to choose another. I'm sure there are some that have overlooked the law, but I hope there are also some that have realised there are legitimate alternatives.

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    More ways for organisations to charge fees. Another cost for Landlords to cover. Another cost that will need to be passed on to tenants. More red tape.  That said for those landlords who are running their portfolio as a business that's a different matter but do private landlords renting out a second property really need to be caught in the net? 

    Not clear to me why who the landlord is in terms of a person is an argument for registration etc. Shades of Big Brother.

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    I agree to an extent.  On one end of the scale you have someone running a full time business with hundreds of properties.  On the other end you have the retired couple letting out one flat to a friend of the family.  The red tape for this small scale end is unbelievable.

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    I must say whilst the thought horrifies me when I sit down and think about it, it's a fantastic idea. It ensures excellent standards which protects tenants and keeps rents up. The downside is further contraction of the BTL market. The investors with surplus cash buy property for letting (ie non-portfolio landlords) perhaps need to outsource their legal obligations. They are needed to keep values up.

    In response to rcpage, surely even private landlords need to adhere to the same standards as portfolio landlords. The last thing anyone wants is a two tier system were tenants pick or choose property because of red tape compliance.

    Great idea!

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    Chartered Accountant, Tax Advisor and Mortgage broker

    (and BTL portfolio owner)

    stuart@johnsonsca.com

    02039077022


    Clearly LL have reached a point of total submission and are now begging for more punishment!

    How would you feel if a malicious tenant made an accusation and got your licence revoked?

    What if the authority were to impose more stringent standards to reduce the number of independent LL to make less competition for build to rent?

    It is better allocate resources to supervise only LL proven to have done something wrong.  There is already a rogue LL register for this purpose.

    The only "benefit" I can see is it would discourage competition and rents could go up.

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