Rental properties and new EPC rules

[niemeyjt]

So more landlords would mean lower rents?
Doesn't seem to have happened over the last few years. Quite the opposite - a free market has driven rents and property prices as high as they can go.

Of course it hasn't - the rents have gone UP over the past few years as the various bash the landlord laws came in and the number of landlords has dropped over past few years. More landlords - or more precisely more rented properties available - would of course push rent down - supply and demand.

The SDLT changes did not affect us - but paying for the check-in, check out etc did impact us. Some landlords may have left the market as a result. We just banged £100 pcm on rent to cover it - and if tenant remains over a year we gain - otherwise we lose. But either way the tenant pays more - just in a different way.

The next thing - the ban on evictions etc - will push out some more landlords. Those that remain won't take anyone without a guarantor. So who loses out? Those with no guarantor.

Then the EPC rules will force out a few more - then the rest will hike rents again - supply and demand.

Then if labour get in and add NI to rents - the same thing will happen over again. The few remaining properties will cost a fortune to rent - maybe two families will have to co-rent?

Insanity is doing the same thing over and over and expecting a different result.

 

[Doug71]

The agency I use for my rental said they used to manage over a thousand properties but now they only have 600 on their books because lots of landlords are selling up and getting out.

 

[niemeyjt]

The agency I use for my rental said they used to manage over a thousand properties but now they only have 600 on their books because lots of landlords are selling up and getting out.

Precisely. And those that remain can and will charge more and will expect guarantors. And those unable to pay the higher rents and find guarantors will lose out again.

 

[paulrbarnard]

It isn't all roses for landlords either.
We got in to financial difficulty in 2020 due to not getting my salary during Covid. In order to survive we decided we would have to sell our rental property. We had to give the tenant six months notice, which was not a problem. It was actually a tough thing to do as they had rented from us for about four years with never a problem. We let them know in November 2020 that the notice would be coming in January and they would have six months notice from January. They were receiving housing benifit and when it got July they then refused to leave. The local authority told them if they left they would be making themselves homeless and they would not be helped to find a new home. Rather than start legal proceedings to get them out we let them stay on a month by month basis untill they found another place to rent, which finaly happened in October. We then put the house on the market and finished up with multiple offers and sold in two days. This was at the end of October 2021. Then ensued a nightmare too and fro with the prospective buyer who turned up concern after concern over the land registry, local land fills, flood plains etc etc etc. This went on all the way until July 2022 so well over a year from when we had decided to sell the property. As most will remember there was a lot of house price scare mongering and mortgage issues in the June/July time frame and the buyer finaly came back and said they had been turned down for a mortgage. The real insult was when he came back a few days later with a vastly reduced offer. I told him where to go in no uncertain terms. We actually wondered if he had played it this way as he knew our situation and was trying to force us to the point of having to sell to him at a discount. Anyway a long story but just sharing why being a landlord can have its down side. Sure we had the asset but we were at the point where we were about to default on the mortgage on the rental property and our live in home and could do nothing about it. The happy ending was that the company I work for recovered and paid me all the back pay from 2020. We were able to keep the house and rent it out again. We had it completely redecorated, new carpets through out and addressed some other things that had got tatty over the four years the tenants were in the house.

The other part of this story is that my daughter had rented a one bed studio flat in Bristol for several years. Her rent was £1000 a month and in August her landlord informed them the rent was going up another £300. It was a pretty dire place tucked round the back of a takeaway restaurant with only one window at the rear of the property. I think he landlord is one of those that is causing all the4 legislation coming in. Thjey had had multiple issues, including leaking roves, no functioning appliances and horrendous neighbour issues (can't blame the landlord for that one). They couldn't begin to afford the increase and despite looking couldn't find anything cheaper in Bristol. They are now renting our house, on mates rates, so they can finally save up to get a place of their own. As mentioned earlier we are about to do the same for one of our other daughters who is studying to be a nurse in Cardiff.

I really feel for those who are trapped in the rental market with the level of rents today preventing them from building the funds they need to buy. I have four daughters, three of which rent, and they all see house prices or the mortgage repayment requirements continue to stay just out ahead of what they can save/afford. It is very different today from when I first left school, got my first job and bought my first house. As a multiplier of salary houses seemed very much cheaper then and mortgages, while expensive due to higher interest rates, at least were offered with small deposits that let you get on the ladder.

 

[niemeyjt]

You make a valid point - with high rents there is nothing left to put aside for a deposit.

Another reason why the various governments' "bash the landlord" schemes have backfired spectacularly.

 

[Ozi]

The only real answer to the high cost of housing is to build more and better houses, build the houses that are needed in an area not the ones that make the greatest profit, which means reforming our very corrupt planning system. NIMBYs need to be told if it doesn't directly effect you you can't complain and Landlords (like me) need a FARE licensing system so that prospective tenants can judge who they are dealing with. Also a Fare rent cap based on the rate-able value to control some of the ridiculous inner city rents where supply and demand clearly do not result in a fare and reasonable outcome.

None of that's going to happen, Landlords are too easy a target and a joined up planning system is seen as attacking local democracy.

 

[Ozi]

It isn't all roses for landlords either.
We got in to financial difficulty in 2020 due to not getting my salary during Covid. In order to survive we decided we would have to sell our rental property. We had to give the tenant six months notice, which was not a problem. It was actually a tough thing to do as they had rented from us for about four years with never a problem. We let them know in November 2020 that the notice would be coming in January and they would have six months notice from January. They were receiving housing benifit and when it got July they then refused to leave. The local authority told them if they left they would be making themselves homeless and they would not be helped to find a new home. Rather than start legal proceedings to get them out we let them stay on a month by month basis untill they found another place to rent, which finaly happened in October. We then put the house on the market and finished up with multiple offers and sold in two days. This was at the end of October 2021. Then ensued a nightmare too and fro with the prospective buyer who turned up concern after concern over the land registry, local land fills, flood plains etc etc etc. This went on all the way until July 2022 so well over a year from when we had decided to sell the property. As most will remember there was a lot of house price scare mongering and mortgage issues in the June/July time frame and the buyer finaly came back and said they had been turned down for a mortgage. The real insult was when he came back a few days later with a vastly reduced offer. I told him where to go in no uncertain terms. We actually wondered if he had played it this way as he knew our situation and was trying to force us to the point of having to sell to him at a discount. Anyway a long story but just sharing why being a landlord can have its down side. Sure we had the asset but we were at the point where we were about to default on the mortgage on the rental property and our live in home and could do nothing about it. The happy ending was that the company I work for recovered and paid me all the back pay from 2020. We were able to keep the house and rent it out again. We had it completely redecorated, new carpets through out and addressed some other things that had got tatty over the four years the tenants were in the house.

The other part of this story is that my daughter had rented a one bed studio flat in Bristol for several years. Her rent was £1000 a month and in August her landlord informed them the rent was going up another £300. It was a pretty dire place tucked round the back of a takeaway restaurant with only one window at the rear of the property. I think he landlord is one of those that is causing all the4 legislation coming in. Thjey had had multiple issues, including leaking roves, no functioning appliances and horrendous neighbour issues (can't blame the landlord for that one). They couldn't begin to afford the increase and despite looking couldn't find anything cheaper in Bristol. They are now renting our house, on mates rates, so they can finally save up to get a place of their own. As mentioned earlier we are about to do the same for one of our other daughters who is studying to be a nurse in Cardiff.

I really feel for those who are trapped in the rental market with the level of rents today preventing them from building the funds they need to buy. I have four daughters, three of which rent, and they all see house prices or the mortgage repayment requirements continue to stay just out ahead of what they can save/afford. It is very different today from when I first left school, got my first job and bought my first house. As a multiplier of salary houses seemed very much cheaper then and mortgages, while expensive due to higher interest rates, at least were offered with small deposits that let you get on the ladder.

May be a daft question but why didn't you sell the house with the tenant in place? I have previously purchased in this situation and from my point of view a tenant with a history of paying the rent, looking after the house and not upsetting the neighbors is very welcome as is the lack of void time and the cost of finding someone like that. If I'm going to save money and reduce risk I'm prepared to pay more. Everybody wins. I have said this before but good laws protect decent people from scumbags (not calling you that you clearly don't fall into that category) but no fault evictions should be banned and fault evictions made much easier.

 

[Jacob]

The only real answer to the high cost of housing is to build more and better houses, build the houses that are needed in an area not the ones that make the greatest profit, which means reforming our very corrupt planning system. NIMBYs need to be told if it doesn't directly effect you you can't complain and Landlords (like me) need a FARE licensing system so that prospective tenants can judge who they are dealing with. Also a Fare rent cap based on the rate-able value to control some of the ridiculous inner city rents where supply and demand clearly do not result in a fare and reasonable outcome.

None of that's going to happen, Landlords are too easy a target and a joined up planning system is seen as attacking local democracy.

It's not the planning policy or the landlords. It's the lack of a housing policy and reliance on a free market.
Buying property to let doesn't help of course, it just cranks prices up and and also rents. Landlords are basically redundant, nobody needs them beyond their limited management service, which they often perform very badly.

 

[paulrbarnard]

May be a daft question but why didn't you sell the house with the tenant in place? I have previously purchased in this situation and from my point of view a tenant with a history of paying the rent, looking after the house and not upsetting the neighbors is very welcome as is the lack of void time and the cost of finding someone like that. If I'm going to save money and reduce risk I'm prepared to pay more. Everybody wins. I have said this before but good laws protect decent people from scumbags (not calling you that you clearly don't fall into that category) but no fault evictions should be banned and fault evictions made much easier.

We considered it but the estate agents told us it would limit the selling options to other landlords. In hind sight that would have been the best option to get use out of the then pending financial situation but as it worked out we came out alright in the end, albeit a few thousand out of pocket.

 

[paulrbarnard]

It's not the planning policy or the landlords. It's the lack of a housing policy and reliance on a free market.
Buying property to let doesn't help of course, it just cranks prices up and and also rents. Landlords are basically redundant, nobody needs them beyond their limited management service, which they often perform very badly.

And indeed the planning authorities foibles. A development of about 50 new houses was proposed in one of the villages near me and it, for once, ticked all; the boxes in terms of local amenities, access and local desire for more housing. The planners rejected it because houses were layed out on a loop road with a single entrance on to the main road and consequently the houses "had their backs to the rest of the village". It is in appeal currently.

 

[Ozi]

It's not the planning policy or the landlords. It's the lack of a housing policy and reliance on a free market.
Buying property to let doesn't help of course, it just cranks prices up and and also rents. Landlords are basically redundant, nobody needs them beyond their limited management service, which they often perform very badly.

This is a genuine question (as well as a rant) because I really don't understand.

How do landlords crank up prices? Personally I think I'm better at buying houses than most of my non landlord competition so pay less or walk away, I'm in no hurry, I have a lot of practice over the years including houses I have lived in myself I've purchased over 30 times ( I don't own anything like that many I trade up ) I pay less than most people because I see potential people with less experience miss, also I buy properties with issues people who need to move in straight away can't, I will buy a property that needs a new roof to be livable if I can get it for less than the gain in value of adding a new roof (your going to hate this bit Jacob) because essential repairs don't count as improvement and then when the property sells are deducted from profit on the sale price for tax purposes (you can see that as wrong if you want to) I see it as good for me and as improving the housing stock nobody looses, and I pay income tax rather than capital gains, a highly unfair tax to landlords (if I keep a property twenty years before I sell I will pay capital gains on the difference in value, thats the government making a profit on their inability to control inflation). I buy from bad landlords who have done little or no maintenance in the belief they increase their profit, sometimes with tenants in place, I do the "essential" maintenance and sell at a profit - who looses there - only the ***** who thinks they can screw money out of tenants instead of realizing if you run a business and mistreat your customers you're going to lose. Good Landlords (we are a magority as are good tenants) are not redundant in any way, people rent for many different reasons, personally I'm looking for long term tenants because that's where I make the most money but I have had people who want to live in the catchment area of a particular school for a couple of years, people who have taken temporary jobs and don't intend to stay in the area long enough to make buying worth while, people who never intend to have children and don't see a reason to climb the property ladder with no one they want to leave money to, I have had tenants who struggle to make ends meet and tenants with considerably more assets than me. If there was no need for a rental sector it would like any other form of business cease to exist. The most socially useful form is and always will be council letting where the profit goes back into the community the Tory party bought elections selling that off, do you blaim the people who took advantage, I don't.

 

[Ozi]

This is a genuine question (as well as a rant) because I really don't understand.

How do landlords crank up prices? Personally I think I'm better at buying houses than most of my non landlord competition so pay less or walk away, I'm in no hurry, I have a lot of practice over the years including houses I have lived in myself I've purchased over 30 times ( I don't own anything like that many I trade up ) I pay less than most people because I see potential people with less experience miss, also I buy properties with issues people who need to move in straight away can't, I will buy a property that needs a new roof to be livable if I can get it for less than the gain in value of adding a new roof (your going to hate this bit Jacob) because essential repairs don't count as improvement and then when the property sells are deducted from profit on the sale price for tax purposes (you can see that as wrong if you want to) I see it as good for me and as improving the housing stock nobody looses, and I pay income tax rather than capital gains, a highly unfair tax to landlords (if I keep a property twenty years before I sell I will pay capital gains on the difference in value, thats the government making a profit on their inability to control inflation). I buy from bad landlords who have done little or no maintenance in the belief they increase their profit, sometimes with tenants in place, I do the "essential" maintenance and sell at a profit - who looses there - only the silly person who thinks they can screw money out of tenants instead of realizing if you run a business and mistreat your customers you're going to lose. Good Landlords (we are a magority as are good tenants) are not redundant in any way, people rent for many different reasons, personally I'm looking for long term tenants because that's where I make the most money but I have had people who want to live in the catchment area of a particular school for a couple of years, people who have taken temporary jobs and don't intend to stay in the area long enough to make buying worth while, people who never intend to have children and don't see a reason to climb the property ladder with no one they want to leave money to, I have had tenants who struggle to make ends meet and tenants with considerably more assets than me. If there was no need for a rental sector it would like any other form of business cease to exist. The most socially useful form is and always will be council letting where the profit goes back into the community the Tory party bought elections selling that off, do you blaim the people who took advantage, I don't.

I can spell magority that way if I want to.

 

[Blackswanwood]

This is a genuine question (as well as a rant) because I really don't understand.

How do landlords crank up prices? Personally I think I'm better at buying houses than most of my non landlord competition so pay less or walk away, I'm in no hurry, I have a lot of practice over the years including houses I have lived in myself I've purchased over 30 times ( I don't own anything like that many I trade up ) I pay less than most people because I see potential people with less experience miss, also I buy properties with issues people who need to move in straight away can't, I will buy a property that needs a new roof to be livable if I can get it for less than the gain in value of adding a new roof (your going to hate this bit Jacob) because essential repairs don't count as improvement and then when the property sells are deducted from profit on the sale price for tax purposes (you can see that as wrong if you want to) I see it as good for me and as improving the housing stock nobody looses, and I pay income tax rather than capital gains, a highly unfair tax to landlords (if I keep a property twenty years before I sell I will pay capital gains on the difference in value, thats the government making a profit on their inability to control inflation). I buy from bad landlords who have done little or no maintenance in the belief they increase their profit, sometimes with tenants in place, I do the "essential" maintenance and sell at a profit - who looses there - only the silly person who thinks they can screw money out of tenants instead of realizing if you run a business and mistreat your customers you're going to lose. Good Landlords (we are a magority as are good tenants) are not redundant in any way, people rent for many different reasons, personally I'm looking for long term tenants because that's where I make the most money but I have had people who want to live in the catchment area of a particular school for a couple of years, people who have taken temporary jobs and don't intend to stay in the area long enough to make buying worth while, people who never intend to have children and don't see a reason to climb the property ladder with no one they want to leave money to, I have had tenants who struggle to make ends meet and tenants with considerably more assets than me. If there was no need for a rental sector it would like any other form of business cease to exist. The most socially useful form is and always will be council letting where the profit goes back into the community the Tory party bought elections selling that off, do you blaim the people who took advantage, I don't.

Well said.

 

[Terry - Somerset]

Basic economics of supply and demand - if supply is below demand, prices will rise. Property is not immune from the fundamentals, save that homelessness is the alternative if both rental or ownership is unaffordable. This is not a socially acceptable outcome.

Markets in a stable environment tend to find an equilibrium - for property this means fairly stable rental and/or ownership costs. Material changes to the financial and regulatory environment creates instability for a period - usually to the (temporary) detriment of housing availability.

Imposition of greater regulation (EPC, tax changes, lease changes) for landlords reduces the supply of rental properties as landlords seek to invest elsewhere. Similarly rapid changes in mortgage interest rates can impact on affordability and house prices.

None of this addresses the fundamental problem - there is too little housing to meet demand, irrespective of whether it is rented or owned.

Regulation to limit empty and second homes is not a solution - disruption created may even worsen housing availability. The UK has the lowest level of empty property in western Europe at about 2% of dwellings, France, Germany, Italy, Spain are all in excess of 8% .

The 2021 census shows the UK population has grown by ~3.5m since 2011. Since then ~1.8m homes have been built - this is a gross figure as many properties will have been lost to redevelopment.

This is not intended as a comment on immigration policy (an entirely separate issue) but illustrates that (at best) housebuilding has just about kept pace with population growth.

The only way to reduce rents and house prices is to build a lot of houses - say 400k pa for the next 5-10 years. Since 1980 all governments have failed with an average build of 200k pa. No amount of regulation or legislation will solve the problem.

It is debatable whether the NIMBY contingent interested in preserving vested interests and wealth, or social conscience with little to lose and much to gain will win the day.

 

[ian33a]

Our rental is a C - and we had two suggestions to get the two points to move to a B. Firstly to get 1 of the two points:

View attachment 148356
So, we can spend £4k to save £27 pa - and still stay in band C.

Assuming no repairs it will only take about 150 years to pay itself off.

And we are supposed to take EPC seriously.

I've seen this so often while looking to move and I've also come up against it with regard to ways to improve the property that we now own.

A buyer or an owner has to have a very strong wish to save the environment to put their hand in their pocket to support fluff such as this.

 

[Jacob]

I've seen this so often while looking to move and I've also come up against it with regard to ways to improve the property that we now own.

A buyer or an owner has to have a very strong wish to save the environment to put their hand in their pocket to support fluff such as this.

Those figures are nonsense.
Solar heating/power in various forms is proven, cost effective and improving rapidly.
https://energysavingtrust.org.uk/advice/solar-water-heating/And everybody should by now have "a very strong wish to save the environment". The only excuse is ignorance!
Government should be taking more initiative across the board at every level.

 

[deema]

Batteries, well last time I looked into it, carbon positive, yep very one you buy for the solar farm is helping global warming. Solar panels were also carbon positive a few years back.

Let’s not forget where all the reactive metals come from that make good batteries, mostly from terribly nice countries with a wonderful record of destroying the environment extracting them.

Let’s also not forget who makes solar panels. Countries with a massive carbon hungry economy that produce the vast majority of the CO2 to begin with.

But, having solar panels makes us feel better and adds a few points to your EPC

 

[Terry - Somerset]

Financial analysis is relatively simple and unambiguous - initial cost compared to estimated future savings. Money as a common denominator makes it possible to compare (say) a ground source heat pump against solar water heating and choose that with the best return.

The environment is complex. There is no common denominator - greenhouse gas emissions (many sorts), pollution, exploitation of labour, environmental degradation (rainforests etc). Comparing (say) wood pellet heating with PV installation is an environmental minefield.

If it is believed the environment is sufficiently important to warrant some level of sacrifice, how is that sacrifice defined and delivered - money/tax, "Stop Oil", EPC, personal greenhouse gas allowance, ban cars, regulate domestic temperatures etc etc etc.

Public opinion seems to capture the whole spectrum of views from "climate change is a conspiracy" to "the most important challenge humanity faces".

Individual circumstances mean that for some EV + PV + organic is easily achievable - they can be sanctimonious despite the Caribbean holidays. Some may have to make very real sacrifices in food and warmth. Some are simply selfish or ignorant.

A coherent shared view of the issue and solutions will involve some pain. Until accepted, debate and implementation will continue to be a shambles. The prompt for effective action will be when climate disruption forces major developed economies to react - by which time it may be too late.

 

[Jacob]

Batteries, well last time I looked into it, carbon positive, yep very one you buy for the solar farm is helping global warming. Solar panels were also carbon positive a few years back.

Let’s not forget where all the reactive metals come from that make good batteries, mostly from terribly nice countries with a wonderful record of destroying the environment extracting them.

Let’s also not forget who makes solar panels. Countries with a massive carbon hungry economy that produce the vast majority of the CO2 to begin with.

If you mean China, in fact it has only caught up very recently with the carbon footprint of the west. We produced "the vast majority of the CO2 to begin with" not China. But it is massively developing green alternatives and is becoming the world leader, and now supplying the west with solar panels and green technology. We are the ones lagging behind.

But, having solar panels makes us feel better and adds a few points to your EPC

and may save you a bit of money, if you can afford them in the first place.

 

[Jacob]

..... The prompt for effective action will be when climate disruption forces major developed economies to react - by which time it may be too late.

er - it is already too late in many parts of the world and it is coming our way too.