Rent Control, answer to the broken housing market?

theres no way of solving the problem the genies out of the bottle and no way of squeezing it back in,by trying to right previous wrongs you,ll just trap people who,ve already bought at historic highs into a life of negativity equity and unable to move

Concrete over the Green Belt.  Build millions of homes watch the market collapse.

Either that or depopulation by 25%.

Charge the landlord council tax and it will only go onto the rental cost. What sort of policy is that ?

The law was changed in N.Ireland to make the landlord responsible for council tax.

This was because the tenants used to clear off owing thousands in tax (millions to the local councils) and it was the devils own job to try and track them down and take them to court and get any money back.

So it was obviously easier to make the landlord responsible, but of course this just meant that it was put onto the cost of renting.

In effect it made rents higher for the tenant.

AFAIK being a landlord is already not nearly as good moneywise as it used to be, and landlords may be pulling out?
It's about supply and demand, the above is .. well .. it's not addressing that.

if you attempt to tax rental income too punitively you will find housing being rented out and no tax being paid.

Why is housing so expensive? because millions of people don't have to pay for their housing.
Address that and you are mainly there.

One of the biggest problems in rentals was caused by Chris Mullin,the labour MP who fought for a change in the law that stopped benefit being paid directly to the landlord. A laudable sentiment that had the unintended consequence of producing a slice of tenants who could not manage their finances and couldnt pay the rent,an item that came some way behind mobiles,TV's and lager,and facing eviction. Many landlords then stopped considering benefits claimants from private rentals and teh many suffered because of the few.

In practise, landlords pay less tax than roadsweepers.
In principle, there is no qualitative reason why rental income should be taxed differently to, say, share-dividend income.

To address the specific points:
1st time poster: There is no reason why a house-buyer should have his investment protected, above an investor in the stock-market or the 15:15 race.
Is there?
The Baron: There is no need for either of your options. 99.9% of the population have a roof over their head tonight - the pressure for more houses stems from one reason: greed or, to put it in middle-class terms, "it's for the kids." Without the expectation of ever-rising house-prices, there would be no housing-shortage.
treetop - No, that threat is not logical. If landlords could charge another hundred a month, they wouldn't need the excuse of Council Tax, they would be doing it to tenants already.
Just Checking - "Landlords may be pulling out." Great. Celebrate the parasites leaving the host.

Some context in the debate:
http://www.bbc.co.uk/programmes/b099v2zr

Landlords have it easier here than just about anywhere in the world. Resulting in a society that values your parent's house higher than your creativity or work-ethic, a recipe for long-term disaster for the UK.

Landlords can only charge what the tenant, or somebody else can afford to pay.
It the tenant is paying 100 a month less in council tax to the council he can pay 100 more to the landlord.

- No, that threat is not logical. If landlords could charge another hundred a month, they wouldn't need the excuse of Council Tax, they would be doing it to tenants already.

That is precisely what would happen ub,no landlord would absorb that extra cost and take the risk of the property being trashed as well.The agents do the calcs when assessing a prospective tenant.

that's how it works in practice over time, rents go up.

landlords are providing housing for the countries population, its a very important thing and should receive some form of incentive and help.

when we have housing difficulties in Britain, (which are inevitable with the increase in population over the last few years)
it is madness to try and make things more difficult for landlords.

We don't have to ask what will happen, it has been implemented in N. Ireland...although for different and more sensible reasons than that proposed by biscuits

Have rents fallen since this change, I don't know but I doubt it.

treetop - When the landlord hikes his rent by £100, buying becomes more attractive to a certain privileged sector of tenants, another demographic will be enticed into a "Spare Room" arrangement, and the disparity between the cost to market renters and the rest of the country becomes even more obscene. Provided landlords suffer from the other three pressure points, we would enjoy a shakeout in the btl market; everyone's happy; a few greedy victims excepted.

I am sorry but whilst I applaud some of the sentiment I do believe the reality ends up being more painful for the tenants.The ones that would suffer would probably be the poorest who may currently get council tax relief towards their costs might but face higher rental payments or worse property options.

The poorest are on Housing Benefit, they have no interest at all in the price they pay to their landlords.

that's why it will have no effect on the value of housing either, except to push housing values up.

they don't have to pay the increased costs, we do, someone has to pay it and it isn't the landlord

It is best to let lfc1971 "widdle on" until his incontinent thought-train dries.

you see if someone is paying for housing then that is one thing, they can only pay what they can afford.

However if someone else is paying, nobody in particular, everyone and no one, then it is surprising how much can be paid.

Yes, very good point, lfc1971. Well done.
Could somebody else converse with him, please?

of course people long for that home, the home they've never had.

if you do not give the people shelter they will perish. Before they perish they will rise up and ask
an honest question. The answer shall decide the consequence.

And if the government were to implement biscuits silly proposals and rents didn't fall would that matter to biscuits ?
No, because he is driven more by a desire to harm landlords than to help tenants

That's a very silly way to go about things.

Houses, gardens ...and people .

These are things I understand.

You do seem to understand biscuits as well.

What about:-
Extra tax breaks on new builds for landlords, such as tax-free profits on rents for the first five years to encourage new house building?

And to encourage landlords to accept LHA tenants:
A guarantee from the government that LHA tenants will have any damage they cause put right for free from the council concerned.
A further guarantee that any rents they withhold from the landlord will also be made good by the council.

Then fully reinstate mortgage tax relief for landlords.

Let's get the housing market moving and the builders building.

Come on UB, you know it makes sense.
Even to a heartless person like yourself, who would rather see people sleeping on park benches rather than see a business person turning a profit.

We need to relieve landlords of their unfair advantages, otherwise there is no rebalancing the housing market. That is bad in itself but worse for the future of the UK - when our children see that entitlement outweighs hard-work and creativity, hard-work and creativity will leach away from these shores.

UB I'm a landlord, just the one property. All repairs are made within a week of being reported to me. Before the current tenant moved in a new oven, hob and carpets were put in plus fresh paint. All I could claim for was the paint. My tenant was told not to use the loft.......its full ! No pets, she's got a cat !!!!!! So don't think I'm to bad a landlord. And out of interest I receive a rent of £800 a month, probably could get more down here in Sussex. How would your proposal for rent control affect me ?

Ufcdan- You would pay tax on the £800, paye about £200. You would also be liable for Council Tax on the property. And if I am paying your rent for her (if she claims Housing Benefit) we'll be having a look at that arrangement too.

4) Reform Housing Benefit. The base of the pyramid that supports the whole housing market is set at a false level derived from from a broken market because only one party cares how much is paid; that being of course the landlord. The tenant has no interest in the price, since he is not liable for it.

Isn't housing benefit "capped" now. Meaning that the tenant won't get necessarily get the full value of their monthly rent paid by the council - depending on the size of the property / number of people living there etc?

Therefore the tenant is forced to find the extra rent themselves, by hook or by crook. This incites landlords to shun those on benefits or forces them to shack up ten to the dozen.

The housing market in this country is a proper game of monopoly. One in the latter stages, where there is nothing left to buy up, and you know everywhere you land you're gonna pay through the nose.

dontwin2easy - Private landlords suck out £200 million a week in LHA from you and me via the Exchequer; cash which is then spent to outbid honest prospective house-buyers, for the purpose of landlords avoiding tax. It's a broken market, as you say, like Monopoly. We all know how that game ends.

ufcdan - Your situation would be altogether better than was sketched out above. There is currently and justifiably a £7,500 allowance that is tax-free, that would be yours to start with. You would only pay the marginal rate of tax on the balance - about £40 a month.

The best figures I can quickly find are...approx 4m private renters.  About 1.5m housing benefit private renters.

Most private renters are not on housing benefit.

That is true, Jack, but LHA raises the level of the whole market by acting as a base-rate (you won't find anywhere a place to rent below LHA).

UB simply wants to punish private landlords for turning a profit.
He cares nothing for the consequences of legislation as long as the end product would frustrate landlords. And fewer landlords means fewer houses available for occupation through loss of newly renovated properties for the rental market and new builds.
Would not it be better to stimulate house building and try to relieve the pressure on the demand for housing?

This is a clear comparison of the destruction that socialist thinking promotes. Against the success of free market principles.

Not one word about taking the pressure off the demand for houses in the rented sector.
Simply an attack on private landlords which would lead to fewer houses to rent and fewer houses being built.
And there you have the results of socialist thinking in a nutshell.

That is true, Jack, but LHA raises the level of the whole market by acting as a base-rate (you won't find anywhere a place to rent below LHA).

That's clearly a lie, and UB knows it is a lie because it's been explained to him many times how LHA is calculated.

LHA is calculated by taking the average rent being charged in that area for that type of property then knocking around 10% off the figure that is arrived at.

charged in that area for that type of property in the private rental sector of course.

There was a programme on council housing last night, foreigners making bogus applications are robbing us for fortunes apparently.

For anyone with an open mind, try this exercise:

1)Choose any property advertised online for rent in the UK.
2) Note the LHA rate for its postcode.
3)Find one property available cheaper than LHA.
4) Don't waste too much time looking for a unicorn. No landlord willingly advertises for less than LHA. Housing Benefit acts as a kind of taxpayer-subsidised minimum-rate for landlords. Free market indeed.

''LHA rates are calculated each month for individual areas, known as Broad Market Rental Areas (BRMA). The LHA rate for each property size is based on the "middle of the range" rental figure for the area. Exactly half of the rental properties of that size in the area will be affordable if you claim housing benefit under the LHA rules.''

http://www.rother.gov.uk/article/6964/How-are-Local-Housing-Allowance-LHA-rates-calculated

''LHA rates are based on private market rents being paid in the BRMA which can differ from advertised rents. Valuation Office Agency (VOA) Rent Officers collect the rental information from letting agents, landlords and tenants.''

https://www.gov.uk/government/publications/understanding-local-housing-allowances-rates-broad-rental-market-areas

Go on then Dr Crippen, find a property advertised for less than LHA. You have the whole internet at your fingertips.

During the coalition when a purge was made on benefits and caps were introduced. The LHA rate in every case was reduced from the average calculation by around 10%.
So you see an attack has already been made on landlords who give shelter to Housing benefit claimants.


All the cheapest properties will be taken, but I'm sure there will be some if you care to look hard enough.
What is it about my last post that you don't understand? The information is all there.

Note the bit in bold. It's government information - and you can't get better than that.

I'll spell it out for you again :-

LHA rates are based on private market rents being paid in the BRMA which can differ from advertised rents.

There you go - Wolverhampton
One bedroom LHA rate £373.97 per month.

http://www.wolverhampton.gov.uk/article/2813/Local-Housing-Allowance-rates

Rightmove:
http://www.rightmove.co.uk/property-to-rent/find.html?locationIdentifier=REGION%5E1476&maxBedrooms=1&minBedrooms=1&sortType=1&includeLetAgreed=false

Tons of them.

Flats as well:

http://www.rightmove.co.uk/property-to-rent/find.html?locationIdentifier=REGION%5E1476&maxBedrooms=1&minBedrooms=1&sortType=1&propertyTypes=flat&primaryDisplayPropertyType=flats&includeLetAgreed=false

Game set and match?

On the contrary, a quick analysis of the market in Dr Crippen's chosen location shows the failure of LHA, even on its own terms. LHA is meant to be set at a level giving access to half of the available housing stock; in practice it becomes the minimum because there is no market pressure to supply accommodation for less than LHA. Rightmove have over a hundred one bedroom properties in Wolverhampton, six below LHA, of which two are studios. Of 109 two bedroom flats , one is £420, one at £440 and only six at £450 (LHA £454, funnily enough). There is a one bedroom above the local Ladbrokes for £450. That's the picture in a pretty depressed place like Wolverhampton, where LHA is the safety net for many landlords.  LHA is frozen because - as described above - it actually acts as an engine for driving up rents across the private sector but the taxpayer is still subsidising private landlords by £200 million a week. Think about that figure for a second, it is more than our net contribution to the EU, and we get nothing back for it. But it gets worse. To avoid tax-liabilities, that £200 million is then ploughed into acquisitions of further buy-to-let properties, where in many cases an honest family would be the underbidder.

That's why the system will never work; at its heart Housing Benefit is based on a transaction where only one party cares about the cost.

Go on then Dr Crippen, find a property advertised for less than LHA.

Which is exactly what I did. He asked for one, I showed him many.

Yet UB is back again with his made up nonsense.

Job done I'd say.

"Unitedbiscuits is back again," unlike DrCrippen, I have never been forced to stay away. As for "job done," hardly, it took him an hour to find the exceptions that prove the rule, after everyone else had left the thread. To be fair, though, what would he really know about doing a job?

There are probably six-thousand LHA claimants with private landlords in Wolverhampton, look at the meagre choice available to them and tell me it's a free market working.

I'm not telling you anything is working well UB, but what you propose would make matters worse and what for?
Simply to satisfy your desire to stifle free enterprise, towards your aim of a communist state?

UB you seem to be another person who follows the Polotics of envy, that said I would prefer rather than my tenant being paid housing Benifit of say £400 out of the £800 she pays. I would be quite happy for her to pay £400 to the council for a quality council house. While a big big fan of Maggie to me selling off council houses was one of her biggest mistakes.

Example A. The landlord has one tenant in Sussex. The tenant pays him £800 a month, and claims £400 LHA. Everyone's happy, right? Well, no, because this - typical - arrangement impacts on the whole housing market and beyond.
Firstly, the landlord gets a £400 taxpayer subsidy every month.
Secondly, as a multiple of its rent, the value of the landlord's property is boosted beyond the reach of honest house-buyers; if the landlord did want to sell, the buyer would likely be a larger btl landlord spending to avoid a tax-liability.
Thirdly, the tenant has no incentive to change her circumstances. Unlike the landlord's rent anything she earns will be taxed, so she's looking at having to work an extra fifty-hours a month just to maintain the status quo, let alone save towards getting on the housing ladder. In all likelihood, the relationship will become permanent: the tenant paying tax on her wages and passing on a good proportion of what she has left to a landlord sitting on his hands. And no tax for him. How unfair is that?

Example B. A landlord in the Midlands has a portfolio of fifteen properties - the magic number! A good accountant and an aggressive policy of further acquisition ensures that he pays less tax his tenants, most of whom are claiming Housing Benefit. This hypothetical landlord has no financial worries, what he does have are two children who are dolts. Luckily for them, the other children in their classroom, even the bright ones, are growing up in houses that he owns, and will end up paying rent to his idiot children. Anything wrong with this future?

What is lazily called "the politics of envy" is simply the politics of the possible. If you belong to generation rent, the housing problem is not intractable, the injustices can be righted, it just needs legislators to challenge the country's sick addiction to rising house prices. Which means a government brave enough to upset The Daily Mail. So not the Tories.

if our land was cheap our country would be poor

its capatalism

if the uk housing market prices fall,sterling will fall equivalently,the uks mainstay wealth is solely dependent on uk house prices staying bouyant.

the bloke owning foxtons selling before the crash said it all

Average house price in London when he sold out in 2007 was 300k chavvers, now it's 500k. He might have left because of the bad publicity about the crooked business methods they used.

The politics of envy is on display in every post that UB makes.

He wants to see the whole house of card come tumbling down, and then replaced by state controls in every thing we do.

Never expect any individual to be anything but greedy, especially on a gambling site. It's fundamental to life. Certainly, everyone should strive for material advantage for themselves and their family, I know I do. That doesn't mean we should be tied into a society where anything our children do in their productive lives counts for nothing compared to their place on the UK housing market. We can build a better society than that, and if people sneer "politics of envy"' , it just means they can't mount a defence.

LHA has been frozen for 4 years since 2016 the rates were already lagging behind before this came in. You will find flats underneath the LHA rate in most areas, obviously mostly **** holes mind. A lot of landlords still want a working tenant not LHA riff-raff.

Like I wrote earlier. Every post from UB displays envy and resentment.

''I can't have it, so why should anyone else?''

Now Dr Crippen hears voices..in MY head lol.
Is he senile or trying to provoke?

Why isn't 'the politics of vested interest' thrown about like 'the politics of envy'?

It's remarkable that private landlords provide social housing at lower cost than social housing providers.
How is this possible you may ask?

Look at the cost of running public lending libraries versus 2nd hand book shops or charity book-sellers
Or at the cost of the two car-ferry crossings to Orkney, one subsidised by the State, and one unsubsidised
Or the popularity of the unsubsidised Edinburgh Playhouse versus those theatres getting Arts Council handouts
Or inflation in the NHS over the last 20 years versus inflation in the costs of the opticians or the vets

Of course in the world of biscuits you would be a fool to think there was a connection between letting the free market at something compared to State intervention.
But what other explanation could there be?

A surprise from bongo. We all know why Dr Crippen has a double-standard about the £200 million per-week Housing Benefit subsidy but a purist of the Adam Smith Institute surely would blush to defend it. But then, it wouldn't be the only time that bongo betrayed himself by choosing the wrong side.

No surprise though from the revolting specimen of sock fungus that is biscuits
If he can smell a subsidy, he wants to sniff it, hence his frenzy of self-abuse over the European Union whose main fiscal policies are:
1 - landowner subsidies under the guise of farm support and the customs union
2 - capitalist subsidies under the guise of convergence funding
3 - rural subsidies under the illusion that rural areas are worse off so we'll give money to the rich rural people
4 - bureaucratic subsidies with over 1000 staffers earning more than the Prime Minister
I bet he gets hard thinking about that.
If someone wants to make themselves last longer when on the job, most people think about Mo Mowlam, but biscuits thinks about free markets.

And bongo's premise is not actuarilly true because council houses are assets belonging to all of us whereas private houses are not, and Housing Benefit paid to local authorities is money we pay to ourselves whereas the £200 million per-week paid to private landlords is lost forever.

I suppose he's right about the Orkney ferry, though.

I'll let the juvenalia of bongo's last post speak for itself - he's plainly over-excited in an embarrassing way.