Rental market is utterly broken
Discussion
LF5335 said:
davek_964 said:
Rental market is broken - rental agencies are even more broken.
Despite emailing me in Feb suggesting that I increase the rent by 5% on the one year anniversary in April (which I declined) - my request now to increase the rent was met with utter confusion. I may as well have asked them to make the sky turn green.
Because it’s a strange time to increase rents. Annually on the anniversary with a few months notice of your intention is the norm, rather a panicky “OMGZ there’s an election date set. Aaaarrrggghhhhh Labour”. Despite emailing me in Feb suggesting that I increase the rent by 5% on the one year anniversary in April (which I declined) - my request now to increase the rent was met with utter confusion. I may as well have asked them to make the sky turn green.
On the other hand, the tenancy agreement clearly states that it can be increased on the anniversary, or - if the landlord decides - any time after that.
It's hardly rocket science - it's plain in black and white.
davek_964 said:
Rental market is broken - rental agencies are even more broken.
Mine are f
king useless. After my tenants had been there for a year they didn't want to sign another contract so my agent suggested just going over to the periodic monthly agreement. They have been there nearly seven years now, this makes getting rent increases a nightmare as usually you would just increase it a few percent each year. Letting them go to the periodic agreement was the worst advice from the agent ever.It also means re-mortgaging is difficult as the new mortgage company want to see the signed lease. As soon as they see it was signed seven years ago they want all sorts of written guarantees from the tenants/agent/landlord which are impossible to get as the agent never replies to any emails or phone calls.
Add on top of that they never do the property inspections despite it being in the contract that I signed.
There were a few times that the rent has been late, the agent didn't even bother letting me know. It was only after I hounded them with emails and calls for days did they finally decide to chase the tenants.
The only reason I don't kick off more is that I rarely get any hassle from the tenants. It seems like we are in an unwritten agreement that in return for under market rent they will not cause a fuss.
If/when they move out it will be new agent, market rent and signed tenancy agreement with increases each year.
If it wasn't for the capital gains to pay I would seriously think about selling it.
ThingsBehindTheSun said:
If it wasn't for the capital gains to pay I would seriously think about selling it.
I suspect mine will be for sale in a couple of years. It's only for rent because I moved in with the g/f - I had no desire to become a landlord. I lived there for 23 years before it was rented out, so the capital gains will be fairly minimal after a couple of years of renting.ThingsBehindTheSun said:
davek_964 said:
Rental market is broken - rental agencies are even more broken.
Mine are fking useless. After my tenants had been there for a year they didn't want to sign another contract so my agent suggested just going over to the periodic monthly agreement. They have been there nearly seven years now, this makes getting rent increases a nightmare as usually you would just increase it a few percent each year. Letting them go to the periodic agreement was the worst advice from the agent ever.It also means re-mortgaging is difficult as the new mortgage company want to see the signed lease. As soon as they see it was signed seven years ago they want all sorts of written guarantees from the tenants/agent/landlord which are impossible to get as the agent never replies to any emails or phone calls.
Add on top of that they never do the property inspections despite it being in the contract that I signed.
There were a few times that the rent has been late, the agent didn't even bother letting me know. It was only after I hounded them with emails and calls for days did they finally decide to chase the tenants.
The only reason I don't kick off more is that I rarely get any hassle from the tenants. It seems like we are in an unwritten agreement that in return for under market rent they will not cause a fuss.
If/when they move out it will be new agent, market rent and signed tenancy agreement with increases each year.
If it wasn't for the capital gains to pay I would seriously think about selling it.
I've regularly remortgaged every couple of years and have never had to provide a copy of fhe tenancy agreement.
I recently rented two very average flats and I've been very suprised by how good the agencies were, in all respects. I had no bother at all. and the service was almost premium.
I got totally screwed over when i was younger on multiple occasions, so can only assume it's an age thing, perhaps they just screw the kids
I got totally screwed over when i was younger on multiple occasions, so can only assume it's an age thing, perhaps they just screw the kids
lizardbrain said:
I recently rented two very average flats and I've been very suprised by how good the agencies were, in all respects. I had no bother at all. and the service was almost premium.
I recommend reserving judgement of the agencies until you've left and are waiting for your bond back. I strongly suspect you won't be singing their praises then. 
r3g said:
I recommend reserving judgement of the agencies until you've left and are waiting for your bond back. I strongly suspect you won't be singing their praises then.
Last time I went for something called a guaranteed clean. Letting Agency has a list of approved cleaners. 250 quid fixed fee and any issues with the clean then the letting agency arranges a revisit direct with the cleaners. Great value for me completely takes the strss and uncertainty out of it. Cleaners are motivated. I just walk away.
I think agencies don’t make any money from deposit disputes so are inclined to reduce exposure to them.
lizardbrain said:
Last time I went for something called a guaranteed clean. Letting Agency has a list of approved cleaners. 250 quid fixed fee and any issues with the clean then the letting agency arranges a revisit direct with the cleaners.
Great value for me completely takes the strss and uncertainty out of it. Cleaners are motivated. I just walk away.
I think agencies don’t make any money from deposit disputes so are inclined to reduce exposure to them.
I suspect the reality there is that the LA themselves are running the "approved cleaner" swindle by simply spending 10 mins running a vac and duster around and then fleecing you for 250 quid. Unless you are leaving the property looking like a landfill site then your definition of "great value" is wildly different to mine!Great value for me completely takes the strss and uncertainty out of it. Cleaners are motivated. I just walk away.
I think agencies don’t make any money from deposit disputes so are inclined to reduce exposure to them.
98elise said:
A periodic tenancy shouldn't be any issue for rent increases. Mine are all periodic from when the initial 6m AST's ended, and some are 10+ years now.
I've regularly remortgaged every couple of years and have never had to provide a copy of fhe tenancy agreement.
A periodic tenancy makes it easier for a rent increase as you will only need to provide one month’s notice of the increase. If the tenants were on an annual tenancy it’s six month’s notice.I've regularly remortgaged every couple of years and have never had to provide a copy of fhe tenancy agreement.
jonathan_roberts said:
A clean warm, and safe home with a damp problem.
Jeez, no something top side has moved/blocked either a slipped slate or a blocked gutter. This is a semi so maybe not even something on my side that's failed but is causing a problem. The point being the place was perfect, signed off by BC but the tenant couldn't be bothered to report a fault when first apparent. ThingsBehindTheSun said:
davek_964 said:
Rental market is broken - rental agencies are even more broken.
Mine are fking useless. After my tenants had been there for a year they didn't want to sign another contract so my agent suggested just going over to the periodic monthly agreement. They have been there nearly seven years now, this makes getting rent increases a nightmare as usually you would just increase it a few percent each year. Letting them go to the periodic agreement was the worst advice from the agent ever.It also means re-mortgaging is difficult as the new mortgage company want to see the signed lease. As soon as they see it was signed seven years ago they want all sorts of written guarantees from the tenants/agent/landlord which are impossible to get as the agent never replies to any emails or phone calls.
Add on top of that they never do the property inspections despite it being in the contract that I signed.
There were a few times that the rent has been late, the agent didn't even bother letting me know. It was only after I hounded them with emails and calls for days did they finally decide to chase the tenants.
The only reason I don't kick off more is that I rarely get any hassle from the tenants. It seems like we are in an unwritten agreement that in return for under market rent they will not cause a fuss.
If/when they move out it will be new agent, market rent and signed tenancy agreement with increases each year.
If it wasn't for the capital gains to pay I would seriously think about selling it.
Capital gains ? Well here's the thing I explained to my wife. House was £130k, now worth 200k
Minus the cost of buying, and the cost of selling. So probably about £60k. Divide by 2 that's £30k each. Minus your capital gains tax allowance. What's that now £12500. So that's about 17500 to pay tax on. Now. If we sell in the years before we are allowed to claim our state pension, but having retired, that's tax on 5000 quid. So about 1k each ?
I'm not an accountant, is that completely wrong ?
Where people have a problem is if they remortgaged to take their equity down to 25% and took money out of the pot. And spent it tax free. I have a mate who has done this. If he sold, he'd be f
ked. He would be fked by interest rates going up, except that luckily rents have also risen (and he takes every opportunity to maximise them) Not sure why he's a mate. He's a bit of a dick. I’ve just let my tenants if five years know that we’d like to sell later this year.
£3,500 per month rent, £1m mortgage, £14,000 service charge per year all adds up to a losing proposition.
We’d kept it as we’d thought we’d want to live there again one year, but don’t now think it’s likely.
We were also renting out a big town house in Newcastle that we instead now use as a second home. Between the tax situation, hassle and the degradation that tenants bring it wasn’t worth it.
£3,500 per month rent, £1m mortgage, £14,000 service charge per year all adds up to a losing proposition.
We’d kept it as we’d thought we’d want to live there again one year, but don’t now think it’s likely.
We were also renting out a big town house in Newcastle that we instead now use as a second home. Between the tax situation, hassle and the degradation that tenants bring it wasn’t worth it.
C-J said:
Acorn1 said:
If the tenants were on an annual tenancy it’s six month’s notice.
Interesting. Is that current legislation? Anyone have a link?Not sure why the link won’t paste properly?
Edited by Acorn1 on Saturday 25th May 09:08
Pit Pony said:
Have you considered using openrent.co.uk?
Capital gains ? Well here's the thing I explained to my wife. House was £130k, now worth 200k
Minus the cost of buying, and the cost of selling. So probably about £60k. Divide by 2 that's £30k each. Minus your capital gains tax allowance. What's that now £12500. So that's about 17500 to pay tax on. Now. If we sell in the years before we are allowed to claim our state pension, but having retired, that's tax on 5000 quid. So about 1k each ?
I'm not an accountant, is that completely wrong ?
Where people have a problem is if they remortgaged to take their equity down to 25% and took money out of the pot. And spent it tax free. I have a mate who has done this. If he sold, he'd be fked. He would be fked by interest rates going up, except that luckily rents have also risen (and he takes every opportunity to maximise them) Not sure why he's a mate. He's a bit of a dick.
CGT allowance is now only £3K. We could also see CGT rates aligned with marginal income tax rates in the not too distant future.Capital gains ? Well here's the thing I explained to my wife. House was £130k, now worth 200k
Minus the cost of buying, and the cost of selling. So probably about £60k. Divide by 2 that's £30k each. Minus your capital gains tax allowance. What's that now £12500. So that's about 17500 to pay tax on. Now. If we sell in the years before we are allowed to claim our state pension, but having retired, that's tax on 5000 quid. So about 1k each ?
I'm not an accountant, is that completely wrong ?
Where people have a problem is if they remortgaged to take their equity down to 25% and took money out of the pot. And spent it tax free. I have a mate who has done this. If he sold, he'd be f
ked. He would be fked by interest rates going up, except that luckily rents have also risen (and he takes every opportunity to maximise them) Not sure why he's a mate. He's a bit of a dick. You are spot on with the equity issue. Lots have done it and are now paying the price, making a loss because they've spent the cash previously and are stuck with property draining their finances.
Pit Pony said:
Capital gains ? Well here's the thing I explained to my wife. House was £130k, now worth 200k
Minus the cost of buying, and the cost of selling. So probably about £60k. Divide by 2 that's £30k each. Minus your capital gains tax allowance. What's that now £12500. So that's about 17500 to pay tax on. Now. If we sell in the years before we are allowed to claim our state pension, but having retired, that's tax on 5000 quid. So about 1k each ?
I'm not an accountant, is that completely wrong ?
Unfortunately yes, the capital gains allowance has been whittled down and now stands at £3,000.Minus the cost of buying, and the cost of selling. So probably about £60k. Divide by 2 that's £30k each. Minus your capital gains tax allowance. What's that now £12500. So that's about 17500 to pay tax on. Now. If we sell in the years before we are allowed to claim our state pension, but having retired, that's tax on 5000 quid. So about 1k each ?
I'm not an accountant, is that completely wrong ?
Also capital gains tax is separate from income tax, with different rates, so in your example you'd likely be looking at 24% of 27k so £6,480 each.
IANAA - I am not an accountant.
Acorn1 said:
Cheers for the link. Apologies if I am being thick here however does that really mean that for a 12 month AST that 6 months notice must be given for something that only comes into play after that particular 'contract' has expired?
Or is that overwritten by 1 month notice period (where there is no mention of how to deal with increase).
Extract from link:
"How your landlord must propose a rent increase
If the tenancy agreement lays down a procedure for increasing rent, your landlord must stick to this. Otherwise, your landlord can:
renew your tenancy agreement at the end of the fixed term, but with an increased rent
agree a rent increase with you and produce a written record of the agreement that you both sign
use a ‘Landlord’s notice proposing a new rent’ form, which increases the rent after the fixed term has ended
Your landlord must give you a minimum of one month’s notice (if you pay rent weekly or monthly). If you have a yearly tenancy, they must give you 6 months’ notice."
Edited by C-J on Saturday 25th May 10:52
Ken_Code said:
I’ve just let my tenants if five years know that we’d like to sell later this year.
£3,500 per month rent, £1m mortgage, £14,000 service charge per year all adds up to a losing proposition.
We’d kept it as we’d thought we’d want to live there again one year, but don’t now think it’s likely.
We were also renting out a big town house in Newcastle that we instead now use as a second home. Between the tax situation, hassle and the degradation that tenants bring it wasn’t worth it.
Let’s face it, your tenants are getting a bargain. Think I’m going to do the same with a place we thought we might live in one day but now seems unlikely. Take advantage of the reduced CGT rate before labour increase it IMHO. Only doing short lets now to avoid my hands being tied. £3,500 per month rent, £1m mortgage, £14,000 service charge per year all adds up to a losing proposition.
We’d kept it as we’d thought we’d want to live there again one year, but don’t now think it’s likely.
We were also renting out a big town house in Newcastle that we instead now use as a second home. Between the tax situation, hassle and the degradation that tenants bring it wasn’t worth it.
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