Labour want to tell you when and how much to sell for

by Property 118

9:27 AM, 2nd September 2019
About 2 weeks ago

Labour want to tell you when and how much to sell for

Make Text Bigger
Labour want to tell you when and how much to sell for

John McDonnell Labour Shadow Chancellor has given an interview to the Financial Times outlining a ‘tenants right to buy’ policy idea first muted by Jeremy Corbyn in 2015 stating it would be a “great and radical solution to the burgeoning buy-to-let market.”

Labour want to redistribute wealth and raise living standards by forcing landlords to sell to tenants at a predetermined discount under a scheme similar to Margaret Thatcher’s council right to buy policy in the 80s.

McDonnell said: “You’d want to establish what is a reasonable price, you can establish that and then that becomes the right to buy. You (meaning the Labour party) set the criteria. I don’t think it’s complicated.”

“We’ve got a large number of landlords who are not maintaining these properties and are causing overcrowding and these problems.”

“In my street now a third of the houses are right to buy, badly maintained, overcrowded. It’s horrendous.”

Conservative MP, Michael Fabricant, told the MailOnline: “McDonnell has promised he would overturn the mixed-economy capitalist system if he came to power. This manoeuvre is just the start.”

“It would decimate the rental market in the UK, creating a shortage of properties available to rent.”

Andrew Bridgen, another Tory MP, said: ‘This is a frightening insight into what it would be like if this man ever became Chancellor of the Exchequer.

“These policies would destroy the private rental market as well as crash the entire housing market. It would also lead to a rise in homelessness, which Labour claims to be against.

“It’s true to his declared ambition to destroy capitalism.”



Comments

Appalled Landlord

9:53 AM, 2nd September 2019
About 2 weeks ago

McDonnell said "In my street now... a third of the houses are right-to-buy”.

Does he live on a council estate? If so, does he own a former council house, or does he rent it from the council/housing association?

Dylan Morris

9:56 AM, 2nd September 2019
About 2 weeks ago

Forget all about Brexit it’s just a side show. The real issue is Labour coming to power. This could easily happen as the Brexit Party swill split the Tory vote and this could be in the next few weeks the way things are going. Frightening, truly frightening.

Dylan Morris

9:57 AM, 2nd September 2019
About 2 weeks ago

Reply to the comment left by Appalled Landlord at 02/09/2019 - 09:53
The bloke’s a liar 100%

Mark Smith (Barrister-At-Law)

10:44 AM, 2nd September 2019
About 2 weeks ago

Reply to the comment left by Dylan Morris at 02/09/2019 - 09:57
I don't think he is lying about his wish to dismantle liberal capitalism by redistribution of private property without market value compensation.

Dino

10:53 AM, 2nd September 2019
About 2 weeks ago

He also wants to take 10% of the shares of companies and give them to their employees, so he'll crash the stock market and ruin pensions as well. Might be time to move any investments into overseas stocks...
Not sure what happens when those employees sell their shares back on the market - does he just keep stealing shares up to 10%? Luckily he'll run out of other people's money before he could do half of what he wants to

David Lawrenson

11:47 AM, 2nd September 2019
About 2 weeks ago

So John Mcdonnell's and Momentum's bid to crash all investment in the UK housing market gets a boost. I can just imagine all the potential investors in build to rent, dusting off their financial plans with this news.

Seizing private property owned by private individuals hey? Well, I'm pretty sure that could face a legal challenge.

But it is not that far renationalising industries is it, to establish "worker control"?

I recall "worker control" of the railways and much car production in the 70s. I'd wake up each sunny morning and rejoice because I knew that I "owned" these important industries. And then I waited for the smelly trains to come, always late. But, hey I owned the both railways and the operating companies, so lucky me!

The problem is that whilst worker control sounds great, what it looks like in practice is actually pretty crap. But Marx was never big on the detailed stuff. Whereas Engels in his Manchester factory always railed against his lazy workers.

My wife grew up in the Czech Republic under Communism. The workers owned restaurants were always "fully booked" even though they were empty. Why would the staff bother - they got paid anyway. And there is the tale of from her relations in rural Moravia that when a tractor spilled its load down a bank, all the local villagers would come and help themselves because, hey "they owned all the crop anyway".

David Lawrenson
http://www.LettingFocus.com
Independent private rented sector advice for private landlords

Rod

11:49 AM, 2nd September 2019
About 2 weeks ago

One very important point seems to have not come to their ......... minds, 'the income tax revenue from LLs' !!! Can I sniff 'vote chasing in the air ' ??

arorat

11:54 AM, 2nd September 2019
About 2 weeks ago

The only positive is; wannabe landlords with good intent who want to provide accommodation and create a 2nd home as a pension or pass to their children, should be deterred to stay out of shark infested waters.

Simon Williams

12:00 PM, 2nd September 2019
About 2 weeks ago

We are indeed entering dangerous times. Having said that, if a new labour government was to force landlords to sell to tenants at a market discount, I am sure there will be legal challenge around Article 1 of Protocol 1 of the ECHR (as copied by our own Human Rights Act). In the case of Holy Monastries v Greece, the court rejected the idea that the State could expropriate private property to give to "poor people" for "social purposes", without adequate compensation.

If Mr McDonnell has in mind therefore, a State enforced transfer of wealth from landlord to tenant in the form of a below market value sale (without state compensation to the landlord), it won't be a doddle.

Of course, quite apart from the calamitous effects on supply such a policy would have, it will also lead to great distortions in the market. The first thing I would be doing is transferring all my properties to room lettings, so that the chances of a right to buy claim would be small. No more families, no more tenants looking for long term stable tenancies as they would pose too much risk of a future right to buy claim costing me potentially tens of thousands.
The very people thought most to benefit from a right to buy policy, will be most likely to suffer.

As for this idea of a "burgeoning" buy to let sector (by which I assume he means over-sized), the reality is that the UK PRS is actually quite small by international standards. Far smaller than in Germany or the USA for example.

Never has there been a more important time for landlords to come together to defend our interests.

Luke P

12:42 PM, 2nd September 2019
About 2 weeks ago

All the [un]workable detail aside, if McDonnell believes he can solve a "...large number of landlords who are not maintaining these properties and are causing overcrowding..." by having the tenants buy their rental property, then he's never met the tenants of Grimsby, because these properties (even if they were indeed poorly maintained) would be far worse under an owner-occupier -certainly one who couldn't not afford the full, true market-value- as they simply do not have the money, nor wherewithal for their upkeep. Broken boilers would be 'solved' with a cheap electric fan-heater from Home Bargains and broken roof tiles would see the teenage son up there with a borrowed ladder using a tarp and a couple of bricks as a 'remedy'. There's not a hope in hell a bathroom or kitchen would ever get replaced. As for overcrowding, it is, if anything, even more likely once in the hands of the ex-tenants because they'd believe they can do what they want in their own house and if they wanna have a few mates chipping in for the bills, then they will...innit!

1 2 3

Leave Comments

Please Log-In OR Become a member to reply to comments or subscribe to new comment notifications.

Forgotten your password?

OR

BECOME A MEMBER

Property118 Landlord Insurance Achieves National Recognition

The Landlords Union

Become a Member, it's FREE

Our mission is to facilitate the sharing of best practice amongst UK landlords, tenants and letting agents

Learn More