Could landlords be incentivised to offer longer term tenancies?

by Property 118

9:31 AM, 3rd July 2018
About 3 months ago

Could landlords be incentivised to offer longer term tenancies?

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Could landlords be incentivised to offer longer term tenancies?

The new government consultation into making longer term tenancies the default option in England, ‘Overcoming the Barriers to Longer Tenancies in the Private Rented Sector’, is considering financial and tax incentive for landlords.

Please see the specific section from the consultation below:

“80. Alternatively financial incentives could be explored. This could be quicker to implement but would still require legislation and could be administratively burdensome. The landlord would likely need to demonstrate compliance with other legislative requirements such as completing annual gas safety checks and protecting any deposit taken in a Government approved tenancy deposit protection scheme and this would need to be easily verifiable. We would also have to consider ways to ensure that incentives were not subject to abuse.

81. In recent research by the Residential Landlords Association, 63% of landlords reported that tax relief would encourage them to offer a longer tenancy. Any tax incentive would require primary legislation, and need to take into account the interaction between tax, which is partially devolved, and housing, which is fully devolved. There is a further consideration around how any tax incentive would play out in Scotland, where they have recently regulated to introduce indefinite tenancies. Different rules would also be required for individuals and corporate landlords. Cash payments could be considered for landlords who demonstrated that they had offered and delivered a longer tenancy. Such payments could be administered locally by local authorities.”

It has to be said that this is only a very small section and among other options that consider a more compulsory approach.

Please Click Here to read and respond to the full consultation

RLA policy director, David Smith, said: “With landlords having faced a barrage of tax increases we believe that smart taxation, such as that being proposed today, would provide the longer term homes to rent many families and older people want.

“We would warn against making it a statutory requirement to introduce three year tenancies. Many tenants simply do not want to be tied to a property long term. It is vital that the market is able to provide the flexibility that many need in order to swiftly access new work and educational opportunities.”



Comments

Whiteskifreak Surrey

9:47 AM, 3rd July 2018
About 3 months ago

I can see it again as an incentive for those who do not have mortgage. They are not affected by S24. Generally lenders will not allow for 3 years tenancies, hence again those leveraged are being beaten up.
Is there a conspiracy theory behind all that aiming for a complete distruction of unincorporated, small LLs with mortgages? I smell a rat.

Paul Shears

11:13 AM, 3rd July 2018
About 3 months ago

"Is there a conspiracy theory behind all that aiming for a complete destruction of unincorporated, small LLs with mortgages?"
It's not a conspiracy theory. It's a fact and the evidence is both consistent and overwhelming.
There are countless obvious examples but I will just list two. The owner who needs to leave his home in order to rent elsewhere for whatever reason. The same person looking for short term accommodation somewhere else for whatever reason.
I personally have no debt of any kind and I am slowly being destroyed by this government. I may well be the last man standing one day, but that does not mean that I will always be able to withstand this onslaught.

p118a

12:44 PM, 3rd July 2018
About 3 months ago

If we want to stop the forced imposition of longer tenancies then it is important we make our views known in response to the consultation.

If everyone responds to the consultation it will make it much harder for long tenancies to be imposed on landlords as the default outcome.

They may not listen, but we cannot complain if we do not take the opportunity to respond. Deadline is 26 August 2018.

See how to respond here: https://www.gov.uk/government/consultations/overcoming-the-barriers-to-longer-tenancies-in-the-private-rented-sector

Paul Shears

13:39 PM, 3rd July 2018
About 3 months ago

Well I filled it in but it is very long and yet another example of an attempt to dumb down an area of life in order to eliminate the basic need for sound judgement.

Annie Landlord

13:48 PM, 3rd July 2018
About 3 months ago

In principle I have no objection to longer term tenancies, provided the process for removing 'rogue' tenants is simplified. There are some plus points in the consultation, such as the requirement for tenants to give 2 months, rather than 1 months notice. Reintroducing tapered cgt relief would be a big incentive to some landlords to retain their properties for longer. The consultation, and the Scottish model both allow the landlord to evict if they need to sell the house, which seems pretty fair.
If I were able to remain a landlord I would be prepared to offer longer tenancies. Sadly S24 and the vile vitriol aimed at landlords has persuaded me that it is in my best interests to sell up. This will land 6 adults (2 classed as highly vulnerable) and 8 children, who have been my tenants for 6 years or so, into the hands of local councils to find new homes. There is no social housing, so unless the council can source another good prs landlord these families might end up in emergency accommodation.
I am bitterly, bitterly disappointed that the totally undeserved anti landlord aggression that has been fuelled by conflation, mis information and the failure of councils to deal with bad landlords has brought us to this point.

Mick Roberts

10:38 AM, 4th July 2018
About 3 months ago

Can you Landlords please sign this & forward to all your contacts.
A small hope, we have to try anything & everything.

I'm sure we not get 10k signatures, but the more Licensing & Govt start to see these things, who knows.

“Petition calling for a review of Nottingham City Councils Selective Licensing."
https://petition.parliament.uk/petitions/223039

Paul Shears

10:52 AM, 4th July 2018
About 3 months ago

Reply to the comment left by Mick Roberts at 04/07/2018 - 10:38
OK, all done and it only takes a few moments as it quite rightly should. Come on folks, we have only just started and already hit 129 signatures. This is important for all of us and the tenants as well.

Steve Masters

11:12 AM, 4th July 2018
About 3 months ago

Reply to the comment left by Annie Landlord at 03/07/2018 - 13:48
The only thing that government has done for landlords in recent years is to create a market environment which encourages and allows those landlords who choose to stay in the market to put up rents. But this barely compensates for all the extra expense and work that has been created for them.

What government could do for me to incentivise me to offer longer tenancies is to overhaul the section 21 and section 8 process to give me confidence that I will not be saddled with rouge tenants for 3 years.

I love keeping my good tenants for as long as they want to stay, no voids, rent coming in, bills paid, no time consuming process of interviewing new tenants and all the hassle of so much more paperwork.

But if I have a bad tenant who thinks they can do just as they please, not pay the rent, damage my property, upset my neighbors or my other tenants then I want them out and I want them out quickly.

Otherwise my vetting process will become so much more tighter and I will no longer be prepared to take a chance on some of the less capable tenants at the bottom end of the scale. I'll keep all the employed well paid professional tenants and leave the low paid and unemployed tenants to someone else.

OR

If the government won't help evict bad tenants them someone will be sending the boys round!

No one (except bad tenants) wants to encourage a situation where bad tenants think they can act with impunity and do as they please at everyone else's expense.

So come on government, take notice, improve the eviction process for bad tenants and do everyone (except bad tenants) a favour and really improve the rental market for everyone. What's the downside to this?

Kate Mellor

19:53 PM, 7th July 2018
About 3 months ago

Reply to the comment left by Annie Landlord at 03/07/2018 - 13:48
When anyone asks what I do for a job I tell them I work in an office doing admin. Ok, it’s my own office and my own business admin, but saying you’re a landlord is akin to announcing you’re a paedophile these days...😢

Kate Mellor

19:54 PM, 7th July 2018
About 3 months ago

When anyone asks what I do for a job I tell them I work in an office doing admin. Ok, it’s my own office and my own business admin, but saying you’re a landlord is akin to announcing you’re a paedophile these days...😢

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