Shelter CEO is confused about the reasons for evictions

by Appalled Landlord

11:11 AM, 4th October 2018
About 3 weeks ago

Shelter CEO is confused about the reasons for evictions

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Shelter CEO is confused about the reasons for evictions

Polly Neate took part in the Tonight programme last week called Britain’s Property Crisis. Click Here to see episode.

She said, just about 5 and a half minutes into the programme “At Shelter we see, every day, people who’ve been evicted for absolutely no reason, so they have been paying their rent, they haven’t damaged the property in any way, they haven’t done anything else that should lead them to be evicted, they’re being evicted, for no reason, often because the landlord wants to put the rent up and they can’t afford it.”

In a single breath you have claimed there is no reason and then given a reason.  Do you see the difficulty with your claim, Polly?

I’ll let you into a little secret.  No landlord evicts a tenant without a reason.  Ever.  When landlords have tenants who pay the rent on time, treat the property with respect and treat the neighbours with respect (what I will call RPN) they are happy to let them stay as long as they like, and without rent increases, because they don’t want them to start looking for somewhere else.  It does not make sense to evict a good tenant, and incur the costs of finding a new unknown quantity.

At least, that’s how it used to be, until Section 24 of the Finance (No. 2) Act 2015 was announced by George Osborne, a History graduate, who rose without trace.  He adopted a recommendation that was made in a flawed report by David Kingman, a Geography graduate, to disallow mortgage interest and other finance costs when calculating the taxable profits of landlords who bought properties in their own names rather than through companies.

Landlord Tax Grab – source document EXPOSED

This change means that such landlords will pay substantially more tax.  You don’t understand why?  It’s because we will be taxed on a fictitious amount of profit.  S 24  pretends that our payments of finance costs did not exist and that the money we have paid to the lender is somehow still in our bank accounts.  Have a look at this real comparison from Caroline, a landlady I know:

 2015/16 2020/21
 £  Effective  £  Effective
 tax rate  tax rate
Rent less non-finance costs  220,000  220,000
Finance costs  155,000  155,000
Real profit  65,000  65,000
Taxable profit  65,000  220,000
Income tax  15,200 23.4%  54,100 83.2%
Net income  49,800    10,900  

In 2020 she will have less than £11,000 for her and her daughter to live on.  But she will  not be entitled to any benefits because of her (mostly fictitious) deemed profit.

So she and other landlords have increased the rent just to pay the increase to HMRC – they will be no better off, but the tenants will be worse off.

Tenants who can’t afford the increase in rent are being replaced by those who can.  So tenants on frozen or reduced housing benefit are being decanted in large numbers.

Other landlords have been forced to sell up, so their tenants have been evicted.  The reduction in supply will force rents up, ceteris paribus.

Shelter supported S 24 when Osborne announced it.  It is having the predicted effect of increasing homelessness just like a milder version did in Ireland.  The Irish government started to phase it out for that reason just as the present UK government started to phase it in – last year.

Polly, if a landlord evicts a tenant there will be a good reason, either S 24 or a breach of RPN.  Please stop pretending otherwise.

If you want to turn the tide of evictions, and reduce the misery it is causing, you should be lobbying to repeal S 24, or at least to stop it being retroactive.  If you really want to turn the tide, that is.



Comments

John MacAlevey

11:59 AM, 4th October 2018
About 3 weeks ago

“At Shelter we see, every day, people who’ve been evicted for absolutely no reason, "

Ridiculous..I did`nt bother reading further as that statement says it all about that person.
We are in the UK not Russia.

Larry Sweeney

12:25 PM, 4th October 2018
About 3 weeks ago

Complete waste of time talking to Polly .
Instead conserve energy and expose Polly and her crew. Shelter the charity which pays its CEO £120k plus while not providing any accomodation for a single homeless person. Compare "polly " £120k Neath neatly staching her cash to the young lady in Liverpool who tried to book a homeless man in to a shelter. Her good deed was stopped in its tracks by more stupid useless regulations. He could not be accomodated as he had no ID. Polly old girl Would you not be better employed working hard as this young lady did, instead of spewing vile lies about tenants being evicted for no reason. Polly it is disgusting but you dont care you have 120k for housing nobody.

Dr Rosalind Beck

12:46 PM, 4th October 2018
About 3 weeks ago

I would also like to see Shelter mention the numbers being evicted from social housing - for very similar reasons of non-payment, damage and anti-social behaviour. The proportions are very similar to those being evicted from private housing, yet Shelter breathes not a word about this.

In fact, we all know that the 'loss of a private tenancy' is not a 'cause.' If it were, why doesn't Shelter say 'the loss of a private tenancy, social tenancy or need to leave an owner-occupied home' are the '3 causes of homelessness in the UK.?' The reason they don't say that - apart from it not fitting their agenda of slamming private landlords exclusively - is because it exposes the tautological absurdity of stating that the loss of home is the cause of not having a home.

Michael Barnes

12:57 PM, 4th October 2018
About 3 weeks ago

Have you sent this to Polly, or are you just preaching to the converted?

AJ

16:08 PM, 4th October 2018
About 3 weeks ago

Reply to the comment left by Michael Barnes at 04/10/2018 - 12:57
I have made similar comments on Shelters FB page, you get the rants form the militant tenants, that all landlords are money grabbing b***stds, but nothing from Shelter.

If they don't answer it will go way.

Ian Narbeth

16:20 PM, 4th October 2018
About 3 weeks ago

We need to be careful with this line of argument. I completely agree that s24 is the cause of landlords such as Caroline putting their rents up. However, I suspect that incorporated landlords and landlords without mortgages do the same though I don't have data on this. What tenants will notice is that they have behaved well, paid rent on time and looked after the property but are being asked to pay more. Tenants are likely to blame "greedy landlords" rather than the greedy Gideot (now editor of the Evening Standard).
Perhaps we can inform tenants on the lines of: "I am sorry your rent has had to be increased but because of a tax change called section 24, although my gross income has gone up my net income has actually stayed the same/decreased by £[500]. The tax change is being introduced in stages so I may have to increase the rent again next year just to stand still. Please ask your MP why he or she supported section 24."

Oyibo

5:06 AM, 5th October 2018
About 3 weeks ago

Reply to the comment left by John MacAlevey at 04/10/2018 - 11:59
Evictions for no reason dont tend to happen in Russia either.

David Lester

7:35 AM, 6th October 2018
About 3 weeks ago

It is very worrying that this totally incompetent women is paid more than the Prime Minister!

Mandy Thomson

9:26 AM, 6th October 2018
About 3 weeks ago

Reply to the comment left by Dr Rosalind Beck at 04/10/2018 - 12:46And of course, housing association figures are included with private eviction figures.
Yes there will be a SMALL number of private landlords who evict simply because they decide they no longer want to be a landlord, but the majority are evicting for a good REASON although they are using section 21 to do so. This is because it's much easier to evict with section 21 as there is normally no hearing and the only real defence is a technical defence.
It is important to mention section 21 because Shelter and other pro tenant groups like to cite the many "no fault" evictions as an argument against private landlords and against "no fault" eviction itself, while forgetting that small private landlords don't have the resource to evict that housing associations and local authority landlords do, that have legal representation at their disposal, and can afford to wait for longer to get their properties back.

Old Mrs Landlord

9:40 AM, 6th October 2018
About 3 weeks ago

Check out Monty Bodkin's recent post on the thread 'Shelter CEO is also confused about reasons for No Fault evictions'. It details Shelter's own research on landlords' reasons. They are perfectly well aware of the reasons, but it suits their "tenants are victims" narrative to publicly assert that tenants have done nothing to precipitate eviction.


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