Buy To Let as we know it is Finished | Buy To Let UK | Saj Hussain

The Renters’ Reform Bill is part of the biggest shake-up of the Private Rented Sector (PRS) in 30 years. The Government wants to push ahead to implement this. Only this week Liz Truss confirmed that the government is not backtracking on their plans to scrap Section 21 so-called ‘no fault’ evictions and will press ahead with the policy. Some of the changes are much needed whereas others could completely destroy the Buy To Let industry. Could this be the beginning of the end of Buy To Let?

Could this be the beginning of the end of the bivalent sector any benefits of being a landlord are slowly being eroded way over the years and now with the introduction of the renters reform bill this could be the final nail in the cotton for many particular landlords forget the idea of having a level playfield between tenants and landlords this is like playing

Football on a hill with you at the bottom trying to defend those goals the question is are you staying as a landlord or are you now packing your bags and getting out of the landlord sector hope you’re watching my videos for the first time my name is saj hussain and on this channel i share with you my 15 plus years of property investing experience to ultimately

Help you get further faster in your own property investing business now the government plans to reform the rental sector and try and make it much more fairer for tennis on the face of it should be a really good thing right but what i think would make it even better if they included landlords in that and made it fair for them too what is it that’s led up to this

Current situation well there used to be a time where the conservative party would support landlords and encourage the owner ownership of property for rental purposes and effectively bring more rental stock to the market but over the years they seemed to have realized there’s a lot more tenants than there is landlords i.e there’s a lot more votes available from the

Rental sector than there is from the people that own the property in that sector and slowly that seems to be a shift away from supporting landlords to favoring tenants and rather than just supporting tenants they’ve shifted their views to more anti-landlord retreat that’s been coming out from the tory party of the last few years now don’t get me wrong i think the

Rental sector does need reforming that’s some very archaic ideas in there in terms of how it’s run and how it operates but i think it needs to be more fairer for everybody more rather than making much more in favor for tenants and leaving out the suppliers to the sector i.e the landlords in february 2022 the government published a leveling of white paper with its

Re-commitment to introducing the renters reform bill which is talking about changing how renting works in principle a great idea then in may 2022 in the government’s queen speech it promised that the renters reform bill would abolish section 21 either no fault evictions now there’s some merit in doing that but it also needs to be balanced and in a more fair way

Because you need to review the whole system rather than something in isolation then in june 2022 the government published a white paper called a fairer private renting sector and the one behind me just here and in that it talks about and lays out the plans for the renters reform bill in more detail the government has also expressed its desire to debate and vote in

This bill within this parliamentary session which means this all could be happening very very soon there are eight key proposals within this bill some of them good some of them let’s face it really not so good for landlords at all let’s now jump straight in and talk about those eight and how they impact you as a landlord the first key proposal is the abolishment

Of the section 21 process sometimes people refer this as to a null fault eviction essentially it’s a process to be able to get a property backed by a landlord without having any particular reason in terms of why they want the property back from a tenant now the government’s own data shows up between 2019 and 2020 more than 20 percent of the tenants that moved did

See also  Money can buy happiness: Michael Norton at TEDxCambridge 2011

Not end their tenancy by choice so let’s put some context into this in terms of why the section one document is used by landlords when a landlord creates a property to be rented out and brings it into the marketplace as a product effectively their longer term intention is to rent a property item create a rental income from that hold the asset for the long term

Maybe for their pension maybe even their kids might be able to benefit from the hard work and the effort they’re putting on the risk they’ve taken in acquiring that property and bringing it to the market however there will be times when there’s an issue with a tenant and often it’s around non-payment or rent or anti-social behavior there’s some kind of challenge

Or difficulty with that tenant now the normal process is to use a section 8 multis to be able to remove that tenant however section 8 is not so easy to use and it can be quite challenging sometimes getting that process through port and it could drive on for quite a long time so what some landlords will do but we’ve done this ourselves as well we use a section 21

Route which means we ask for a no fault eviction and that means without giving a reason we look for feedback simply because it’s an easier route to achieve the same outcome rather than going through what would be the correct process because it’s much more cumbersome and an unreliable way to get the outcome that we want so in short landlords don’t go around the

Victim tenant what they want is a property rented out to attendance is going to look after you and pay the rent on time and the only time they do a victor tenant if there’s a problem with that tenant the second proposal is minimum housing standards now i’m in favor of this because i think it’s important that the accommodation that we provide should be of good quality

So this is extending the decent home standard into the private rental sector as i said i think this is important this is something that really should happen and if something should have happened a long time ago because we really shouldn’t expect anybody to live in substandard housing proposal number three is for periodic tendencies to become standard effectively

What that means there’ll be no more fixed period of six month tenancy there’ll effectively be like a rolling tenancy so when a tendency comes out of a fixed period it becomes periodic and that will be the standard way tenancy agreements put together and effectively a tenancy then can’t be ended by a landlord without a valid reason and the tenant could stay as long

As they want now the theory behind that makes sense however my concern is to be open to abuse or depending on how it’s set up and how it works it could be that this works really well or it’s just massively abused for example a tenant could stop paying rent and choose to move because they feel that the housing is of poor quality the question is how do you define

That and of course sometimes you know we’ve experienced as well with a tenant can be manipulative in terms of getting a situation to work in their favor so as long as this works in a fair way i think this is a great idea proposal number four is a new ombudsman covering all private landlords so the current system would effectively change to cover all landlords to be

A member of an ombudsman scheme so if there’s any disputes or issues that can go to the ombudsman service and again as long as this is done in a fair way i don’t really see any issue with this i think that’s great news however my only slight gripe with this is when are we going to see a system that also means that tenants have to register and tenants have to meet

Certain standards as well rather than just landlords are the ones i have to adhere to various standards proposal number five is for tenants speak with more right to keep pets in properties now on the face of it again i don’t really have an issue with this and then keeping pets if the goldfish there’s no real issue at all if it’s a six foot alligator then that can

See also  What does the Bible say about Halloween?

Be a bit of a challenge because no real description of what pets are what size petty degrees number or not of course having some animals in the house can cause much more damage than others yes they’ll be required to have pet insurance but sometimes enforcing these things can be a real pain in the backside so i although i agree that a tenant should have a right to

Be able to have a pet within the property it also needs to be balanced with what damage that potentially could cause in that property as well proposal number six is a new property portal for private landlords and tenants as well so what this will mean is a central place for all the information is kept now i think this is a great idea because sometimes what happens

With legal information when we go look at it particularly around the rental sector when it comes to licensing and planning and various things often you find it scattered around it’s not in one place but if we’ve got information held in one place which is relevant to landlords and relevant tenants or rental or residential property i think that will make things a

Whole lot easier proposal number seven is to prevent landlords from not renting to families with children and also excluding families and people that aren’t dss benefits or sometimes you see as no dss type of adverts again i think generally this is a good idea i think it’s important to take into consideration why it is that some landlords choose not to rent to

Families or choose not to rent to people on benefits well when it comes to not renting on families for me that doesn’t really make sense i think renting a property to a family with children for us generally we don’t have an issue with that but when it comes to not renting to for example people that are on benefits often there could be reasons of security around

That in terms of how payments are made now payments can be made on time and as long as that system’s tightened up and a landlord is going to get paid the rent on time and there’s no issues then certainly there’s no issues around that so this is comes down to read the ability to pay which i think is important which sometimes the system the weight operates right now

Is very weak so we don’t exclude people that aren’t benefits from renting from us but what we do look for is some guarantors and some security to ensure that we’re going to get paid the rent as and when it’s due proposal number eight is to double the time frame the multi-speed required for a landlord to give notice to a tenant to increase the rent at a property

But more importantly to give a tenant the right to object if they think it’s unfair the level of increase that’s happening now i don’t know any tenant that likes to get a rent increase so i can see a lot of tenants objecting to that and causing delays and problems there needs to be a more balanced and fairer way of how rent increases work so for example retail

Price index annually as that increases it could be pegged to a percentage of that inflation right now inflation is through the roofs or might not be the best thing but there needs to be some method where rent increases happen and reason rent increases happen because market conditions dictate there’s an increase in the rent so if it’s picked or something would make

Sense but when it isn’t it then again it’s open to abuse so a lot of these things are good ideas on the surface but a lot of it is going to depend on the devil really is going to be in the detail in terms of how these things are going to work and how it’s going to get implemented my real concerns are many of these things haven’t really been thought through the

Why the government in terms of how they’re going to play out what the impact they’re going to have so for example they’re moving of section 21 which means we can’t evict a tenant without any um without any justification or any reason then that was changes you really need to be built into the current section 8 system which they’ve talked about they’re going to do

See also  10 best ONLINE JOBS you can do from your PHONE | MAKE 3-4 per hour

But really again there’s no detail and the frustration is when a tenant’s not paying rent it takes months and months so for example let’s say you got a rent of 500 pounds a month and it takes say six months to get somebody out and often it can take much longer you know that landlord is thousands and thousands of pounds of out of pocket and many landlords are not

Really in a position to absorb those kind of losses and you can see where the chances of abuse and increasing problems like that might happen for them but some landlords are simply throwing the pal and say enough is enough i no longer want to be a landlord and what that is doing is taking property away from the rental sector and the government is not fulfilling

This gap they’re not putting new rental property stock into the marketplace so what ultimately will happen will be fewer and fewer properties in the marketplace available for rent and so rather than getting landlords involved and trying to make a better sector for everybody they’re marginalizing them really in favor for tenants but they’ll only be so much that

Landlords are willing to accept so for instance we talk about having decent homes and a good standard driving is really important but at the same time if you cap rent increases for example rents can’t be increased beyond certain numbers again we’ve yet to see the detail of how this is going to play out but i can see how that’s going to get pulled back and there’ll

Be a limited amount of rent increases that can happen that what you’re doing you’re preventing a landlord from being able to generate profit on their property so for instance if their mortgage rates are going up like they are right now their profit margin is being squeezed because the rental remains the same but their costs are increasing now if that was to happen

You can see why landlord would choose not to spend money on a property because they’re not making enough money it’s not really viable for them to do that so rather than encouraging landlords to create nice and decent homes what you’re doing is squeezing the margin of landlords to a point where they don’t want to spend money and there may be some landlord to start

Even cutting corners which i don’t think is a good thing but you can see how all these things are going to happen so unfortunately rather than creating a more fairer system for everybody right now what’s happening is a system is becoming much more in the favor of tenants it’s not really a fair system at the expense of landlords hey look i’d love to know what your

Thoughts on this topic i’d like to think that i’ll have a fairly balanced opinion on this but many people might think i’m biased with the view of a landlord and the opinion there really what i want to do is to see a more fairy system for everybody in the rental sector for this to thrive for tenants to have great homes in a reasonable rent that they’re paying for

Landlords to be able to create profit what they’re doing so they continue to invest in sector and make it grow hey if you’ve enjoyed this content what to do next is click on my face over here to subscribe to the channel once you’ve done that then click on here to watch this video next where i talk about evictions interest rate rising which is a vlog i did earlier

In the year in february 2022 where also the infamous eviction expert paul champlin was on stage at one of our events so watch this video next and i’ll see you there

Transcribed from video
Buy To Let as we know it is Finished | Buy To Let UK | Saj Hussain By Saj Hussain