Newish LL asking about why tenants wants a three year rent period.

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  • Newish LL asking about why tenants wants a three year rent period.

    Hi I wonder if anyone can help. I am renting out for the first time and a year has passed with the same tenants. They are a family with one small child. They are asking for an extension of their AST to now be for another three years or atleast another two years. Does anyone have any advice. Should I give this or should I just renew it for another year. What happens if they renew on a year by year basis on the AST with same tenants? Do tenants get more rights if they stay on one year renewals? I am worried that I will end up loosing the house to tenants. Does this happen?
    Last edited by Gizmos; 29-08-2018, 17:51 PM. Reason: Spelling errors

  • JK0
    replied
    Originally posted by jpkeates View Post
    I used to think that too.
    In fact I've made the same argument on here in the past.

    But then someone showed me an interesting graphic.
    Areas of highest use of s21 notices and areas with highest rates of rent increase adjusted for population.
    The areas with the highest rate of rent rise had a disproportionately high level of s21 notices.

    Obviously there's a lot of other things that could impact the figures - the figures on notices come from the courts, so they relate to disputed notices or at least one's not complied with, which could simply be a result of the tenant not being able to comply when rents around them are rising sharply - or simply wanting a few more weeks/months at a lower rent.

    But, overall, it changed my mind.
    Hmm. I think you might put up with a useless tenant if you know you aren't going to get any more money from anyone else.

    If you know you can get more cash from a better tenant, you'll crack on with the s21, won't you?

    Leave a comment:


  • boletus
    replied
    Originally posted by buzzard1994 View Post

    Well I did forget that his agent messed up the guarantor agreement, so that probably wouldnt have been enforceable - but how do you define "competent"?
    In this context, I meant competent in knowing the legalities of being a landlord, rights and obligations.
    Sounds a decent enough bloke but seems to be winging it a bit with the guarantor agreement.
    Although I'm sure you'd honour it if they'd behaved reasonably. Plus student lets are usually paid substantially in advance, for a student year and with a (hopefully) high paid graduate to go after for the next 6 years if necessary.
    As said, student lets are a different kettle of fish.

    Leave a comment:


  • buzzard1994
    replied
    Originally posted by boletus View Post

    Unless well-paid Mummy and Daddy with a PPR are firmly on the hook as guarantors, I'd question that competency.
    Well I did forget that his agent messed up the guarantor agreement, so that probably wouldnt have been enforceable - but how do you define "competent"? He has tenants who keep the place reasonably tidy, dont ask him to do anything unless it's really needed, pay the rent regularly and dont annoy the other tenants. So he made a good decision in letting to them in the first place and its not surprising he wants to keep them. He has any necessary work done very quickly, didnt ask for a rent increase and doesnt bother them and the other tenants arent too much of a pain so they are happy to stay.

    Leave a comment:


  • boletus
    replied
    Pretty hard to refute without seeing any actual data that backs it up but if someone is claiming it is commonplace, then it sounds like anti-landlord spin to me.

    I just no longer believe that "no landlord*" would evict a decent tenant just to rent it to someone else for more money.
    Me neither, (nearly) all of us are in it for the money but the risk, void, cost and hassle of actually making a section 21 claim hugely outweighs most possible gains. I'd be looking at a 30%+ increase at least before entertaining it, and the earlier link shows nowhere giving that.

    And why not just do a simple section 13 rent increase notice if there are no problems with the tenant?

    Not saying it doesn't happen, just that the amount must be infinitesimal compared with those evicted for rent arrears and ASB.

    The 1% from the Shelter survey sounds about right.

    Leave a comment:


  • jpkeates
    replied
    Originally posted by boletus View Post
    It sounds like a clever theoretical argument from a spin doctor, made to fit around their anti-landlord agenda. Casting just enough doubt to send us off down correlation argument rabbit holes.
    I'm fairly sure it was highlighted by Nearly Legal on Twitter.
    It was based on data for a period when rents were rising, as far as I remember.

    It should be interesting when stats are available for the periods with falling rent.

    I don't buy the shelter data.
    It's based on 185 landlords (few of whom are going to claim they kicked a tenant out to make more money).

    Most commonly they blame rent arrears (which makes sense) but most tenants claim they were told it was to sell the property.
    And I've heard the same from a lot of tenants (who then are mystified when the property they've left is readvertised to let).

    I'm not 100% sure, either way.
    I just no longer believe that "no landlord*" would evict a decent tenant just to rent it to someone else for more money.
    Which I once did.

    *I'm ignoring the crooks who would do just about anything.

    Leave a comment:


  • boletus
    replied
    It sounds like a clever theoretical argument from a spin doctor, made to fit around their anti-landlord agenda. Casting just enough doubt to send us off down correlation argument rabbit holes.

    As landlords, we know it is wrong, if only for sound financial reasons. Landlords mainly evict under section 21 for rent arrears followed by ASB.

    An increase in rent was responsible for just 9% of rent arrears.
    (Unemployment, benefit problems, pay day loans, holidays in Ibiza, beer & fags etc were responsible for the other 91%).
    Source EHS;

    https://assets.publishing.service.go...tor_report.pdf

    Not to mention rents are falling/flat in London and the SE and rising in the SW and East Midlands;

    https://www.lslps.co.uk/news-and-med...y-to-let-index

    And this one from Shelter;

    https://england.shelter.org.uk/profe...vate_landlords

    The chart below shows the reasons landlords gave for removing tenants. Rent arrears of over two months (46%) or anti-social behaviour/ damage to the property (26%) were by far the most common reasons given, but in 9% of cases, the main reason was to do with either the landlord needing to sell, move in or get a higher rent (1%), which the existing tenant wouldn’t pay.

    Convinced?


    Leave a comment:


  • jpkeates
    replied
    Originally posted by boletus View Post
    Some of mine are in the SE and I've never once come across a landlord directly evicting for that reason, or anywhere else for that matter. It just doesn't make any financial sense. (Increasing the rent to reflect market rates, well that's life.
    I used to think that too.
    In fact I've made the same argument on here in the past.

    But then someone showed me an interesting graphic.
    Areas of highest use of s21 notices and areas with highest rates of rent increase adjusted for population.
    The areas with the highest rate of rent rise had a disproportionately high level of s21 notices.

    Obviously there's a lot of other things that could impact the figures - the figures on notices come from the courts, so they relate to disputed notices or at least one's not complied with, which could simply be a result of the tenant not being able to comply when rents around them are rising sharply - or simply wanting a few more weeks/months at a lower rent.

    But, overall, it changed my mind.

    Leave a comment:


  • boletus
    replied
    Originally posted by jpkeates View Post

    This is one of those problems that (seems to me) to be very local. Where rents increase pretty continually and by reasonable amounts, there's a tendency for landlords to evict tenants -either directly to bring in new higher paying tenants or indirectly, by increasing the rent to the point that the tenants have to move.

    *This is most common in London and the SE. I.e. where most of the politicians and media are based.
    Some of mine are in the SE and I've never once come across a landlord directly evicting for that reason, or anywhere else for that matter. It just doesn't make any financial sense. (Increasing the rent to reflect market rates, well that's life.)

    For every direct eviction I bet there is an underlying issue;
    Late rent payment, annoying the neighbours, ASB, drugs, not looking after the property etc.
    And the property will naturally be re-advertised at a higher rent (existing tenants pay less than new tenants).
    So every disgruntled tenant will claim they were evicted just because the greedy landlord wanted more rent.

    Leave a comment:


  • jpkeates
    replied
    Originally posted by buzzard1994 View Post
    They recently renewed with their second landlord (nothing wrong with the first landlord either but the flat was ex council and had difficult neighbours).
    That's a different problem right there. The tenants want the security of a long contract but the flexibility to move when they want.

    This is one of those problems that (seems to me) to be very local. Where rents increase pretty continually and by reasonable amounts, there's a tendency for landlords to evict tenants - either directly to bring in new higher paying tenants or indirectly, by increasing the rent to the point that the tenants have to move. In that scenario, I can see tenants being insecure and wanting a longer term without a rent increase*.

    Where I let, the market rate is fairly static (a small percentage increase is reported, but in reality properties are advertised today at the same rate as they were several years ago). So there's no landlord benefit in moving decent tenants on. A tenant who pays their rent is probably only slightly less secure then someone who owns their own home - the chances of me having some kind of life changing event that causes their lease to end aren't that much more likely than the same thing happening to the tenant.

    Whether they feel that way, of course, I don't know.

    *This is most common in London and the SE. I.e. where most of the politicians and media are based.

    Leave a comment:


  • boletus
    replied
    Originally posted by buzzard1994 View Post

    Current landlord offered a longer contract - and they are competent as a landlord.
    Unless well-paid Mummy and Daddy with a PPR are firmly on the hook as guarantors, I'd question that competency.

    Leave a comment:


  • islandgirl
    replied
    another vote for periodic...it's what I do after an initial 6 month contract

    Leave a comment:


  • theartfullodger
    replied
    If I've had good tenants I tell them they can stay as long as both they & I are happy.

    And my happiness includes having rent paid in-full-on-time, place looked after, no (valid) complaints from neighbours. And so perioidic gives us both the best flexibility - plus NO BLEEDIN' paperwork!

    Leave a comment:


  • buzzard1994
    replied
    boletus,

    OP wasnt asking about an initial tenancy, it's a renewal - and I'd offer a 2 year contract with a break clause if they've been good tenants.

    Leave a comment:


  • boletus
    replied
    Originally posted by buzzard1994 View Post

    Current landlord offered a longer contract - and they are competent as a landlord.
    Student lets are a different kettle of fish.

    As a competent landlord yourself, how long do you usually offer on initial tenancies?

    Leave a comment:

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