Can we follow the German model?

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    Can we follow the German model?

    A thought experiment.

    The standard practice is Germany for long term rental is to rent a shell, and T supplies kitchen and bathroom (and carpets?).

    Given that we and our tenants are just being .. er .. fooked over by another crazy set of rules wrt fees and prevention of recovery of legitimately incurred costs, and the Housing Department appears to be run by a person from the planet Zarg with all the intelligence and sense of a lobotomsed sea-slug, how close can we get to the German practice as a way of eg minimising Deposit issues etc?

    I can see a well-insulated shell (say an EPC B or a C which is OK but not great) with:

    Electric only heating - either ASHP plus UFH, or storage.
    Good quality double glazing.
    Either a robust floor - eg porcelain tiles, or floorboards with no covering.
    Electrical wiring, sockets etc.
    Minimal kitchen for mortgage / habitable - which I think is water, sink and cooker.
    Loo.
    Electrics.
    Tenant decorates.

    The ability to save on the costs of replacement kitchens + bathrooms + carpets looks attractive for rent reduction and risk reduction.

    This is basically the same strategy as people who have given up on Deposits due to the red tape.

    What else is required by law, and how far can approach this go in the UK?

    Ferdinand

    Refer Mad Regulators to Arkell vs Pressdram.

    #2
    You'd have someone move in saying they were happy with the lack of kitchen & bathroom. They'd be on the phone to the council complaining the next day. The council would do an HHSRS assessment, and force you to install those things at no cost to the tenant. Probably make you put him in a hotel until it was done!

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      #3
      I must admit I've been thinking a model like this could work well... but it requires government to be sensible.

      Just can't help imagining that we'd still be screwed over for something. Fundamentally the government is trying to kill the private rentals market either way.

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        #4
        This sort of model, which of course only really applies to family lets, requires the tenants to accept that they are going to be tenants for many years if not life and accept the property as their settled home for a good chunk of that time. I dont think we have enough tenants with that sort of mindset yet apart from so called benefits tenants that most landlords dont seem to want. I suspect that most still aspire to owning their own home even if they cant see a way to do it and would baulk at the idea of having to 'improve' someone else's property

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          #5
          @Mods

          The system just spamemd a big post on this thread. Could you unspam.

          Thanks
          Refer Mad Regulators to Arkell vs Pressdram.

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            #6
            Originally posted by DPT57 View Post
            This sort of model, which of course only really applies to family lets, requires the tenants to accept that they are going to be tenants for many years if not life and accept the property as their settled home for a good chunk of that time. I dont think we have enough tenants with that sort of mindset yet ......
            Isn't that a chicken and egg situation though?

            Tenants can't have that mindset at the moment - because they can't get that kind of long term rental agreement at the moment.

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              #7
              As I recall, back in the last century, unfurnished accommodation had security of tenure but furnished accommodation did not, which is why furnished accommodation was the norm.

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                #8
                Originally posted by nukecad View Post
                Isn't that a chicken and egg situation though?

                Tenants can't have that mindset at the moment - because they can't get that kind of long term rental agreement at the moment.
                To an extent they can. (or in our case, could)

                This was my model, which has now been progressively killed by various laws, and is under review in some respects. It was used to incentivise long tenancies.
                ----------------------------------
                In 2014-5 the rental model used for our small family portfolio included:

                1 - Most tenancies with a 3-year no-increase clause.

                2 - Where not 3 year, an increase clause indicating that a normal increase would be inflation-linked.

                3 - In practice, rents usually increased only minimally during a tenancy, by less than inflation. For example our longest serving tenant has had an increase of 14% between 2010 and 2018 (in addition to major investment in the property, but I will leave that aside). Over the period inflation according to CPI has been 25%, and according to RPI has been 27%. This is typical in our portfolio.

                4 - On fees, I do not think that we have charged anyone for any fees whatsoever in well over a decade.

                5 - Approximately half of our tenancies involve pets.

                6 - It is now unusual for us to charge deposits.

                7 - The renovation model has been to upgrade property at the outset if a full renovation, or over time if not, such that energy costs etc are approximately half of those of an unmodernised equivalent.

                8 - All lets unfurnished.
                ------------------------------------

                ML
                Refer Mad Regulators to Arkell vs Pressdram.

                Comment


                  #9
                  Work with me, on this...

                  Originally posted by DPT57 View Post
                  This sort of model, which of course only really applies to family lets,
                  Disagree there. I think it also applies to any long term tenancy, which could just as well be older people or pensioners, or singles, or groups of 2 friends. Consider Hinge and Brackett.

                  I dont think we have enough tenants with that sort of mindset yet apart from so called benefits tenants that most landlords dont seem to want

                  Amongst my tenants leavers are rare. The group I am mainly with are lowish income around or below average, or young families moving towards home ownership when savings are done, or credit problems have been fixed. They tend to stay. but I have to date had a strong policy of good renovating (to current building standards roughly) for lower bills (typically half of the 'normal' level), and aiming to minimise changes. Rents typically 450-700 pcm. They stay.

                  (Osborne plus the current lot of fw-its have killed my model, where I used AST tenancies with a 3 year no rent increase clause. Now I judge that due to the risk of - amongst others - rent control appearing in the middle, plus a random-walk in regulation, this cannot be sustained.).

                  Now, no carpets, bathroom or kitchen supplied would seem to save perhaps £500 a year on replacement costs - counting 1 k or b per decade, and 1 lot of carpets perhaps every 7-8 years - for those items alone. Add in T as redecorating (most of mine do anyway, and I just make noises about the correct paint or indeed supply it), and it is a big difference in rent for these groups.

                  Consider HHSRS, which is a brobdingnagian cobbled-together Health-Robinson machine that no one properly understands, and (just like EPCs) there are elements in it that are disfunctional or inappropriate for properly built modern houses (meaning eg airtight, near-passive spec, mvhr etc).

                  For example well-built houses are typically run as 1 or 2 heating zones only inside a constant temperature envelope, the requirement for heating in each room is nearly self-satirical. Similarly with short-term controllabilty, when such houses are designed to be operated at a constant temperature which lasts day to day with only a few kWh of heating.

                  Tactically the bare bones requirement of HHSRS may be met by eg a shower-cloakroom and kitchenette or single unit plus a Baby Belling, 10 year alarms, no carpets (or tiled throughout) etc.

                  But a real collaboration L-T to facilitate lower rents and costs will be a significantly different Tenancy Agreement.

                  I think the model I like would be more like Building Regs, where there are performance standards laid down, and the actual documents followed are one way of meeting those standards, and there is an option to demonstrate alternative approaches.

                  But I suspect the Shelters and Politcians of this world who are invested in a manichean politics of overlord-vs-victim would absolutely hate tenants and Landlords working together. If Ts get more responsibility where long-term tenancies are concerned, the likes of Shelter become less necessary.

                  Midlands Landlord

                  Refer Mad Regulators to Arkell vs Pressdram.

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