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If you forbid people to buy with the intention of letting the flat, you are forcing people to buy or else. How would that be an improvement?

Because it means there are fewer houses to buy, and therefore prices for buyers are higher. And because landlords have to make a guaranteed return - or they lose the property - rents are higher too.

Just regulate the price increase while letting buy to let happen and you may find that the price adjustment will be a lot faster.

Rent regulation is Immensely Unserious.

I think there may still be some vestiges of regulation left in London, but no one in government is going to mind much if there's a new generation of rich landlords.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Fri Jun 3rd, 2011 at 04:53:43 AM EST
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but no one in government is going to mind much if there's a new generation of rich landlords.

in that case the limit of housing benefit and rents is a funny way to go about it.  On the plus side it should collapse the BTR market and thus bring house prices back into the reach of the less rich.

Any idiot can face a crisis - it's day to day living that wears you out.

by ceebs (ceebs (at) eurotrib (dot) com) on Fri Jun 3rd, 2011 at 08:05:16 AM EST
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Hmmm.

Torygraph

In an attempt to end the era of heavily subsidised (council house) rents, the Coalition's new system will lead to tenants paying as much as 80 or 90 per cent of the market rate. "This is still about there being affordable rent, but it needs to be more realistic. At the moment, if you get a council house you are really winning the jackpot," said a source. "In terms of the rent you pay it is very, very heavily subsidised. You may pay only a third or a half of the market rate."

And increasing council rents will help push up private rents.

Plentiful council housing is one of the best ways of keeping rents down. But too much of that would annoy "the market."

by ThatBritGuy (thatbritguy (at) googlemail.com) on Fri Jun 3rd, 2011 at 08:40:06 AM EST
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Lets see, Council housing has basically not been built since roughly the early 1980's when the Thatcher government ruled to stop councils spending money on the council housing that they sold under the house sales scheme on building new council houses. So those houses  that are not renting at market rates, were constructedd at best at 1970's prices, so don't have the recent price explosions as part of their costs.

 This is nothing more than an attempt to  transfer the cost of local government from taxpayers over to renters

Any idiot can face a crisis - it's day to day living that wears you out.

by ceebs (ceebs (at) eurotrib (dot) com) on Fri Jun 3rd, 2011 at 09:21:31 AM EST
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"Because it means there are fewer houses to buy, and therefore prices for buyers are higher."

Yes, but the alternative means fewer houses to rent, and therefore prices for renters are higher. Which is worse when there are already too many owner-occupied houses.

"And because landlords have to make a guaranteed return - or they lose the property - rents are higher too."

Well, having no tenant certainly does not give you a guaranteed return.
Now you may argue that banks should not be allowed to demand a guaranteed return. But to talk about banning buy to let seems crazy.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Fri Jun 3rd, 2011 at 11:50:04 AM EST
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Well, having no tenant certainly does not give you a guaranteed return.

When there's high demand this doesn't happen much. A bigger problem - so I'm told - is the cost of wear and tear, decoration, and repairs after tenants leave.

As for landlords, owner-occupiers traditionally rent out spare rooms anyway. So owner-occupiers don't necessarily push rents up. Generally they're less likely to be demanding about rent because they don't have to pay the extra cost of repairs/maintenance/redecoration. And they can choose to rent out casually, or not.

BTL landlords don't have that choice. They're on the hook for all expenses, they don't live with tenants so their costs are likely to be higher, and they have to pass those costs on tenants to keep up with payments.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Fri Jun 3rd, 2011 at 12:19:31 PM EST
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This is just a hunch, but I guess Helen would be pretty satisfied with "regulating BTL so it is no longer pushing BTO out of the market". Giving rights to tenants would be a logical step.

A vote for PES is a vote for EPP! A vote for EPP is a vote for PES! Support the coalition, vote EPP-PES in 2009!
by A swedish kind of death on Sun Jun 5th, 2011 at 11:27:58 AM EST
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