Landlords required to give longer-term tenancies?

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The Labour Party recently announced a policy whereby landlords may be required to give longer term tenancies, rents may be restricted and charges imposed by agents forbidden.

Perhaps predictably, the Conservative Party, wedded as it is to the dogma of free markets, condemned the move comparing it to copying Venezuela. Housing should concern us all and ought to be a major issue in the election next year. What depresses me is the widespread acceptance that large numbers of working people are going, unlike their parents, to live much or all of their lives as tenants rather than home owners.

Let’s have a look at the history of this.

For many years under governments both Labour and Conservative, tenants of private landlords, provided they paid their rents could stay in their homes more or less as long as they wished, rents were fixed by law, could only be increased at three-year intervals and charges other than rent (key money) were outlawed.

You have to be well into middle age now to remember this time. You often felt sorry for landlords. I remember elderly spinsters who had been unable to marry, because so many men were killed in the First World War, living in genteel poverty owning inherited houses which were almost worthless as the controlled rents barely covered the costs of repairs.

Margaret Thatcher changed all that. The shorthold tenancy removed security of tenure for private tenants and nothing but market forces kept the rents in check. Reliance on a private landlord is no place to be for anyone looking for a long-term home. However good your landlord may be, death, divorce or financial hardship may all leave a tenant out in the cold if the landlord, his heirs, ex-wife or creditors want to sell up.

There is a place for the private landlord – some people may only want a house as a temporary home and some people may never have the stability in their lives which enables them to take on a 20-or-so-year mortgage. So will Labour’s proposals do any good – a bit, perhaps. There is no doubt private landlords and their agents have sometimes had a bonanza at the expense of working tenants although being a landlord is not always much fun when you are faced with bad tenants who wreck the property and fail to pay the rent.

The thing we really need to do is reverse the trend to renting a home. Home ownership is good for the individual and good for society as, in general, people who have a stake in their property make good citizens. Unfortunately the Labour Party’s attitude to home ownership is, to say the least, ambiguous. Margaret Thatcher introduced the right to buy for tenants of council housing. This had a huge impact in enabling relatively poor people to achieve home ownership where they might otherwise never have done so. Many Labour councils hated this legislation and did all they could to avoid complying with it. The last Labour Government couldn’t abolish the right because that would have been too unpopular – it did, though, reduce the discounts available to a point where few tenants found purchase possible or worthwhile.

In Wales, as a devolved matter, Labour which runs the Welsh Assembly is contemplating ending the right.

Anyone considering voting Labour because of anything that party promises should ask why it did nothing in the 13 years it was in government. The fact is Labour’s attitude to home ownership is ambiguous because home owners are less likely to vote for it whereas tenants mostly do. A few years ago, an employer of mine bragged to me he owned 22 houses – many of them being bought on mortgage in competition with first-time buyers; when I told him that was greedy and 21 more than he needed, he protested that he provided homes for poor people, took out his wallet and showed me his Labour Party membership card to prove his socialist credentials! Moreover, of the 26 Labour councillors on Burnley Council, the register of members’ interests shows seven having interests in houses other than the ones they live in, presumably tenanted properties; another is a letting agent. Labour is today as much a landlords’ party as the Conservatives, so how far will it go in acting against landlords’ interests?

May I make what I hope are a couple of constructive suggestions. Until about 20 years ago owner occupiers were entitled to tax relief on their mortgage interest.

Why not treat landlords on the same footing by no longer allowing mortgage interest on a rented property to be set against taxable income? That would pretty much put an end to the buy-to-let mortgage which (on Labour’s watch don’t anyone forget) contributed so much to the financial debacle of 2007/8.

How about another law that when a private landlord wishes to sell a tenanted property the tenant has the right to buy it at a fair market price and couple that with a government-backed guarantee of a mortgage? (After all if you’ve been paying your landlord’s mortgage you should be able to pay your own.)

Perhaps Gordon Birtwistle, Julie Cooper and anyone else who thinks to represent you as MP would care to say whether these are ideas he or she could support.

John Rowe

Tennis Street, Burnley