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LETTER: Buy-to-let is disaster for economy

Opinion

Opinion

Buy-to-let landlords are enjoying 2014, which is a shame, because they are a disaster for the economy.

There are up to 1.4 million individuals renting out small strings of properties as a sideline or in some cases as their main income and more people are expected to join their ranks in the coming months.

Britons are, as we know, obsessed with property as an investment, despite booms and busts.

Over recent months, figures from the Chartered Institution of Surveyors has shown that rising prices are driven by an increasing mismatch between supply and demand exacerbated by sellers withdrawing from the market in the hope of higher prices in a few months.

These are not people moving to change job, but to maximise their investment. Buy-to-let landlords are the worst offenders.

It is the current crop of landlords, those who already have at least one property for rent, that will make the biggest impact over the coming years.

They have the benefit of owning an already-profitable asset to use as collateral on the next deal. According to a survey, the majority of buy-to-let landlords are looking to expand the number of homes they own.

Mortgages for business, a buy-to-let broker, says 60 per cent expect to buy properties over the next six months.

They are a disaster for the UK because when they need cash for investment, they do little more than paint over the damp patches and replace broken windows.

Double glazing, roof insulation and more adventurous investment like solar panels eat into profits. According to a report by the Institute of Housing, a third of private rented housing, much of it supplied by buy-to-let landlords, fails to even meet the ‘decent homes standard’.

And this standard is not concerned with checking the jet power on the bathroom shower: it sets a benchmark for a functioning kitchen, bathroom and living quarters without damp or infestations of creepy crawlies.

Yet buy-to-let landlords are well placed to outbid rivals in the pursuit of homes. Mortgage lenders are falling over themselves to offer them cheaper mortgages when before the crash they charged a premium.

It has been a reversal in fortunes for the poor, beleaguered first-time buyer, which is partly why the Help to Buy scheme was invented (and why it is buy-to-let landlords that should be tamed and not necessarily Help to Buy).

Boston Labour councillors will continue to put pressure on Boston Borough Council to outlaw rogue landlords who are not prepared to look after their tenants and are just in it for profit.

We also believe they should licence all Houses of Multiple Occupation (HMOs). The national outlook is bleak and in Boston we already have the highest rents in the East Midlands.

Boston Labour councillors

 

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