In Praise of Mr Osborne

No, not that Mr Osborne, but Patrick Osborne, the former Buy-to-Let landlord featured in today’s Guardian.

Mr Osborne has quit being a landlord because:

“It’s not nice to profit from someone else’s need to sleep somewhere. I think it’s wrong some landlords have strings of properties. It restricts supply, and tenants have very few rights, or aren’t aware of rights they do have.”

Unlike many landlords and their representatives, Mr Osborne is honest about:

  • The conditions some tenants face :

“You hear all kinds of horror stories, such as three months’ rent in advance, or houses let out that aren’t safe but if tenants say anything they’re evicted.”

  • The favourable tax treatment he received:

“I was quite surprised by how much I could set against tax and that was without hiring a flashy accountant, so I probably could’ve claimed more. The tax rules were, believe me, very generous.”

He took his responsibilities seriously and when he asked his tenants to move on gave them six months notice, when two would have done.

It’s a shame he’s quit being a landlord. Who knows who lets out the home he once owned and on what terms.

 

Most renters have had a range of experiences with landlords – many have had dreadful experiences; unsafe homes, nicked deposits, last minute evictions. Most have had good experiences with trustworthy landlords.

The problem is that you just don’t know what you’ll get when you sign the tenancy, and that’s why we need better regulation and better enforcement of the rules we have.

Such regulation wouldn’t impose any extra costs and duties on landlords like Patrick Osborne, who provide a safe and secure home for the longer term anyway. It would force the others out of the market or get them to up their game.

Even The Economist agrees that:

When demand outstrips supply against a background of profound housing need, tough action is required.

If that bastion of the free-market thinks state action is needed, then Grant Shapps’ charge that regulation is red tape can hardly stick. His views on the situation for private renters are increasingly divorced from reality:

“I am satisfied that the current system strikes the right balance between the rights and responsibilities of tenants and landlords … the Government has no plans to create any burdensome red tape and bureaucracy.”

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One Response to In Praise of Mr Osborne

  1. Anon says:

    When Labour was in power, they could have put the brakes on house prices, by telling banks not too lend excessively, which fueled the housing price bubble. Now you have people in negative equity. The ‘get rich quick property’ TV shows did not help. The returns on renting were lousy and only justified by rising house prices.

    There is no money in renting (either in rising house prices or rental returns). And has a landlord, I am glad, because too many landlords would not be good for our country. We need a balance of tenures. We needs to remember the valuable service landlords provide. If you had a job offer in Norwich, you would not be able to take it up, if there was no where to rent…..

    A lot of ‘wanna be landlords’ just dont understand rental returns. Currently, it costs 4.5% to borrow money. PLus a 1% loan arrangement fee. The rental return is 6.5%. So that leaves a return of 1%. However, that excludes the costs of services e.g. gas safety, furniture, EPC, letting agent fees, insurance, repairs, damp proofing, roof repairs, clearing guttering, drainage, pest control, lock changes, boiler servicing…… and that assumes the property is renting without gaps and the tenant is not in arrears.

    So, Mr Obsorne is better off putting money in the bank.

    When you go on holiday, people see nothing wrong in paying for hotels. Yet landlords are the poor cousin to hotels. My monthly rent is the same as a five day stay at the local 3 star hotel!

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