[Ben Reeve
Lewis is resting his liver …]
Well I survived my 4 days in Galway. Frazzles and I had a brilliant time.
On Saturday night we boogied on down to the Family Stone (Sadly without Sly), on the big stage in the centre of town, was mightily impressed by tuneful Irish rapper Maverick Sabre (check him out) on the same stage on Sunday night and danced until my knees gave out in Massimo’s, a rather excellent little club bar in town.
If I tell you that each night we went in, at 3am it was more packed than a Saturday afternoon you will get an idea of how well the Irish can party, given a gap in the rain and some live music.
Now I’m back, resting my liver and my knees and catching up on what’s been happening in housing world while I was off pretending I was young again.
Localism machinery
Let me open with a very interesting bit of information that would have slipped most people by in normal housing land. Last week’s introduction on the Communities and Local Government website of the “Right to Challenge” element of Localism
This is the procedural machinery that allows community groups, individuals, council employees, social enterprise business’s to challenge their local authority on the running of services. A website has been set up to help people get these bids together which offers to shepherd people through the process.
Simply put, if someone has a better idea about how to run a range of council services they can register their interest in doing so and the council must put the service out to tender, giving the interested party a chance to take it over.
Dismantling the monsters?
This is the beginning of the dismantling of town halls as a bureaucratic monster and no bad thing in my book. Several housing services will be major targets and I know of several people who have been hovering around the periphery waiting for this initiative to become active.
It really is going to be a “Watch this space” development that will impact on landlords and tenants alike, maybe for the better and sometimes for the worse. Time will tell.
The 99% stand up to be counted
Another prediction I make this week is to watch a new outfit that have thrown their hats into the ring, Housing for the 99%.
This is a recently formed tenant’s pressure group who last week door stepped the National Landlords Association property awards ceremony to raise awareness of poor property conditions in the PRS and unsustainable high rents.
On a link published on Lambeth Save our Services blog Housing for the 99% say:-
“We’re planning a peaceful, colourful protest with our lovely new banners and placards. There’ll be a role for everyone, whether you’ve been to an action before or not, so please come along and bring a friend or flat mate – there are 8.6 million private tenants in England, and we know most of them aren’t very happy (despite the government’s attempts to claim otherwise)!”
As with Right to Challenge it’s too early to tell which way this is going to go. Whether Housing for the 99% is simply a couple of semi-retired activists meeting occasionally in a pub or if, in a social media savvy world, they will connect up with other disgruntled tenant’s groups that comprise that sizeable army of 8.6 million mentioned above and become a well organised pressure group.
Rent arrears rising
Given how well anti-capitalist protestors use the internet to coordinate big campaigns my money is on the latter. Especially after reading this article on the daily mail online l about how the number of tenants in severe rent arrears has risen 24% in the past year, 8% in the past few months alone.
Director of receivers Templetons, Paul Jardine, who commissioned the report that threw up the figures said:-
“As the private rented sector grows, the number of tenants in dire financial straits is steadily climbing. Falling wages in real terms have been compounded by rising rents, pushing a greater number of rented households over the edge financially.
With the instability in the labour market and wider economy, and public sector cuts still to come, the section of renters in multiple months of arrears is likely to continue its expansion.”
I’m not surprised by this. I am a London tenant myself after all and I see how 60% of my take home pay gets swallowed up on my 1 bedroom flat every month.
I also deal everyday with tenants in rent arrears and I hear from them all how London rents particularly are crippling people just trying to get by. Overcrowding is becoming a growing phenomenon among my clients as they desperately downsize to something they can afford, sharing bedrooms with their children.
Of course nobody who isn’t a tenant wants to hear this party pooping information when, as so many landlord websites regularly say “Rents have never been more buoyant”.
Pity the poor landlords …
What did surprise and annoy me about the Daily Mail’s was the opening sentence in the article:-
“Buy-to-let landlords have been hit with more tenants unable to pay their rent”.
What about the bloody tenants? The article suggests that landlords are the only people suffering because of these arrears. I suppose you have to expect that with the Daily Mail but I still find it unpleasant to dismiss the lives of the other parties in this as not being worthy of consideration.
And what annoyed me even more, and adds more fuel to my growing predictions of a backlash is an article by ARLA last week reporting a possible rent hike of 11% in London later this summer and in particular the politician’s double speak of the director of letting agents Edmund Cude who said:
“An 11% higher rent should not be ignored by the capital’s landlords. By having a well-placed break clause in a tenancy agreement, landlords are able to re-synchronise tenancies”.
Who went on to say:
“London landlords need to think about how they can benefit from better organised tenancies”
For having “better organised tenancies” and “Re-Synchronising” you need to read “If your existing tenant cant afford an 11% hike then oik them out and rent out to a corporate client who can”. That is the honest language version of what they are saying.
The above news from ARLA aside, I do get the sense that a tipping point is in the offing, but then again I’ve thought this before only to find the cards getting shuffled again.
Diamonds millions
Which is exactly what happened this week with the whole Barclays debacle (De-Barclays?) and the resignation of Bob Diamond.
Just when you think that irresponsible bankers are finally going to get their come-uppance, the establishment forms a protective square like the Welsh Borderers at Rourke’s Drift. The Indpendant reported that Diamond’s likely financial gold-watch will be only £8 million less than the annual budget of the fraud office.
As I pointed out last week, while Cameron seems to be sanguine and unconcerned about dodgy banking practices he doesn’t seem to have any compunction on jumping on dole scroungers as the sole cause of our financial predicament.
A thought not shared by Inside Housing this week that ran a story suggesting that the Barclays interest rate scam may have caused a rise in homelessness.
From the mouth of Schapps
Grant Shapps (yes you knew a week couldn’t go by without the playful scamp) is quoted as saying:-
‘All the research into homelessness proves that there are a lot of different causes, and Libor may be a contributory factor if it transpires that mortgage rates have been adjusted as a result.’
How interesting is that? I’ll bet he gets a roasting by Cameron behind closed doors for that quote. Held up by the big boys against the fire until his bum burns, like poor Tom Brown in the eponymous book.
Rangor the VIking
Last prophetic words this week go to Ragnor, an educational Viking I encountered in Galway (see picture of him with Molly taken on Monday).
He was firmly in character and explaining to us how the Vikings moved around Ireland and northern Europe with the aid of various animal skins and skulls laid out on the floor in the shape of a map.
The sheep skulls marked areas where they had friends. I pointed out to him that there wasn’t a sheep’s skull in London to which he replied:-
“I’ve not been there myself but I’ve spoken to sea traders who fetch up in Galway that there isn’t anything of any interest there”
Cheeky bugger.
Ben Reeve Lewis
Ben’s runs Home Saving Expert, where he shares his secrets on defending people’s homes from mortgage repossession Visit his blog and get some help and advice on mortgage difficulties, catch up with him on Twitter and check out his free report “An Encouraging note on Dealing with your Mortgage Lender” and have it sent right to your inbox.
Picture : Lord Mayor of London
-> “If your existing tenant can’t afford an 11% hike then oik them out and rent out to a corporate client who can”.
That may work very well for the agent that gets a big finder’s fee for the next tenant (as well as what the tenant is charged!); it does not work so well for the landlord with normal agent charges the landlord see very little of the first month’s rent, then add on void for a few weeks and it can take well over a year to see any of the increase.
Tenants can also use the break clause (and likely voids) to reduce rent, if, as it very possible, the market is flooded with properties to rent in East London in a few month’s time
Well exactly Ian. ARLA are the agent body, they arent really talking to landlords in all this stuff about re-sychronising tenancies but to agents who could make a killing.
I am starting to notice more complaints about agents made by landlords on various online forums who seem to be twigging that the bad ones are simply advising landlords to do things that benefits the agent, not the landlords, and certainly not the tenants.
Agents gain more by tenants being changed every 6 months than landlords and tenants do. And at this same time as campaigns are being mounted against rubbish agents in scotland and Wales, landlords too seem to be rebelling and even would be agents spotting the backlash and starting online services.
What I dearly hope comes out of this is that those high street agents remaining in business steal a niche market where honesty and good service marks them out, thus rescuing the reputation of letting agents that has been tarnished by lack of professionalism that would be ensured through mandatory regulation.