9 ms·

The UK is awful. Worse than American cities. No property tax, non existent/weak tenant laws, and renters have to pay the council taxes (in the US the owner is u

by nvarsj 8y ago

The UK is awful. Worse than American cities. No property tax, non existent/weak tenant laws, and renters have to pay the council taxes (in the US the owner is usually responsible for all HOA and taxes). The deposit protection schemes seem more designed to benefit landlords too.

goguy 8y ago
Totally agree, most of them are hard assed companies with no morals and very loose practices. One place I used to rent from tried to swindle my deposit for "repairs" of things that were clearly just standard wear and tear over the years. I argued till I was blue in the face and they eventually agreed with me on most of the things and agreed to "refund" me. They messed up somehow and transferred me 2x my initial deposit, normally I would absolutely let them know about their mistake but as they messed me around for months I didn't say a word and kept it. Suprise suprise they went out of business a few months later
- kileywm 8y ago
  Depending on the local laws, the 2x return of your deposit may not have been a mistake. They may have been legally obligated to return 2x of the deposit amount because they failed to return your correct deposit amount within a certain number of days. Example: 21 days for some areas
jeffbax 8y ago
Taxes and HOA just get rolled up into the rent. It's not like those aren't already impacting the price because the landlord must be the one to pay the money.
- mikeash 8y ago
  There are still important second order effects. Making those the responsibility of the renter makes it harder to comparison shop (remember what it used to be like buying plane tickets when everybody just showed the base fare?) and it means the renter bears the risk of any sudden increase in those costs.
  - bluGill 8y ago
    That is the downside. The upside is renters have better insight into how voting to raise/lower taxes will affect their rent. In the US that is all rolled into rent, and as a result renters happily vote to raise the taxes in the area they live without realizing that it will come back in rent increases eventually. (though there is some time lag as other economic factors affect how much rent can be raised)
    - mikeash 8y ago
      Seems like you could have the best of both worlds by making it the landlord’s responsibility and requiring them to itemize it for the renter. Also, what happens when a property is vacant? Do taxes revert to the owner, or do they not get paid?
      - clort 8y ago
        In the UK, yes. The owner is responsible for council tax when a property is empty. This varies across the country, it could be totally zero rated when the property is empty and unfurnished, or it could be that you have to pay entirely. Where I live, landlords can get one month free in any 12 month period for empty (no residents) and unfurnished (except for white goods) properties.
- eru 8y ago
  Not all taxes can be passed on. See https://en.wikipedia.org/wiki/Tax_incidence https://en.wikipedia.org/wiki/Tax_incidence (Basically, a landlord bears the economic burden of a land value tax.)
  - jeffbax 8y ago
    From your own article: "However, some economists think that the worker bears almost the entire burden of the tax because the employer passes the tax on in the form of lower wages. The tax incidence is thus said to fall on the employee." This is much closer to reality than the contrary
captainbland 8y ago
Yeah it feels a lot like the feudal system still exists in some small way with our rental system. Revenge evictions are common enough to be a well known problem. In public discourse the right of the landlord to do whatever they like with their tenancy agreements dominates and other viewpoints are still often marginalised, typically with whinges about difficult tenants and the apparent right of landlords to an early retirement while they leech off their tenants' work. A disproportionate number of MPs are landlords. Even Tony Blair made a killing from his own buy-to-let portfolio.
- 13of40 8y ago
  > Revenge evictions The last apartment I rented (15 years back) had an interesting mechanism for this: The rent was about $2000 but they applied something they called a "subsidy" of $400 off per month. Basically if you pissed them off they could immediately raise your rent by $400 per month to drive you out.
beobab 8y ago
For the landlord side: Renting out my one house in London after I bought another one to live in (across the country). I had tenants who flat out refused to pay their rent after a few months living there. This went on for several years, and it took legal battles and numerous court fees to evict them. None of which they turned up to contest. Before they left, they plastered globs of lard on the walls, and destroyed the kitchen floor and wall by rigging the water pipes to constantly overflow down the outside wall. I was not allowed to enter the property to inspect it, nor was I allowed to "harass them" by speaking to them face-to-face, because they didn't want me to. I was powerless. Yes, they lost their deposit, but I was out of pocket tens of thousands, which I basically couldn't afford. I maxed out my credit cards and bank account overdrafts. Even selling the house, it took me nearly 5 years to get back to zero. I'm not saying that UK law is worse for landlords, but the laws aren't particularly on the side of landlords either.
- Loughla 8y ago
  It seems like you learned a valuable lesson about stepping into a space where wealthy, well-connected players dominate. It seems like if you had the appropriate connections to government, this process would've been easier?
  - geezerjay 8y ago
    How exactly do you imagine that having "connections to government" would affect a problem caused by the law?
    - novaleaf 8y ago
      I'm sure he/she means nepotism/graft/corruption getting the landlord extrajudicial favors.... though their comment seems a bit out of place in this context.
    - rtkwe 8y ago
      It's not even entirely a problem caused by the law, beobab also just didn't know the full extent of their rights as a property owner. Tenent protections are strong but they wouldn't have stopped beobab from getting them out sooner and inspecting the property for damage.
dazc 8y ago
The obvious answer for this problem is for the major housebuilders to adopt a 'build to rent model' rather than 'build to sell'. It would eliminate the need for a middleman who is often borrowing money to fund the purchase himself, adding further inefficiencies to an already inefficient business model. The prospect of builders becoming long-term landlords may also incentivize them to build a house that will last the course of the tenancy?
- purple_ducks 8y ago
  ??? Developers (who hire builders) go to market for finance - they don't have the funds lying around. Those financiers want a quickish (< 3/5 yrs) return, not a long term investment(20+ years).
  - dazc 8y ago
    Yes, I understand they want a fast turnaround on investment which is part of the problem.
isostatic 8y ago
The council taxes round here work along the following lines: £50k house -- £750 (1.5%) £150k house -- £1500 (1%) £650k house -- £3000 (0.5%) £3000k house -- £3000 (0.1%)
- mring33621 8y ago
  So, highly regressive.
  - isostatic 8y ago
    Sadly the main complaint seems to be that wealthy pensioners who live in £1m estates have to pay.

by nvarsj 8y ago

goguy 8y ago

Totally agree, most of them are hard assed companies with no morals and very loose practices. One place I used to rent from tried to swindle my deposit for "repairs" of things that were clearly just standard wear and tear over the years. I argued till I was blue in the face and they eventually agreed with me on most of the things and agreed to "refund" me. They messed up somehow and transferred me 2x my initial deposit, normally I would absolutely let them know about their mistake but as they messed me around for months I didn't say a word and kept it. Suprise suprise they went out of business a few months later

kileywm 8y ago
Depending on the local laws, the 2x return of your deposit may not have been a mistake. They may have been legally obligated to return 2x of the deposit amount because they failed to return your correct deposit amount within a certain number of days. Example: 21 days for some areas

jeffbax 8y ago

Taxes and HOA just get rolled up into the rent. It's not like those aren't already impacting the price because the landlord must be the one to pay the money.

mikeash 8y ago
There are still important second order effects. Making those the responsibility of the renter makes it harder to comparison shop (remember what it used to be like buying plane tickets when everybody just showed the base fare?) and it means the renter bears the risk of any sudden increase in those costs.
- bluGill 8y ago
  That is the downside. The upside is renters have better insight into how voting to raise/lower taxes will affect their rent. In the US that is all rolled into rent, and as a result renters happily vote to raise the taxes in the area they live without realizing that it will come back in rent increases eventually. (though there is some time lag as other economic factors affect how much rent can be raised)
  - mikeash 8y ago
    Seems like you could have the best of both worlds by making it the landlord’s responsibility and requiring them to itemize it for the renter. Also, what happens when a property is vacant? Do taxes revert to the owner, or do they not get paid?
    - clort 8y ago
      In the UK, yes. The owner is responsible for council tax when a property is empty. This varies across the country, it could be totally zero rated when the property is empty and unfurnished, or it could be that you have to pay entirely. Where I live, landlords can get one month free in any 12 month period for empty (no residents) and unfurnished (except for white goods) properties.
eru 8y ago
Not all taxes can be passed on. See https://en.wikipedia.org/wiki/Tax_incidence https://en.wikipedia.org/wiki/Tax_incidence (Basically, a landlord bears the economic burden of a land value tax.)
- jeffbax 8y ago
  From your own article: "However, some economists think that the worker bears almost the entire burden of the tax because the employer passes the tax on in the form of lower wages. The tax incidence is thus said to fall on the employee." This is much closer to reality than the contrary

captainbland 8y ago

Yeah it feels a lot like the feudal system still exists in some small way with our rental system. Revenge evictions are common enough to be a well known problem. In public discourse the right of the landlord to do whatever they like with their tenancy agreements dominates and other viewpoints are still often marginalised, typically with whinges about difficult tenants and the apparent right of landlords to an early retirement while they leech off their tenants' work. A disproportionate number of MPs are landlords. Even Tony Blair made a killing from his own buy-to-let portfolio.

13of40 8y ago
> Revenge evictions The last apartment I rented (15 years back) had an interesting mechanism for this: The rent was about $2000 but they applied something they called a "subsidy" of $400 off per month. Basically if you pissed them off they could immediately raise your rent by $400 per month to drive you out.

beobab 8y ago

For the landlord side: Renting out my one house in London after I bought another one to live in (across the country). I had tenants who flat out refused to pay their rent after a few months living there. This went on for several years, and it took legal battles and numerous court fees to evict them. None of which they turned up to contest. Before they left, they plastered globs of lard on the walls, and destroyed the kitchen floor and wall by rigging the water pipes to constantly overflow down the outside wall. I was not allowed to enter the property to inspect it, nor was I allowed to "harass them" by speaking to them face-to-face, because they didn't want me to. I was powerless. Yes, they lost their deposit, but I was out of pocket tens of thousands, which I basically couldn't afford. I maxed out my credit cards and bank account overdrafts. Even selling the house, it took me nearly 5 years to get back to zero. I'm not saying that UK law is worse for landlords, but the laws aren't particularly on the side of landlords either.

Loughla 8y ago
It seems like you learned a valuable lesson about stepping into a space where wealthy, well-connected players dominate. It seems like if you had the appropriate connections to government, this process would've been easier?
- geezerjay 8y ago
  How exactly do you imagine that having "connections to government" would affect a problem caused by the law?
  - novaleaf 8y ago
    I'm sure he/she means nepotism/graft/corruption getting the landlord extrajudicial favors.... though their comment seems a bit out of place in this context.
  - rtkwe 8y ago
    It's not even entirely a problem caused by the law, beobab also just didn't know the full extent of their rights as a property owner. Tenent protections are strong but they wouldn't have stopped beobab from getting them out sooner and inspecting the property for damage.

dazc 8y ago

The obvious answer for this problem is for the major housebuilders to adopt a 'build to rent model' rather than 'build to sell'. It would eliminate the need for a middleman who is often borrowing money to fund the purchase himself, adding further inefficiencies to an already inefficient business model. The prospect of builders becoming long-term landlords may also incentivize them to build a house that will last the course of the tenancy?

purple_ducks 8y ago
??? Developers (who hire builders) go to market for finance - they don't have the funds lying around. Those financiers want a quickish (< 3/5 yrs) return, not a long term investment(20+ years).
- dazc 8y ago
  Yes, I understand they want a fast turnaround on investment which is part of the problem.

isostatic 8y ago

The council taxes round here work along the following lines: £50k house -- £750 (1.5%) £150k house -- £1500 (1%) £650k house -- £3000 (0.5%) £3000k house -- £3000 (0.1%)

mring33621 8y ago
So, highly regressive.
- isostatic 8y ago
  Sadly the main complaint seems to be that wealthy pensioners who live in £1m estates have to pay.