I am Englishman of Italian heritage with a Bulgarian wife, so I consider myself European. Our children are BritishBulgarian, which may be an issue if Bulgaria declares war on Britain. Or if my parents declare war on anybody; that would be a mistake and I have told them so.
For the most part, my Italian genes tell me I am a glass-half-full guy. Lavazza, good Chianti or Sanpellegrino Limonata for choice. Strolling ‘la passeggiata’ with friends. Fine food. A somewhat dysfunctional Government and the natural ability to nail it with ace tailoring and well-chosen accessories.
But looking back over this column in the past year I find, I tend to come across as a carping whiner, forever bleating on about ill thought out legislation hitting the rental sector. And this does not sit well with my sunny disposition. So, allow me to set the record straight?
Yes, over the past few years there has been some well-meaning but ill thought out legislation imposed upon the rental sector. Some has been mitigated, some has passed into law. But we are where we are and, I would suggest ‘well meaning’ should be the key.
There is now legislation to determine minimum bedroom size. Homes fit for Human Habitation. Minimum Energy Efficiency Standards mean the poorest in the land, often on usury key meters, are not spending money for their heat to vanish into the walls, windows or roof. This is something we can all support.
This legislation is simply what we in the private rental sector should do. To protect our clients’ investment and to ensure our tenants have a decent place to live. Many of our landlords are ahead of the game. Undertaking refurbishments which allow them a reasonable return on investment and happy, long term tenants.
For other landlords, the glass is less than half full. We are told that in 2016, on a property income of £9,000 their net income was £3,240 after tax and mortgage interest relief. In 2020, having lost some of these perks, it is predicted at £2,520. This is a drop of 22% net. That is still a decent return. As a glass-is-half full guy, anything above 8% means break out the Sanpellegrino Limonata.
The rental sector in the North East is changing fast. The grotty student flats of yore are gone. Replaced by purpose-built blocks of student accommodation. The market is competitive so incomers to the market need to innovate. Free Wi-Fi and Aparthotel accommodation is a given. A gym? Sauna? Roof terrace with loungers? No problem! These blocks are run by business people who have researched the market.
That is the lesson for some buy-to-let landlords. No, there are two lessons. One. You are running a business, not an investment portfolio. Two. Your tenants are customers, not a resource. When landlords give tenants what they want, and tenants are happy in their property, the legislation will take care of itself.
I usually end my piece with a quote from one of my Italian ancestors. Like Cicero. But I shall leave the last word to Simon and Garfunkel from their 1970 album Bridge Over Troubled Water. ”I’m just trying to keep my customers satisfied, satisfied”.
