‘I fear Labour’s rent reforms will mean I have to turn out my social tenants’
Leonora Eddolls has been housing the unemployed and homeless for 15 years – but under Labour she fears this could come to an end.
Having grown up on various council estates in Plymouth, she managed to buy her first home off the council using Right to Buy in 2010.
Since then, Ms Eddolls has bought a further three properties which she rents out. One is a house of multiple occupancy (HMO), where she covers all the bills, and the others are flats. The properties make very little profit, so she also works full-time running her own therapeutic practice.
Being such a landlord has its challenges. Her tenants often struggle with mental health issues, and it’s not uncommon for her to be called out to her properties following anti-social behaviour. At Christmas, she expects rents to be late and has repayment plans ready to help tenants get back on track.
But now, under the Government’s new Renters’ Rights Bill – which will be written into law by next summer – Ms Eddolls is having to seriously reconsider her business model.
Costs for landlords are about to go up. Homes will need to be brought up to new standards in a timely manner, otherwise landlords could face £7,000 fines.
Energy efficiency improvements will also need to be made by 2030, rents will be able to default on three rather than two months of rent before action can be taken, and all evictions will have to go through the courts – a change which could see landlords waiting months, even a year, with unpaying tenants in situ.
Unlike most investors, Ms Eddolls cannot raise the rent to cover some of these costs. Her tenants rely on housing benefits and are on either very low or no incomes.
Ms Eddolls said: “My business model will become unviable with all the new legislation. I will no longer be able to offer housing at the price of the local housing allowance, because it would not cover the overheads.
“Now, I’m having to consider only offering housing to working people after more than 10 years of offering housing to unemployed people.
“Housing benefit tenants are becoming a less viable option, as I am going to need tenants who can afford to pay rent that covers the above costs.”
Ms Eddolls is also worried about being dragged in front of the court for not doing work in a timely fashion, when she is trying to juggle tenants who have not paid rent.
She said she tries to keep her homes up-to-date for tenants, but due to the irregularity and unpredictability of rental payments, and some tenants often falling into arrears, work that needs to be done cannot always be done quickly.
Currently, one property in Ms Eddolls’ portfolio has an energy performance certificate (EPC) rating of D, and another property needs a new kitchen which she reckons will cost around £20,000.
She added: “Who does the Government think is going to pay for that? My tenants can’t. I have four in the property that needs a new kitchen. They won’t have anywhere to go if I have to evict them.”
Costs for landlords have been piling up since 2017, when the former Conservative government started to phase out mortgage interest rate relief. For Ms Eddolls, bringing this back would make a huge difference to her profit margins. And she is not the only one who feels this way.
In December, The Telegraph spoke to landlords in the private sector who were letting properties to social tenants. Andrew Claringbull, a 58-year-old landlord in Surrey and Sussex, said: “The axing of mortgage interest rate relief has had a huge impact on us. On mortgaged properties we are paying tax on income that we have not and never will receive. Paying 100pc has exceeded our rental income in many cases.”
Charities have also warned of the decline in landlords letting to social tenants. As a result, waiting lists for council homes have ballooned.
Jasmine Basran, of homelessness charity Crisis, said: “We often work with landlords to support the homeless, and we’ve always had landlords willing to work with us and lower the rent slightly. But now, we’re increasingly hearing landlords say they want to help but can’t. They just can’t make the numbers work anymore.”
A Ministry of Housing, Communities and Local Government spokesman said: “Responsible landlords who meet the right standards have nothing to fear from the measures in the Renters’ Rights Bill.
“The Bill will give 11 million private renters much greater security and stability so they can stay in their homes for longer and build lives in their communities.”