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Basic economics

Welsh landowner evicting tenants from homes to make way for holiday lets, claims Senedd member

When an asset is moved from a lower valued use to a higher then the society as a whole becomes richer.

Research from landlords indicates that three times more money can be made from short-term lets compared to long-term tenancies.

Shrug.

27 thoughts on “Basic economics”

  1. Ha ha good “typo” sneaked in there

    “Mr up Iorwerth ”

    Anyway, if it’s in the contract and the tenant signed it without a gun to the head, then there is nothing to complain about.

  2. Basic short term / long term economics init? Do you want a steady cash flow or gamble on the economy not going south and the holiday market drying up?

  3. Bit risky. Any of you other old farts remember when the Welsh Nats were burning English second homes in the 80s?

    Come home to a real fire. Buy a cottage in Wales!

  4. Bloke over the road has spent 16 months getting a tenant out of his buy to let property.
    £15,000 costs and lost rental income and thousands more spent repairing the damage and getting the place saleable. He wouldn’t dream of doing another buy to let so I can quite understand the desire to do the short term stuff. Add in Oiky Goves ‘rights’ that are to be enshrined in law to ‘protect’ the tenant and it isn’t hard to see a shortage of rental properties on the horizon.

  5. As Mark Drakeford has been pontificating about Wales being so welcoming to Ukrainian refugees (and “Syrians” before that) perhaps some of his governmental largesse could extent to providing housing for actual Welsh people.

    Failing that he could always follow the SNP’s example and rent a few Estonian ferries for them.

  6. @squawkbox

    Remember the green paint on road signs too – in north wales at least. Never saw it on a B&B sign though

  7. “Do you want a steady cash flow or gamble on the economy not going south and the holiday market drying up?”

    I don’t think it’s going to dry up, although I don’t personally understand the attraction of going on holiday to somewhere as cold and wet as where you live. We stayed home all through Covid, had some days out to a few places.

  8. I don’t think it has a great deal to do with making more money, it has everything to do with the new tenancy law thats on it way – basically giving tenants a permanent right of tenure, and reducing the landlords rights to evict them to only certain circumstances. I suspect that big estates like the one in question have decided that the balance between the rights of tenants and landlords is only moving in one direction, and not in their favour. So they are getting shot of tenants while they can, before their rights are curbed, and probably will be curbed again (or removed entirely) in the not too distant future. They can then operate their properties as commercial short term rentals, and thus avoid all the tsunami of restrictions on domestic landlords.

    As ever the tenants being evicted should blame the real culprit – the State who in its mad rush to ‘protect’ them has resulted in them losing their homes.

  9. The BTL sector has been inflated by artificially low interest rates for years. A subsidy for both owners and renters, in other words.
    There will be a lot of disgruntled people when reality intrudes.
    But the Welsh farmer is probably prudent to keep a reserve of accommodation on his land in preparation for the day when diesel engines are banned and organic muck spreading has to be done by hand.

  10. All the interference with BTL landlords introduced, or threatened, by the socialist Tories are just the sort of thing The Guardian loves.

    When will it start complaining about the consequences?

  11. In our part of the country locals are rubbing their hands in anticipation of restrictions making it hard for holiday lets to operate, not the other way around.

  12. Dear Mr Worstall

    That nice Mr Drakeford could help by stopping government sponsored tourism adverts.

    Tearing up the planning laws could help too, but I guess both reduce the role of government in screwing up taxpayers’ lives.

    Betteridge of the day?

    “Will the next Prime Minister set us on a path to prosperity?”

    From the weekend newsletter of the Other Place.

    DP

  13. @dearieme It’s the Guardian… So… either tomorrow, of at least in the next week.

    Depends if they can find enough Experts from matching foundations/ngo’s to work in the climate/diversity angle willing to pay for the privilege of being published in the Guardian…

  14. Bloke in the Fourth Reich

    “Remember the green paint on road signs too – in north wales at least. ”

    Driving in Bosnia, you can tell if you are in a Serb or Croat area byn whether the Latin or Cyrillic script on the road signs has been painted over.

  15. Theophrastus (2066)

    Jim nails it. That’s exactly why I got out of BTL. And holiday lets registered as businesses don’t pay business rates when empty (except for a basic refuse collection charge). And you can get some use out of the property yourself.

  16. In our part of the country locals are rubbing their hands in anticipation of restrictions making it hard for holiday lets to operate, not the other way around.

    It’s a sad fact that many, perhaps most, of the people of this country are the scum of the fucking earth – and are more so on holiday when the consequences of their behaviour don’t stick with them. The lives of locals turns into a living hell. Air B&Bs are the worst, with few responsibilities for the owners.

    In my brother’s village this has resulted in “burly boys” making it clear to owners that they will be held responsible for the behaviour of their visitors and that failure will result in costs far exceeding profits.

  17. Bloke in North Dorset

    “ That nice Mr Drakeford could help by stopping government sponsored tourism adverts.”

    If he wants tourism, at least motorhome tourism, he needs to send out a memo. We were made to feel most unwelcome lat year. Locations we’d stayed at previously had big no motorhomes signs. A lot of car parks, on the west coast didn’t allow motorhomes and those that did started at £4 per hour.

  18. Some bloke on't t'internet

    As a couple of people above have mentioned, and I’m sure Timmy would agree with, it’s a logical response to a barrage of regulations designed to make it less profitable and more risky to be a PRS (Private Rental Sector) landlord.
    All along, the government seem to be pandering to ill informed demands from the likes of Shelter and Generation rent, using “dodgy” (at best) stats to portray PRS landlords as being evil fatcats abusing vulnerable tenants. If we’re all so bad, why do I have a tenant in one of our properties who’s been there for 12 years, and another who asked if he could rent our other property again when it last came up to let ?
    If I wasn’t already in it, I doubt I’d go into being a landlord now. What with extra taxes here, elimination of allowances that every other business gets there – as someone said in an article I’ve read recently, we are taxed as a business when it suits HMRC to take more money, but not as a business when it might reduce the tax taken. Then we have rules on energy performance which are based on a system that everyone who has a clue will tell you is “rather flawed” – in reality, the EPC system is a complete and utter failure – which can result in being forced to spend massive amounts upgrading properties to the point where it’s better to just flog them off so some owner occupier can live in it without upgrades as they aren’t subject to the same restrictions. And we’re expected to act as unpaid border force officers – without any training and with massive potential penalties for getting it wrong. And you also get some uninformed idiots baying for restrictions on what we can charge in rent as if it’s never been tried (in many countries) and found to be about the most effective way to destroy the private rental system. And the latest changes will make it virtually impossible to get rid of a rogue tenant (they don’t exist – according to Shelter and generation Rent, all tenants are persecuted saints) who can simply stop paying the rent and enjoy rent free accommodation for a year or two while you attempt to get possession back.
    PRS landlords are selling up large numbers – at a time when more and more people are looking to rent. Basic economics says that if you are still in the market when this happens, you can charge a higher rent – I’m actually a bit happy about this, though I generally charge below market rents as I’d rather have a happy tenant than an empty property every 6-12 months (c.f the note above about having had a tenant in one property for 12 years). But one thing you can be certain of, I’m getting tighter and tighter on who I’ll rent to – as is every other landlord. So when the one’s at the bottom that Shelter represent come to rent – they are finding it harder and harder to get a place precisely because of the restrictions Shelter have been calling for.

  19. “All along, the government seem to be pandering to ill informed demands from the likes of Shelter and Generation rent, using “dodgy” (at best) stats to portray PRS landlords as being evil fatcats abusing vulnerable tenants. ”

    The evil right wing bigot in me has a sneaking suspicion that if one lined up every landlord in the country by degree of ‘dodginess’ the very dodgy end of the line would be disproportionately inhabited by the more ‘diverse’ elements within society………

  20. I do wonder if back in the day when most people rented, many politicians and the legal class they disproportionately represented were landlords. Owner occupation has not been a widespread status throughout history. It wouldn’t surprise me to see social, economic and legal manipulation used so that most housing ended up in the hands of politicians and their class.

    Strangely, “you will own nothing and be happy” won’t apply to them.

  21. 《When an asset is moved from a lower valued use to a higher then the society as a whole becomes richer.》

    If valuations are fickle and arbitrary, can you just enclose the commons and force me to pay to sleep, thus violating a fundamental natural right?

    In other words, what if I could sleep for free outside on non-exclusive common land and not have to participate in rental markets?

  22. @some bloke on t’internet

    Remember: the purpose of Shelter (and its little friends) is to ensure the continued existence of Shelter, otherwise Tarquin and Jocasta would have to go to the effort of finding another non-job. The best way to ensure their continued existence is to exacerbate the problems they are purporting to solve.

    See also: Scot Nats, buggering up the Scottish economy so that nobody dare vote for independence.

  23. @rsm
    what if I could sleep for free outside on non-exclusive common land and not have to participate in rental markets?

    I suspect you haven’t thought that concept through.

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