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‘I expect landlords will avoid letting property to three or more sharers’ – Star Letter 24/08/2018

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  • 24/08/2018
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Mortgage Solutions and its sister title Specialist Lending Solutions select the most thoughtful or thought-provoking comment for Star Letter.

 

This week’s letter comes from Simon Redler from Prudell Financial Services in response to the article: Lenders blamed as letting agents accused of discriminating against housing benefit tenants.

He said: “This is an age old problem and lenders have a part in it.

“The other growing problem that is not really hitting the headlines are the new rules that are being brought in by a lot of local councils, mainly in London I find, where if there are three or more people renting a property, even on one assured shorthold tenancy (AST) and in a three bed property, then the property has to now be designated as an additional HMO.

“For any landlord that has gone through the process it is expensive and time consuming. I expect that many landlords will avoid letting property to three or more sharers as they are not necessarily getting a higher rent than letting to a family.

“Where this leaves people sharing a property to reduce their rental costs remains to be seen but I expect that the number of properties available to let to this market will reduce.

“I expect this may be the next news headline as many lenders deem these new rules to mean that they will now class such properties as HMOs from now on.”

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