Are Landlords Really That Bad?

The housing crisis is real and it is here in the UK, despite how much the government and rich may want to deny it.

Hundreds of thousands of people are homeless in what remains the sixth-biggest economy in the world, but the housing crisis has exceeded beyond just rough sleeping. With the rise of the cost of living crisis and the increase in interest rates, rent prices have also skyrocketed as a result. Resulting in a new age cohort of people struggling to find affordable housing, according to the Office for National Statistics, “more than a third (35%) of adults reported that it was difficult to afford rent or mortgage payments.”

As interest rates rise, landlords are increasing tenants’ rent to continue making a profit. So the question remains, are landlords the bad guy?

Higher interest rates mean more money they have to pay back on their mortgage, a loss they are not willing to take, which in ordinary circumstances may be somewhat understandable. However, we are not in ordinary circumstances we are in the midst of a cost-of-living crisis, where thousands of people are suffering from malnutrition and millions are living in poverty. So focusing on making a profit while other people don’t even have a roof over their heads is not exactly understandable.

Estate agency Hamptons revealed data that showed an average rent increase of 9.1% across the UK, and 13.1% in London. Meanwhile, interest rates have only gone up by 0.5% and fixed mortgage rates have gone from 5.32% to 6.19%, so one can beg to differ on whether these absurd rent hikes are necessary.

In worst-case scenarios, there are landlords who don’t have a mortgage because they were fortunate enough to buy their property outright. Now no one is faulting them for being financially stable. But the problem arises when these same landlords who are not being impacted by rising interest rates because they don’t have any loans continue to increase rent costs simply because the market is going that way. Increasing rent on people already struggling to get by just because you can, really reinforces the draconian feel of the UK right now.

A recent vox-pop interview by Novara Media shows a journalist going around speaking to landlords at the National Landlord Investment Show in London and the stuff that was said was shocking? Not really to be honest. One clip showed a young man, maybe in his late 30s/early 40s talking about how he just retired so he needed to bump up his tenant's rent so he can get by. Not to mention, it’s a huge privilege to be able to retire that early.

Most people are struggling to keep up with the rising costs of living, and at the same time, the rich minority see an opportunity to exploit the lower socio-economic classes because they simply know they can. A large portion of landlords can afford the rise in interest rates, yet they continue to shift them on to their tenants, who can’t afford a rise in rent. This leaves renters either homeless, strapped for cash or living in horrendous conditions just to stay within budget.

To most landlords, the money they receive from tenants is nothing more than passive income. Income that they can continue to make a small fraction of profit on by simply increasing rent in accordance with the mortgage rates. They need to lead with empathy rather than their desire to make some quick cash.