Cheap homes: why we should be selling them to landlords

Empty properties should be given to buy-to-let investors for just £1...

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Derelict Houses In Stoke-On-Trent Up For Auction

Do you remember the news story of the derelict houses in Liverpool and Stoke being offered to would-be homeowners for just £1?

A street of 20 empty homes was offered for sale for just £1 each, with the proviso that new owners must pledge to refurbish them (and have the funds to do so) and live there for at least five years. You can read more about the scheme in Liverpool and Stoke in our article.

The five-year clause was clearly to discourage anyone who wanted to treat the homes as a property investment or get-rich-quick scheme – and landlords were barred from applying. Yet 18 months later only five families have exchanged contracts, according to a report by the BBC, despite thousands initially applying.

One reason so many would-be buyers were put off was the financial commitment required; the homes needed at least £35,000 spending to make them habitable. Yet Liverpool reportedly has a further 1,000 empty homes it wants to bring back to life this way so it needs to do better than five in 18 months.

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I have driven down those streets – I have seen large terraced houses standing empty, daubed with graffiti, windows covered with steel. They are lifeless, a blight on a vibrant northern city. They pollute the surrounding areas with hopelessness and crime.

We can all agree that this waste of property is obscene. The housing shortage is reaching critical proportions; estate agent Savills estimates that in the south of England alone we will be short of 160,000 needed homes in the next five years. That's 160,000 homeless families.

But the country isn't just short of houses to buy; we are critically short of homes to rent. Our obsession with home ownership is blinding us to an equal and connected problem – rising rents. Research by property firm Countrywide found that the average rent paid by tenants grew by 2% in 2013, twice the level of 2012. Its spokesperson said this was because "increased competition among tenants for properties has intensified".

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Inside 'Britain's cheapest house'

Inside 'Britain's cheapest house'


So why on earth are we not letting landlords buy, renovate and let empty council-owned properties? If they can pledge to refurbish the homes to the standard required, if they can sign good-faith covenants with the council ensuring they treat tenants fairly, if they can bring streets back to life and give people affordable homes then why aren't we handing them the keys?

Rising rents hurt the very poorest, the people who cannot afford to dream of property ownership. They have to compete for homes to rent with the professionals who previously would have bought starter homes. Rising rents and demand means they are forced to pay more for worse conditions – lining the pockets of the slum landlords.

And rising rents coupled with changes to housing benefits mean that the better landlords can afford to be pickier about their tenants and to discriminate against those on benefits.

It's also worth noting that rising rents hurt would-be homeowners too. High rents put even more pressure on their budgets and make it harder to save a deposit for their first homes. High rents encourage landlords to scoop up typical first-time buyer homes and rent them out, increasing house prices and ensuring fewer homes are left for new buyers.

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Landlords often get a bad press – and there are certainly some bad apples that deserve to be stripped of their rights to own other people's homes. I am not suggesting for a moment that slum landlords should be gifted entire streets for less than the price of a curry so that they can continue making poor people's lives miserable.

But landlords who could prove they have the £35,000 minimum required to refurbish these properties and have a well-managed portfolio already – why would we not sell them these properties? Why would we not take those steps to ease the housing crisis and end the obscenity that is people sleeping rough outside empty homes?

I believe that the political and social obsession with supporting first-time buyers is now hurting both would-be buyers and those who simply want to rent a warm, affordable property. And that really is obscene.

What do you think? Why are these properties still empty? Is the author right, should landlords be given a chance to invest? Have your say using the comments below.

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