A prominent economist who has called for a raft of measures to protect tenants during the Coronavirus crisis is now calling for a legally-enforced 20 per cent reduction in all rents - residential and commercial.
Richard Murphy, a chartered accountant and political economist who works as Professor of Practice in International Political Economy at the University of London, writes on the website of the think tank Tax Research UK that such a statutory rent reduction would be “a minimum”.
And he adds: “I'd also suggest rent roll up with liability due over a period eight times longer than the length of the period over which deferral takes place would also be appropriate. I would match this with a right to claim a mortgage payment holiday to match. Landlords could survive this. Their tenants cannot.”
Earlier this year, as the Coronavirus outbreak became widespread in the UK, Murphy advocated rent-free periods for tenants and made it clear that he believed landlords could survive the costs.
“I am quite deliberately suggesting that they should bear the heaviest burden of dealing with the epidemic. The reason is simple and is that whatever happens they will still have an asset at the end of this period, and no other sector can guarantee that at present. As a consequence they have the greatest capacity to bear this cost. And, if it so happens that some landlords do fail as a consequence, the assets that they have owned will still exist after this failure and so the economy can manage the consequences of this” he wrote at the time.
Murphy works as Professor of Practice in International Political Economy at the University of London. He has also founded a range of networks campaigning for tax and economic reforms.
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" Landlords could survive this. Their tenants cannot."
What planet is this guy from? Who (other than him) says that landlords could survive what he proposes? And if what he suggests comes to pass the landlords may well NOT have the asset at the end of the period. The guy's a nutter.
A nutter I agree. What about the poor small landlords who have no other income and live off the rent they receive. Those who don't have a mortgage would be in trouble as would just have 20% less income. All landlords are NOT billionaires like Tony Blair......how did that happen? Oh yeah...... people just gave him and his greedy wife money and property deals. Not all landlords are the same and most of us not rich
I wonder if he's aware of S24.
Just another jumping on the landlord bashing wagon for a bit of self publicity .. the whole country seems to be onto this now as easy pickings
I have tenants who receive universal credit such that they do not /cannot work and as a result they have seen no reduction at all in their income and have continued to pay the rent on the due date. I know not all tenants are in this position but many are and they do not need a rent reduction - the suggestion made by the economist needs greater thought as it is a sweeping suggestion ill conceived and impossible to implement fairly.
You're 90% correct there, but actually not only have they seen no reduction their income has actually increased as they everyone has been awarded approx 100 pounds extra per month until April 2021.
Also as most on u.c have council tax reduction they will pay no council tax until April 2021.
So most who are on u.c are now approx 200 pounds better off than before the covid 19 pandemic.
They're not all locked up yet...or is it April 1st!!!
Typical ' Irish joke ' from this guy suitably named, if I'm not mistaken, he's previously come out with some ludicrous ideas ( perhaps he takes something recreational ? )
Yeah, Murphy's Law was originally: Anything that *can* go wrong *will* go wrong.
It wasn't strictly correct, of course, but amusing and even consoling at times; "don't worry it's not your fault - it's just Murphy's Law".
The NEW Murphy's law seems to be: Anything you *can* do to attack or undermine landlords you *should* do.
And boy does the uninformed and/or malicious Mr Richard Murphy follow his own law!
Let's ask him if he will take a 20% cut in his salary or give away 20% of his assets. Another lefty with too much time on his hands. They will only stop spending other people's money when it runs out.
Or suggest that all the trustees, directors and senior people at Shelter take *at least* a 20% cut in every type of pay, remuneration and perk they get during "this difficult time".... they can afford it because at the end of the "crisis" there will still be just as many stupid, ignorant people (especially in Westminster) who'll believe and lap up all their lies, spin and made-up dream-world of how everyone can live forever off the Nation's fat, undeservedly super-rich, uncaring, always negligent landlords and their agents - who should all be locked up as well as made to pay for everything anyone might feel they "need" or are "entitled to".
Since the tax changes I am lucky to make £250 A YEAR from my parents home. I am only keeping it because I have a good tenant. I'm certainly not going to accept a loss on it. I am not a charity
But that's what they want you to be.
Good heavens!
It must be a joke.
His name is DICK!
Very ' apt '
Without taking the mikie, and out of interest, I've just briefly looked into this Dickie Murphy fellow. Firstly, from his City University pages, I notice he has what appears to be an extremely cushy but ostensibly respectable job as the toast of all left-wing liberals.... absolutely adored as a spokesperson numerous BBC presenters can call on at the drop of a hat (and pay handsomely) to say whatever suits their usual agendas. The same for the Guardian and all the other left-luvvie rags and organs you can depend on to understand and defend the plight of landlords.
He 'specialises' in exposing tax avoidance and evasion schemes, even though - hypocritically - he has (and probably still does) use them himself when it suits him. He even has a Wikipedia page he probably got his friends, admirers and/or students to cobble together for him (a bad idea because once its there anyone can add more or less anything they like and/or change what his friends lovingly posted there for him - I could easily find all this out if it were important enough and/or I had the time and interest because there's a "history" page behind every Wikipedia page and you can easily follow the profiles and quickly get to understand the motives of most of the "contributors" - I'm an expert at it because until about 2011, when I finally got utterly fed-up with all the bullying and politics behind it and subverting it, I was a leading "editor" for some particular high traffic topics, and still dabble in it discreetly when I feel the urge, to keep up to date).
On his Wikipedia page - and easily verified elsewhere from more reliable sources - it mentions that he was a founder of the company behind the game Trivial Pursuits (that became such a big hit and made him A LOT of money). The company was incorporated in Ireland for tax avoidance reasons that he'd "now" be "ashamed of".... well, I think by intentionally drawing attention to that one they distract from possibly many others, and no matter how "ashamed" he might or might not be I'm willing to bet he's never gone to the Revenue, "taken the knee for them" (as is now the fashionable but totally ridiculous expression for simply kneeling), apologised and paid back with interest all the money he saved by that "strategy" alone..... probably not even 20% of it! :-)
Is this guy delusional? Maybe he want's to rent a place for himself but only pay 80% rent or better still, he wants Landlord's to fall by the waist-side so he can pick up a few bargains to dd to his own portfolio of assets. Clever guy I guess!
Online searches are interesting. From Wikipedia:
"In 1985 he co-founded an accountancy firm which became Murphy Deeks Nolan. The company was sold in 2000. Murphy was also the founder of a company that became the European distributor for the game Trivial Pursuit"
"Murphy has since admitted that the manufacturing operation he set up in Ireland to manufacture Trivial Pursuit was there to avoid UK taxation, something of which he is now ashamed and was a turning point in his career towards anti-tax avoidance campaigning."
"In 2009, Murphy lost a libel claim by Lord Ashcroft and associated businesses where he misunderstood an article posted on an unrelated website and published a blog post claiming that Lord Ashcroft's Belize bank provided "tax evasion services"
"In August 2015, many of Murphy's ideas were taken up as proposed policies by Jeremy Corbyn in the Labour Party leadership election. " - THAT explains a lot.
He seems a typical deluded left-winger that is not averse to making a bob or two on the side.
AGREED!
I can tell how bias is the population of this website.
Owning a property in a very limited space or in a non constructible area such as a big city and not actually using the property but renting it for profit or for investing should be simply made illegal!
Shocking! Why, you might ask?
Because basically what you are doing is holding up a limited viral resource and selling it for profit. The "limited vital" part makes it very problematic indeed: imagine holding massive amount of petrol so its price surge so you can sell it for profit? Oh wait, that's illegal... Unsurprisingly, doing so makes you rather detestable indeed.
To whom in this situation and living off from their tenants, perhaps you should consider doing like them: getting a proper job. And if you can't work because you are suffering from a condition or your retirement is ridiculously low, perhaps you could wonder yourself why your government is not supporting you but rather supporting companies such as Apple instead letting them being taxed 8% rather than 20%... But that's an other topic...
The only acceptable tenancy situation would be for non profit (including any sale benefit), for leisure or for properties in non restricted area such as in the countryside.
People need home and they need their own home so it can contribute them feeling safe and confident enough to make children and keep an economy afloat without having to massively import a stronger new population actually replacing the previous aging one overriding an entire culture by the process of it (yet an other topic).
You are welcome.
Great idea Tom - by the way, where are 4.6 Million people going to live ? !!!
If only Margaret Thatcher could have seen a way forward to continue social housing instead of the need to pass the burden to the private sector. But she couldn't. Now without the private landlord we would be in real trouble which begs the question as to why the government is not looking after the landlord and in turn looking after the tenant?
Alas Tommy boy you do not seem to realise that:
(a) Landlords do not cause house price inflation
(b) Landlords add massive amounts of housing to stock (you probably think they only buy existing houses)
(c) There is a demand for rented housing from people that can't or won't buy their own home
(d) 356,800 people bought their first home last year, so those that want to buy clearly are
And the list goes on but you don't want to understand, so you won't.
I can see that a mortgage payment holiday adds all of the interest to the loan (If he does it) and subsequent cost in interest long term but the tenant has a 20 per cent reduction in rent. Is he not clever enough to suggest reduced long term interest, so that the heaviest burden is against the lender? Why deliberately choose the landlord? The clever thinking has a bias in favour of the tenant and the lender. Because when the landlord is topped the lender has to remove the tenant and sell the property, which might otherwise have continued. What stops the landlord handing over the keys to the lender anyway if he sees no benefit from his greying hair and negative bank balance? The altruistic view that at least society will still have the asset from ‘the assets that they have owned’ even if the landlord is topped in the process is actually callus in my view. It would appear that the general view is that so long as the tenant survives, the landlord can go take a hike. The heaviest burden deliberately but why? The tenants can always claim housing benefit but the landlord cannot so why weight it against the landlord? To protect the tenant and the landlord the do gooder argument of paying the tenant the benefit so that he can be responsible for his own finances is misguided. All benefit claims should automatically be paid to the landlord. Make it an act of parliament come on professor lobby for the right thing.
Ever heard of 'clawback?'
Ever heard of a tenant spending the housing benefit?
Speaking of commercial tenants I totally agree with the economist. I am a commercial Landlord and have given all my tenants a 50% discount while they are closed or partially closed. We should share the pain and aim to have stronger more profitable tenants when this nightmare ends.
How about immigrants that have no rights to public funds and no benefits whatsoever.
They contribute to the economy of this country: pay tax, NI, council tax.
With government intervention, I do not think rent should be reduced because landlords also pay mortgages and rely on it too for up keep.
What I will recommend is temporary suspension of no recourse to public fund until April next year so that the immigrants can also benefits from palative measures from the government and be able to meet all financial obligations with ease as well!
....
For commercial tenant we can have a form.of reduction since the business is partly closed or non-operation at all!
Thank you all.
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