In Conversation With… John Grimes
July 24, 2014
We are regularly in conversation with a plethora of leading figures in the property, investment, finance and charity sectors, many of whom are guest authors for PRSupdate. The purpose of this feature is to get them to discuss the topics and issues that are currently affecting the Private Rented Sector.
If you would like to take part in an In Conversation piece then please do get in touch with us.
Today we are in conversation with John Grimes, Managing Director at Drummond House Developments Ltd.
John, can you tell us a little about your background?
I have been working in property for over forty years now. By the time I was 20 I was managing a team of hot shot sales negotiators for an estate agency before becoming a junior partner in a surveyor’s practice at 25. From there I went into Property Development and House Building, becoming Managing Director of Persimmon Homes (Thames Valley) Ltd, a company I started from scratch with the backing of the main board.
In 1990 I commenced building and dealing with sites on my own account, entering Joint Ventures and so on. In 2003 I founded Drummonds Property Rentals Ltd as I had been involved as a Landlord (and indeed as a tenant at times) over the years and could see an interesting future for the Private Rented Sector (PRS).
What challenges are faced by the Private Rented Sector?
The rental market has evolved, and continues to do so, to meet the demand for places to live. In the latter part of the 20th century the drive to own a home resulted in an imbalance between rented and owner-occupied property that had not been seen before in this country, or in our European neighbours. Whilst there were winners in this boom there were also losers and a rebalancing was inevitable.
The PRS is now being recognised for the important role it has to play and the biggest challenge I see it facing is the lack of understanding of the rental market by those in power. This seems to lead to populist knee jerk reactions when producing legislation.
What are your thoughts on the current level of regulation in the Private Rented Sector?
Current regulation is confused and seems not to understand that renting is separate from owning. This may sound like an obvious position to understand, and in some ways it is, but the “hammer to crack a nut” philosophy abounds and often creates more issues than it resolves.
To address this there needs to be more consultation with those of us who have been at the coal face of the industry for a while. The layers upon layers of hastily produced legislation, to repair cracks as they appear, is pointless and helps only to delay the serious, and much needed, reforms.
What are your thoughts on Ed Miliband’s backing of a blanket ban on lettings agency fees?
Ed Miliband’s backing of a ban on Lettings fees serves to illustrate my previous point nicely. Scotland has always had its own law banning them but regulators there had not enforced it thoroughly as those North of the border could see that there was a better system in the South and had been allowed to emulate it through a lack of policing. As I understand it, the enforcement of the law has started to create chaos. It’s just like a balloon; when you stand on it bulges start to appear elsewhere.
Things are done differently with Scottish property, always have been, so the political pressure applied by Shelter and Unite, using Scotland as an example and with a total lack of understanding of the real world in the South, has caused Mr Milliband to cave in to their demands and back policies with no proof that they would work.
What do you believe can be done by government to tackle the rogue elements within the Private Rented Sector?
All successful sectors attract rogues businesses and operators, banking is a good example of this. But the industry should not all be tarred with the same brush just because of the actions of a minority.
The Association of Residential Letting Agents, along with the other professional bodies, should be shown greater respect. It is an organisation that works day in, day out at the sharp end of the sector to make sure that tenancies work successfully, and fairly, for all involved. It would help them greatly if some form of licensing was to be introduced.
I believe that finding a solution to ridding us of the parasites (that have been attracted by the suggestions that a quick buck can be made) could be achieved if all parties would formally consult to a time scale to achieve a clear understanding of how to effectively stamp out bad practices.
Lastly, is there anything you would like to mention that we’ve not already covered?
I believe there will be no quick fix for the PRS and I dread that the sticking plaster approach, that appears to prevail currently, will continue. The sooner we get started on a joined up solution the better for all concerned, both tenants and landlords.