Written By Em

Em Morley

Over 20% of landlords take 4 months to find first tenants

Published On: November 29, 2016 at 10:17 am

Tags: Buy-to-Let,finding tenants,investors,tenants

Interesting new research has revealed that over one in five buy-to-let landlords have to wait more than four months before getting their first tenants into the property.

The study from Nottingham Building Society shows that 21% of new landlords had to wait four months or longer after completing their buy-to-let mortgage before they found paying tenants.

Obtaining tenants

Conducted by the HMLettings part of its business, the Nottingham’s research found that 53% of buy-to-let investors have tenants within two months of purchasing their first investment. However, many more are facing delays, putting pressure on their bank balance.

Further data from the report found that the average investor has to pay £2,000 on their initial property before they find suitable tenants. 35% said that they managed to spend less than £1,000.

62% of those questioned said that they had to redecorate or refurbish their property before letting them out. 28% said that this work took two weeks or longer.

More encouragingly, once tenants are in a property, it seems the pressure eases somewhat. 45% of landlords quizzed said that they had no void periods in the last 12 months.

Over 20% of landlords take 4 months to find first tenants

Support

The Nottingham feels that the research shows the need for support and advice throughout the process of getting a buy-to-let mortgage, then letting out the property.

Stephen Reade, Lettings Operation Manager at the Nottingham, noted: ‘Becoming a landlord remains attractive for thousands of people, but it is clear landlords need to think carefully before making the decision and also to plan ahead. Having to wait four months or more before getting tenants in can put a strain on finances and landlords need to ensure they have spare money to invest in their property over and above basic mortgage costs.’[1]

[1] http://www.propertyreporter.co.uk/landlords/1-in-5-landlords-experience-a-4-month-tenant-delay.html

Guides for Landlords on Limited Companies a “Great Success”

Published On: November 29, 2016 at 9:59 am

Author: Em Morley

Categories: Landlord News

Tags: buy-to-let finance,guides for landlords,limited companies,limited company,mortgage interest tax relief

Foundation Home Loans’ guides for landlords on setting up limited companies to hold their property investments have been hailed a “great success”.

Guides for Landlords on Limited Companies a “Great Success”

The specialist buy-to-let lender, which helped to pioneer the use of limited companies in the buy-to-let sector, has been delighted with the response to their guides from landlords and their advisers.

The guides for landlords, which are freely available on the firm’s website, explain the ease of setting up a limited company, what is required to run one, and how to close one down.

Quarterly data from one of the UK’s leading specialist brokers, Mortgages for Business, shows that limited company structures for buy-to-let accounted for 63% of all purchases. The move to this vehicle arrives on the back of tax changes from the Treasury, announced in July 2015.

According to Foundation Home Loans’ Business Development Director, Paul Brett, the guides have been created to show advisers and landlords that a limited company can be set up in 15 minutes or less and will help to beat the damaging tax changes.

From April next year, the amount of tax relief that landlords can claim on mortgage interest and other finance costs will be restricted to the basic rate of tax. The Government has created its own guide on how the change will affect you: /government-guide-tax-relief-changes-residential-landlords/

Be aware that the change will be gradually introduced, and will be fully operational in April 2020.

Brett says: “Clearly, our guides have had a very enthusiastic reception. They were developed to help advisers and landlords understand that the limited company route is not difficult.

“Since the Treasury’s announcement of tax relief changes, we have worked tirelessly to ensure that introducers, their clients, and the wider market can be confident and benefit from using a limited company as a positive and legitimate means of managing their properties in the most tax efficient way.”

How many landlords are thinking of setting up limited companies due to the tax change? These guides may be able to help!

Remember that we provide exclusive guides for landlords on the many legal obligations and responsibilities that you have when renting out property: /guides/

First Time Buyer Sales at Highest Level on Record

Published On: November 29, 2016 at 9:27 am

Author: Em Morley

Categories: Property News

Tags: first time buyers,housebuilding,property market,property sales

The number of first time buyer sales in October was at the highest level on record, according to the latest Housing Market Report from the National Association of Estate Agents (NAEA).

First Time Buyer Sales at Highest Level on Record

Last month, a third (32%) of total property sales were made to first time buyers – up by 9% on September and the highest number since records began 16 years ago in 2000.

The last time the number of first time buyer sales was at a similar level was in October last year, when 31% of sales were made to these purchasers.

The number of sales agreed per NAEA member branch stayed steady in October, at an average of nine.

Property supply

The amount of properties available per branch in October was 43 – up by 7.5% on September and the highest number recorded since March this year.

Property demand

In October, the average number of house hunters rose by a third (32%), from 333 to 440 registered per member branch. This is the highest level seen since February this year, when there were 463 prospective buyers on estate agents’ books.

The Managing Director of the NAEA, Mark Hayward, comments: “This month’s report paints a positive picture for the UK housing market. Our findings over the last few months indicated mild uncertainty immediately following Brexit and, last month, we even saw sales to first time buyers fall. After shrugging off the uncertainty, we have seen an increase in supply and a rise in the number of sales to first time buyers this month – proof the market is beginning to bounce back.

“Clearly what we need now though is a clear plan as to how the Government is going to tackle the chronic shortage of homes that we are facing. During the Autumn Statement, the Chancellor announced a boost to housebuilding, which is a start, but sadly nowhere near enough. We have high hopes for the Housing White Paper, as this will set the housing strategy and intent for this Government going forward.”

With first time buyer sales now at a record high, will landlords begin to see a slowdown in potential tenants? LandlordNews.co.uk will continue to keep you updated on tenant demand and the wider property market, and how this will affect you.

Landlords in Wales facing fines for illegal lets

Published On: November 28, 2016 at 2:20 pm

Author: Em Morley

Categories: Landlord News

Tags: buy-to-let landlords,investors,landlords,Rent Smart Wales,Wales

Concern is growing that thousands of buy-to-let landlords in Wales could face fines or even a jail sentence for failing to register for a new licensing scheme.

Last week (23^rd November), the Welsh Government’s Rent Smart Wales scheme became law. However, it is estimated that over 13,000 private landlords in the country are yet to register with the scheme, meaning they could be letting out properties illegally.

Rent Smart Wales

The new registration and licensing scheme in Wales is a major change for the private rental sector. It requires all landlords and letting agents to register their properties and undertake training to gain a licence, should they intend on self-managing their investment.

Landlords and letting agents in the principality were given until last week to comply with the legislation, before it became an offence to either let or manage a property without the sufficient licence.

By the deadline, 89,130 online accounts had been created, with 64,248 licence registrations submitted. Another 13,208 applications but not finished.

Landlords in Wales facing fines for illegal lets

Delays

Carl Sergeant, communities secretary and minister responsible for overseeing Rent Smart Wales, acknowledged the registration system had seen delays. However, Sergeant said those who have started the compliance process would not face action-but said, ‘this must not be seen as an excuse to ignore the law.’[1]

In addition, he noted: ‘My message to private landlords is clear. You must take action to comply with the requirements of the law.’[1]

Registering as a landlord costs £33.50 if carried out online. On paper, this is £80.50, regardless of the number of properties an investor has in their portfolio.

Further information on Rent Smart Wales can be found on the Government website.

[1] https://www.landlordtoday.co.uk/breaking-news/2016/11/thousands-of-landlords-could-face-fines-for-illegally-renting-out-properties

Many property investors failing to conduct gas safety checks

Published On: November 28, 2016 at 12:40 pm

Author: Em Morley

Categories: Property News

Tags: buy to let investors,carbon monoxide,gas safety,gas safety checks,investors

A concerning new report has revealed that hundreds of thousands of properties are at risk of a life-threatening gas incident. These could be linked to features such as a carbon monoxide leak, or failures with boilers, fires, radiators and cookers.

CORGI HomePlan, who carried out the survey, feel that many investors are failing to carry out potentially life-saving checks before buying property.

Concerns

The study found that only 10% of property purchasers considered it necessary to check the safety of a property before completing a purchase. 28% thought a full check was covered in the mortgage lenders’ survey.

Most commonly, new property owners overlook the working condition of their boiler, with 39% net getting a qualified engineer in to test it.

Worryingly, 70% of new property owners questioned said they did not know that new homebuyers can request a service record of all gas appliances-including boilers, central heating, cookers and fires.

Wales was found to be the safest area, with eight in ten respondents having a Gas Safe Registered engineer to assess their property before buying. On the other hand, Londoners were found to be least safety conscious, with just 38% of people in the capital following suit.

Many property investors failing to conduct gas safety checks

Reports

Kevin Treanor, director of CORGI HomePlan, said: ‘Buying a new home is an exciting time and one that often involves committing yourself to the limit of your finances. However, just as you wouldn’t commit to buy a property without seeing the surveyor’s report first, it is just as important that homebuyers also see the full service record of all gas appliances and have a Gas Safe registered engineer inspect the home too.’[1]

‘Carbon monoxide still kills around 50 people a year and every one of these deaths is avoidable. People must minimise the risks by making sure all their gas appliances are in full working order,’ Mr Treanor added.[2]

[1] https://www.propertyinvestortoday.co.uk/breaking-news/2016/11/lack-of-safety-checks-being-carried-out-by-property-investors

How Electronic Signatures can Make Things Easier for Landlords

Published On: November 28, 2016 at 11:18 am

Author: Em Morley

Categories: Landlord News

Tags: inventories,landlord admin,lettings,tenancy agreements

Ignorance isn’t always bliss – electronic signatures make things easier for you and your clients…

How Electronic Signatures can Make Things Easier for Landlords

Property is an area of business which constantly needs contracts signed off. Tenancy agreements, guarantor forms, inventory reports… The list goes on. And if your business needs to send documents in any capacity, adopting an e-signature solution is incredibly beneficial.

Once upon a time, it wasn’t out of place to see rows of filing cabinets lining office walls and piles of paper on your desk waiting to be organised; that no longer makes sense today. Electronic signature solutions, like Signable, help increase productivity by sending documents to its signer instantly and by removing a time consuming, paper-based filing system. It doesn’t make sense for businesses to waste time on admin tasks when there are solutions available to speed things up, but more importantly; it also doesn’t make sense for your clients.

Physically signing documents can get problematic for signers sometimes. For lettings, it can involve tenants trying to find the time during work hours to visit an office, and often landlords aren’t in the same location. Of course, there’s the option of emailing the signing page, faxing, or even posting it – but waiting for it to be returned signed can take days or even weeks.

When considering the sales side of property, e-signatures help enormously during the offer stage after a viewing. With potential buyers completing an offer form, providing information around broker’s details, solicitors, if they have a mortgage in principle, etc… And as vendors may not live together once selling a property, or even live locally, electronic signatures remove the need for them to visit the office regularly.

Businesses always see costs associated with both email and e-signatures generally lower than more traditional methods. It’s easy for businesses to keep their spend down by using email services, as any postage costs are quickly eliminated. Money is also saved by the speed of email – and these savings add up significantly for your business over time.

Being able to manage documents on the go was once a dream for many of us. Now sending a tenancy agreement from from your laptop in the office then viewing its status at home from an iPad, signing it off on the train from your mobile, and viewing it again whilst you’re overseas on your laptop is now truly a reality, and apps like Signable are making this process slicker than ever.

When it comes to finalising contracts, ask yourself: Can your signer be relied on to have access to a printer and a scanner? Can their schedule accommodate visits to your office? Can admin time spent organising paperwork be reduced? The development of electronic signatures can be your solution.