Written By Em

Em Morley

Landlords Oppose Licensing Scheme in Weston-Super-Mare

Published On: July 19, 2016 at 11:42 am

Tags: landlord licensing,licensing scheme,rogue landlords,Weston-super-Mare

Landlords are joining forces to oppose a new licensing scheme in Weston-super-Mare, which has been created to improve poor quality rental properties in the area.

Landlords Oppose Licensing Scheme in Weston-Super-Mare

The scheme has been slammed for being “short-sighted” and nothing more than another “money-making exercise” at the expense of landlords.

Landlords have spoken out in opposition of the new license, which would cover Central ward and part of Hillside. More than 50 landlords have teamed up to create the Somerset Property Network to campaign against the scheme, which would cost landlords £320 for a five-year license.

The group has also organised a question time event at The Royal Hotel, Weston-super-Mare on 28^th July. More details can be found here: https://www.facebook.com/events/899330520178625/

A spokesperson for the group complained that all landlords are being “tarred with the same brush”, saying: “We do not need the council to tell us how to run our business and charge us for the privilege of doing so.

“So we have created this group for competent landlords across Somerset, where we can all get together and unite as one voice. We can also challenge the council as a united stronghold over landlord issues in the future.

“It is so short-sighted to lose landlord support, as the tenant only ends up back through the council doors costing North Somerset money.”

However, Councillor Ap Rees has defended the license, which would carry a minimum standard criteria. Anyone not meeting these standards could be prosecuted.

Rees comments: “We are determined to root out rogue landlords in this area of Weston and we need to be in a position to inspect all rental properties within the selected area. To do that, we have to cover the costs. The basic charge is the cost of the license and the compliance visit.

“We accept that sometimes it isn’t the landlords, it may be the tenants that cause the damage, but the only way to monitor that is to visit the property. Conscientious landlords have nothing to fear.”

Are you opposed to landlord licensing schemes? Join the group in campaigning against these plans.

Generation Rent has Spent £44,000 More on Rent than Baby Boomers

Published On: July 19, 2016 at 11:08 am

Author: Em Morley

Categories: Finance News

Tags: Generation Rent,homeownership,housing crisis,private rental sector

The combination of declining homeownership and rising costs in the private rental sector mean that today’s generation rent will have spent £44,000 more on renting by the time they reach 30 than baby boomers, according to new research by the Resolution Foundation.

The analysis, published ahead of yesterday’s launch of the Resolution Foundation’s Intergenerational Commission, highlights a worrying drop in homeownership over recent decades, which has reduced living standards for the millennial generation and led to a further concentration of wealth among the older generation.

The study found that baby boomers – those born between 1946-1965 – were the main beneficiaries of the growth of homeownership during the 20^th century, with almost two-thirds (63%) owning their own home by the age of 30. However, decades of falling housebuilding and rising house prices have reduced homeownership levels for subsequent generations.

About 60% of generation X owned their own home by the age of 30, falling to 42% for today’s millennial generation.

This shift away from homeownership has left many more millennials renting privately, which has subsequently caused a sharp rise in the cost of renting. The Resolution Foundation found that millennials have spent almost twice as much on rent as generation X did at the same age, who in turn spent twice as much as the baby boomers.

Generation Rent has Spent £44,000 More on Rent than Baby Boomers

Combining the downward shift in homeownership with the rising cost of renting, the report shows that millennials have spent £44,000 more on rent than baby boomers by the time they reach 30, and £25,000 more than generation X.

The Resolution Foundation says that the extra spending on rent has reduced living standards for today’s young people and made it harder to save for a deposit for their own home. It adds that the extra spending on rent is more than the average first time buyer deposit, of £33,000.

With half of all residential rental income landing in the pockets of baby boomers, the organisation says that the growth of generation rent is a key reason why questions of intergeneration fairness are rising nationally.

The Resolution Foundation welcomes Theresa May’s acknowledgement of Britain’s housing deficit in a speech last week, where she said that unless action is taken, “young people will find it even harder to afford their own home”.

The group says that a major housebuilding scheme is likely to be supported by all generations, contrary to popular belief, pointing to findings in the British Social Attitudes Survey, which found that baby boomers’ support for homes being built in their local area has almost doubled in recent years, from 29% in 2010 to 56% in 2014.

The Resolution Foundation report was published ahead of the launch of its Intergeneration Commission, an 18-month investigation that hopes to repair the fractured social contract between generations. It will consider the extent to which the living standards of generation rent have been permanently scarred, and recommend policies to raise the living standards of current and future generations.

The Senior Policy Analyst at the Resolution Foundation, Laura Gardiner, explains: “The nation’s housing crisis is perhaps the most visible example of growing inequality between generations.

“Young people today are paying a heavy price for decades of falling homeownership. The struggle to get on the housing ladder has left many of today’s millennials renting, at a time when it has become more expensive to do so. Millennials have had to spend £44,000 more on rent by the time they reach 30 compared to the baby boomers.”

She continues: “Britain’s continuing failure to build enough homes means that unless we change course, the struggle of young people to own their home is only going to get worse.

“The good news is that older generations are just as concerned about young people’s struggle to own their home, and support for housebuilding is growing across all age groups. A sustained programme of housebuilding to cut Britain’s housing deficit would send out a clear message from the incoming Prime Minister that she is committed to repairing the social contract between generations.”

Do you support plans to help generation rent get onto the housing ladder?

What Will Theresa May’s Government Mean for the Housing Market?

Published On: July 19, 2016 at 9:45 am

Author: Em Morley

Categories: Property News

Tags: EU referendum,homeownership,housebuilding,housing market,property market,Theresa May

Last week, Theresa May became the UK’s 76^th Prime Minister, becoming the first female PM since Margaret Thatcher. But what will her Government mean for the housing market?

Her appointment as PM is welcome news for the property market and landlords, who have suffered a period of political uncertainty since the country voted to leave the EU on 23^rd June.

Now that Theresa May is in office, how will the new Government improve the property market, and the country?

Making Brexit a success

In a statement following her appointment, May promised to build a “better Britain” and “to make a success” of Brexit. She spoke of the need for strong leadership to lead us through these uncertain economic and political times, and the need to negotiate the best deal for Britain outside of the EU.

Although many had called for a second referendum, May – who was part of the Remain campaign – has insisted that “Brexit means Brexit” and there will be no second vote.

Dealing with the housing crisis

What Will Theresa May’s Government Mean for the Housing Market?

May has made it clear that she will tackle the housing crisis as Prime Minister.

In a speech delivered in Birmingham, she said: “Unless we deal with the housing deficit, we will see house prices keep on rising. Young people will find it even harder to afford their own home. The divide between those who inherit wealth and those who don’t will become more pronounced. And more and more of the country’s money will go into expensive housing instead of more productive investments that generate more economic growth.”

What will happen to house prices?

If the Government finds a way to control net immigration and May delivers on getting “more houses built”, she could have a chance of swinging the supply and demand imbalance seen across the UK, particularly in London, where house prices have spiralled in recent years.

However, London estate agent Portico believes that this is quite unlikely, as the country does not currently have the housebuilding capacity, in terms of manpower, to see supply outstrip demand.

The firm argues that unless this changes and the supply of housing increases significantly, certainly in the short-term, it doesn’t expect to see an immediate drop in prices across the capital. Outside of prime central London, the market is driven by homeowners rather than landlords, who Portico points out will always need somewhere to live, regardless of the Brexit. They will also continue to need to upsize as their circumstances change.

Additionally, the prime central London market was showing signs of a slowdown prior to the referendum, and in areas of central London, prices began to cool following a decline in property sales. Portico believes that this decrease is likely to continue over the rest of the year.

What must happen?

Housebuilder shares have dropped post-Brexit, and most firms are now reassessing land approvals.

The Regional Director of Portico, Mark Lawrinson, explains: “May and her Government need to not just build more houses, but make the building of houses easier, be that by reducing planning restrictions on brownfield sites, encouraging more young people to take up the trade through funding and education, speeding up the planning process time it takes for developers to get sites off the ground, or incentivising smaller developers – as well as the larger groups – to build with potential tax breaks for hitting a certain quota year-on-year.

“We then need to make the process of buying property easier and cheaper; as much as Stamp Duty Land Tax has been reviewed, it is still a significant cost to any potential purchaser, on top of a large deposit required to obtain a mortgage. If we are successful in building more houses and reducing the costs associated with buying a property, it will help generate more transactions, which will keep momentum in the market and keep house prices at a steady level.”

Should you buy now?

Lots of buyers, both homeowners and landlords, have been holding off property purchases due to political uncertainty and a possible interest rate cut.

However, now that we have regained some political certainty and the Bank of England looks set to leave interest rates as they are, those holding off property purchases should now be ready to act.

The future of the housing market

Although it is yet unclear what Theresa May’s Government will mean for the housing market and for Britain, it is clear that her pro-EU approach and years of experience in UK Government has created a level of certainty for the future. Ultimately, this is what the property market needs to regain momentum at this time.

Property Demand Up by 3% in Q2

Published On: July 19, 2016 at 8:49 am

Author: Em Morley

Categories: Property News

Tags: EU referendum,homeowners,property demand,property hotspots,Stamp Duty

Property demand across the UK rose by 3% over the second quarter (Q2) of the year, according to the latest National Hotspots Index from hybrid estate agent eMoov.co.uk.

The property hotspots study records the change in supply and demand for the most populated locations across the UK, by monitoring the total number of properties sold in comparison to those for sale.

The national average

Over the UK as a whole, property demand rose by an average of 3% between Q1 and Q2 this year, now standing at 40%.

However, it’s not good news for homeowners in the capital, with demand in London down by 2% to 39%.

Despite an artificial surge in demand ahead of April’s Stamp Duty deadline for second homeowners and buy-to-let landlords, the tax change seems to have had a detrimental affect on property demand in London.

Excluding the decrease in demand in the capital, the rest of the UK has experienced a significant 8% rise in property demand since Q1.

Property Demand Up by 3% in Q2

Property hotspots

Despite a slowdown in demand in the capital, the London Borough of Bexley remains the top hotspot for property demand in the UK. At 71%, demand for homes in Bexley is the highest across the nation, although it has dropped by 7% since the start of the year, in line with the decline seen across the capital as a whole.

Bristol remains the hottest spot outside of London, with property demand increasing to 69% between Q1 and Q2. Bedford, at 67%, also retains its place as the third property hotspot of the UK, as commuter zones around the capital continue to grow in popularity, due to sky-high housing costs in London.

Aylesbury has climbed two places to take fourth place, with demand now at 64%. Medway (64%), Ipswich (61%), the London Borough of Sutton (61%), and Watford (61%) have also retained their top ten spots.

Both Cambridge and Milton Keynes have dropped out of the top ten, and have been replaced by Northampton and Coventry, where property demand now stands at 64% and 58% respectively.

Edinburgh continues to lead the way north of the border, with the Scottish capital sitting in 18^th place, at 54%, ahead of Glasgow (48%) at 34^th. This is also the case in Wales, where property demand in Cardiff stands at 44%, putting it at 44^th on the list, while Swansea sits in 90^th place, at 27%.

Greatest growth in property demand

It’s not all bad news for the capital, as Kingston upon Thames, at 59%, and Southwark, at 47%, are two of five boroughs to have recorded an increase in property demand since Q1.

There has also been a resurgence for property demand across the North East, after a difficult year for homeowners in the region.

Cold spots

At just 12%, the City of Westminster continues to be the coldest spot in the UK for property demand, joined by its prime central London neighbours, Kensington and Chelsea (12%) and Hammersmith & Fulham (17%).

Despite a slight revival in Q1, demand for property in Aberdeen is also incredibly low as of Q2, at just 13%.

The founder and CEO of eMoov, Russell Quirk, comments: “The changes to Stamp Duty tax brackets for those looking to secure a second home or buy-to-let property seem to have hit the London market harder than the rest of the UK.

“Despite London tending to drive the UK market as a whole, it would seem, for once, it has taken a backseat whilst the rest of the UK has enjoyed upward growth on the first quarter of this year.”

He continues: “That said, national demand is still lower than the levels seen at the back end of last year, and the big decider on which way it goes now will be Britain’s choice to leave the EU.

“There has been a lot of talk about the consequence of this vote on the UK property market, with many forecasting a detrimental impact on house prices. We don’t believe this to be the case and I’m certain that come Q3, our index will show a further increase in property demand across the nation.”

Rogue Landlord Jailed for Illegally Evicting Tenants

Published On: July 18, 2016 at 11:38 am

Author: Em Morley

Categories: Landlord News

Tags: evictions,London,rental property,rogue landlords,tenants

A rogue landlord in Wembley has been sentenced to four months imprisonment and ordered to pay costs and compensation of £20,000 after illegally evicting his tenants.

Rehan Sheikh, of Manor Drive, was found guilty at Willesden Magistrates’ Court of illegally evicting the tenants from his property, 90 Wembley Park Drive.

Brent Council prosecuted the rogue landlord for the unlawful eviction of six tenants, as well as for failing to obtain a House in Multiple Occupation (HMO) license and for the

Rogue Landlord Jailed for Illegally Evicting Tenants

poor conditions of the property, which enforcement officers discovered during an unannounced visit in January 2016.

Sheikh, who is the landlord of eight properties in Brent, was convicted of all offences and sentenced to four months imprisonment and ordered to pay costs of £9,000 and compensation totalling £11,000 to the evicted tenants.

The court heard that although Sheikh was receiving around £3,000 each month in rent, the property was in a terrible state of disrepair, with holes in ceilings, walls and the floor, and filthy carpets. The front of the property was also being used to dump rubbish. When the tenants complained about the condition of the property, Sheikh fraudulently told the court that the tenants were squatters and issued a claim to evict them.

Without informing the tenants of his plans, Sheikh obtained a possession order from the court and used it to evict the tenants in February 2016, assaulting one of them in the process – a crime for which he was convicted in May 2016. Sheikh gave all of the tenants, including one with two young children, just two hours to move out, even refusing to allow a tenant to wait until their children had returned from school.

The Brent Cabinet Member for Housing, Councillor Harbi Farah, says: “This was an appalling case which caused great distress to the victims and demonstrates the necessity of our private sector licensing scheme. Good tenants and their children were forced from their home by this heartless landlord’s deliberate actions.

“Our ground-breaking licensing scheme, which has been running since January 2015, is helping us to tackle poor standards in the private rented sector and focus on the minority of unscrupulous landlords who refuse to comply with the law. However, as this case shows, we also need to look at the eviction practices of some of the landlords operating in the borough. Brent Council will not tolerate this kind of criminal behaviour and we will prosecute any landlord or agent we find treating their tenants in such a despicable way.”

Sheikh, who pleaded guilty to all of the charges, has since appealed the custodial sentence and has been granted bail pending the appeal hearing.

Since the start of this year, the council has considerably increased its enforcement activity, carrying out two to five prosecutions per week, and with many more raids expected in the coming months.

If you suspect that someone is renting out an unlicensed property in Brent, you can report them anonymously at prslicensing@brent.gov.uk or by calling 020 8937 2384/5.

New Chancellor Urged to Suspend Stamp Duty Hike

Published On: July 18, 2016 at 11:06 am

Author: Em Morley

Categories: Landlord News

Tags: Brexit,chancellor,landlords,mortgage interest tax relief,Stamp Duty

The ex-President of the National Association of Estate Agents (NAEA) has urged the new Chancellor, Philip Hammond, to suspend the 3% Stamp Duty surcharge for medium-tier landlords, which he believes would help prevent rents from spiralling and exacerbating the housing crisis.

New Chancellor Urged to Suspend Stamp Duty Hike

With a drop in landlords purchasing buy-to-let properties following the introduction of the 3% Stamp Duty surcharge in April, there is some concern that the supply of rental properties could lead to a sharp rise in rents. Simon Gerrard insists that the only way to curb this increase is to uspend the surcharge for mid-tier landlords – those with five or more properties in their portfolios.

Gerrard, who is also the Managing Director of Martyn Gerrard estate agents, explains: “In the wake of Brexit, the only people actually pulling out of deals are investors. The Chancellor’s Stamp Duty hike on second homes in April had already sent them running for the hills, but Brexit could now be the final nail in the coffin.

“We already have a serious housing shortage, particularly in London, and desperately need to support medium-sized landlords so they can continue providing much-needed accommodation to the so-called generation rent. The only way to keep these individuals in the market and encourage them to keep calm and carry on in the midst of much panic is through removing the tax disincentives.”

He adds: “Brexit, a double-whammy tax from Osborne and a spooked property market – there is only so much an investor will take before they simply put their money elsewhere, which will derail the supply of new rental property to the market and mean an immediate spike in rental prices. Nobody wants to see what that will look like for this country’s housing crisis.”

Last week, the Residential Landlords Association (RLA) also called on the new Chancellor to reconsider the Government’s approach to the private rental sector, and to recognise that forcing some landlords to leave the market and preventing investment through higher Stamp Duty and a reduction in mortgage interest tax relief will only make it more difficult for many people to find suitable homes and will push up rents for private tenants.

The Chairman of the RLA, Alan Ward, comments: “Access to decent, affordable homes to rent is vital to supporting a flexible labour market, and ensuring that young people and families have a place to live.

“Whatever the new Government does to support homeownership, demand will continue to increase for homes to rent.

“The new Chancellor has an important opportunity to reverse recent punitive tax changes and support the majority of landlords who are providing good housing to their tenants to invest in the new homes we need.”