Written By Em

Em

Em Morley

Rogue landlord in Birmingham jailed for neglect

Published On: April 7, 2016 at 9:15 am

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A rogue landlord from Birmingham has been jailed for a whole host of safety breaches in a four-floor property in Edgbaston.

Cyrus Bassiri was sent to prison for 19 months and told to pay £13,820 following his disregard for health and safety in his rental property.

Greedy

During sentencing at Birmingham Crown Court, Mr Bassiri was described as ‘greedy and cynical’ and was told he put, ‘profit before the safety of tenants’ by Judge Mary Stacey.

The Court heard that two fire alarms in the property did not work and that a fire escape was blocked by a washing machine and display cabinet. What’s more, emergency lighting was fitted incorrectly and a fire door was found to be damaged.

When firefighters raised their concerns with Mr Bassiri, he responded in an ‘aggressive and bullying’ manner.

Exploitation

Judge Mary Stacey told Mr Bassiri, ‘you have been greedy, you have been cynical and you have been exploitative of the occupants of this property in your control. Having failed to address the matters raised by the fire brigade you responded to their attempts to get you to comply with your legal obligations by being aggressive, by bullying behavior, by threatening to take them to court and expose them to the press.’[1]

Previously, 59 year old Bassiri had admitted three counts of failing to adhere to general fire precautions and two of failing to comply with an enforcement notice.

Rogue landlord in Birmingham jailed for neglect

Rogue landlord in Birmingham jailed for neglect

Disregard

Mark Jackson, prosecuting, noted Mr Bassiri had already been handed a six-month suspended sentence for breaches of fire safety regulations in another property in 2012. In addition, a member of the public complained over further disregard to fire safety rules in the property during 2013.

Mohammed Afzal, defending, argued Bassiri had wrongly believed he was the victim of a plot to force him out of the property and there were ‘only three tenants.’ He also claimed Mr Bassiri was, ‘distracted by a business dispute and was under severe pressure.’[1]

Buy-to-let investors should utilise advice for landlords on fire safety before making a purchase.

[1] https://www.landlordtoday.co.uk/breaking-news/2016/4/birmingham-landlord-jailed

 

 

 

New rental adverts soared ahead of SDLT changes

Published On: April 6, 2016 at 11:54 am

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New to market rental adverts for properties soared ahead of the changes in Stamp Duty Land Tax on April 1st, research has revealed.

Property Partner, a property crowdfunding platform, analysed the number of new rental properties being advertised between 28th March-3rd April. It then compared these figures to those recorded between 21st-27th March in over 90 towns and cities across the UK.

Results show that in 85% of locations, there was a significant increase in the number of new rental properties coming onto the market.

Rises

In a number of areas, rises recorded were substantial. Telford in the West Midlands saw listings up by nearly 160% in the week of the changes coming into force. New to market properties in Stevenage nearly doubled.

Five of the top ten areas in terms of rise in rental properties coming to market were found to be in the North of England.

Of all major cities, London saw new property listings increase by 19.4% between 28th March-3rd April, in comparison to the previous week. In Manchester and Birmingham, new advertisements were up by 28.7% and 49.9% respectively.

New rental adverts soared ahead of SDLT changes

New rental adverts soared ahead of SDLT changes

Final rush

Dan Gandesha, CEO of Property Partner, observed, ‘inevitably, there was a final rush by investors to complete on property purchases ahead of the 1st April stamp duty surcharge deadline.’[1]

‘More rental properties on the market is good news for tenants, but sadly this looks like a temporary blip. The savings landlords have made may turn into losses further down the line. Future cuts to mortgage interest tax relief and likely interest rate rises could wipe out profits and force many landlords to sell up,’ he continued.[1]

Looking to the future, Mr Gandesha said, ‘longer term, we’re likely to see the supply of rented properties dropping and rents increasing. The pressing issue is to get Britain building more homes for tenants, as well as buyers.’[1]

‘The Government has changed the whole structure of the UK buy-to-let market and made it less attractive and viable for amateur landlords. Once the dust has settled on the stamp duty hike, anyone looking to invest in residential property would be wise to consider alternatives to traditional buy-to-let, which do away with the hassle, expense and tax implications,’ Gandesha concluded.[1]

[1] http://www.propertyreporter.co.uk/landlords/new-to-market-rental-properties-spiked-before-stamp-duty-dealine.html

Soaring student numbers driving rental shortage

Published On: April 6, 2016 at 10:51 am

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Record numbers of university students looking for rental accommodation has led to a distinct lack of affordable rental properties.

That is the main finding of a report from the Mistoria Group, which says that there is a severe shortage of accommodation for this group.

Highs

Last year, the Government raised the cap on the number of places universities are able to offer by 30,000. This in turn has lead to increased competition between institutions.

According to UCAS, the total number of university applicants reached a record high in the previous academic year. Recent figures show a 3% rise in the number of year-on-year applications.

The largest growing group in recent times was non-European Union students, with numbers rising by 50% in the last decade. There has also been a distinct rise in UK student numbers during the last 20 years.

Competition

Data from SpareRoom.co.uk shows that up to 22 students and professionals competed for each room available in university towns and cities in 2015. Only 40% of rooms in the top 25 UK university cities are available to students.

The most fierce competition was seen in Edinburgh, where 22 people battled for one room. In Oxford, 100 students had no accommodation at the start of the new academic year, with 15 people searching for every available room.

Changing pace

Mish Liyanage, Managing Director of The Mistoria Group observed, ‘unfortunately, university managed accommodation has not kept pace with the growth in student numbers and this is driving increased demand for HMOS and PSBAs in many UK towns and cities.’[1]

‘Traditionally universities were responsible for providing good quality student accommodation. However, over the last ten years, demand for university accommodation has outstripped demand and the private sector has supplemented some of the shortfall, ‘Liyanage continued.[1]

Soaring student numbers driving rental shortage

Soaring student numbers driving rental shortage

Robust and Lucrative

Liyanage went on to say that, ‘the student property is a robust asset class. Since 2011, student accommodation has outperformed all other traditional property assets and has been the strongest growing investment property market in the UK. It has continued to be one of the most resilient investment sectors, with rental incomes and property values remaining stable, or increasing. The attraction of the student accommodation sector has been driven by structural undersupply and positive rental growth year-on-year.’[1]

‘Without doubt, the student rental market is the most financially lucrative for investors and landlords if it is managed well. An investor can currently buy a four bed HMO in a good location for students and professionals, fully refurbished and furnished and tenanted for the coming year, for less than £150,000 in the North West based on 2015 prices.’[1]

Concluding, Liyanage said, ‘Investing in student HMO accommodation offers a long-term investment option, as the property is highly likely to be in constant demand throughout the calendar year.  Typical rents are significantly higher for student properties, than a comparable buy-to-let property in the same city.’[1]

[1] http://www.propertyreporter.co.uk/landlords/record-student-numbers-fuel-rental-property-shortage.html

Advice for landlords-check your agreements are compliant!

Published On: April 6, 2016 at 9:18 am

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Concerning new research from landlord insurance provider Direct Line for Business suggests that some landlords have no formal tenancy agreement with their tenants.

According to the firm’s investigation, 10% of landlords have no legally binding contract with their renters.

Compliance

Data from the research shows that where contracts are place, landlords could be unknowingly asking tenants to sign forms that are not legally compliant. Of landlords who do not use a letting agent, 58% said that had used modified agreements for old agent contracts, other landlords (38%) or a template they found on the internet (20%).

Most commonly, the investigation found landlords utilise agents when they first rent out their property, but then use older contract templates when agreeing renewals. This lack of legally reviewed tenancy agreements could be an explanation why 13% of landlords said they have had difficulties with disputes coming from tenant’s rental contracts over the past two years.

More reason for concern was highlighted with the news that 9% of landlords admitted to not informing their tenants that their deposit had be held in a tenancy deposit scheme. This is a legal requirement and must be done within 30 days after a deposit has been taken. Alarmingly, 4% of landlords said they had not taken any deposits from their tenants!

Advice for landlords-check your agreements are compliant!

Advice for landlords-check your agreements are compliant!

Protection

Nick Breton, Head of Direct Line for Business, noted, ‘tenants and landlords need a contract in place to protect both their interests. Contracts, deposits and deposit protection all help to make clear what is expected from each party when renting a property and which can help minimise disputes where possible. If an old contract is adapted it may not comply with new legislation or be relevant for the current market. Given the volume of disputes arising from tenancy agreements it’s important to get the contract seen by a legal professional before it’s signed.’[1]

‘We understand that getting legal documents in place can be complicated which is why we’ve launched our new Legal Documents Service for landlords. Not only can this save landlords time and money, but creating the documents is both quick and easy and most importantly, they can be reviewed by a Solicitors Regulation Authority regulated law firm to ensure they are legally compliant. Based on our research of solicitor prices, it is estimated each landlord using the service would save over £2,503’ Breton added.[1]

[1] http://www.propertyreporter.co.uk/landlords/landlords-beware-check-your-contracts-58-may-not-be-legally-binding.html

Britain is made up of nosey neighbours!

Published On: April 5, 2016 at 1:17 pm

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Britain is officially a country of nosey neighbours, according to new research.

Analysis from Direct Line shows 38% of Britons have snooped on the price of someone else’s property online. These include homes belonging to their family and friends!

Nosey

The research revealed that 19 million Britons have looked up another property online. Of these:

  • 52% looked at their neighbours’ home
  • 38% snoop on homes belonging to their family
  • 31% have a nosey at their friends’ dwelling
  • 10% look at the homes of their work colleagues
  • 10 vet the homes of potential new partners
  • 9% even check the property of ex-lovers!

However, it is not only the price of a property that people are searching for when looking at a home. The research suggests that motivation can range from downright nosiness to fantasy.

63% of Britons were found to have window shopped for homes that they have no intention of ultimately purchasing.

Property obsession

Katie Lomas, head of Direct Line Home Insurance, noted, ‘we are a nation of property obsessives with very good reason. Our homes are our castles and becoming a homeowner or even climbing the ladder in the UK is a huge challenge and aspiration for many.’[1]

‘Property sites are a source of information and inspiration and browsing these sites has become something of a past-time for millions of people. The flip side of this trend is that those who list on these sites exhibit their homes and belongings to millions of strangers every day,’ Lomas continued.[1]

Britain is made up of nosey neighbours!

Britain is made up of nosey neighbours!

City snoopers

By region, the highest percentage of people found to browse property with no intention to buy was in Sheffield. The Steel City was closely followed by London and Newcastle. The top ten were as follows:

  • Sheffield-74%
  • London-72%
  • Newcastle-70%
  • Cardiff-65%
  • Plymouth-64%
  • Belfast-63%
  • Birmingham-62%
  • Brighton-61%
  • Edinburgh-61%
  • Liverpool-61%        [1]

Other potential reasons for using property websites to check on property include to gauge local prices, assessing potential purchase areas and simply daydreaming over an ideal home!

By percentage, Direct Line’s research shows that peoples’ motivation for looking online at property includes:

  • Keeping tabs on local prices-60%
  • Checking out potential purchase areas-40%
  • Daydreaming over an ideal home-34%
  • Looking for interior design ideas-29%
  • Assessing value on own home-26%

Technology

‘We are a nation obsessed with property and with technology at our disposal it is so much easier to keep in touch with the value of our property and those of our neighbours and friends,’ observes Daniel Bailey, of mortgage brokers Middleton Finance.

‘When are for sale sign appears on our streets we all jump on our laptops to seek the asking price of our neighbours’ property,’ he concluded.[1]

[1] http://www.dailymail.co.uk/property/article-3517159/Neighbours-house-prices-checked-price-homes-belonging-people-know.html

71% of accidental landlords unaware of tax changes

Published On: April 5, 2016 at 10:31 am

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Research from Direct Line for Business indicates that over half of new buy-to-let mortgage applicants are unaware of mortgage tax relief alterations. The firm highlights that accidental landlords are most likely to be unaware of the changes in legislation.

Concern

A survey of mortgage brokers revealed concerning results. 62% of respondents said they were unaware of changes to mortgage tax relief or the EU’s Mortgage Credit Directive. This is extremely worrying as these changes could impact on their mortgage availability criteria.

This number rose to 71% amongst so called accidental landlords-those who rent out a property having inherited due to unforeseen circumstances. Mortgage advisers suggest that accidental landlords account for 17% of the total new mortgage applications. Overall, buy-to-let mortgage applications have grown by 29%, according to the report.

In addition, just 7% of mortgage advisors said they felt the Mortgage Credit Directive will have a positive impact of buy-to-let mortgage approvals. 59% said they believed it would have a negative effect. Concern is growing that the Mortgage Credit Directive will see landlord mortgage lending seen as consumer lending, thus making accidental landlords subject to more stringent lending criteria.

From next April, changes to mortgage tax relief will see landlords unable to deduct mortgage interest payments before working out their bill. Instead, they will receive a tax credit, equivalent to 20% basic-rate tax on this amount.

71% of accidental landlords unaware of tax changes

71% of accidental landlords unaware of tax changes

Significant alterations

Nick Breton, Head of Direct Line for Business, said, ‘the new EU legislation on mortgages coupled with the Government’s increase in buy-to-let taxation could significantly alter the buy-to-let market, so we would encourage any mortgage applicants to think carefully about the new law and how this could impact them as a landlord.’[1]

‘With house prices in the UK rising by 7% in the year leading to October 2015 and with the estimated average deposit standing at more than £61,000, it is imperative that landlords are able to maintain a suitable amount of property to house the population of young people saving up to buy their first property or those seeking a temporary stay in a town or city,’ Breton added.[1]

[1] http://www.propertyreporter.co.uk/landlords/accidental-landlords-most-at-risk-warns-new-research.html