Search Results For: buy to rent sector

Landlord Ordered to Repay £39,000 in Housing Benefit

Published On: January 6, 2017 at 11:12 am

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Landlord Ordered to Repay £39,000 in Housing Benefit

Landlord Ordered to Repay £39,000 in Housing Benefit

A buy-to-let landlord who failed to obtain a license for a House in Multiple Occupation (HMO) in London has been ordered to repay £39,000 in housing benefit, following action taken by Islington Council.

The council ordered Landhouse Ltd, which rented out the HMO, to repay the money it had paid in housing benefit, after the firm admitted to letting the property without the correct HMO license.

Islington Council’s environmental health officers had conducted an inspection of the property, finding it to be overcrowded and badly managed. In addition, fire hazards were uncovered throughout the property.

In a hearing at the Property Chamber – the First-tier Tribunal for London Residential Property – the landlord was ordered to pay £14,140 in fines and costs, as well as repay the council £39,022.52 in the housing benefit claimed during the period when the property was rented without a license.

Landhouse Ltd has now applied for a license, but is still liable to repay the benefit, which will be returned to a central Government housing benefit consolidation fund.

Councillor Diarmaid Ward, Islington Council’s Executive Member for Housing and Development, comments on the case: “More and more people rent privately in Islington, and we’re committed to helping make sure they have decent homes to live in. We will take action when landlords do not keep within the law, and, as this case shows, the costs can be very significant.”

If you rent out a HMO, be aware that you are required to obtain a license from the local council. The Government has made it incredibly easy for landlords to gain a license for their property – simply enter the postcode of the property you require a license for at: https://www.gov.uk/house-in-multiple-occupation-licence

To avoid facing hefty fines and even imprisonment, remember to stick to the law governing the private rental sector. Signing up for free access to our handy guides will ensure that you have all the information you need: /guides/

Government Must Do More for Those at the Start of the Property Cycle, Insists Student Platform

Published On: January 6, 2017 at 9:28 am

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The Government must do more for those at the start of the property cycle, particularly students, insists free-to-list student rentals platform, StudentTenant.com.

While this week has brought good news for the property market, following announcements to build the first wave of Starter Homes and the development of 14 garden villages, StudentTenant believes that more must be done for those at the beginning of the property cycle, especially students living in the rental sector.

Government Must Do More for Those at the Start of the Property Cycle, Insists Student Platform

Government Must Do More for Those at the Start of the Property Cycle, Insists Student Platform

Over the past few years, investors have spent billions of pounds on student accommodation due to current shortages and high demand. Despite this, many campuses find themselves with an inadequate number of properties, warns the platform.

In addition, despite the huge spike in tuition fees in recent years and Britain’s departure from the EU softening interest from foreign students, UK universities continue to experience overwhelming levels of interest from prospective students.

But with a lack of suitable housing in the student rental sector to meet this demand, not only is the education of these students being hindered, as is their first experience in the property cycle, the firm states.

Danielle Cullen, the Managing Director of StudentTenant, says: “It is great news that new homes are being built for homebuyers in 2017, but we also have to address the burning issue in the rental sector.

“Many look at first time buyers as the start of the property lifecycle, but this just simply isn’t the case, especially for those that fall within the generation rent category, where homeownership may never be obtainable.”

She explains: “For many of us, going to college or university will be our first taste of the property lifecycle in the rental sector. Unfortunately, there is a high chance that this will leave a sour taste in the mouth, as many students struggle to find suitable accommodation.

“It is a shame that the rental sector in the UK is not a top priority on the Government’s agenda this year, because so many people across the nation depend on this form of housing. If they can’t manage to provide an appropriate level of affordable housing, they should at least ensure that there is an adequate rental sector to fall back on. Regulation of pricing in the sector would be a good start, particularly for students, who are forced to pay extortionate prices in areas of high demand.”

Landlords, if you provide housing for those at the start of the property cycle, remember to stick to the law and protect your tenants by providing safe, secure and good quality accommodation. Our guides explain all you need to know to be a responsible landlord: /guides/

£2bn worth of housing benefit paid to Scottish landlords in last 5 years

Published On: January 5, 2017 at 2:54 pm

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Private landlords in Scotland have received over £2bn in housing benefit during the last five years, according to new figures.

Data from Scottish Labour shows that on average, one quarter of all housing benefits since 2011/12 have gone to private landlords.

Failures

Labour feels that these figures show the SNP’s failure to tackle the housing crisis and as such has called for greater investment in Scotland’s private rental sector. What’s more, the data has lead Mid Scotland and Fife MSP Alex Rowley to call for immediate action from the Scottish Government.

Mr Rowley said: ‘’I have been calling on the Government for some time to address what is evidently a housing crisis spiralling out of control across Scotland.’[1]

The average private sector rent in Scotland has risen by 14% since 2010.

Rowley continued by saying: ‘Money that is spent on housing benefits should be used to support those that need it, whereas instead we are seeing that money end up in the pockets of private landlords. That is why I want to see a reform of the private rented sector to ban rip-off rent rises.’[1]

£2bn worth of housing benefit paid to Scottish landlords in last 5 years

£2bn worth of housing benefit paid to Scottish landlords in last 5 years

More homes

Mr Rowley suggests that more homes need to be built in order to help solve the housing crisis. As such, he has called for a national house build plan.

Responding, the Scottish Government has moved to defend its track record on housing delivery.

A spokesperson for the Government said: ‘We have an excellent track record on housing and are committed to achieving sustainable, long-term solutions to address housing issues. In the previous session of Parliament, we exceeded our target of delivering 30,000 affordable homes by 10% and our bold and ambitious More Homes Scotland approach will build on that achievement.’[1]

‘We have committed to investing over £3bn to deliver at least 50,000 affordable homes over the next five years and by ending Right to Buy we are protecting up to 15,000 social homes for sale over the next 10 years and safeguarding this stock for future generations. This is accompanied by increased housing subsidy levels and a new rural and islands housing fund to increase the supply of affordable rural housing,’ he concluded.[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2017/1/more-than-2bn-in-housing-benefits-paid-to-private-landlords-in-scotland

 

Mortgage Approvals Hit Eight-Month High

Published On: January 5, 2017 at 10:15 am

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Mortgage approvals for house purchases hit an eight-month high in November, according to the latest figures from the Bank of England (BoE).

Some 67,505 mortgage approvals were recorded in November, up from 67,371 in October and the highest number seen since March, when the figure reached 70,079. It is believed that the peak witnessed in March was the result of a rush of investors hoping to beat the introduction of the 3% Stamp Duty surcharge for additional homes in April.

Mortgage Approvals Hit Eight-Month High

Mortgage Approvals Hit Eight-Month High

Despite November’s high number of mortgage approvals, the level was still down on an annual basis, from 70,123 the previous year.

However, the value of lending was higher in November, at £12.3 billion, up from £11.8 billion in October and £12 billion in November 2015.

The Director of Edinburgh Mortgage Advice, Mark Dyason, considers the cause of the increase: “There is a growing sense among existing UK homeowners that the first rate rise for a very long time could be on the horizon. More recently, this feeling has been compounded by the quarter point hike in the US in December.

“Most people now accept that rates are unlikely to get any better and are taking action to lock in to the competitive rates that are still, for the time being, available.”

He continues: “The sense that time is running out on the best rates, coupled with a general softening in prices, especially in prime areas of the country, has kept the market ticking over.

“Ironically, the ongoing uncertainty around the full impact of Brexit has spurred many people into action.”

He concludes: “The philosophy many people have adopted appears to be one of take action now while conditions are at least in their favour.”

But are landlords continuing to buy properties for rent? The latest data from the Council of Mortgage Lenders, which reveals that the number of landlords in mortgage arrears has hit a two-year high, suggests that too many investors have locked into purchases that they cannot afford.

At a time when tax and legislation changes are shaking the private rental sector, it could be a good idea for investors to hold back on purchases before assessing what the future will hold for their portfolios.

With mortgage approvals high across the house purchase sector, it looks that the general property market is still holding strong.

Number of Landlords in Mortgage Arrears at Two-Year High

Published On: January 5, 2017 at 9:25 am

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The number of buy-to-let landlords in mortgage arrears has hit a two-year high, according to new figures from the Council of Mortgage Lenders (CML).

Number of Landlords in Mortgage Arrears at Two-Year High

Number of Landlords in Mortgage Arrears at Two-Year High

Mortgage arrears among landlords rose by 6% – from 4,700 to 5,000 – between July and September last year. This was the first increase seen since records began two years ago.

Following a rush of buy-to-let activity early last year ahead of the introduction of the 3% Stamp Duty surcharge in April, fewer investors are now adding to their property portfolios.

But some experts fear that many landlords, especially those entering the buy-to-let sector for the first time, acted too hastily in acquiring property that they could not afford to avoid being hit by the higher tax on additional homes.

The Chief Executive of the National Landlords Association (NLA), Richard Lambert, believes: “Some first time landlords may have rushed in to the market ill-prepared to beat the Stamp Duty hike. Unless landlords begin to make plans to mitigate the impact of these changes, it’s likely that buy-to-let mortgage arrears will continue to rise.”

The increase in the number of landlords falling into mortgage arrears has led to concerns that thousands more investors could get into debt when they are hit by further tax changes in April this year.

The existing rules that allow landlords to offset all of their finance costs against tax will, from 6th April 2017, be phased out under Section 24 of the Finance Act 2016, restricting the amount of tax relief that landlords can claim on mortgage interest.

The NLA estimates that around 440,000 basic rate tax payers will be forced into the higher tax bracket from April, once the changes come into force.

By April 2020, when the change is fully implemented, the consequences of Section 24 will mean that it is likely that higher rate tax payers will only receive 50% of the relief they currently get, with various experts warning that landlords will be left with little alternative but to pass higher costs onto tenants.

And with the forthcoming ban on letting agent fees for tenants, it’s highly likely that landlords will be forced to put their rents up considerably, leaving many tenants struggling to afford a home.

RLA calls for better tenant protection

Published On: January 4, 2017 at 9:47 am

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A new call from the Residential Landlords Association (RLA) has urged councils to do more to protect private tenants from rogue landlords providing them with sub-standard accommodation.

This call comes after a Citizens Advice report yesterday that revealed that whilst the majority of buy-to-let investors respond to issues quickly, some are taking too long to rectify problems.

Rooting out rogues

There are currently over 140 Acts of Parliament, with more than 400 regulations, affecting the private rental sector. As such, the RLA is urging councils to utilise these extensive powers to identify and remove rogues.

Last year, a RLA Freedom of Information request saw responses from 237 councils in England and Wales. 126 said they had brought no prosecutions against landlords between 2011 and 2014.

RLA calls for better tenant protection

RLA calls for better tenant protection

Alan Ward, Chairman of the RLA, noted: ‘Every tenant has the right to expect a safe, legal and secure home. Whilst the majority of landlords provide a good service to their tenants, there are a minority who do not and who have no place in a modern rental sector.’[1]

‘Councils have the powers to do something about them. What is needed is a greater will to use these powers to root out the criminal landlords once and for all,’ Mr Ward added.[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2017/1/tenants-need-better-protection-says-trade-body-for-landlords