Posts with tag: landlords

Seasonal lull in BTL ahead of expected surge

Published On: January 25, 2016 at 11:46 am

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A typical, seasonal lull occurred in the rental market during the last month, with the supply of properties falling alongside demand.

These were the findings of the latest report by ARLA, whose agents registered an average of 29 prospective new tenants in December. This was down on the 34 recorded in November, a fall of 15%.

Supply also dipped in the last month, with an average of 182 properties managed per branch, as opposed to 189 in the previous month. Potential renters in the capital however were not spoilt for choice, with an average of only 108 properties managed per branch, 43 less than the overall national average.

Rent relief

In addition to falling supply and demand, rents also slid in December, with the number of tenants experiencing rental increases dropping. Just 18% of ARLA letting agents reported an increase in rents, a drop of 5% since November. Additionally, this was the lowest total recorded in the whole of 2015.

‘As we’d expect in December, the UK saw a lull in activity, with people putting off any moves until January,’ noted David Cox, ARLA managing director. ‘It’s reassuring to see the number of agents reporting rent increases is still on the decline-some encouraging news for tenants as we start 2016’.[1]

A change is coming

Unsurprisingly, the views of ARLA members on the upcoming tax hikes mirror those of the wider sector. 62% believe that the changes will push up rents, while 65% believe the alterations will lead to some landlords leaving the sector, thus lowering supply still further.

The upcoming changes in legislation seem to be having an immediate impact on investors, with ARLA agents recording a 24% increase in investors looking to purchase before the changes come into play in April.

‘With supply, demand and the number of agents reporting rent increases all declining in December, this could well be the calm before the buy-to-let storm,’ Cox continued. ‘Buy-to-let landlords determined to complete purchases before the changes come into force in April are storming the UK housing market, meaning the lull we’d usually see is less significant.’[1]

Seasonal lull in BTL ahead of expected surge

Seasonal lull in BTL ahead of expected surge

‘Subsequently, after April, we’re very likely to see the number of buy-to-let properties on the market begin to decrease and this will most certainly have a detrimental effect on renters across the country,’ he concluded.[1]

[1] http://www.propertyreporter.co.uk/landlords/is-this-the-calm-before-the-buy-to-let-storm.html

 

 

Landlords campaigning against tax hike to contact Government

Published On: January 25, 2016 at 10:14 am

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An attempt by two buy-to-let investors to seek a judicial review of the Chancellor’s mortgage interest tax relief alterations is beginning to gather pace.

Steve Bolton and Chris Cooper have taken advice from a number of legal aids, including Cherie Blair QC, on the prospect of getting a review of section 24 of the Finance (No.2) Act 2015. They have been informed that they have a, ‘reasonable chance of success.’

Challenge

Messrs Bolton and Cooper launched their challenge shortly before Christmas and had little trouble securing £50,000 through crowdfunding to first secure legal advice and then launch the campaign.

Mr Bolton is head of Platinum Property Partners, which has £200m of residential property in its portfolio. He has teamed up with fellow buy-to-let landlord Cooper in order to launch a challenge, on behalf of nearly 250 investors in the Platinum Property Partners network.

Landlords campaigning against tax hike to contact Government

Landlords campaigning against tax hike to contact Government

On their Facebook page, the pair state, ‘the Finance Act 2015 includes Clause 24, which overturns a fundamental financial business principle, where INCOME less COSTS equals PROFIT. The current government sees fit to change this trend, tested and proven commercial formula. In simple terms, the government believe that it makes complete sense to tax property owners on that part of the rent that has been paid to the lender as mortgage interest, as that money was still in the property owners’ bank account!’[1]

‘The next step is for our lawyers, Omnia Strategy LLP, to send a letter outlining our case to the government with a view to commencing judicial review proceedings,’ the post adds.[1]

[1] https://www.lettingagenttoday.co.uk/breaking-news/2016/1/lawyers-for-anti-osborne-buy-to-let-tax-changes-to-contact-government-this-week

Many landlords still not prepared for Right to Rent

Published On: January 24, 2016 at 11:49 am

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A concerning new report has indicated that only half of UK landlords are ready for the Right to Rent rollout, which is set to come into effect in less than 2 weeks (February 1st).

Urban.co.uk conducted a survey of 5,000 landlords and found that 20% wrongly believed that they had until April 2017 to prepare for the changes. 3% thought they had until 2018!

Knowledge

These alarming findings were part of Urban.co.uk’s Landlord Knowledge Survey Report, which questioned landlords on issues relating to the leasing market.

With a number of new legislations coming into play in 2016 and landlords’ responsibilities growing, the investigation provided cause for concern.

Key findings from the report include:

  • just 10% of landlords provide the correct information to their tenants at the start of a new tenancy
  • 90% of landlords could not articulate the characteristics of a HMO
  • 16% did not put a valid contact address on their tenancy agreements, something which could deem contracts being null and void

‘There has been an influx of new legislation relating to the rental market made in recent years and we know that UK landlords are struggling to keep on top of these changes,’ noted Adam Male, Co-Founder or Urban.co.uk. ‘Despite knowing many of the basics, many find it difficult to navigate the minefield of changing renting rights and wrongs and this is particularly so for accidental landlords.’[1]

Many landlords still not prepared for Right to Rent

Many landlords still not prepared for Right to Rent

Reassuring

Despite this perceived lack of understanding in some areas, thankfully, most landlords were found to be knowledgeable of most other rental issues. 77% were aware of the up-to-date Energy Performance Certificate requirements, with 95% of landlords able to identify their gas safety responsibilities.

76% of respondents knew their smoke alarm requirements, with 7% saying they put one in every room.

According to the research, the most knowledgeable landlords are located in Southampton, with the least located in Newcastle-under-Lyme.

Male went on to say, ‘it’s great to hear that knowledge about things such as gas safety is widely understood and implemented landlord legislation, however there is still a long way to go in educating landlords about the varying aspects of renting. New regulations such as the Right to Rent have the potential to stop back door lettings and create a better environment for all, however this will only happen if the scheme is communicated to landlords properly. We as an organisation want to do our bit to clean up the industry and help landlords protect themselves from significant financial risk.’[1]

[1] http://www.propertyreporter.co.uk/landlords/are-landlords-prepared-for-%C3%A3%C2%A2%C3%AB%C5%93right-to-rent%C3%A3%C2%A2%C3%A2%E2%80%9E%C2%A2.html

Rogue landlord in Cambridge fined £15,080

Published On: January 22, 2016 at 2:15 pm

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A landlord has been charged and fined for not adhering to regulations for HMOs, following an early morning raid involving immigration enforcement officers.

Selvakumar Francis, a London-based landlord, appeared in court on charges related to the condition and overcrowding of his property in Cambridge.

Disregard

Evidence was uncovered that Mr Francis had show disregard to the property, allowing its condition to deteriorate substantially. The property was found to have no basic fire safety precautions.

Officers noted that many defects amounted to nine breaches of the Management of Houses in Multiple Occupation (England) Regulations 2006.

Mr Francis pleaded guilty to the charges and was fined a total of £13,500. In addition, he was told to pay the council’s costs of £1,460, plus a victim surcharge of £120.

Rogue landlord in Cambridge fined £15,080

Rogue landlord in Cambridge fined £15,080

Lack of safety

As part of the inspection, Cambridge council officers noted that there was no fire detection system. A fire door had been removed or simply not installed and this, combined with no dire detection system in the downstairs area, meant that tenants would have been unaware of any fire and thus would have been trapped.

The hallway, the main route of escape, was found to be blocked with three bikes, a mattress and unopened packs of laminate flooring.

There were eight beds located within the three-bedroom property, with only one toilet for all occupants. One of these rooms was only 5.5 sq metres in size. In two of the bedrooms, three-beds were crammed in, with only one electrical socket for use between the three occupants of each. This led to multiple extension sockets being used and an increased risk of fire.

On sentencing, magistrates said Mr Francis was negligent and has actions, ‘had a significant effect on human health and quality of life.’[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2016/1/early-morning-immigration-raid-leads-to-15-080-bill-for-landlord

 

 

£5m pot to tackle rogue landlords announced

Published On: January 22, 2016 at 12:04 pm

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The Housing Minister Brandon Lewis has today announced a £5m fund to crackdown on rogue landlords across England.

48 councils will split the cash, which will be used in order to root out irresponsible landlords that force their tenants to live in unsuitable and dangerous properties.

Improving the sector

Additionally, the money will assist councils to conduct inspections, surveys and demolish ‘beds in sheds’ and other prohibited buildings.

Since 2011, almost 40,000 inspections have taken place across the country, with 3,000 landlords served with enforcement actions, statutory notices or prosecutions.

Lewis has provided the funding to try and make sure that millions of hard-working, law-abiding tenants receive a better deal when renting a property.

Tough tackling

Mr Lewis said that, ‘many private rental tenants are happy with their home and the service they receive, but there are still rogue landlords that exploit vulnerable people and force their tenants to live in overcrowded and squalid accommodation.’[1]

‘We are determined to tackle these rogue which is why we are providing 48 councils with extra funding, so they can get rid of the cowboy operators in their area and bring an end to tenants living in miserable homes in the name of profit. We also want to raise the quality and choice of rental accommodation across the sector. The funding will ensure tenants know what level of service they can expect and have confidence to get help and take action if things go wrong,’ he added.[1]

£5m pot to tackle rogue landlords announced

£5m pot to tackle rogue landlords announced

A better buy-to-let sector

The announcement comes as part of the proposals in the Housing and Planning Bill, aimed at ensuring England’s 9 million private sector tenants are given better standards by their landlords.

Included in the Housing and Planning Bill proposals are:

  • a database of rogue landlords and agents convicted of previous offences
  • total banning orders for the most prolific offenders
  • introduction of civil penalties up to £30,000, instead of prosecution
  • a more hardline fit and proper persons test for landlords of licensable properties, such as HMO’s

Councils

A full-run down of the forty-eight councils and how much of the £5m they have been allocated is as follows:

  • Birmingham £110,250
  • Blackburn with Darwen £39,375
  • Blackpool £150,000
  • Boston £74,600
  • Bradford £45,000
  • Bristol £135,000
  • Burnley £18,200
  • Calderdale £100,000
  • City of Lincoln £96,071
  • Cornwall £127,500
  • Croydon £15,000
  • Derby £13,161
  • Ealing £150,000
  • Fenland £44,500
  • Hastings £122,734
  • Hyndburn £112,500
  • Ipswich £56,250
  • Islington £112,500
  • Lambeth £90,000
  • Leeds £70,000
  • Lewisham £151, 378
  • Liverpool £112, 500
  • London Borough of Barking and Dagenham £250,000
  • London Borough of Brent £295,000
  • London Borough of Enfield £360,000
  • London Borough of Hackney £36,400
  • London Borough of Hammersmith and Fulham £91,000
  • London Borough of Haringey £100,000
  • London Borough of Hounslow £67,500
  • London Borough of Newham £428,241
  • London Borough of Southwark £31,200
  • London Borough of Tower Hamlets £100,000
  • London Borough of Waltham Forest £225,000
  • Luton £94,000
  • Manchester £60,000
  • Middlesbrough £100,000
  • Newcastle £70,000
  • North East Lincolnshire 64,250
  • Nottingham £151,079
  • Pendle £22,500
  • Peterborough £112,500
  • Plymouth £60,000
  • Royal Borough of Greenwich £175,000
  • Salford £63,952
  • Slough £90,000
  • Thanet £88,737
  • Kensington and Chelsea £91,000
  • Torbay Council £90,000

[1]

[1] https://www.gov.uk/government/news/5-million-cash-for-councils-to-stop-rogue-landlords

 

18% of landlords will leave sector due to tax changes

Published On: January 22, 2016 at 10:04 am

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A concerning new survey has indicated that the majority of landlords believe that the Government’s perceived assault on the buy-to-let sector will lead to serious market damage.

Research conducted by property management group Orchard and Shipman suggests 90% feel that the tax hikes will bring about higher rents. This was based on a survey of 500 landlords.

Leaving

Further results indicate that one quarter of landlords will sell their properties as a direct result of the changes, with 18% saying that would have to leave the sector altogether.

In addition, the research shows that over 90% of landlords think that they should be able to deduct legitimate costs from rents. This was found to be one of the main issues with the Government’s proposals to limit mortgage interest tax relief for the more higher-taxed landlords.

Committed

Over half of the landlords surveyed said that they would increase rents over the course of 2016, to cover the increased financing costs.

However, Orchard and Shipman thinks the Government’s ambition to thwart the buy-to-let sector may yet come up short.

18% of landlords will leave sector as result of tax changes

18% of landlords will leave sector as result of tax changes

‘Many landlords and property investors are committed and passionate and will do whatever it takes to protect their interests. Our research shows that the majority of landlords are looking at ways to recover the potential drop in revenue,’ noted Shane Spiers, chief executive of the firm.[1]

‘I believe that the buy-to-let market will pull together to ensure it continues to provide much needed accommodation to meet growing tenant demand,’ he added.[1]

[1] http://www.propertyreporter.co.uk/landlords/will-the-governments-tax-changes-discourage-btl-investment.html