Posts with tag: rental property

Redevelopment of Empty London Buildings Could Provide 420,000 Homes for Rent, Says Think Tank

Published On: February 17, 2016 at 4:01 pm

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Redeveloping unused or empty commercial land and buildings in London could provide up to 420,000 additional homes for rent by 2036, according to a leading think tank.

Research from the Policy Exchange found that there are more than 500 hectares of empty or under utilised industrial land in the capital alone – the equivalent of 750 football pitches – as well as a huge amount of neglected retail space in outer London.

Redevelopment of Empty London Buildings Could Provide 420,000 Homes for Rent, Says Think Tank

Redevelopment of Empty London Buildings Could Provide 420,000 Homes for Rent, Says Think Tank

The think tank’s report states that if the Government were to commit £3.1 billion per year to finance the purchase of this land, alongside a private sector partner, such as an institutional investor, about 21,000 homes could be built every year.

The Policy Exchange suggests that the homes should be designed to accommodate the ever-expanding private rental sector and shared ownership market by using pre-fabricated materials, which will overcome skills shortages in the construction industry and other factors that slowdown house building, such as bad weather conditions.

Rental income from the homes and the sale of equity stakes could recover the Government’s money within 20 years, says the think tank.

If a scheme like this went ahead, it would be the largest Government investment and delivery on housing since the 1970s.

The report adds that the process of buying non-residential land could be sped up by giving extra powers to the Mayor of London to fast track the purchase of commercial land and buildings that have been empty or unused for two years or more.

At present, around 27,000 homes are being built in London each year – significantly less than the estimated 50,000 homes that are needed every year to keep up with demand.

The Head of Housing at the Policy Exchange, Chris Walker, comments: “The Government urgently needs to make bold reforms to the laws surrounding compulsory purchase of empty or under utilised commercial properties to create a significant supply of land for new housing.

“It should seriously consider making the largest investment in housing since the 1970s to pay for land acquisition, land redevelopment and large scale house building.”1

1 http://www.telegraph.co.uk/finance/newsbysector/constructionandproperty/12159522/Empty-commercial-buildings-in-London-could-provide-420000-homes-for-rent-think-tank-says.html

Landlord Insurance Company Seeks Payment from Tenant

Published On: February 9, 2016 at 1:56 pm

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A landlord insurance company is seeking payment from a tenant over damages to a rental property.

The outcome of the case could prove worrisome for generation rent.

Landlord Insurance Company Seeks Payment from Tenant

Landlord Insurance Company Seeks Payment from Tenant

Galina Govina, a scientist, rented a £1m cottage in Wiltshire for £2,800 per month. In 2010, she went away over the Christmas period. While she was away from the property, a pipe burst and flooded the cottage.

Govina later received a bill for £128,000 to cover the damage from her landlord’s insurance company, NFU Mutual.

The case is resting on whether Govina left the heating on to prevent pipes freezing when she was away, as is required by her tenancy agreement. She claims that she did keep the heating on and blames the damage on a “mechanical failure”1.

However, NFU Mutual says Govina turned the heating off, therefore breaching her tenancy agreement. Although the firm has paid the landlord for the damage, it is still pursuing Govina.

Govina is refusing to pay, insisting that the landlord’s insurance policy was in place to protect her from any financial consequences of accidental damage to the property too.

Her barrister, Andrew Butler, warns that victory for NFU Mutual could prove dangerous for many tenants in a similar position in the future.

He says the case is unique, but that it will be “a concern” to anyone living in private rental housing.

He adds: “This was not an uncommon form of tenancy agreement. There hasn’t really been a case like this before in a residential context.

“If the judge finds that the insurance policy didn’t apply for both the landlord and the tenant, that would certainly be a point of concern for tenants.”1

The outcome of the case is yet to be announced. 

1 http://www.telegraph.co.uk/news/uknews/law-and-order/12140902/Physicist-renting-1m-cottage-in-High-Court-test-case-over-128k-bill-for-damage-from-burst-pipes.html

Conservatives Reject Move to Ensure Rental Homes are Safe

Published On: January 13, 2016 at 3:53 pm

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Conservative MPs have voted against proposals that would have required private landlords to ensure their properties are fit for human habitation.

The Labour amendment to the Government’s Housing and Planning Bill – created to make sure that all rental homes were safe for tenants – was defeated by 312 votes to 219 yesterday, when the bill went through its third reading in the House of Commons.

Conservatives Reject Move to Ensure Rental Homes are Safe

Conservatives Reject Move to Ensure Rental Homes are Safe

The Shadow Housing Minister, Teresa Pearce, who proposed the amendment, stated: “The majority of landlords let property which is and remains in a decent standard. Many landlords go out of their way to ensure that even the slightest safety hazard is sorted quickly and efficiently.

“So it is even more distressing when we see reports of homes which are frankly unfit for human habitation being let, often at obscene prices.”

She added that the condition of some rental properties would not be tolerated in other sectors, noting reports of mould growing.

She asked: “Where else in modern life could someone get away with this? It’s a consumer issue. If I purchased a mobile phone or a computer that didn’t work, didn’t do what it said it would, or was unsafe, I would take it back and get a refund.

“If I purchased food from a shop and it was unsafe to eat, I would not only get a refund but there is a high possibility the shopkeeper could be prosecuted. Yet if I rent from a landlord, perhaps the only available property for me, and it was unsafe to live in, then I can either put up or shut up. In a market where demand outstrips supply, renters lack basic consumer power to bargain for better conditions.”1

The Government has been criticised for trying to rush the Housing and Planning Bill through Parliament – last month it quietly tabled an amendment to the bill that set a maximum of five-year terms for new council home tenancies.

In yesterday’s debate, MPs backed the proposal to ban rogue landlords and letting agents that repeatedly commit offences against private rental sector laws or regulations. Fines of up to £30,000 for landlords or agents that knowingly rent out unsafe homes will also be implemented. Councils will be given access to a blacklist of rogue operators.

Additionally, the bill will controversially extend the Right to Buy scheme to housing association tenants who wish to purchase their homes. This policy will be partly funded by requiring councils to sell the top third of their most valuable properties.

Marcus Jones, the Local Government Minister, believes Pearce’s proposal would cause “unnecessary regulation and cost to landlords” that could discourage further investment in the buy-to-let sector and drive up rents for tenants.

He said: “Of course we believe that all homes should be of a decent standard and all tenants should have a safe place to live regardless of tenure, but local authorities already have strong and effective powers to deal with poor quality and unsafe accommodation, and we expect them to use them.”1

For the latest landlord advice and updates, check back to LandlordNews.co.uk.

1 http://www.theguardian.com/society/2016/jan/12/tories-reject-move-to-ensure-rented-homes-fit-for-human-habitation

 

 

Is This £95-a-Week London Flat Too Good to be True?

Published On: January 12, 2016 at 3:05 pm

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Many Londoners are searching for cheap rental accommodation in the capital – could this property be what they’re looking for?

A property has been advertised on Gumtree in the desirable W4 postcode area of Chiswick for just £95 per week. At a much cheaper price than London’s average £1,500 monthly rent, what’s the catch?

The advertisement describes the flat as “a spacious single studio with kitchenette and own shower, pine furniture and double bed”.

It is also “well-served by Chiswick Park and Turnham Green Tube stations and the London Underground”.

Additionally, residents will enjoy the nearby Chiswick High Road, which “is home to a wealth of fabulous amenities, including Harvey Nichols, Waitrose, Caffe Nero. Acton Green Common, Chiswick Common and Turnham Green offer plenty of spacious, green areas close by”1.

So far, so good.

However, the studio flat is so crammed that the shower is installed right next to the kitchen.

Is this a good use of space, or does the flat highlight the extraordinary crisis in the London housing market?

As the property has been unoccupied since the beginning of November, it appears that even though this place is cheap, it may not be suitable for even the most desperate tenants.

1 http://metro.co.uk/2016/01/08/this-spacious-west-london-flat-is-a-bargain-at-95-a-week-but-theres-a-catch-5609206/

Only Prime Central London Landlords Can Absorb Extra 3% Stamp Duty

Published On: January 8, 2016 at 9:27 am

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Only Prime Central London Landlords Can Absorb Extra 3% Stamp Duty

Only Prime Central London Landlords Can Absorb Extra 3% Stamp Duty

Only landlords buying properties in the prime central London market will be able to absorb the extra 3% Stamp Duty charge, which will come into effect on 1st April, according to investment advice firm, London Central Portfolio (LCP).

Investors buying rental properties in other parts of the UK will be hit much harder by the additional tax, claims LCP.

A statement from the firm reads: “For UK investors buying outside prime central London, for affordability reasons and who have benefitted from very low levels of Stamp Duty, the new additional rate sees the tax jump by almost 2.5 times.

“In prime central London, on the other hand, Stamp Duty will rise less than 50% on average. This is likely to be absorbed very quickly, due to the strong, long-term price growth in prime central London of 10.1% per annum, which would equate to 61% over the next five years.”

This fairly modest effect on landlords in London contrasts to the much stronger impact on Manchester, where long-term growth has only averaged 4% per year.

LCP warns: “The additional 3% Stamp Duty will significantly eat into profits. As investors weigh their options, it is areas outside prime central London that are likely to suffer the most.”1 

LCP believes the rise in Stamp Duty for landlords is part of a Government attack on the buy-to-let sector, which will institutionalise the market through Build to Rent and institutional investment; large-scale property investors will be unaffected by the extra Stamp Duty, which does not apply to purchasers of 15 properties or more at one time.

Read more on the tax here: /btl-homes-hit-with-increased-stamp-duty/

1 https://www.lettingagenttoday.co.uk/breaking-news/2016/1/prime-london-buyers-can-absorb-extra-3-duty–but-other-cities-cant

Renter Offered £450 a Month Bathroom to Sleep in!

Published On: January 6, 2016 at 3:50 pm

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A hopeful tenant searching for a home in Glasgow’s fashionable West End was left alarmed after a landlord offered him a bathroom to sleep in for £450 per month.

Danny Andrews, 32, replied to an advertisement for a “small but cosy living space” on Pride Flatmates, a website that sources gay-friendly accommodation.

The advert stated that the two-metre by two-metre room was “unconventional” and “needing some TLC”, but did not admit that the space is actually a bathroom.

When Andrews went to view the property, the landlord led him into the run-down bathroom, informing him that he was expected to sleep in the bath.

On Twitter, Andrews expressed his horror: “A nutter tried to rent me a bathroom in Glasgow for £450 a month. He even suggested I sleep in the bath!”

The advert said that the landlord plans “to put new flooring down and buy furniture as soon as I get confirmation that someone would like to rent”.

He explained that the “property has two toilets, and I have an en suite bathroom, you will have access to your own personal facilities” but that “viewing is advised”1.

Although Andrews could laugh off the viewing, the advert highlights the awful state of the private rental market in the UK, as prices are surging for small spaces.

In London, the average rent on a flat or house hit £1,500 per month last summer, with the typical rent outside of the capital reaching £751 a month.

Prices are usually cheaper in Glasgow, with some homes advertised on SpareRoom.co.uk for as little as £500 per month.

Pride Flatmates, which is free to users, responds to the advert: “We do our best to make sure that they are genuine, but we will explore other options to see if it is possible for us to make improvements to this process.

“We would like to take this opportunity to apologise for any inconvenience that the recent issue has caused and we will do our very best to make further improvements to the website.”1

1 http://www.prideflatmates.com/listing/living-space-glasgow