Posts with tag: tenants

It’s Good News for First Time Buyers, but Bad News for Tenants

Published On: May 16, 2018 at 9:23 am

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Categories: Landlord News

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A significant number of homes suitable for first time buyers could flood the property market in the coming year, as new figures from the National Landlords Association (NLA) show that approximately 380,000 landlords (39%) intend to sell their investments.

The report indicates that 45% of landlords who intend to sell property in the coming year plan to offload individual flats and apartments, with a third (33%) looking to sell terraced houses – both of which are typically affordable and attractive options for those taking their first steps onto the property ladder.

Significantly, just 7% of landlords who plan to sell say that they intend to sell to other landlords, signalling renewed hope for many first time buyers and homeowners looking to progress up the property ladder.

The data comes as separate findings from UK Finance show signs of buoyant first time buyer activity of late.

Richard Lambert, the CEO of the NLA, says: “These findings sound like positive news for potential new homeowners, but the reality is, not everyone wants or is in a position financially to buy.

“In fact, if all these homes are sold as planned, then it will lead to a significant fall in the supply of property available to those who choose to rent, or have no other option but to rent.”

The NLA has been looking into this issue recently, and has produced a video and discussion paper about the relationship between landlords and first time buyers in the market.

Lambert adds: “Everyone seems to have a gut instinct about the extent to which they feel landlords and first time buyers compete for homes in the UK, but homeownership is a highly emotive issue, so the facts are often overlooked.

“There’s certainly no denying that competition exists, but the significant barriers to homeownership are more likely to be the high cost of a deposit or ability to access mortgage finance.”

He concludes: “With our new video and discussion paper, we hope to provide more of an accurate picture of these issues, and, importantly, we want to focus the debate on what can be done to ensure that everyone has a roof over their head – regardless of whether they rent or own.”

Access these documents from the NLA here: www.landlords.org.uk/news-campaigns/news/the-hustle-homes

RLA Calls for Government to Support Longer Tenancies

Published On: May 15, 2018 at 9:03 am

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Categories: Tenant News

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The Residential Landlords Association (RLA) has reached out to the Government to request that support is provided for landlords to adapt their tenancies in order to accommodate the rise in older renters.

Over a quarter of those in their late 30s and 40s are now renting, according to research based on figure from the annual Family Resources Survey. The amount of middle-aged tenants renting from private landlords in the UK has doubled in the past decade. The number of those in the same age group with a mortgage has also fallen from 60% to less than 50% between 2007 and 2017.

The RLA believe that the offering of longer tenancies, with assistance from the Government, will make a big difference.

David Smith, Policy Director for the RLA, has commented: “With government data showing that rents are increasing by less than inflation and that average weekly rents are lower than weekly mortgage payments, it is not surprising that more older people who are finding it difficult to afford to buy a property are now renting.

“We recognise that older tenants, especially those with children, want security in rented housing. Although official statistics show that tenants have, on average, lived in their existing rented homes for almost four years, we have called on the government to do more to support the provision of longer tenancies.

“This includes addressing the problem that mortgage lenders often prevent landlords offering longer tenancies with an RLA survey showing that 44% of landlords have mortgage conditions that limit the maximum length of tenancy that can be offered.”

“This is making it more difficult in areas of high demand for tenants to find decent accommodation,” he added.

“The government is increasingly asking the private rented sector to house people in categories that it was never intended or structured to do. Ministers need to undertake a comprehensive review to ensure the support is in place for landlords to meet the changes in the types of tenants in rented housing.”

Landlords Respond to Increase in Older People in Rented Housing

Published On: May 14, 2018 at 8:10 am

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Data analysed for and by BBC News has revealed a steep increase in the proportion of 35 to 54-year-olds living as private tenants, compared to ten years ago. Since 2006-7, we can see that these numbers have doubled, according to the Family Resources Survey.

David Smith, Policy Director for the Residential Landlords Association, has responded to this research: “With Government data showing that rents are increasing by less than inflation and that average weekly rents are lower than weekly mortgage payments, it is not surprising that more older people who are finding it difficult to afford to buy a property are now renting.

“We recognise that older tenants, especially those with children, want security in rented housing. Although official statistics show that tenants have, on average, lived in their existing rented homes for almost 4 years, we have called on the Government to do more to support the provision of longer tenancies. This includes addressing the problem that mortgage lenders often prevent landlords offering longer tenancies with an RLA survey showing that 44% of landlords have mortgage conditions that limit the maximum length of tenancy that can be offered.

“The growth in the number of older tenants is one factor behind an increase in demand for rented housing at a time when an increasing number of landlords are not investing in more properties or are selling off homes because of Government tax rises on the sector. This is making it more difficult in areas of high demand for tenants to find decent accommodation.

“The Government is increasingly asking the private rented sector to house people in categories that it was never intended or structured to do. Ministers need to undertake a comprehensive review to ensure the support is in place for landlords to meet the changes in the types of tenants in rented housing.”

Redress System for Housing is ‘Ineffective, Confusing and Complicated’

Published On: May 3, 2018 at 9:01 am

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Categories: Tenant News

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The results of recent data from Ombudsman Services (OS) and Building Balance has found that almost 7 in 10 people find the existing redress system for complaining about housing confusing. This survey compiles its results from more than 400 renters, tenants and homeowners who took part.

The report forms part of a major dialogue on how complaints should be handled across the housing and property sector – with finding ways to better protect consumers the end goal.

Key findings included:

  • 69% of respondents admitted they find the system for complaints confusing
  • 55% found that they didn’t know where to go when they needed to make a complaint about housing and property
  • 84% said they’d prefer the creation of a single housing ombudsman

Commonly found housing complaints

In addition to the statistics above, which seem to indicate a need for change, responses also indicated the most common housing issues reported to the redress system by consumers. The most common were found to be with new build properties (56% of participants), maintenance and upkeep of the property (10%), and problems with the letting agent or estate agency (10%), as well as problems with parking, asbestos, theft, dangerous electrics and gas leaks.

More complex issues were also reported, with details varying on a more individual basis. Some examples included one tenant who was too afraid of being evicted to report a severe mould problem, and a pair of neighbours who were faced with a £500,00 bill to make their new build homes safe to live in.

The results of this report also follow on from the Property Redress Scheme’s annual report, which was released on the 13th of April. This showed that there had been a 61% rise in complaints notifications overall, when compared to the previous year.

The redress system for housing is currently ‘ineffective, confusing and complicated’

The redress system for housing is currently ‘ineffective, confusing and complicated’

In response to the findings, recommendations that the report put forward are summarised below:

  • The Ministry of Housing, Communities and Local Government should put consumers at the heart of the sector, offering a simple complaints journey, strong regulation and easy access to help and advice for consumers.
  • In keeping with the 84% of respondents who backed the idea, the report puts forward the recommendation of a single ombudsman for housing and property
  • Consistent standards to be introduced which firms operating within the sector must comply with. This is intended to provide clarity on the process to consumers and firms alike

Chief ombudsman, Lewis Shand Smith, said: “Our Building Balance dialogue has given us a clear remit to call for change.

“The current system for redress in housing is ineffective, confusing and complicated, and clearly doesn’t provide the service that consumers need. The recommendations put forward in our report are underpinned by real insights, as well as the experience we have gathered during our 10 years of helping consumers with complaints in the housing sector.

“For example, the dialogue showed overwhelming support for the creation of a single ombudsman. We know this model can work well – the scheme we operate in energy handles around 40,000 complaints every year, and with oversight of the whole sector we’re able to identify issues and help companies improve their processes to reduce consumer detriment.

“Now it’s up to the government to take our recommendations forward and put into place a new system; one that is fair, balanced and has the legal powers to put things right.”

 

 

New Home Secretary must Address Right to Rent, NLA Urges

Published On: May 2, 2018 at 9:02 am

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Categories: Law News

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The new Home Secretary, Sajid Javid, must address industry-wide concerns around the controversial Right to Rent scheme, the National Landlords Association (NLA) has urged.

On Monday, a cabinet reshuffle replaced Javid as the Minister for Housing, Communities and Local Government with James Brokenshire. Javid was then appointed as Home Secretary, following the resignation of Amber Rudd.

There is growing speculation that Javid is paving the way to become the next Prime Minister. However, the NLA insists that he must first address the Right to Rent scheme, and the adverse impact it is having on many “would-be and vulnerable tenants”.

In a letter of congratulations to Javid, the NLA used the opportunity to press the new Home Secretary to take this opportunity to review the Right to Rent scheme in light of the Government’s own figures, which show that the policy costs an additional £4.7m per year.

While many industry experts have long been campaigning for the removal of the Right to Rent scheme, it is still a legal requirement. Landlords and letting agents can use this helpful guide, which we put together with the help of the Home Office, to understand their obligations: https://landlordnews.co.uk/home-office-reinforces-landlord-responsibilities-right-rent/

Richard Lambert, the CEO of the NLA, says: “In his time as Housing and Communities Secretary, Sajid Javid worked with the NLA to support the private rented sector (PRS).

“We have reminded Mr. Javid of the effects the Right to Rent scheme has had on would-be and vulnerable tenants, its excessive checks and lack of monitoring, and the additional cost it is placing on an already pressurised sector.”

He insists: “There is now an opportunity for us to work with Mr. Javid, and with new Housing Secretary, James Brokenshire, to look again and come up with a more practical, workable system than the one we have.”

Landlords and Tenants Split over New Insurance-Based Deposit Schemes

Published On: October 30, 2017 at 9:10 am

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Categories: Landlord News,Tenant News

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Both landlords and tenants are split over the effectiveness of new insurance-based deposit schemes, according to recent research by Upad.co.uk.

The letting agent revealed concerns from both landlords and tenants regarding various aspects of these insurance-based deposit options. Specifically, landlords were worried that the insurance would not cover them fully for repairing any damage at the end of the tenancy.

A number of insurance-based deposit schemes have been launched recently, which aim to resolve tenants’ difficulties in raising the cost of a deposit by instead offering a monthly insurance payment.

When questioned over the new alternatives, some tenants felt that, despite sometimes having to borrow money to pay their deposit, they would get their deposit back in the majority of cases. Paying for the insurance, however, would see them making payments that would never be returned.

Nevertheless, tenants overall were more in favour of the insurance-based deposit schemes than landlords were.

Perhaps most alarming is that less than 10% of both groups were even aware that these new options existed.

Landlords and Tenants Split over New Insurance-Based Deposit Schemes

Landlords and Tenants Split over New Insurance-Based Deposit Schemes

When the new insurance-based schemes were put to landlords, they were unconvinced that they would have any real impact, with 57% claiming that they’d never had a tenant struggle to raise a deposit.

Just 35% thought that finding tenants would be easier if they offered this option as an alternative to requesting a deposit. Additionally, only 14% thought that insurance-based deposit schemes were better than taking a deposit.

Although a higher proportion of tenants appeared to support these new schemes, in some cases, those in favour were still in the minority, with 35% thinking that insurance-based deposits are better than taking a deposit.

However, 37% said that they would definitely rather pay a monthly insurance cost than a deposit, while 62% had no concerns about paying a monthly sum, rather than one large deposit.

Portfolio landlord and the Founder and CEO of Upad, James Davis, responds to the findings: “Alternatives to paying one-off deposits are always welcome, and these schemes are a great idea.

“Immediately, tenants will be free of the struggle of having to raise a deposit for a new rental before they have got their existing deposit back, and those who are unable to raise a deposit at all, or have no means of borrowing the money, could find themselves able to rent a far wider range of properties than they previously could.”

He adds: “I am definitely in favour of such schemes, and hope in the coming months a greater proportion of landlords will also take this point of view.”

Do you believe that insurance-based deposit schemes are a better idea for the lettings industry?