Posts with tag: tenants

What to do if Your Property has been Sublet Online

Published On: December 9, 2016 at 10:15 am

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As the Christmas season approaches, online student lettings platform StudentTenant.com highlights the growing problem of tenants – particularly students – subletting their homes through websites like Airbnb. So what can you do if your property has been sublet online?

With the high expenses of the Christmas period and students returning home to their families, many tenants are taking the opportunity to sublet their accommodation online to make up the costs of this expensive time of year.

What to do if Your Property has been Sublet Online

What to do if Your Property has been Sublet Online

While this might seem the perfect solution, there are many problems with subletting a property that you don’t own. The majority of tenancy agreements do not permit subletting without the consent of the landlord. As a result, the landlord must be notified and it becomes their decision.

However, many students will still sublet online without speaking to their landlord. Over the past year, StudentTenant has detected an increase among landlords that have seen their property on Airbnb or a similar platform, or found that the tenant has sublet online without any prior knowledge or discussion.

Tenants are reminded that it can be extremely dangerous to let a stranger into your home, despite the simple verification process involved in setting up an Airbnb account. Your roommates, neighbours and belongings must all be considered.

In addition, there are liabilities with insurance as well, particularly if the landlord is unaware that a person who is not on the lease is staying in the property.

Airbnb gives tenants advice on how to speak to their landlord about becoming a host, and what issues need to be addressed before putting the property online. It recommends looking at the lease, speaking with neighbours, and learning the rules of the building. Although the site does offer a £600,000 Host Guarantee, it does not act as homeowner’s or tenant’s insurance, and has a list of limitations depending on what country the home is located in.

The Managing Director of StudentTenant, Danielle Cullen, comments: “Students can be strapped for cash, and it doesn’t help during this busy season, but subletting a rental property is not the solution. Not only can it be a liability for your roommates and your belongings, but it can lead to serious insurance problems for your landlord, especially if they don’t know about the person renting. It also goes against most leases, which is a breach of a legal document.

“Of course, we can sympathise with the students, but we must emphasise that it is neither a safe nor legal route to take when trying to make a few extra pounds.”

So what can landlords do if their property has been sublet online?

“In the case of a landlord discovering that a tenant is subletting their rented space, there is a three-step process that needs to be addressed,” she explains.

“The first is to speak directly with the tenant. It could be as simple as not understanding that the tenancy terms are being broken. If the advertisement remains active, the next step is to speak with the sub-tenants or the subletting platform in order to seek further action. Finally, if nothing changes, the landlord may only be left with legal action against the tenant, and should seek advice.”

Avoiding the Growing Trend of Rent Arrears

Published On: December 8, 2016 at 11:16 am

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James Davis – Portfolio landlord & property expert

After being a landlord for 22 years and becoming increasingly frustrated with the lack of quality tenant find services for landlords, James started Upad – the UK’s largest online letting agent. Upad has mastered the intricacies of online to provide landlords a service they can rely on. In this week’s article, James highlights the increasing importance of selecting tenants based on affordability, given the growing cases of rent arrears.

Avoiding the Growing Trend of Rent Arrears

Avoiding the Growing Trend of Rent Arrears

Avoiding the growing trend of rent arrears

Landlords and tenants are in a financial tug of war. While property owners struggle with growing rent arrears, renters are taking on too much expenditure. The worst possible eventuality is when this dynamic breaks beyond repair, leaving both sides with legal fees to pay and new relationships to build.

In London, 57% of young professionals’ take home pay is being spent on rent. While this doesn’t represent the rest of the UK, it is a trend that we do not want to emulate.

If you think about the modern tenant lifestyle, there are many new and incremental outgoings that most tenants forget to account for. Whether it’s a Spotify subscription or increasing student loan repayments, renters are now committing to more standing orders than ever before. In fact, the growth in unsecured debt, such as loans, credit cards and overdrafts is nearly £10,000 per household.

As a result, I’d recommend that rent should be no more than 30% of a tenant’s net pay. This will allow a financial buffer for any unforeseen monthly payments.

Fail without the detail

Evictions are expensive. To rise above this worst case scenario isn’t easy, but it is necessary, especially if you are one of many landlords who own multiple properties. Multiple evictions are really expensive.

From the beginning of a tenant search, landlords must ask the right questions about income and help their tenants to understand the impact of local bills and taxes on their monthly living costs. It is also important to revaluate risk throughout a tenancy, continuing to communicate with tenants about their situation and employment.

Most importantly, you nip problems in the bud. When a tenant doesn’t pay or you notice that they have stopped responding to calls, take a soft but direct approach to understanding more about their situation. Do this yourself, as tenants are less likely to respond to impersonal, automated agency emails.

Rents in London forecasted to increase as demand rises

Published On: December 6, 2016 at 10:40 am

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Property agents Portico has forecasted that the cost of renting property in London is likely to increase in the coming months, as the balance between supply and demand increases in the capital.

Portico estimates that rising demand from the increasing population, coupled with unemployment levels, could put more pressure on rental values in the city. This could also push up yields for buy-to-let landlords.

Blow for tenants

This prediction will come as a blow for tenants who are already struggling to keep up with their rental payments. The monthly outlay for tenants in Greater London hit an average of £1,543 in October, according to the latest figures released from referencing firm Home Let.

Mark Lawrinson, regional sales director of Portico, noted: ‘The population is growing, the job market is buoyant and people are still coming to live in London-so while supply is decreasing, demand is continuing to grow.’[1]

‘It’s this imbalance between supply and demand that is likely to increase rental prices, while weaker transaction prices will push up rental yields’ he continued.[1]

Rents in London forecasted to increase as demand rises

Rents in London forecasted to increase as demand rises

Rising rents

Another report from Savills last month indicated that rents are set to increase considerably faster than house prices over the next five years. This report suggests that rents will rise by 19% by 2021, with house prices increasing by 13% over the same period.

In addition, the gap is predicted to be more pronounced in London, where rents are indicated to rise by 24.5%. House prices are forecasted to increase by 10.9%.

[1] https://www.landlordtoday.co.uk/breaking-news/2016/12/rents-in-london-set-to-rise-as-demand-for-homes-outstrips-supply

 

Scottish Renting Conditions Named Worst in UK

Published On: December 5, 2016 at 10:12 am

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Scottish renting conditions have been named the worst in the UK following a study of private tenants.

The research, conducted by boiler firm Help-Link in partnership with eviction specialist Paul Shamplina, revealed that a quarter of tenants in Scotland described their current renting conditions as a “nightmare”.

Scottish Renting Conditions Named Worst in UK

Scottish Renting Conditions Named Worst in UK

Around 24% of Scottish tenants are unhappy with their renting conditions – higher than anywhere else in the UK.

Last year, Citizens Advice Scotland received over 6,000 complaints, with evidence of landlords failing to meet their legal obligations, refusing to conduct basic repairs, and even bullying or intimidating their tenants.

And the situation doesn’t seem to be improving.

Six landlords in Glovanhill, Glashow – the area represented by Scottish First Minister Nicola Sturgeon – have been banned after their licenses were withdrawn. They now face criminal prosecution with fines of up to £50,000 if they attempt to let their properties.

The area has been dogged by reports of slum homes and rogue landlords, including investors continuing to let their properties despite being banned.

In some cases, rogue landlords in the area are said to have advertised property for rent that they do not own and which is due to be demolished. Victims paid deposits and rent before losing their money.

In Scotland, all private landlords must be registered.

The six landlords in Glovanhill were found to be unfit to rent out property by Glasgow City Council’s licensing and regulatory committee.

Five of the landlords failed to provide a range of certification, including Energy Performance Certificates and Gas Safety Records, and confirmation that their tenants received information packs.

There were also concerns about the conditions of the properties, following inspections by council officers.

Hamid Akram, Tauheed Hussain, Mohammed Adnan Hussain, Shakeel Shahid and Simon Tsang own seven properties between them.

The sixth landlord, Johar Mirza, was banned from the register following his conviction for assault with intent to rape and for letting properties that failed to meet the tolerable housing standard.

If you are a landlord in Scotland, you must ensure that your tenants’ renting conditions adhere to the standard encouraged across the private rental sector – do not fall foul of licensing rules!

Over 20% of landlords take 4 months to find first tenants

Published On: November 29, 2016 at 10:17 am

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Interesting new research has revealed that over one in five buy-to-let landlords have to wait more than four months before getting their first tenants into the property.

The study from Nottingham Building Society shows that 21% of new landlords had to wait four months or longer after completing their buy-to-let mortgage before they found paying tenants.

Obtaining tenants

Conducted by the HMLettings part of its business, the Nottingham’s research found that 53% of buy-to-let investors have tenants within two months of purchasing their first investment. However, many more are facing delays, putting pressure on their bank balance.

Further data from the report found that the average investor has to pay £2,000 on their initial property before they find suitable tenants. 35% said that they managed to spend less than £1,000.

62% of those questioned said that they had to redecorate or refurbish their property before letting them out. 28% said that this work took two weeks or longer.

More encouragingly, once tenants are in a property, it seems the pressure eases somewhat. 45% of landlords quizzed said that they had no void periods in the last 12 months.

Over 20% of landlords take 4 months to find first tenants

Over 20% of landlords take 4 months to find first tenants

Support

The Nottingham feels that the research shows the need for support and advice throughout the process of getting a buy-to-let mortgage, then letting out the property.

Stephen Reade, Lettings Operation Manager at the Nottingham, noted: ‘Becoming a landlord remains attractive for thousands of people, but it is clear landlords need to think carefully before making the decision and also to plan ahead. Having to wait four months or more before getting tenants in can put a strain on finances and landlords need to ensure they have spare money to invest in their property over and above basic mortgage costs.’[1]

[1] http://www.propertyreporter.co.uk/landlords/1-in-5-landlords-experience-a-4-month-tenant-delay.html

 

 

What regions have the highest and lowest letting agent fees?

Published On: November 25, 2016 at 12:31 pm

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New research from online letting agency Urban.co.uk has claimed to reveal the highest and lowest letting agent fees charged to tenants across the UK.

The investigation comes after the controversial announcement by the Chancellor in the Autumn Statement that letting agent fees are to be banned.

Fees highs and lows

Urban said it accessed 400 agencies in total-including some online-in more than 150 towns and cities in the UK.

Data from the report indicates that on average, the five most expensive areas for tenant fees are in:

Basingstoke-£621.67

Slough-£543.33

Cirencester-£535.00

Reading-£530.62

Alnwick-£530.31

On the other end of the scale, the five cheapest areas for letting agent fees were found to be in:

Harbrough-£136.67

Worksop-£139.00

Market Harborough-£153.00

Lees-£162.98

Newham-£164.00

Costs include the preparation of a tenancy agreement, contract fees, referencing, Right to Rent checks and guarantor fees.

What regions have the highest and lowest letting agent fees?

What regions have the highest and lowest letting agent fees?

Oddities

As part of its research, Urban looked at what some agencies charged tenants for and found some shocking results. These include:

  • £200 to change the name on an agreement
  • £40 to live with your partner, if not married
  • £7.50 to access keys
  • £90 to move in on a Saturday
  • £25 for extra copies of the tenancy agreement

Adam Male of Urban, noted: ‘The additional costs that some tenants are required to pay can often be easily explained however, and this is something that letting agents often struggle to get across.’[1]

 

‘For instance, speedy moving and name changes on tenancy agreements can be due to additional solicitors fees, so we recommend tenants ask up-front what fees they might be subject to and compare them with others in the local area to ensure they get the best deal,’ he added.[1]

[1] http://www.mirror.co.uk/money/750-pick-up-key-40-8186288