Posts with tag: tenants

Council leaders call for Right-to-Buy reform

Published On: August 11, 2016 at 9:24 am

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Council leaders in England have today called for the Government to make reforms to the right-to-buy scheme in light of new figures.

Analysis completed by the Local Government Association reveals that 12,246 council properties were sold to tenants under the scheme in 2015/16. However, just 2,055 replacements were started by councils, a fall of 27% on the previous year.

Right-to Buy

The Right-to-Buy scheme was designed to allow low-income tenants to purchase their council-owned home at a discounted price.

Since its inception in the early 1980’s, nearly 2m properties have been sold to these tenants by councils across England. As a result, the proportion of homes that are social housing have fallen from 31% to 17%.

Numbers of people using the scheme were on the downturn, until the Government re-launched the scheme in 2012, offering quadruple discounts for London tenants.

The scheme has already been scrapped in Scotland, with the Welsh assembly also confirming plans to abolish it. Now, the Local Government Association has said that the scheme could become defunct in England, if more is not done to fund replacement homes.

Replacements

Representing 370 local authorities across England, the Local Government Association said it expects 66,000 council properties to be sold to tenants by the year 2020. Councils are expected to struggle to replace many of them.

A further 22,000 properties will be sold should councils be forced to offload higher-value properties to fund an extension of the scheme to housing associations. In their manifesto before last year’s general election, the Government promised to make discounts available to 1.3million housing association tenants.

The Local Government Association warns that a fall in council homes would exacerbate the housing crisis, with an increase in homelessness and spending on housing benefit.

Council leaders call for Right-to-Buy reform

Council leaders call for Right-to-Buy reform

Re-launch

Since the re-launch, the Government has pledged to provide one-for-one replacements for additional homes sold. The Local Government Association said that prompt reform is necessary to ensure councils replace stock efficiently.

The Association believes authorities must keep 100% of receipts from sales, as opposed to the one-third they can currently retain. In addition, it has called for discounts to be set to reflect regional variations in property values.

Nick Forbes, senior vice chair of the Local Government Association noted, ‘Right to Buy will quickly become a thing of the past in England if councils continue to be prevented from building new homes. Housing reforms that reduce rents and force councils to sell homes will make building new properties and replacing those sold even more difficult. Such as loss in social housing risks pushing more people into the more expensive private rented sector, increasing homelessness and housing benefit spending.’[1]

Commitment

The Department for Communities and Local Government (DCLG) said that the Government was prepared to undertake action to ensure the provision of additional homes.

It noted, ‘we’re committed to building the homes this country needs and investing £8bn to build 400,000 more affordable homes. There is a rolling three-year deadline for local authorities to deliver an additional affordable home and so far they have delivered well within their sales profile.’[1]

‘However, we have always been clear that if local authorities don’t start building replacement homes within the three-year deadline, then we will step in and build them for them.’[1]

[1] https://www.theguardian.com/society/2016/aug/11/right-to-buy-reform-urged-as-council-leaders-fear-for-social-housing?CMP=share_btn_tw

Where in the North East can you expect a quick let?

Published On: August 9, 2016 at 9:56 am

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An average North East rental property houses a tenant within 97 days of going onto the market, according to new research.

Analysis of 15 North East regions by sales and lettings firm KIS reveals that there are a few unlikely rental hotspots in the region.

Tenant turnover

Landlords in Consett can expect to have the shortest wait to find tenants.

The report indicates that buy-to-let investors in the region see properties rented out within an average of 58 days. Other fast-renting areas include Chester-le-Street (75 days), Whitley Bay (81 days), Cramlington (83 days) and Durham City, (86 days).

At the other end of the scale, the second slowest region in the North East to rent out a property was Newcastle, where homes take an average of 125 days to let.

Houses in the North East take an average of 17 days less to rent out than flats.

Where in the North East can you expect a quick let?

Where in the North East can you expect a quick let?

Quick lets

Ajay Jagota, managing director of KIS, said, ‘Consett may not be the first place you think of when it comes to Northern property hotspots, but there are some obvious reasons for why properties there seem to rent out faster than the rest of the region. The most obvious one is that as a smaller area than most of those we’ve surveyed there are likely to be less houses to rent and more competition for properties as a result-something always worth considering for landlords and prospective property entrepreneurs.’[1]

‘The time it takes to rent out a property is, of course, not the only factor you need to consider when it comes to deciding where to invest in property. Although these figures suggest Gatesehead is somewhere to consider avoiding it has offered investors the region’s highest rental yields in almost every survey we’ve ever undertaken. If you are looking to rent out a property quickly, the quickest way to do it is to remove the biggest and bizarrest obstacle to finding and keeping good tenants-rental deposits,’ he continued.[1]

‘Our research shows that tenants on average need to find £798 in deposits to move into a rented home. By insisting on deposits when you could instead use an insurance-backed deposit free solution is intentionally limiting potential tenants to people who have that sort of money lying around,’ Jagota added.[1]

[1] http://www.propertyreporter.co.uk/landlords/where-do-north-east-properties-rent-the-quickest.html

Landlords Urged to Help Tackle Homelessness

Published On: August 9, 2016 at 9:51 am

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A Hertfordshire-based housing association has called on landlords to help tackle homelessness in the area through its new social lettings scheme.

The Hemel Hempstead-based Hightown Housing Association, based in the Dacorum Borough Council area, is launching its own social letting agency to help combat the increasing problem of homelessness in the district.

Landlords Urged to Help Tackle Homelessness

Landlords Urged to Help Tackle Homelessness

Hightown Lettings will offer private landlords a three to five-year lease for their properties, which they will let to families who are homeless or facing homelessness.

Under the terms of the new scheme, landlords will be guaranteed a monthly rent, whether their property is occupied or not, while Hightown Lettings will also manage the properties.

Landlords will also benefit from quarterly inspections, a £300 contribution towards minor repairs each year, and the ability to fund more expensive repairs/renewals by taking the cost out of their monthly payment.

Hightown will also return the property at the end of the lease in the same condition as the start, aside from fair wear and tear.

All properties leased under Hightown Lettings will be let and managed on Assured Shorthold Tenancies (ASTs), with a break clause for either party to end the agreement within three months.

The housing association hopes that the scheme will help to reduce homelessness in the area, as the number of applications in the Dacorum Borough have risen by a huge 70% between 2014-15 to 131 in the last quarter.

The Chief Executive of Hightown, David Bogle, says: “The number of people being made homeless is increasing nationally, with 68,560 households living in temporary accommodation at the last count. Locally, the overall trend is not improving and we’ve been looking for new ways to assist local authorities with the problem.

“We hope this scheme will assist the local community and help us fulfil our aims of providing homes for those in need. For local landlords, they’ll have the benefit of long-term, no hassle letting with the rent and welfare of the property guaranteed.”

The housing association also reminds landlords that they will save on letting agent fees by leasing through the scheme, but they must be aware that the rental income they earn will usually be controlled by the amount of housing benefit that the tenant receives, which is typically 80% of the average local market rent.

The Lettings Manager of Hightown, Brian Finn, adds: “By guaranteeing the rent every month and not charging fees, the landlord’s income under Hightown Lettings will be very similar to the income received by going through a high street letting agent.”

The call from Hightown Lettings arrives as a new report highlights the chronic housing crisis in the UK. Shelter recently found that three million working families in England are at risk of losing their homes due to sky-high housing costs: https://www.justlandlords.co.uk/news/3m-working-families-one-pay-cheque-away-losing-home/

Could you join the new scheme?

Government Should be Helping Landlords with Energy Efficiency, Says Investor

Published On: August 9, 2016 at 8:31 am

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Eco-friendly ways to reduce running costs and add value to a property

The Government should be providing buy-to-let landlords with energy efficiency support, warns established investor Peter Armistead, of Armistead Property.

Government Should be Helping Landlords with Energy Efficiency, Says Investor

Government Should be Helping Landlords with Energy Efficiency, Says Investor

New Government plans will require buy-to-let landlords to spend up to £5,000 on energy efficiency improvements.

The new legislation, which will be introduced from 2018, requires landlords to raise the energy efficiency of their rental properties to at least an E rating for new tenancies. Many landlords will be forced to carry out improvements, such as insulation, cavity wall filling and new boilers.

The Residential Landlords Association (RLA) believes that a total of 330,000 rental properties, typically Victorian and Edwardian homes, will be affected by the new legislation. It also warns that the new “green tax” could push rents even higher.

However, the Government has suggested a £5,000 cap, insisting that most landlords will have to spend no more than £1,800.

But Peter Armistead has urged the Government to provide alternative support to landlords, now that the Green Deal has ended.

“Landlords have been bombarded with new tax measures over the last 12 months, and this is yet another cost that some landlords will have to face. Landlords can’t be expected to absorb all these new taxation measures and just stand back and watch their profits being eroded. Unfortunately, it will be tenants that will have to bear the brunt of these costs through higher rents.”

He continues: “While it is a good move to improve the quality of rented accommodation, there should be another scheme to help landlords make the improvements. The Green Deal gave loans to improve energy efficiency, and these loans were then repaid by tenants, who, as a result of the works, were paying lower bills.

“To help spread the improvement costs, landlords should start upgrading their properties before it becomes mandatory in 2018 for new tenants. Buy-to-let mortgage providers will require borrowers to comply with the regulations, and valuers are likely to amend their criteria in the run-up to 2018, making buy-to-let mortgage applications more difficult.”

Armistead adds: “Most insurance policies require landlords to comply with all relevant statutory requirements. This may mean that it could be more difficult to get insurance unless landlords comply with the forthcoming regulations. Landlords with F and G-rated properties need to manage the upgrading and improving their properties to avoid potential prosecution and fines.”

Landlords, have you started thinking about any energy efficiency improvements your rental property needs?

27% of tenants felt rushed into signing tenancy agreement

Published On: August 8, 2016 at 11:44 am

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Concerning new research has revealed that 27% of tenants feel they were rushed into signing their tenancy agreement.

The investigation from Ocean Finance shows that many renters felt the pressure of competition in the market made them sign an agreement on the day they viewed the property.

Rushing renters

One in ten renters said that their time taken between viewing and entering an agreement was between 2-3 days. A further ten percent said they signed a contract 4-7 days after viewings.

18-24 year olds were found to be the age group acting with most haste, with 46% saying they rushed into signing a deal. In contrast, just 17% of those aged over 55 felt pressured to move quickly to secure their tenancy.

Unsurprisingly, tenants in the capital felt under more pressure to sign quickly, with 40% stating that this was the case in their experience. Renters in Northern Ireland felt under similar pressure, but just 12% of tenants in Wales felt obliged to rush.

27% of tenants felt rushed into signing tenancy agreement

27% of tenants felt rushed into signing tenancy agreement

Regrets

Of those tenants who felt pressured to sign their tenancy agreement, half wished that they hadn’t.

The top reasons for regretting signing were:

Reason for regret % of rushed tenants who gave reason
Property is too cold 10%
Property is too small 9%
Property needs too much work doing to it 9%
Dislike of surrounding area 8%
Not enough outdoor area 6%
Property lacks character 4%
Property is too old-fashioned 4%
Property is too far away from amenities 2%

[1]

Ian Williams, spokesman for Ocean Finance, said, ‘our figures demonstrate just how hard it is to rent a property across much of the UK. The best properties are often snapped up within hours or even minutes. As a result, would-be tenants feel under pressure to sign quickly to secure the property. Sadly, half of those go on to regret their haste, finding themselves in a home that they don’t like or which doesn’t suit them.’[1]

[1] http://www.propertyreporter.co.uk/landlords/1-in-4-tenants-say-they-rushed-into-their-tenancy-agreement.html

Rent Controls Would Spell Disaster for Tenants, Warns RLA

Published On: August 8, 2016 at 9:41 am

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Rent Controls Would Spell Disaster for Tenants, Warns RLA

Rent Controls Would Spell Disaster for Tenants, Warns RLA

Jeremy Corbyn’s plans to introduce rent controls and secure tenancies in the private rental sector would spell disaster for tenants, warns the Residential Landlords Association (RLA).

The Labour leader has vowed to implement rent controls and secure tenancies if he is elected Prime Minister at the next general election. However, the RLA has spoken out against Corbyn’s plans, saying that they would deter many landlords from investing in the buy-to-let sector, which would reduce the supply of homes to let.

Last week, Corbyn announced ten pledges in his bid to become the prime minister, but the RLA believes his plans would worsen the UK’s housing crisis.

The Chairman of the RLA, Alan Ward, explains: “Jeremy Corbyn’s call for rent controls would be a disaster for tenants. He is ignoring all history and experience, which shows that where such controls are applied, they choke off the supply of homes to rent, making it more difficult for tenants to access decent and affordable housing. This has previously been acknowledged by Labour’s former minister responsible for housing in Wales.

“Rather than playing the populist tune, Mr. Corbyn would do well to consider the facts. Figures in the English Housing Survey show that private sector tenants are spending an average of four years in their current property, up from 3.7 five years ago. Such tenants are also more satisfied with their accommodation than those in the social rented sector, according to the same survey.”

The RLA has long opposed the introduction of rent controls, insisting that the Government should address the issue of housing supply by encouraging greater levels of housebuilding in order to stabilise rents in the long-term, rather than penalising landlords.

The RLA’s objection to Corbyn’s plans arrives as the Society of Licensed Conveyancers calls for the Government to scrap Stamp Duty.

The group believes that abolishing Stamp Duty, particularly the 3% surcharge for landlords, would create a more “buoyant and vibrant” property market.

Do you agree with these recent calls?