Posts with tag: tenants

Abolish rental deposits, property expert urges

Published On: June 13, 2016 at 9:45 am

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A leading property expert has moved to welcome plans to reform rental deposits. What’s more, Southampton MP Alan Whitehead Labour MP has called for policy makers to abolish the legislation altogether.

Chancellor George Osborne has recently revealed the Government’s intention to change rental deposit laws, while deputising for David Cameron at Prime Minister’s Question.

Pot luck

Mr Whitehead also said that letting agents are, ‘completely unregulated,’ which in turn led tenants to rely on, ‘pot luck’ when trying to find scrupulous property owners.

Osborne noted, ‘we are looking at what we can do to make sure that people who rent have proper consumer protection, including protection from landlords who withhold deposits unreasonably.’

Property expert Ajay Jagota, owner and founder of property firm KIS, the first letting agents to abolish monetary deposits, feels that these kind of deposits should be scrapped across the sector.

Solutions

Mr Jagota said, ‘Alan Whitehead was quite right when he said renters can face pot luck when it comes to choosing the right landlord or letting agent. The irony is that a glaringly obvious solution to that problem has been staring everyone in the face for some time. He was less right when he claimed the lettings industry is unregulated. In fact landlords and letting agents need to comply with almost 150 individuals pieces of legislation.’[1]

Instead of churning out more red tape for good landlords or creating new costs to be passed on to tenants, the simplest and most effective landlords or creating new costs to be passed on to tenants, the simplest and most effective solution to guarantee a better deal for renters is to abolish deposits and move the private rented sector towards the insurance-backed model used in almost every other industry on the planet,’ Jagota continued.[1]

Abolish rental deposits, property expert urges

Abolish rental deposits, property expert urges

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Rising rents

Continuing, Jagota noted, ‘study after study concludes that they are the biggest barrier to entering and moving house in the private rented sector, with our research showing the average renter needs to stump up more than £1,000 to get the keys to a new home before they’ve even paid the first month’s rent.’[1]

‘But time and time again policy-makers ignore this in favour of the same old cul-de-sacs and clichés like banning of letting agent fees or rent controls. Not only would abolishing deposits mean the £3.2billion being release into the wider economy, £2bn of which is literally just gathering dust and interest right now, it would make it easier for renters to move house, easier for them to keep a house and easier for them to save for a property of their own.’[1]

‘A survey recently showed that 78% of renters want greater protections from their landlords – this is the simplest and most effective way of giving them that piece of mind,’ he concluded.’[1]

[1] http://www.propertyreporter.co.uk/landlords/politicians-urged-to-abolish-rental-deposits.html

Right to Rent Named a Top Cause of Stress for Landlords

Published On: June 10, 2016 at 9:45 am

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Categories: Landlord News

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The Right to Rent scheme has been named as a top cause of stress and worry for landlords, especially those in areas of the UK with a high number of immigrants, according to a new study.

The report, from PropertyLetByUs.com – a leading online letting agent – found that Right to Rent is the number one cause of stress for over a third of buy-to-let landlords, ahead of dealing with tax and inland revenue, raising finance, handling tenant complaints and void periods.

Only rent arrears and sorting out property repairs were voted more stressful than the Right to Rent scheme.

Right to Rent Named a Top Cause of Stress for Landlords

Right to Rent Named a Top Cause of Stress for Landlords

Landlords in areas with high levels of immigration, such as London and the South East, the West Midlands, the East of England and the North West, are suffering the most under the new legislation.

Furthermore, landlords are concerned that they are paying over the odds for all of the reference checks that they are now legally required to make.

Research by the Residential Landlords Association (RLA) found that in February, when the Right to Rent scheme was introduced, a huge 90% of landlords in England and Wales had not received any information from the Government on their legal duties under the new rules.

It also found that 72% of landlords did not understand their obligations, and 44% will only let to tenants who have documents they are familiar with.

Since 1st February, landlords or their letting agents are legally obliged to conduct immigration checks on all prospective tenants. Those breaking the law will face fines of up to £3,000.

This guide, from the Home Office, will help landlords understand their duties: /home-office-reinforces-landlord-responsibilities-right-rent/

The Managing Director of PropertyLetByUs.com, Jane Morris, comments on the findings: “Landlords are under huge pressure with constant new legislation, new mortgage lending rules and increased taxation. Right to Rent is making matters worse. While the Government argues this will help crack down on illegal immigrants, it is placing far too much responsibility on the shoulders of landlords.

“Anyone would think the Government dislikes landlords, with what appears to be a relentless attack on the buy-to-let market. The undisputed fact is that landlords provide essential private and social housing for a growing band of tenants, who simply can’t afford to buy. With forecasts from PwC predicting that 7.2m households will be in rented accommodation by 2025, landlords will continue to play a pivotal part in the supply of housing for a growing UK population.”

She adds: “However, it is not just landlords that are suffering under the Right to Rent legislation; several charities working in the West Midlands have warned that people they represent were now struggling to find accommodation and some had even become homeless. It is undoubtedly making tenants’ lives even more miserable than they already are – the same can also be said for many landlords.”

Generation Rent Calls for House of Lords to Support Ban on Letting Agent Fees

Published On: June 10, 2016 at 9:03 am

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Categories: Finance News,Tenant Fees Ban

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Tenant lobby group Generation Rent has called for the House of Lords to support a ban on letting agent fees charged to tenants when the issue is debated today.

The Renters’ Rights Bill, introduced by Baroness Grender, is due to have its second reading debate in the House of Lords today, Friday 10th June 2016.

Generation Rent Calls for House of Lords to Support Ban on Letting Agent Fees

Generation Rent Calls for House of Lords to Support Ban on Letting Agent Fees

Generation Rent will be joining tenants outside Parliament at 11am today to demonstrate support for the bill, alongside Vicky Spratt of The Debrief, whose Make Renting Fair campaign has attracted over 250,000 signatures on a petition to ban fees.

Vicky will be broadcasting live on Facebook from College Green outside Parliament at 11am. She will be online for 30-45 minutes at: https://www.facebook.com/thedebrief/

The Facebook live stream will include Vicky interviewing Baroness Grender about why she believes letting agent fees should be banned.

There will also be a discussion with Betsy Dillner, the Director of Generation Rent, about the campaign and why she thinks action should be taken as soon as possible.

Vicky also hopes to speak to other parliamentarians during the live stream.

The Renters’ Rights Bill would end letting agent fees for tenants and would enable tenants to access information about rogue landlords, as well as tighten the law on electrical safety checks in rental properties. It is expected to be debated in the House of Lords after 12.30pm today.

Follow the campaign on Twitter with #makerentingfair.

Dillner explains the need for the ban: “With a captive market of desperate renters, there’s nothing stopping letting agents from charging grossly inflated fees at the start, middle and end of tenancies. If landlords had to pay all the fees instead, agents would have to start lowering their prices and tenants would find it easier to move, leading to a much more efficient rental market.”

Spratt continues: “We are currently in the midst of a housing crisis. Frankly, I’m surprised it’s not yet being called a housing disaster. We simply don’t have enough homes, and a buy-to-let boom has trapped more people than ever in the private rental market. Young people, in particular, face the prospect of renting long into their adult lives.

“It’s high time that legislation changed and that renting began to work for the people who have no choice but to live in rented accommodation. This is a common sense issue. Letting fees have been banned in Scotland since 2012 and the market works. We need to do the same in England.”

Tenants’ satisfaction is high as demand grows

Published On: June 10, 2016 at 9:03 am

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Categories: Property News

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A new investigation has uncovered that the demand for rental accommodation in Britain is increasing, but there is a high degree of satisfaction amongst tenants.

The survey of more than 1,800 Private Rented Sector landlords and tenants uncovered positive sentiment towards the current and future states of the market.

Positive tenants

Undertaken by BDRC Continental on behalf of Paragon Mortgages, the survey shows that despite new measures introduced by the Government to cool the market, rents actually rose in Q1 of 2016.

The total number of buy-to-let landlords reporting demand as increased, either slightly or significantly, stood at 39%. 36% of landlords described tenant demand as stable.

As a whole, the sector is seeing high levels of satisfaction. 79% of tenants questioned said that they are satisfied with their current landlord. 85% of tenants said that they consider their current rental property to be their home, with 69% believing the rate of rent they pay to be good or very good value for money.

Lengths

Interestingly, the average length of time tenants are spending in their current properties presently stands at 7 years. In addition, the average length of time that tenants are spending in the PRS in total is reported to be almost 13 years.

Buy-to-let landlords also agree that the Private Rental Sector plays a vital role within housing in the UK. The social housing sector has lost around one million homes since 1991 and 78% of landlords agree that the PRS has compensated for the decline of this sector.

89% of landlords also noted that the PRS has an important role to play in accommodating people priced out of owning their own home. 74% agree that the sector is vital in housing those excluded from social housing accommodation

Tenants' satisfaction is high as demand grows

Tenants’ satisfaction is high as demand grows

Changing trends

John Heron, Director of Mortgages at Paragon, observed, ‘the rise of the PRS and the decline of the social housing sector have been the predominant trends in the UK’s changing housing tenure over the last 20 years. This data gives an interesting insight into how both tenants and landlords perceive these trends.’[1]

‘It’s good to see tenant satisfaction at such high levels. The sector often suffers from negative PR and the good work done by the vast majority of landlords to provide homes for those who cannot or do not want to buy goes unremarked. This survey clearly demonstrates that the PRS is increasingly providing longer term solutions in housing and that responsible and professional landlords are supporting the provision of housing to those that rely on the PRS for their home,’ Heron added.[1]

[1] http://www.propertyreporter.co.uk/landlords/tenant-demand-and-satisfaction-remains-high.html

Tenant Satisfaction High as PRS Plays Vital Role in the Housing Market

Published On: June 10, 2016 at 8:27 am

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Categories: Landlord News

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Tenants are satisfied with their rental properties, as the private rental sector (PRS) plays a vital role in the housing market, according to a survey of over 1,800 private landlords and tenants by BDRC Continental on behalf of Paragon Mortgages.

Tenant Satisfaction High as PRS Plays Vital Role in the Housing Market

Tenant Satisfaction High as PRS Plays Vital Role in the Housing Market

Despite attempts by the Government to crack down on the buy-to-let sector and stimulate homeownership levels, demand for rental properties continued to rise in the first quarter (Q1) of the year. The number of landlords reporting tenant demand as either increasing slightly or significantly stood at 39%, up from 34% in Q4 2015. A further 36% of landlords described tenant demand as stable.

The PRS is also experiencing high levels of tenant satisfaction. Almost eight in ten (79%) tenants said they are satisfied with their current landlord. A huge 85% consider their current rental property to be their home, while 69% believe the rent price they pay is good or very good value for money.

Reflecting the struggles of generation rent to get onto the property ladder, the average length of time a tenant spends in their current property now stands at around seven years. The average length of time spent in the PRS in total is almost 13 years.

Landlords claimed that the PRS is playing an increasingly important role in the UK’s housing market. With the social housing sector having lost around one million homes since 1991, over three quarters (78%) of landlords agreed that the PRS compensates to some extent for the drop in social housing.

The majority of landlords (89%) also believe that the PRS plays an important role in accommodating those who are priced out of homeownership, while almost three quarters (74%) agree that the PRS plays a role in accommodating those excluded from social housing by dwindling supply.

The Director of Mortgages at Paragon, John Heron, comments: “The rise of the PRS and the decline of the social housing sector have been the predominant trends in the UK’s changing housing tenure over the last 20 years. This data gives an interesting insight into how both tenants and landlords perceive these trends.

“It’s good to see tenant satisfaction at such high levels. The sector often suffers from negative PR and the good work done by the vast majority of landlords to provide homes for those who cannot or do not want to buy goes unremarked. This survey clearly demonstrates that the PRS is increasingly providing longer term solutions in housing and that responsible and professional landlords are supporting the provision of housing to those that rely on the PRS for their home.”

Rents set to rise faster than house prices

Published On: June 9, 2016 at 10:39 am

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Categories: Property News

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Tenants are set to see rents spiral quicker than their incomes and faster than property price growth, according to a concerning new report.

The study from the Royal Institution of Chartered Surveyors (RICS) suggests that while house prices are likely to rise, rents look set to outstrip them.

Rent rises, tenant concerns

People currently residing in privately rented accommodation are thought to bear the brunt of the tax increases for buy-to-let landlords. The fear is that this will lead to a reduction of properties on the rental market, that will in turn push rents higher.

RICS forecast that rents in Britain will rise by an average of 4.7% year-on-year for the next five years. This is in comparison to house prices, which are predicted to increase by 4.1%.

However, the RICS survey is not the only investigation pointing at bad news for renters. The most recent HomeLet Rental Index shows that cost of a new tenancy in the private markets in Britain, increased by 4.4% in the three months to May. This was with the exception of Greater London.

Rents set to rise faster than house prices

Rents set to rise faster than house prices

Increases

Rental price growth in Britain was led by Scotland, where rents increased by 10.6% year-on-year. This was followed by rises of 8.3% in the East Midlands. London saw a rise of 6.2%, with rent for new tenancies standing at £1,563.

Martin Totty, chief executive of Barbon Insurance Group, HomeLet’s parent company, observed, ‘the May HomeLet Rental Index continues to show a rental market characterised by steady growth in rents, as the number of tenants looking for property runs ahead of the supply in the market-that remains the picture in most regions of the country.’[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2016/6/rent-price-increases-set-to-outstrip-house-price-growth