Posts with tag: tenants

New Welfare System Introduced for More Housing Benefit Tenants

Published On: February 29, 2016 at 3:00 pm

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Every Monday, the Universal Credit scheme is rolled out further across the UK. And today – leap year day – is no different.

If you are not familiar with Universal Credit, it is the Government’s new benefits system that rolls six payments into one monthly payout. This includes housing benefit.

New Welfare System Introduced for More Housing Benefit Tenants

New Welfare System Introduced for More Housing Benefit Tenants

Last week, we reported on some controversy surrounding housing benefit and private tenants; in the London Borough of Hackney, tenant group Digs found just one rental property available to those in receipt of housing benefit. On Saturday, tenants campaigned against No DSS policies that many letting agents and landlords adopt.

If you are a landlord with tenants on housing benefit, be aware that their financial circumstances may have changed recently, or will be subject to change in the near future.

It is vital that you communicate with your tenants on any changes to their finances, to avoid rent arrears. If your tenants do default on the rent, remember that rent guarantee insurance is the best way to ensure you still get paid.

For the areas that have become subject to Universal Credit since the start of the year, see last week’s article: /yet-more-tenants-move-onto-universal-credit/

If you have rental properties in the following areas and rent to housing benefit claimants, they will be moved onto Universal Credit as of today:

  • CB1, CB2, CB3, CB4, CB5, CB6 3, CB7, CB8 0, CB8 7, CB8 8, CB8 9, CB10, CB21, CB22, CB23, CB24 and CB25 in Cambridge.
  • GU3 3, GU4 7, GU12 5, GU15, GU16, GU17, GU18, GU19, GU20, GU21, GU22, GU23, GU24, GU25, GU46, GU47 7 and GU47 8 of Guildford.
  • HU1, HU2, HU3, HU4, HU5, HU6, HU7, HU8, HU9, HU11, HU12, HU13 9, HU16, HU19 and HU20 in Hull.
  • IP28 8 of Ipswich.
  • KT6 4, KT6 5, KT6 6, KT7, KT8, KT9 1, KT10, KT11, KT12, KT13, KT14, KT15, KT16 and KT22 0 in Kingston upon Thames.
  • MK44 2 of Milton Keynes.
  • PE2 6, PE7 3, PE8 6, PE19, PE26 1, PE27, PE28 0, PE28 2, PE28 4, PE28 5, PE28 9 and PE29 in Peterborough.
  • SG7, SG8 0, SG8 5, SG8 6, SG8 7, SG8 8, SG8 9, SG19 2 and SG19 3 of Stevenage.
  • SL4 2, SL5 0, SL5 7 and SL5 9 in Slough.
  • TW12 2, TW15, TW16, TW17, TW18, TW19 and TW20 of Twickenham.

We will keep you updated of the next rollout areas at LandlordNews.co.uk.

Most common struggles faced by landlords revealed

Published On: February 26, 2016 at 10:44 am

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A new investigation has looked at the struggles landlords face and the most common demands put on them by their tenants.

According to the survey conducted by property management specialists London Shared, one-third of buy-to-let landlords said that the full-on nature of the role made it more stressful than they first imagined.

Responsibilities

The research quizzed 500 UK landlords, who noted that the job of being a landlord is far from straightforward. Worryingly, 76% of landlords said that their tenants do not understand their responsibilities as renters. 10% of landlords said they had experienced anxiety problems due to the behaviour of their tenants.

Many landlords said that they are call for 24 hours, with 34% saying that they had received calls in the middle of the night from renters.

Of the landlords questioned, the top five minor issues that they said they have been called out for were:

  • Unblocking the drain (23%)
  • Lost Keys (19%)
  • Turning the heating back on (14%)
  • Changing a light bulb or fuse (13%)
  • Mowing the lawn (7%)

Repairs

Another worrying stat was that 43% of respondents to the survey said they were unsure of their responsibilities when repairing a property.

Just 24% of landlords said they were clear on their legal obligations for adequate HMO licensing and just 18% said they knew they had to apply for a HMO licence.

Additionally, the survey found that landlords spend an average of 11 hours per month managing their rental property. 83% said they spent up to £5,000 per year on property repairs from their rental accommodation.

Most common struggles faced by landlords revealed

Most common struggles faced by landlords revealed

Arrears

A major source of landlords’ stress was underlined by 40% of those questioned saying that they had received their rental payments late. Of those that said that they had received late payments, 18% said they had defaulted on their bills.

When looking further at those that have either had late or missed payments from their tenants, 11% said they were unable to pay off their existing debt. 22% said they had to go to court to reclaim money owed to them by their tenants.

Many landlords were found to be dependent on their rental income to pay off their mortgage, with over half stating this was the case. 23% said they used rental incomes to renovate their homes, while 13% said it paid for their children’s rental fees.

Notices

Some tenants are causing such a problem for their landlords that 24% said they had to serve notice on them. Of those that served noticed, the main reasons for doing so were found to be rent arrears (69%), property damages (44%) and inappropriate behavior (24%). Furthermore, 18% said that they served notice as their tenants sublet the property without consent and 11% after finding out their tenants were using the home for illegal purposes.

Despite it being illegal to live in a property once an eviction warrant is given, 44% of tenants who had been served notice refused to leave. As such, 25% of landlords said that this caused them extra financial stress. 13% of landlords admitted that they wished their rental property was managed by somebody else!

 

Attempt to Have Right to Rent Rollout Postponed is Defeated

Published On: February 26, 2016 at 9:52 am

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Earlier this week, we reported that two members of the House of Lords were attempting to have the UK rollout of the Right to Rent scheme postponed, believing that there was not sufficient evidence to prove that the scheme was effective.

It has now emerged, after debate, that their bid was defeated.

The peers expressed many concerns over Right to Rent and the proposed introduction of criminal penalties for those that do not comply with the rules.

Liberal Democrat peer Baroness Hamwee claimed that the Government had pledged to not introduce excessive administration through the scheme.

She said: “I do not think that that would resonate with the letting agent whom I heard interviewed on Radio 4’s You and Your programme. What he said was: ‘I have become an immigration officer’.

“Indeed, he has become an immigration officer who is liable to civil penalties and who, under the current Bill, will face criminal sanctions.”

At present, landlords or their letting agents must conduct immigration status checks on all prospective adult tenants. If they do not comply with the law, they will face civil penalties under the Immigration Act 2014. However, the new Immigration Bill – currently going through Parliament – seeks to impose criminal sanctions.

Attempt to Have Right to Rent Rollout Postponed is Defeated

Attempt to Have Right to Rent Rollout Postponed is Defeated

Baroness Hamwee continued: “Landlords have to make reasonable inquiries as to the immigration status of all the occupants before letting a property. Well, it is not actually that easy.

“I have been through the material on the Home Office website. The user guide is 39 pages long and there are 12 hyperlinks – there may be more, I may have miscounted – plus a code of practice, plus a short guide. There are 25 types of document which may show immigration status, more if there has been a name change.”

She explained: “These have to be examined and copied. And not all of them are invalid if the expiry date has lapsed. A checking agent on the same programme said that there are 400 documents in the EU that would support the right to rent. Leaving aside unfamiliar documents, how easy is it to spot fakes?”

The full debate can be read here: http://www.publications.parliament.uk/pa/ld201516/ldhansrd/text/160224-0002.htm#16022460000396

Meanwhile, Open Democracy has reported that the Right to Rent scheme is causing discrimination against individuals with every right to live in England, including British citizens.

It highlighted two cases:

  • In the first, Tony and Mary are a British couple of Chinese descent, with a close relative and her baby son – also British – staying with them. The landlord informed the couple that he could be fined if they did not provide the passport and immigration status of the baby, despite Right to Rent only concerning adults.
  • In the second case, Sara is an Australian citizen married to a French citizen, working in the UK. She left her husband and searched for rental accommodation. The letting agent told her that they could not go ahead with the tenancy, as they were not satisfied that Sara has the right to rent – as the wife of a French citizen, she does.

The study on the Open Democracy website states that people like Tony, Mary and Sara are the real victims of the scheme, and not those it intends to target.

It also questions whether illegal immigrants discovered through Right to Rent checks will actually leave the country. This has also been highlighted after it emerged that landlords do not need to report illegal immigrants to the Home Office if they discover them through immigration checks.

Open Democracy claims: “It appears more likely that they [illegal immigrants] will resort to unscrupulous landlords, therefore eliminating the underground business of exploitative landlords that the Government purports to want to deter.

“Another category of people who risk resorting to these landlords are those in limbo: those who do not have the right to rent, for example, because they overstayed their visa, but who are not removable, for instance, because they have a pending application to stay in the UK based on human rights grounds.

“If they are not allowed to rent, yet also non-removable, this group risks either resorting to unscrupulous landlords or applying for local authority accommodation. This will be especially true of parents of British children, which the local authorities have an obligation to accommodate.”

The story concludes: “The scheme will, therefore, not only struggle to meet its aims, but also risks increasing the workload of local authorities, and therefore constitutes an additional burden on their limited resources.”

The whole piece is here: https://www.opendemocracy.net/5050/nath-gbikpi/britain-s-disqualified-adults-no-passport-equals-no-home

Controversy surrounding the Right to Rent scheme has been rife recently, with one case regarding Ryanair supposedly weakening the enforcement of the scheme and shocking statistics that reveal that many landlords still don’t understand their obligations under Right to Rent.

We will keep you all informed of any changes to the law and offer advice for landlords on all lettings issues.

Generation Rent Launches List of Letting Agent Fees in London

Published On: February 25, 2016 at 12:23 pm

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Tenant lobby group Generation Rent has created a new website to help London tenants find the best letting agent in their area.

The organisation has researched letting agent fees in the London boroughs of Croydon, Ealing, Tower Hamlets and Waltham Forest. It hopes that by publishing the fees, tenants will save themselves potentially hundreds of pounds, and letting agents may bring their costs down.

Generation Rent Launches List of Letting Agent Fees in London

Generation Rent Launches List of Letting Agent Fees in London

The list of local letting agents in these areas and the fees they charge to tenants can be found here: http://lettingfees.co.uk

Since May 2015, letting agents have been required to publish details of the fees they charge to tenants and landlords on their website and in a prominent position in each branch.

Generation Rent has revealed that about one in four have not complied with this law and has reported them to their local councils to investigate.

Using volunteers, the body has been able to compile a comprehensive list of the typical fees from local letting agents.

Waltham Forest Renters was the first group to help Generation Rent, by investigating fees in the area in June. In the northeast borough, rents have increased by a third in the last two years and demand appears to have encouraged agents to charge the highest average tenant fee for the typical two-person household (out of the four boroughs) at £489.

Ealing was the cheapest on average, at £374.

Tower Hamlets has both the most expensive letting agent and the cheapest. The priciest, Skampi, charges £900 per couple, while Tabiner imposes a cost of just £40.

As competition for rental properties is very fierce, it can sometimes be impossible to choose a letting agent. However, Generation Rent hopes that by releasing this information, tenants will be able to avoid the rogues.

And the Government believes that this transparency will bring letting agent fees down. If it does, Generation Rent will update the figures on its site. Tenants can also report an incorrect fee.

Meanwhile, the group is working alongside volunteers in 13 other local council areas in England and the site is set to be updated soon. If you wish to research letting agent fees in your own area, you can register on the website here: http://lettingfees.co.uk/explore/

Supply of rental accommodation slips further

Published On: February 25, 2016 at 11:51 am

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A worrying new investigation by the Association of Residential Letting Agents suggests that the supply of rental accommodation is at its lowest level since records began.

What’s more, demand for accommodation was up slightly in January.

Decline

Supply of rental accommodation slips further

Supply of rental accommodation slips further

After months of steady decline, January saw the number of properties registered per letting agent branch slip by 5%. The total currently stands at 172 properties, down by 10 on December 2015.

However, renters north of the border have much more choice, with 280 properties registered per member branch in Scotland. In London however, demand for property is being driven up by lack of supply, with just 116 properties available per registered branch.

Rising demand

Demand for rental property rose in January, following a lull in December. One average, 31 would-be tenants registered per member branch during the last month. This is still lower than in January 2015, when 38 tenants were registered per branch.

Growing demand was underlined by the number of agents reporting rent hikes in January. 30% reported a rise in rental values, the largest since September 2015.

‘Supply of housing continues to be a problem and tenants bear the brunt of this with more people competing for properties at higher prices,’ noted David Cox, managing director of ARLA. ‘The majority of tenants find that it is impossible to save very much at the end of the month to put towards buying their own home. Our recent Cost of Renting report found that a fifth of those renting in the UK do not expect to ever be able to afford to buy a home and unless we act soon to build more properties, this number will only get higher,’ he continued.[1]

Reforms

The upcoming stamp duty changes on buy-to-let and second residential homes is causing concern in the sector. 63% of ARLA members believe the Chancellor’s reforms will drive landlords out of the market. This in turn will lesson supply still further, with 58% of ARLA members believing that reforms will also push up rental costs.

Mr Cox went on to say, ‘a few weeks into the new-year and the April deadline for the stamp duty surcharge is looming and interest from buyers looking to invest in buy-to-let properties and beat the deadline is ramping up. The final details of the new tax will be revealed at the Budget in March but we are not expecting to see the Government back down on this policy.’[1]

‘The findings from our members echo our concerns that efforts to penalise buy-to-let will ultimately impact those entering and currently in the rental market, as by increasing rents landlords will seek to recoup their costs. Rent costs are already rising exponentially and tenants are feeling the strain of a crowded marketplace. We just need more houses; it’s a simple as that,’ he concluded. [1]

[1] http://www.propertyreporter.co.uk/landlords/where-have-all-the-rental-properties-gone.html

 

 

Tenants prefer short-term lease agreements

Published On: February 25, 2016 at 10:13 am

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New research has revealed that nearly four out of five tenants would like a rental lease that lasts between six months and two years.

Further data from the report by online letting agent PropertyLetByUs.com shows just one in five tenants preferred leases of between two and five years.

Just over half of tenants said that they hoped to move further up the rental ladder when they could afford to do so.

Homely

The survey found that the majority of tenants want their rental accommodation to feel like home, even if they are letting for a short period. 60% of tenants said they would like to redecorate their property and over 50% said they wanted to alter the carpets or flooring.

23% of tenants expressed their desire to install decking, 18% wanted to install a hot water tub and 13% wished for a patio.

‘Clearly tenants don’t want long leases,’ observed Jane Morris, Managing Director of PropertyLetByUs. ‘For many, longer than two years does not give them the freedom and flexibility they need. They may find a job, then move on to another one, start out living with friends and then want to move in with a partner. However, landlords like longer leases-they get charged fees each time their agent needs to find new tenants. Landlords can save money by using an online lettings agent instead of a high street lettings agent.’[1]

Tenants prefer short-term lease agreements

Tenants prefer short-term lease agreements

Aspirations

Morris said that her company’s research, ‘shows that many tenants do aspire to owning their own home and a large proportion of them want to redecorate their rental accommodation.’ She feels, ‘this can cause a major headache for landlords, with many facing redecorated properties at the back end of the lease, with no prior approval secured by the tenant. The latest Tenant Deposit Scheme report shows that redecoration is a major cause of dispute, taking 32% of the share.’[1]

‘We have seen properties with walls painted in bright colours, despite landlords specifying that the décor must be a neutral and standard lettings property colours, from off-whites and beige to magnolia,’ she continued. ‘One tenant decided to decorate the whole house black and white; removed all the carpets/lino downstairs and upstairs; and painted all the floors/ceilings/kitchen/bathroom tiles in a beautiful shade of black! She did keep the walls white. Another tenant chose a dark burgundy for all the walls, throughout the property.’[1]

Inspections

Concluding, Morris said, ‘even when a tenant repaints in the correct or authorised colour scheme, there are still problems. We have seen instances of bad paint application, patchy walls, paint spills on carpets, curtains, fixtures and fittings, all of which the tenants will be responsible for at the end of the tenancy.’[1]

She stresses that, ‘it is vital that landlords carry out mid-term property inspections and ensure the inventory and check-in stipulates the colour and quality of the decoration. If tenants do want to decorate, they should be given colour swatches to choose from and clear instructions on what can be painted and how.’[1]

[1] http://www.propertyreporter.co.uk/landlords/majority-of-tenants-want-short-term-leases.html