DWP Helpline for landlord clarification

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I have noticed that there are a few articles floating around the landlord community regarding a new landlord helpline for landlords that have tenants on Universal Credit.

In one article it states “The new number 0345 600 4272 can be used by landlords who are unable to obtain the tenant’s co-operation to get DWP to supply information when it comes to enquiries about major payments – such as a direct payment to the landlord.”

I would like to clarify that the number that has been provided is the Universal Credit full service number which has always been in use, the number is not specific to landlords and can be used by both claimants and landlords who need assistance.

If the landlord wishes to discuss a new APA that has recently been submitted the landlord still requires “explicit consent” from the tenant to discuss the claim.

Landlords can use this number to discuss existing APAs that are already been put in place as consent has already been provided by the claimant in order for the APA to be set up.

DWP issued new guidance on Universal Credit via the gov.uk website on 4th August 2017, for more information please follow this link

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Financial Planning / Tax Advice needed

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Dear all,

I am a landlord with 3 rental properties that all earn a reasonable profit (and therefore tax). The properties are jointly in my name and my wifes.

I am currently employed but my wife has recently decided to take a 1-2 year (maybe longer) break to look after our children.

In addition, I have just accepted a job in Atlanta, USA and we will be re-locating in January for approximately 2 years.

I have always done my own tax returns as up until now it’s been relatively straight foward. However, I feel now that I need professional advice to minimise my tax liability.

What I’m mainly considering is whether now is a good time to pass ownership of the properties to my wife as she will not be earning an income. I’m open to other ideas/strategies!

Can anyone point me in the right direction of who / how I can get help?

Many thanks!

Mike D

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Generation Rent Finally Provide Some Useful Info

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A few us of secretly signed up to receive Generation Rent emails some time ago, mainly to stay abreast of their latest propaganda.

However, they now appear be inadvertently giving us insight into the best places to invest for both rental and capital growth. Apparently, all we need to do is find out where Waitrose would like to open stores in the future, buy there and watch the money pour in.

Below is the email they recently sent out.

We look forward to reading your comments.

Here’s the extract from the Generation Rent update email ….

If Waitrose opens a new store in your local area, it could mean different things: job opportunities with a well-regarded employer, extra choice for your weekly shop – or, if you’re a renter, an eviction notice through the door.

Oxford academic David Adler has pored over eviction data from the Ministry of Justice and opening dates of Waitrose branches between 2005 and 2015. In a paper, published by Generation Rent, he found that areas see an increase in no fault evictions of between 25 and 50% when they get a new store.

He links this to rising house prices. Waitrose tends to open up in areas that are getting wealthier – i.e. through higher house prices. The presence of a Waitrose then attracts wealthier people into the area, which pushes up house prices further. Some landlords respond to rising property values by selling up, or finding tenants who can afford a higher rent – and that involves turfing out their current tenants.

It would be unfair to blame this phenomenon on Waitrose, but it does illustrate the impact of gentrification for private renters, when we have so little security over our homes. Renters shouldn’t face a forced move just because their neighbourhood is becoming more fashionable.

It’s another reason why we’re campaigning to end Section 21, the law that gives landlords the ability to evict tenants with no reason – and no grounds for appeal. If landlords are supposed to be in business for the long haul, the law should not make it so easy to evict someone who is upholding their side of the agreement.

We’re proposing restrictions and a penalty to deter landlords from evicting blameless tenants, giving tenants greater stability and a financial safety net if they are forced to move.

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Court refusing CCJ registration upon eviction?

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My local County Court is being difficult in respect of registering a £4k CCJ for a s8 eviction, see email trail below, am I missing anything or did anything wrong???

[me] “We have still not received payment for the attached order for possession. Can you please issue a CCJ judgement against the defendants and confirm when it has been done.”

[Court] “The order does not contain a court judgment to register. You have an order for arrears of rent which can be enforced and at this point the order will be registered.”

[me] “Sorry I don’t fully understand, for clarification are you saying you have now registered this judgement against their name as the have still not paid?”

[Court] “For clarification the court is saying there is no County Court Judgment to register.”

[me] “I am surprised as in the past when tenants were evicted they had a CCJ placed against their name for the arrears. What is the court process to have a CCJ marker against their name for this case to safeguard future landlords/lenders? Does the defendant really get away 100% scott-free, which is highly unfair?”….

I’m awaiting a reply!

Nathan

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Announcing the Landlord Law / Property118 Legal Update series 2017

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Summer is a time for holidays and relaxation. I think it is also a good time to stop and take stock and bring yourself up to date.

There have been a lot of legal changes for landlords and letting agents over the past year – with more to come. To help, I have got together with Property118 to provide this series of articles to bring you up to date. It is aimed at anyone who is a private sector landlord, letting agent, advisor or who works in the PRS in some other way.

Why keeping up to date is essential

For years things have chugged along in the private rented sector, not changing that much – maybe a new legal case from time to time, but no major changes.

However, over the past couple of years there have been a number of massive changes in the law affecting the private rented sector.  It has been a bit of a roller coaster – leaving many landlords worried and confused.

For example, new rules have come in for deposits and section 21 notices, right to rent penalties now include criminal proceedings and Local Authorities have acquired draconian new powers of enforcement.

Local Authorities and others

The main reason why Local Authorities have in the past done little enforcement work is lack of funds. But this is about to change. New Local Authority enforcement powers which came into force in April this year include the right to impose penalty charges and make rent repayment orders and are almost certainly going to be used – as Local Authorities get to keep the money.

This will then allow them to step up their enforcement work, funded by this new income stream.

It’s not just fear of fines though which should make you worry. Tenants are becoming more aware of their legal rights, and Judges are becoming increasingly picky when deciding whether or not to grant possession orders.

So it behoves landlords to know and understand the law – and comply with it!

This Summer Legal Update Series

Over the next couple of weeks, I will be looking at the most important areas of law which landlords need to know about and giving a quick overview.  I will also be giving you links to places where you can find more information.

The series will kick off on Monday, and my first post will be on deposits.

Tessa Shepperson is a specialist landlord & tenant lawyer and runs the popular Landlord Law online information service.

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Landlords turning to holiday lets

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Airbnb Lets:

Large numbers of private rented properties in London are being let on a “holiday let” basis, many in contravention of the 90 day planning rule, using Airbnb to find “tenants”. The trend means fewer properties are available for those wanting long-term lets reports the Residential Landlords Association (RLA).

New research in London carried out by the RLA finds that there has been a 75 per cent increase in the number of landlords listing more than one propriety on Airbnb between February 2016 and March 2017.

The research has also uncovered evidence that the number of whole properties and rooms advertised on Airbnb in London, available for more than 90 nights a year in contravention of the holiday let planning rules, has increased by 23% between February 2016 and March 2017.

Outside of London a similar trend is emerging. The RLA survey of almost 1,500 landlords found that 7 per cent reported that they were now offering properties as holiday/short term lets through Airbnb or a similar advertising platform.

Previously, all these properties would have been available to let longer term in the private rented sector. If this trend is reflected across the whole sector, it would mean a minimum of 134,400 private rented homes moving from the traditional private rental (PRS) market to holiday or short let accommodation.

The reason given for the move to short-term letting by 36 per cent pf landlord surveyed was that the recently introduced tax changes to mortgage interest relief had forced them into it.

The new rules mean that landlords are now being taxed on their income instead of their profit and tax relief in only applied at the basic rate of income tax. One landlord who has made the move to holiday lets told the RLA:

“I didn’t want to do this, but the tax changes have forced me down this route. Selling is not an option due to CGT, and this iniquitous tax which is effectively retrospective is unjust in that my buy to lets are a business, just like any other. There will be less properties available to rent as a result of this tax.”

The RLA is calling on the Government to end the perverse incentive landlords have to move to holiday lets by scrapping the mortgage interest relief changes.

RLA Policy Director, David Smith, commented:

“With London and the country as a whole in desperate need of new homes to rent in the long term, it is crazy that recent tax changes encourage landlords to move to the short term holiday let market.

“What we need is a tax system that encourages investment in homes to rent for the long term by good landlords.

“By skewing the market Government policy will serve only to hit the hardest those young people and families who most need a growing private rented sector to meet their needs.”

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Estate Agent Property Bingo sweeping the nation

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A nationwide game of Property Bingo has been triggered by a comedian and former estate agent’s witty new glossary for beleaguered property seekers

Glossary translates infamous go-to estate agent lingo into what it means in real life

Property Bingo card available to download from https://twitter.com/PrivilegeUK @PrivilegeUK

Comedian and former estate agent, Nick Page, has released a new ‘Estate Agent Glossary’ for Privilege Home Insurance.

The glossary contains 15 key phrases, and debunks the difference between what estate agents say, and what they really mean, using Page’s unique perspective.

The new list has triggered a game of Property Bingo, where players are challenged to see how many of the phrases in Page’s glossary they have heard an estate agent say, or how many they have seen written in a property’s write-up.

Property Bingo is available to download via https://twitter.com/PrivilegeUK with players encouraged to share their scores online using the hash tag #propertybingo.

Estate Agent Glossary

Source: Privilege Home Insurance

 Property Bingo – Play for Yourself

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TDS simplifies busiest day of the year

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With the annual busiest day for end of tenancies approaching, the country’s leading deposit protection provider TDS has launched a new guide to make the process of concluding a lease easier for tenants, landlords and agents.

TDS expects the third Thursday in September (21^st September) to be the busiest period for tenancies coming to an end. The date has been calculated from the peak day over the last ten years. Last year, the third Thursday in September TDS saw 18,000 tenancies coming to an end, compared to the average of 1,300 and 2017 is looking to follow suit.

The downloadable guide gives the latest advice on what to do when a tenant is due to move out of a property, in particular highlighting the key points to address before, during, and after a check-out inspection.

The guide also gives advice on the best approach for negotiating the return of the deposit and promotes the use the new deposit deduction template, recently developed by TDS, to hasten an early agreement.

Michael Morgan, director of dispute resolution at TDS, said: “We see many disputes where a few simple steps taken before the end of the tenancy could avoid problems later on. Tools like our new guide and the deposit deduction template provide a solid structure and basis for end of tenancy procedures and to improve deduction negotiations. If tenants better understand the reasons for deductions at an early stage and can see the justification for them, they are much more likely to agree.”

Steve Harriott, TDS chief executive added: “This is great guidance for members and their tenants – and another great example of the work being done by TDS to reduce disputes and improve practices for dealing with tenancy deposits.”

• Peak day over 13 times busier than normal
• New guide makes end of tenancies easier for landlords, agents and tenants

TDS’ new guidance is available to download: Click Here

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7% of landlords report using Airbnb or similar short term lets

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A survey of 1,500 landlords across the UK conducted by the RLA showed that 7% are now using Airbnb or similar sites to offer their properties as short term of holiday lets.

The RLA concluded from these figures that if this trend was consistent throughout the whole PRS then potentially 134,400 homes have been taken out of the housing stock as main residences.

The RLA are connecting this trend to Section 24 mortgage interest relief restrictions increasing the tax burden of offering Buy to Let property on long term ASTs. In fact 36% of the respondents offering short term or holiday lets said that Section 24 was the direct cause.

One landlord offering properties on Airbnb commented in the survey, ““I didn’t want to do this, but the tax changes have forced me down this route. Selling is not an option due to CGT, and this iniquitous tax which is effectively retrospective is unjust in that my buy to lets are a business, just like any other. There will be less properties available to rent as a result of this tax.”

The shift to using Airbnb and other types of short term let is particularly acute in London with a 75% increase in the number of multi-listings (more than one listing per individual) on Airbnb between February 2016 and March 2017.

David Smith, RLA Policy Director said: “With London and the country as a whole in desperate need of new homes to rent in the long term, it is crazy that recent tax changes encourage landlords to move to the short term holiday let market.

“What we need is a tax system that encourages investment in homes to rent for the long term by good landlords.

“By skewing the market Government policy will serve only to hit the hardest those young people and families who most need a growing private rented sector to meet their needs.”

The RLA along with Property118 and Axe The Tenant Tax are calling on the Government to end the perverse incentive landlords have to move to holiday lets by scrapping the mortgage interest relief changes.

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Now see the other side of the coin – tenant wrecks house…

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Tenants from Hell:

There’s been a lot of talk in the media recently about rogue landlords and how they house their tenants in appalling conditions, and landlords “raking in the money” for doing next to nothing. What we rarely hear about these days is the other side of the coin: the tenants that cause landlords sleepless nights, lots of stress and worry and a big hole in their pocket.

Liverpool landlord Steve Parry, 55, a surveyor, had invested in two rental properties in his home town, hoping the two would rent out to provide him with a comfortable income for his retirement, as he told the Liverpool Echo he does not have a big workplace pension.

But Parry claims he has ‘not made a bean’ after ‘the living nightmare’ he has gone through with this tenant family.

The shocking photos at his Wavertree property, published in the paper, show just what a trail of destruction was left behind by his “tenant from hell” – a wrecked kitchen, flooded bathroom and bags of dog mess left around.

The pictures show internal doors smashed in, piles of rubbish in the sink, cupboards torn off and a ceiling that collapsed after a flood in the bathroom, which brought down the ceiling below, and the landlord believes this was deliberate.

The female tenant had refused to leave the property for months even after the landlord had served notice and gone to court, and Parry claims he ended up losing more than £2,000 in unpaid rent, £1,500 in court fees and at least £6,000 of damage to the home.

Parry decided he had to evict the tenant and her children in 2015 after she had fallen behind with rent. And despite the tenant signing a tenancy agreement which didn’t allow pets, a large dog, which the landlord claims had scratched several floors, and ‘petrified’ him when he went round.

“The house was wrecked – it’s shocking. She had failed to sort the rent out despite numerous promises, so I gave her two months’ notice to quit.

“I was then forced to serve two notices on her, which cost £200 each and she ignored. I had to get an order for possession in court, which I only got in the November.

“She was supposed to vacate by December 13, but despite everything I let her remain on agreement she would leave after the New Year,” said Parry

“But she refused to move – saying she was looking for a new house. I had no choice but to pay for court bailiffs. She was finally removed this April.”

Parry said the experience has put him off taking on tenants reliant on benefits to pay rent, though he admitted it was unfair on most decent housing benefit tenants.

Mr Parry said that many other landlords were also turning their backs on this type of tenant, partly as the income is less reliable after welfare reforms put tenants in charge of managing their money.

He told the Echo:

“Most people are good people, but you get a few rotten apples. I can see it causing problems for 99% of people who aren’t like that.

“People assume you’re loaded as a landlord, but I haven’t made a bean I’ve had that many problems. All I’m hoping is the house value will be more than I bought them for.”

Mr Parry noted that politicians had rightly started cracking down on bad landlords, but called for more action to protect good landlords from problem tenants.

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