TDS Foundation awards £94k towards improving PRS

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The Charitable Foundation of TDS deposit protection scheme made £94,054.94 in awards in latest round of funding. It hopes to break £500k in total by the next round of funding

The TDS Charitable Foundation awarded over £94,000 to organisations to advance education on housing rights and obligations in the PRS.

Now in its ninth round of funding in four years, the Foundation’s awards were split among ten organisations and charities across England.

The Foundation was established by Tenancy Deposit Scheme (TDS) to raise standards through education in the private rented sector.

Projects being awarded funding include:
• Easton and Lawrence Hill Neighbourhood Management
• Community Links Bromley
• South Hams Citizens Advice Bureau
• Father Hudson’s Society
• Centre for Sustainable
• Firvale Community Hub
• Living Options Devon
• Newcastle City Council (Private Rented Service)
• Avon and Bristol Law Centre (ABLC)
• Ealing Equality Council

To date, it has provided over £400k in funding support for organisations across England and Wales and hopes to top the half million-pound mark in its next round of funding.

Prof. Martin Partington CBE QC, Chairman of The TDS Charitable Foundation, said: “We’re proud to support the ten initiatives receiving awards. The PRS is often difficult to navigate but the projects we’re supporting will go somewhere to make sure that both landlords and tenants across the country know their rights and responsibilities.

“The TDS Charitable Foundation goes right to the heart of the private rented market, with grants aimed directly at benefitting tenants and landlords in communities across England and Wales.

“Applications from similar organisations for our next round of funding will be close on 4 October 2017 and we’d encourage any organisation or charity that educates and informs tenants, landlords or agents to apply.”

Organisations wishing to apply for support must submit their bids by 5pm on Wednesday 4th October 2017.

Further information on the application process and criteria are available here: http://bit.ly/TDS_Char

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If not me then who?

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If I do not continue to let out homes as a result of section 24 who will provide the housing?

Are there other options for renters aside from council and social options?

I am Intrigued to know if there are any other groups, aside from private landlords in the market as I have never come across them.

Posted with a genuine interest in who else is providing rental accommodation.

Many thanks

Richard

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Welfare Reform Week – Your chance to feedback to DWP on Universal Credit

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Caridon Landlord Solutions are pleased to announce that we are partnering with Property118 to bring to our readers Welfare Reform Week.

Throughout this week we will be providing free online advice to landlord’s with tenants that are in receipt of benefit’s covering various topics from:

• Housing Benefit overpayments
• Housing Benefit Suspensions to Universal Credit direct payments
• Universal Credit delay in payments

This will give landlord’s alike the opportunity to share their issues that they have faced both past and present and receive online immediate advice from an expert.

We understand that landlords main issue at present is dealing with the major flaws with the Department of Work and Pension’s (DWP) Universal Credit System.

This is your chance to feedback via Caridon Landlord Solutions straight to the DWP.

Please use the comments section below to express your experiences and thoughts regarding Universal Credit and its effect on the Private Rental Sector.

With the information raised we will provide feedback to DWP presenting the different scenerios requesting answers.

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Borrowing request hits brick wall?

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After some advice, as have been a bit naive and hit a brick wall. I am looking to borrow more money against a property which has some equity in it, but is not due for remortgage yet.

My thinking is that I’d like to have some money available should an opportunity come up to invest and if I can’t find anything that I have additional money in case I need it as a liquidity buffer. I would invest the money in peer-to-peer to help cover the interest.

However, having applied I have been asked for the mortgage offer on a property I haven’t found yet. I’d appreciate people’s thoughts on whether I should reapply for a different use and if so what’s acceptable i.e could I say I would put the money in peer-to-peer? Or that I would spend it on property repairs?

I don’t see the point in continuing on the basis of a property investment until I find a place to buy as I’d incur survey fees etc.

However, I’d really like to hold the money rather than the bank having my equity particularly as interest rates look like they will rise.

Many thanks

Richard

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ARLA confirms landlords ‘rough ride’ is being passed on to tenants

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The Latest figures from the ARLA Propertymark report shows that in August agents reported 35% of landlords increasing rental costs to tenants. This figure has risen from 27% last year and is the highest figure since July 2015 at 37%.

This compares to only 2% of tenants who were able to achieve a rent reduction.

Demand from new tenants looking to rent per ARLA member letting agents increased to 72 per branch and the average number of properties landlords were looking to sell per branch was 3 out of an average 189 properties per branch.

ARLA Propertymark chief executive, David Cox, said: “This month’s findings paint another bleak picture for tenants. In November last year, only 16% of agents saw landlords increasing rent costs, but that figure now stands at 35%, which is likely to continue rising.

“Landlords have had a rough ride at the hands of policy changes at government level, and it’s becoming clear that these additional costs are now being passed onto tenants.”

Please see the graph below and for the full ARLA report please Click Here

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Tenant running out on utility bills

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I rented my property and once the tenant moved out she left owing nearly £700 in utility bills.

She contacted the gas company and said she was just renting a room from me and that I was responsible for the bills.

This of course wasn’t true, this has gone on for over 2 years, she has disappeared and I’m pretty sure she will do the same again as I have found out she had done the same at a property prior to renting mine.

What can I do?

Many thanks

Stuart

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Mezzanine Finance – a solution for building homes outside the big corporates

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The UK housing shortage will not be successfully addressed if we rely entirely on the major house builders. This is the view that was expressed by the government housing White Paper at the beginning of the year, which recognised both the importance of creating a diverse construction sector and the significant contribution that can be made by the development of smaller sites.

Securing the appropriate funding will be key in determining whether small developers are able to step up to the challenge and take advantage of this opportunity and, for many, achieving the right leverage at the right price will be the main consideration.

Conventional senior debt development finance was traditionally limited to around 50% gross development value (GDV), but it is now possible to secure finance up to 70% GDV with some specialist providers. This is known as stretch-senior debt and, while it offers greater leverage, it is also more expensive than senior debt.

An alternative to stretch senior is to split the financing into two layers of debt instead of one.  The first layer, the senior, can be structured conservatively at low cost, often by a large bank.  On top of this senior layer sits a strip of mezzanine debt from a specialist provider in a second charge, subordinated position.

In isolation mezzanine finance, or “mezz”, looks expensive, but when it is blended with a bigger chunk of cheap senior debt, the overall cost can be lower than a stretch senior deal can achieve.

There is more work in assembling and managing a structured solution that includes mezz, but for some developers it can provide a cheaper way of securing increased leverage on their schemes.

If you are a developer and would like to discuss how you could use mezzanine finance on your next development, please complete the contact form below and we will be happy to help.

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Student Rents remain static says new report…

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Student Landlords:

A new report highlights static accommodation costs across England in the wake of rising student debt.

An annual report (1) into student accommodation, compiled by Glide Utilities, the student utilities and service provider, has found that private student rent has remained at an average of £100 – £119 a week, for the second year running.

The news comes as a respite for students, who face increasing debts, with the Institute for Fiscal Studies (IFS) last month reporting that students in England are likely to graduate with debts just shy of £60,000. (2) The fourth annual ‘What Students Seek’ report found that 20% of students don’t envisage paying off their loans, a number that is dramatically out of sync with the IFS, which forecasted that three quarters of students will never be able to pay off their loans.

Accommodation represents the second biggest spend for students during their studies following fees. The What Students Seek report found that 72% of students pay between £80 and £139 per week. University locality creates some variance with 15% of London students paying over £200 a week, and 69% of students in the North East paying less than £90 a week.

Almost half, 45%, of students surveyed said their accommodation offers good value for money, but 36% disagree, suggesting that while rents remain static, landlords need to understand students better to attract and retain the best tenants; a growing concern given the continued increase of modern student developments on the market. (3)

The annual What Students Seek report uncovers what students look for when it comes to their accommodation to reveal common themes that could help landlords improve the market appeal of their HMO property.

Key insights from the 2017 report:

Less is more: On average students live with four other people, with 39% sharing with five people or more. However, when asked how many people they’d ideally like to live with, almost half, 48%, indicated they’d like to share with just two or fewer people in their next property.

Switch off the TV:  It appears that a television is not going to sway students into renting a property. The majority, 60%, rated having a TV as the least important factor when choosing accommodation. After cost, a fast broadband connection is by far the most important factor for students, followed by good storage space, bills inclusive and double beds.

Management: The majority of students are positive when it comes to the way their property is managed; 57% shared this view. However, almost a quarter, 23%, felt negatively citing the following top issues to be causing problems:

Lack of response on maintenance issues, (37%)

Poor upkeep of the property, (30%)

Lack of communication, (28%)

Bills included: Three quarters of students said that having bills included in their rent was either essential or quite important when considering a property, making this an easy fix for landlords and letting agents in attracting tenants.

Incentives: One in 20 students said they had been given either a cash or non-cash incentive for taking their current property. Although very low, 2% said they had been taken out for a drink by their landlord

The report also revealed the best university cities for landlords to invest in, based on overall tenant satisfaction ratings and annual yield. (4) Although there are great investment opportunities across the UK, university cities in the North East consistently rate highly for both annual yield and tenant satisfaction, with properties in Middlesbrough providing a 16.1% annual yield4 and 82% satisfaction rating. Durham and Sunderland followed close behind while on the other end of the scale, London rated lowest with just a 2.7% annual yield and 76% satisfaction rating.

Outside of accommodation needs, the report also pointed to a decline of the infamous student social life. When asked how respondents funded their social life, almost one in five, (17%) admitted that they didn’t have one.  Despite this over a third still rated the proximity to bars and clubs as an important factor when choosing accommodation.

James Villarreal, CEO at Glide Utilities said of the 2017 What Students Seek Report; “It’s good news for students that private rental costs remain static, especially since the price of living in Halls of Residence continue to rise. However, it’s very likely that costs will rise moving forward as the ban of tenant fees will inevitably get passed through to the price of the rent., therefore landlords and agents can offer students greater value for money  by offering bills included and ensuring that properties are well maintained and efficiently managed”

What Students Seek was commissioned in April and May 2017 by Glide Utilities. 722 students responded to the report via www.accommodationforstudents.com, the UK’s leading student accommodation website. The full report can be downloaded here.

1. Results taken from a survey of 722 students in April and May 2017 as well as year-on-year data obtained from previous surveys and focus groups conducted by AFS.
2. From a report by the Institute of Fiscal Studies, July 2017
3. In May 2017 the property advisory group, JLL, predicted that 2017 would see a higher amount of investment in the student housing market.
4. Average annual yield research taken from the Rightmove House price data, May 2017 and the Student accommodation rent report 2016 (Accommodation for Students). Average weekly rent multiplied by 3 tenants, multiplied by 52. The average annual income divided by average property price, multiplied by 100. Full report available upon request.

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Tenants saved by existing landlord in fake landlord scam

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A fake landlord used Facebook to copy and paste property details and pictures from a rental listing on Rightmove and scammed prospective tenants from Plymouth out of £1,200.

Jenny Foster-Mitchell, who was taken in by the imposter, reported to the local paper The Herald (click here to see article) saying:

“The house was listed at £600 per calendar month including bills. It looked perfect. We got in touch at the end of August by commenting on the post.

“We didn’t get a reply straight away so we sent a direct message to the landlord on Facebook asking for more details. We got a message back giving us more details and letting us know that pets were welcome in the house, which was perfect for us.”

When Jenny asked to view the property she was told the agents had the keys, but she could go and visit the property with her partner to look at from the outside

Jenny said: “She (the imposter) said we could go and have a look at it through the windows to see if it was what we wanted. “We went and had a look at it and it was exactly the same as the photos.

“We were very keen to find somewhere new and we liked it so we were happy to go ahead with it. We were sent a tenancy agreement which we completed and sent back. Everything seemed normal.”

Jenny and her partner agreed to pay one month’s rent and one month’s deposit in advance to secure the property.

However the imposter then got greedy and asked Jenny to pay £400 for maintenance before they move in.

Jenny reported: “I was thinking, we shouldn’t have to pay for maintenance, and this was even written into the tenancy agreement we had signed, but then she threatened to add the bills to the monthly rent so we agreed.

“At this point we were getting wary, but we were so desperate to get out. We had made all of the other payments through online bank transfer, but this time she wanted us to use MoneyGram.

“We did attempt to make the £400 maintenance payment but MoneyGram wouldn’t release it, thank god, until I spoke to them to confirm the details.

“Shortly after this, we decided to search for the property and came across it on Rightmove. That is when it all unravelled.

Jenny contacted Martin & Co the listing agent who confirmed that the name of the fake landlord they had been dealing with did not match the name that they had.

“We confronted the woman (imposter) and she said that she didn’t like not being trusted and then blocked us.”

However, after giving notice on their existing property the current landlord came to the rescue.

“Thankfully our current landlord allowed us to retract our notice. They have been brilliant throughout this ordeal and have really helped us.”

Director at Martin & Co, Chris Whitaker told The Herald: “In this particular instance, we were made aware by the victim of this ‘scam’ and that some of our marketing images had been extracted from our website and used without consent on Facebook by an individual purporting to be the landlord.

“We immediately recommended that the tenant contact the police to report the incident and have also sought to identify other potential options to support the victim in finding alternative accommodation. Unfortunately this type of property scam is becoming increasingly common throughout Devon.

“Our advice to all potential tenants is to be extremely cautious when it comes to passing money to unregulated agents or landlords who are able to act anonymously and with relative impunity through various internet sites and online forums.

“Tenants should instead seek to use regulated agents who are members of the Association of Residential Letting Agents and members of a government approved Client Money Protection scheme.”

A lesson for due dilligence, but a partial good news story in the end.

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NLA Budget recommendations

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Ahead of the Chancellor’s next budget on the 22nd of November the National Landlords Association (NLA) has made representation to HM Treasury focusing on support for investment in the Private Rental Sector (PRS) and implementation of the Homelessness Reduction Act.

The summary of the recommendations are:

1) Embark on an immediate review of the removal of finance cost relief for private landlords

2) Introduce a package of Capital Gains Tax reduction measures to encourage the sale of:

• Poorly performing investment properties.
• Properties where the proceeds of the sale will be entirely reinvested into the lettings business.
• Properties invested in, and utilised, for a period of more than 10 years.
• Properties that are eligible and suitable for sale to existing tenants.

3) Introduce measures to facilitate the tax-efficient movement of a letting portfolio into a corporate structure.

4) Establish a government-backed investment vehicle to allow the sale of properties into a managed fund.

5) Reintroduce the Landlords’ Energy Saving Allowance (LESA), and establish a level sufficient to improve the tax efficiency of carrying out relevant works.

6) Set LESA at a level sufficient to improve the tax efficiency of carrying out works

7) Fund the expansion of Help to Rent nationwide

8) Establish a national deposit guarantee scheme for the private rented sector

9) Remove the Capital Gains Tax surcharge for property sales

10) Introduce Capital Gains Tax tapering and business asset rollover relief for private residential property which is let.

11) Abolish the Stamp Duty Land Tax levy on additional property

To download the full NLA Budget submission to the Treasury please Click Here

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