Stamp duty could be ‘carrot and stick’ for energy efficiency says climate minister

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Claire Perry, the Energy Minister, has said Stamp Duty could be used as the ‘carrot and stick’ in order to meet targets on climate change laws and cut fuel bills and increase energy efficiency for households reducing carbon emissions.

Stamp Duty rates could be used as incentives or punishment depending on the efficiency of the home.

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Meet the woman showing gender is not a pre-requisite in the construction industry

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Education is key to showing the construction industry is no longer regarded as a ‘man’s job’ – according to a female associate director at Birmingham’s Building Services Design (BSD).

Jo Jones has been promoted to associate director at the mechanical and engineering (M&E) company – the first woman in the business to take on the senior role.

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79% of BTL purchases now in Ltd company names post Section 24

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Mortgages for Business Quarter 3 figures show that post Section 24 mortgage interest relief restrictions for individual purchasers that 79% of Buy to Let purchases by value are now in the name of a Limited Company.

This is up from 73% of purchases in Quarter 2 of this year.

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Splitting a Commercial Property to Sell

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We own a commercial property (2 properties side by side) which is currently split for lease between 3 tenants as follows:

2 downstairs shops/units leased as food outlets (tenants 1 & 2)
1 HMO – all of the upstairs with 9 studios (tenant 3)

Tenant 3 (HMO) would like to buy the upstairs.

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Rogue Landlords Make A Killing from Benefit Tenants, or do they?

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Housing Benefit:

David Lawrenson writes in his LettingFocus.com blog about rogue landlords and how they no longer target the “rent capped” housing benefit tenants, but instead now go for the untraceable immigrant market.

David writes, “I’m a regular subscriber to a newsletter written by Ben Reeve Lewis,” whose job is working as a Tenancy Relations Officer for a local authority.

“Ben really understands the realities of the private rented sector far more than the top local and government politicians do. Like many people at the coalface he will tell you that myriad laws imposed on private landlords will not do a thing without enough enforcement bodies on the ground to go after the rogue landlords who blight our profession, whilst causing misery to their tenant-victims,” writes Mr Lawrenson.

The rogues just ignore all the rules and do their best to stay under the radar. In the absence of enough enforcement at local government level, most continue to get away with it for years, probably forever!

Rogue Landlords making a Killing

In a recent blog post, says David, Ben highlighted a piece form a national newspaper that said some £2.5 billion in housing benefit (HB) goes out every year to landlords running properties in what they term a “non-decent” condition by which they mean properties with inadequate heating, outdated sanitation and serious disrepair such as vermin, dodgy boilers and faulty wiring

Ben remarks how this article piqued his interest. He says, “Given my day job, I’m interested in this. I go into these properties every day but in actual fact, in London, you find that 90% of the crappiest properties aren’t occupied by people on HB at all but by foreign nationals paying cash, usually with no receipts given.”

He remarks that he first noticed rogue landlords swapping over to this market 4 or 5 years back when they evidently realised that benefit claimants meant “people inside the system”, which in turn means documentation and traceability, not to mention people entitled to claim homelessness and approach the council for advice who then could potentially turn into “Witnesses for the Prosecution”.

Ben goes on to say in his blog:

“In the worst areas, the worst properties are occupied by people paying rent to the worst types of landlords and the worst kinds of agents, all too eager to exploit vulnerable people desperately cramming themselves into rooms in order to be able to afford the rents out of their meagre earnings garnered through either cash in hand work (often with the same landlords) and zero hours contracts cleaning hotels for £4 an hour.

“In London, this is the real bad end of the rogue landlord market as people, like Dick Whittington, still think the streets are paved with gold.  I suppose if you are a criminal landlord with a ready supply of migrant workers desperate to just get by – they are.”

Right to Rent

“Our daft government and the top civil servants at County Hall might like to think that the ‘Right to Rent’ controls would deal with this,” says Mr Lawrenson

“But, of course, it won’t, because, as Ben says”:

“The criminals playing the system who don’t give a flying fox about those laws either. They are not ‘ordinary’ landlords who obey the rules! This is organized crime, including people trafficking, not poor Mrs. Moggs from Cheltenham who accidentally let to a turbaned man from Lahore, because she’d once taken a weekend break in La Rochelle and understandably thought they were both in France.”

“Meanwhile, you dear landlord-reader, given that you are reading this, will no doubt be complying with all the laws. You will still be struggling to deal with the multi-pronged tax assaults unleashed on our business by George Osborne.”

“And right now, if you have more than four mortgaged and let properties you may be reading about how the government in the shape of the PRA (part of the Bank of England) has just made it even harder for landlords like you to get finance or even to refinance your existing mortgage loans. The fact that it has got harder for you to get financing or to turn a profit will be part and parcel of the cost of having to comply with all the rules and regulations (many of them overlapping) that now govern our business.

“But the criminal landlord will not have your cost base to worry about because he will not be meeting any regulations. His often illegal tenants will hardly dare complain for fear of being deported by the Border Control people. The chances of him ever being found out are very low because there are so few officers like Ben at the town halls – the councils are hopelessly overstretched. For the criminal landlord, life goes on very happily indeed.

“And meanwhile, you dear good landlord, you will be castigated by the likes of some in the press for supposedly ripping off benefit tenants.

“Yes, it’s a mad world in which the government plays continually to the press gallery, who themselves fail to understand what is actually going on in the real world of the private rented sector.”

David Lawrenson writes his regular blog here: www.lettingfocus.com

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Rogue Landlords Make A Killing from Benefit Tenants, or do they? | LandlordZONE.

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HMO, Council and the Local Government Ombudsman.

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I’m suffering because of my local Council and the Local Government Ombudsman. I’m sure you will find my story shocking!

My case/story:

My treatment from Stevenage Borough Council’s Environmental Department & the LGO has been unfair

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How to get the best insurance for a portfolio of let property

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IF you own more than one let property then you could save money and improve cover by buying a landlord portfolio of insurance.

If you own multiple properties, there are benefits to buying the insurance all together as discounts can be applied that single properties do not attract.

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How buy to let lending has changed

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From 30th September, a regulatory change means that all buy to let mortgage lenders have to adjust the way they underwrite mortgages for landlords with four or more mortgaged rental properties. These landlords will be known as “portfolio landlords”.

The last few years have been a transitional time for buy to let, with the portfolio landlord regulations representing the latest change to the rules governing this sector.

Leeds Building Society explains how buy to let has changed in the last few years.

This article is intended as a summary only and does not constitute legal or financial advice. No reliance should be placed on this guide. We recommend that you seek independent legal advice and/or financial advice if you have any questions or queries.

Stamp duty: April 2016

Before April 2016, Stamp Duty Land Tax (known as stamp duty) was paid as a flat percentage of the price of the property you were buying, as long as the property was worth at least £125,000.

But since April 2016, changes to stamp duty have meant you pay more stamp duty when you’re buying an additional property – which means any property that isn’t your main residence.

This means most buy to let landlords now have to pay higher stamp duty fees when buying their rental properties.

Wear and tear allowance: April 2016

April 2016 also saw changes to wear and tear allowance. Previously, buy to let landlords had been able to deduct 10% of their profits from their tax calculations as “wear and tear allowance”. But the new changes have meant that landlords can only claim back the costs they have actually incurred to replace furnishings, appliances and kitchenware.

For many buy to let landlords, this means a higher tax bill than they would have faced before the change were made.

Prudential Regulation Authority (PRA) affordability standards: January 2017

From January 2017, lenders have had to take into account any tax liability, including tax relief and all property-related costs, when assessing affordability for buy to let.

Because of this, many lenders increased their Interest Coverage Ratios (ICRs) and stress rates, meaning some landlords may find it more difficult to secure new finance.

Mortgage interest tax relief: April 2017

In April 2017, new rules were introduced around mortgage interest tax relief for buy to let landlords. Previously, buy to let landlords could deduct all of their mortgage interest from their profits, which meant they could reduce the amount they were taxed.

But these changes reduce the percentage of mortgage interest that’s tax deductible. It’s happening gradually over the next few years, ending in 2020, when the maximum amount of mortgage interest that can be offset will be 20%.

Portfolio lending: September 2017

On 30th September, mortgage lenders will have to change the way they underwrite buy to let mortgage applications for buy to let landlords with four or more properties. These landlords will become known as “portfolio landlords”.

With these changes, we’re likely to see some lenders stop accepting buy to let applications from portfolio landlords, while others will embrace the changes and tailor their offerings to better meet the needs of this type of borrower.

Portfolio landlords probably won’t notice much difference in the application process. They might be asked for a bit more documentation, and the application process might take a little longer, but the noticeable changes should otherwise be fairly minimal.

Learn more about the upcoming changes for portfolio landlords

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – How buy to let lending has changed | LandlordZONE.

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Warning – no insurance cover on damage if property not let quickly?

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I’ve not been able to find an article on this in the forums.

I have a few properties and I’ve unfortunately had to claim on one or two insurance policies in the past, usually for malicious damage done to them.

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Growing Trend of people living in Vans in Bristol

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The local press in Bristol have picked up on a Gumtree advert offering a parked van to live in for £220 per month.

The advert said the LDV Convoy van (a yellow minibus) comes with all the facilities required for winter living on a city street with a fire burner

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