Tenants to sue landlords for unsafe properties

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Breaking News – Housing Safety:

Secretary of State for Housing Sajid Javid Sunday (14 January) has confirmed government support for new legislation that will enable tenants to take direct action against their landlords to help ensure that rented homes are safe. Tenants will be given the right to take legal action when landlords fail in their duties.

The government has already been introducing a range of measures and powers for local authorities which will enable them to crack down on the minority of landlords who rent out unsafe or substandard accommodation – the rogue landlords.

This measure include local councils being able to fine failing landlords up to £30,000 and from April this year councils will also be able to issue banning orders to “kick the worst offenders out of the business”.

However says Sajid Javid, “public safety is paramount which is why government will support further measures proposed by Karen Buck MP in a Private Members Bill to protect tenants in both the social and private rented sectors”.

This will give tenants another route to take direction action and take their landlords to court if their landlord don’t ensure their property is fit for human habitation at the beginning of the tenancy and throughout.

Housing Secretary Sajid Javid said:

“Everyone deserves a decent and safe place to live. Councils already have wide-ranging powers to crack down on the minority of landlords who rent out unsafe and substandard accommodation.

“However, public safety is paramount and I am determined to do everything possible to protect tenants. That is why government will support new legislation that requires all landlords to ensure properties are safe and give tenants the right to take legal action if landlords fail in their duties.”

More information here

Commons Library briefing paper here

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The UK’s Fourth Largest City Packs a Property Punch

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Sheffield Property: 

Located in the middle of the UK within the South Yorkshire region, Sheffield has plenty on offer. Known as the ‘steel city’, Sheffield has grown to become England’s fourth-largest city. The city’s ever-increasing inhabitants and population of over 635,000, have pushed house prices up and increased housing demand. As a UK buy-to-let hotspot, Sheffield has been widely identified amongst property professionals as an area that will experience continued growth and remain a city popular amongst students.

So what makes Sheffield the perfect city for property investment? Here’s 5 reasons why the city should be on your radar:

 Property Market

Sheffield city centre has one of the highest rental yields of any British city and consistently ranks within the top 10 property hotspots. The average price of a flat in Sheffield rose by 20% from £117,831 in 2016 to £141,484 in 2017 (home.co.uk). The increasing demand for flats required by students and graduates provides a great opportunity for investors. This demand is driven not just by students and graduates, but also those relocating from more expensive areas, like Leeds and Manchester.

 Northern Powerhouse

As one of Britain’s ‘Northern Powerhouse’ cities, Sheffield is a prime position for inward investment. In 2015, the Government agreed to invest £30 million a year into the city for the next 30 years, giving the city the power to allocate new funding towards boosting local growth and investing further into manufacturing and innovation. It is projected that this vast amount of investment will influence property prices throughout Sheffield and position the city on an upward curve for years to come.

 Economy

Sheffield City Region’s economy has an output of more than £30 billion pounds per year and is home to approximately 52,000 businesses which have created and sustained approximately 700,000 jobs. A recent report released by the Centre for Economic and Business Research found that the city’s economy is set to become £80m larger by the end of 2017. The UK Powerhouse report predicts that the value of goods and services produced in Sheffield will grow by 0.7% during 2017 despite the challenges of Brexit.

 Connectivity

Sheffield station, a combined railway and tram station, runs frequent services to London St Pancras. The journey currently takes 2 hours however, this is expected to be reduced to just over an hour when the HS2 construction project is completed. It is proposed that HS2 will run from London to Birmingham, then on to Manchester and Leeds calling at Sheffield; which would reduce the journey time from London. The journey time to Leeds and Manchester will also be less than half an hour. The station’s annual footfall is over 9 million passengers providing access to destinations up and down the UK.

Student Population

The University of Sheffield and Sheffield Hallam University combined attract over 60,000 students to the city every year, including many from the Far East. The two universities are highly regarded, with The University of Sheffield rising to 21st in The Times University Guide 2018 – a ranking that highlights the University’s strong performance in providing graduates to leading employers.

Regency Residential is a multi-faceted company that has a strong focus on high-yield investment opportunities, whilst offering residential services. We provide clients with our expertise in both the private rented sector (PRS) and residential markets, imparting our advice to aid you in making key decisions at every stage of each purchase process.

Regency Residential’s offering is distinctive, in that we offer secure stand-alone investment property in the UK and international markets. We are able to provide this distinct product as our parent company and developer, MCR Property Group is backed by substantial private trusts and funds.

www.regencyresidential.co.uk

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Evicting tenant’s girlfriend?

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I had a tenant who appears to have left the property three months ago, at least that’s when he stopped paying rent or answering his phone.

The house is still occupied by a woman who wasn’t on the original tenancy and I assume she’s his girlfriend.

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Average Rents rose by just 0.7% in 2017

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Rent Increases 2017:

A recent report published by Rightmove shows that rents across the nation, but excluding London, rose by just 0.7% in 2017.

This is a much slower rate of increase that the industry has experienced over recent years and compared to the rises in 2015 (+3.7%) and 2016 (+3.0%), it’s at a snail’s pace.

Cumulatively, over the last three years, the Rightmove figures show that rents have increased, on average across the country, by 7.6%. With that rate of increase equating to over £50 per month for the average renter, and with wage increases largely stagnating, a slower pace of increase is hardly surprising.

On the other hand, the good news for London landlords is that new rental properties coming to market in London are seeing rising rents again, the first increase in the annual rate of growth since the start of 2016.

This uplift in London comes after a market readjusting following an unsustainable annual rise of 8% recorded in 2014. The subsequent fall in London is put down largely to stamp duty increases on high end properties and a surge in rental supply in 2016 from landlords rushing to buy-up properties ahead of the 3% stamp duty surcharge on second homes, after April 2016.

The overall regional trend is masking some of the key commuter areas in the South East that continue to perform strongly, with Farnham in Surrey coming top for rental price growth in 2017, up 9% on 2016.

Rightmove Director and housing market analyst Miles Shipside says:

“Nationally rents have been holding pretty steady over 2017, retaining the 3% plus rises seen in both 2015 and 2016, and adding a more modest 0.7% in the last twelve months. Increasingly stretched tenant affordability, and the surge of buy-to-let property supply beating the stamp duty tax hike deadline, have acted together to mute landlord pricing power.

“In contrast, after a few years of falling rents in London they’re back on the up again, due to a combination of tightening stock available to rent and strong demand.

“While the 2017/2018 tax year will see the start of the government’s changes to tax relief on buy-to-let mortgages, we don’t think this first phase will have that much of an effect on many landlords’ portfolio decisions until another year down the line.

“From speaking to some landlords they’re unlikely to make any decisions to sell up until they see in real-time how much of an impact it has on their finances, with many choosing to take a wait and see view rather than looking at short-term gains or losses.

“However, agents report that there are some highly-geared landlords with large loans looking to reduce their exposure to loss of tax relief by cashing in and selling some properties.”

The National Picture

Image by Rightmove

Rightmove Summary: Pace of annual rent rises now lowest since 2014

• 7% annual rate of increase in national asking rents (excluding London) in 2017, the lowest since 2014
• Asking rents in London ended the year 1.2% higher than at the end of 2016, the first time the annual rate in the capital has been in positive territory in nearly two years
• South East and Yorkshire and the Humber are the only two regions to end 2017 with asking rents down, while the North East saw rents rising at the highest rate, up 3.3% on 2016
• Farnham in Surrey recorded the highest rental growth outside London at 9% in 2017, followed by Corby in Northamptonshire, up 8.2%

Government Statistics

Relevant figures produce by the Office of National Statistics (ONS) show:

• Private rental prices paid by tenants in Great Britain rose by 1.4% in the 12 months to November 2017; this is down from 1.5% in October 2017.
• In England, private rental prices grew by 1.4%, Wales also saw growth of 1.4% while Scotland saw rental prices increase by 0.2% in the 12 months to November 2017.
• London private rental prices grew by 0.6% in the 12 months to November 2017, that is, 0.8 percentage points below the Great Britain 12-month growth rate.

Index of Private Housing Rental Prices, Great Britain: November 2017

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Are Ltd companies excluded from SLDT relief for 1st Property?

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My client has just set up a new Ltd Co with which they wish to buy and manage several rental properties.
They are using a new solicitor to do the conveyancing who is supposed to be an expert in Ltd companies and  buy to let’s.

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20% of landlords plan on selling up

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The National Landlords Association’s (NLA) latest research shows that 20% of its members plan to reduce the number of properties in their portfolio in the next year – the highest level of intended property sales in 10 years.

The NLA believes this is due to recent tax changes

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New EPC rules set To upset the PRS as well as me!

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From April 2018, landlords of privately rented domestic and non-domestic property in England or Wales must ensure that their properties reach at least an Energy Performance Certificate (EPC) rating of E before granting a new tenancy to new or existing tenants.

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Letting fees ban on hold until at least Spring 2019

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Breaking News – Letting Fees:

The newly renamed “Ministry of Housing, Communities and Local Government” (MHCLG) headed by Sajid Javid has confirmed that a letting fees ban will not come into force before the Spring of next year.

In written communicate to the Select Committee hearings, currently scrutinising the draft legislation, and also to the National Approved Letting Scheme (NALS), MHCLG has said that it will be at least 15 months before any lettings fee bad can be introduced.

The draft legislation, which was introduced by Sajid Javid last November, was given a rough ride by industry representatives at the hearing Monday. It will now go proceed to a third reading in the House of Commons before moving to the Lords.

MPs heard on Monday from the University of York’s Centre for Housing Policy and Shelter that a letting fees ban could easily lead to higher rents when the equivalent of the fees is added to tenants’ rents, spread out over the length of each tenancy.  The fear was also expressed that such a ban could result in the reduction of the quality of rented accommodation, as landlords react by “tightened their purse strings”.

Isobel Thomson, CEO of NALS told The Negotiator industry journal:

“We’re pleased to see more clarity on the timetable for implementation of the ban – it’s much needed for our industry and something NALS has long called for.

“While the Bill aims to create a fairer and safer PRS for all, NALS doesn’t believe this will deliver what the government aspires to and risks doing real damage to the PRS.

“NALS urges government to use this time to fully assess the impact of the Bill. It is crucial that government look again at the proposals and consider tenant fees in a broader, coherent framework of regulation for the PRS.

However, ppeaking in response to the announcement James Davis, founder of online letting agent Upad.co.uk and himself a portfolio landlord, commented:

“Ever since the proposed ban on charging upfront fees to tenants was announced in the 2016 Autumn Statement, there’s been an air of ‘will they?  won’t they?’, not to mention, the ‘when will they?’.

“Whilst today’s announcement that it’s unlikely to be implemented before the Spring of 2019 provides a certain level of clarity, the fact remains that there are still many mixed messages around this move.  Indeed, some within the industry still believe it’s likely to come in to effect before the end of this year.

“Landlords, however, simply can’t afford to not be prepared for what lies ahead.  In my experience, there’s a certain amount of ‘head in the sand’ mentality around the impact that this ban could have, both amongst letting agents and landlords.

“Unfortunately, many headlines focus on how rents will increase once this legislation is implemented but the reality for landlords is that this needn’t be the case.  Most private landlords don’t, in fact, charge excessive upfront costs and by simply taking the time now to consider how else they can manage their costs, they’ll be assured of being prepared for the fees ban, whether that happens, this year, next year or indeed at all.”

A petition opposing the ban can be accessed here:  https://petition.parliament.uk/petitions/206569

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Do we need to pay SDLT changing to tenants in common?

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I am quite confused with SDLT tax. Here is our situation,

My wife and I own two buy to let properties (50:50 split joint tenant) at the moment. I am thinking of changing to tenants in common with 99:1 split.

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Blighted as a landlord after major claim?

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After a pipe leak caused a £130k claim (not quite yet settled) I find myself unable to find tenanted insurance. The letting agent insists on landlord insurance and my obligation to provide it is written into their standard tenancy agreements.

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