Should I get a new 12 month tenancy agreement signed?

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My 12 month tenancy is coming to an end once again. Last time it ended one of the tenants moved out and the other remained (moving a partner in, under a re-signed agreement). A new agreement was drawn up and any changes within the new agreement were initialed by the remaining tenant

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Should I get a new 12 month tenancy agreement signed?

admin    Uncategorized     agents

My 12 month tenancy is coming to an end once again. Last time it ended one of the tenants moved out and the other remained (moving a partner in, under a re-signed agreement). A new agreement was drawn up and any changes within the new agreement were initialed by the remaining tenant

The post Should I get a new 12 month tenancy agreement signed? appeared first on Property118.

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Should I buy a third buy to let?

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I currently have 2 buy to let flats in Reading. Each brings in £9800 per annum. I have a total of £125000 mortgage lending on these and they have a value of £410000. I work earning £21,900 and have a pension of £18800.

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Shadow Housing Minister urges crackdown on rogue landlords

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Labour to lean on landlords:

Labour’s shadow housing minister, John Healey, on visit to Walsall, has been urging councillors to clampdown on rogue landlords. He says that these rogue landlords are housing thousands of tenants in squalid conditions.

Stating that the West Midlands is one of the worst parts of the country for poor quality private rented homes, with one-quarter of homes not properly fit for people to live in, Mr Healy said tenants’ health is being put at risk by faulty electrical wiring, chronic damp and vermin infestations.

Praising the borough council for its efforts to force unscrupulous landlords to improve conditions in their properties, he said:

“It is a major problem everywhere, but the West Midlands has a bigger problem than most other places when it comes to private rented homes that are not up to scratch.

“There are too many tenants who just can’t get their landlords to do what they should. In fact, one in four private rented homes don’t even qualify as being fit for human habitation.

“I’m talking about properties with faulty electrical wiring that can cause a fire, condensation or damp, they’ve got vermin infestations. All of these things can be hazardous to health and to life.

“Labour is leading legislation that we have now got the Government to back, to give tenants the legal right to take their landlord to court if they don’t make necessary improvements.

“But in the meantime, people need a council like Walsall to step in and lean on landlords that aren’t doing the job.”

During the visit Mr Healey met with Walsall Council leader Sean Coughlan to discuss new plans for a licensing scheme for private landlords in the town.

Mr Healey said:

“All credit to the council for putting this in place. It shouldn’t be needed, but it is, and if that is what it takes to get some private landlords to pull their fingers out then it must be a good thing.

“Without a clampdown on the worst landlords, people are at the mercy of living in conditions that no one should have to put up with.”

Walsall council says its team of housing standards officers will advise tenants and landlords to help them meet their legal obligations. They will inspect premises to ensure safety regulations are met, particularly in homes in multiple occupation (HMOs).

Elsewhere, Labour’s Jeremy Corbyn has committed to introducing rent controls when it next forms a government:

“We will control rents – when the younger generation’s housing costs are three times more than those of their grandparents; that is not sustainable. Rent controls exist in many cities across the world and I want our cities to have those powers too and tenants to have those protections”, Mr Corbyn has said.

Labour is also considering using powers to forcing landowners into giving up land sites for a fraction of their current market value in what it says will slash the cost of council house building.

John Healey has already drawn up a proposal which would see a Jeremy Corbyn-led government change the law so that landowners would be forced to sell their land at confiscatory prices. Ordinarily, one hectare of agricultural land worth around £20,000 would be worth nearly £2m when planning permission for house building is achieved.

Image – Walsall town centre

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Shadow Housing Minister urges crackdown on rogue landlords | LandlordZONE.

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Fair or unfair landlord treatment – We’re OUT!

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It’s an absolute Joke – Unfair and UNJUST LEGISLATION on the Private Sector. The same as the Deposit Protection Service – I had £2,000 of repairs to address burned / damaged carpets / Ripped wallpaper / cleaning / etc.

All the carpets were brand new as was the wallpaper.

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Space efficient plumbing strategy for 5 showers?

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I’m in the process of converting a 2 bed terraced house into a 5 bed student, all with ensuite shower rooms.

I have kicked off an enquiry with Western Power to look at upgrading the electricity supply to a 3 phase supply which will give me enough capacity for 4 electric showers plus an additional shower fed from a combi boiler.

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Home building Stand-off with Government as BTL falls

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The Berkeley Group, one of the UK’s largest home builders, has said that despite government pressure it is unable to ramp up house production.

Prime Minister Theresa May has told builders to “do their duty to Britain” and that she wanted “to see planning permissions going to people who are actually going to build houses

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Client Money Protection to be mandatory soon…

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Client Money Protection (CMP):

Key provisions relating to Client Money Protection, as published by the government in February, will come into force soon, allowing the secretary of state to pass the necessary regulations.

Although the exact details of when and how the system will work are yet to be confirmed, Tim Frome, Associate Director at Hamilton Fraser, administrator for an existing scheme called Client Money Protect (CMP), says regulation is imminent and letting agents, relocation agents, and property managers in England may be required to join an approved CMP scheme as early as April 2018.

Mr Frome comments:

“After being heavily involved in the two consultations to date, I am delighted that the Government appears to be following Scotland and Wales in moving quickly to make membership of a client money protection scheme compulsory for letting agents in England.

“With key provisions in place, the groundwork has been laid for CMP regulations to be introduced, the details of which are likely to be unveiled in April when most regulations appear.”

Membership of a Client Money Protection scheme protects the money of landlords and tenants against theft or misappropriation by the owners of a letting agent whilst it is in their custody. This could include monies such as tenants’ deposits and landlords’ rental payments, or funds held for repairs and maintenance to a property.

Agents who are already a member of a trade body or association such as NALS or ARLA Propertymark will already have Client Money Protection in place, but for those SME letting agents who are not, Client Money Protection is also currently just optional. It is already a legal requirement for letting agents in England to display whether they are a member of a client money protection scheme or not.

However, mandatory Client Money Protection for all letting agents has now moved a step closer with Lord Palmer of Childs Hill, who co-chaired the consultation committee alongside Labour’s Baroness Hayter, stating:

“I am delighted to say that Government is committed to making membership of a CMP scheme mandatory, based on the review which I co-chaired. I expect the regulations to be finalised and released very shortly.”

It is likely there will be a couple of approved CMP schemes for agents who don’t already have cover to choose from, and failure to join a scheme is likely to be enforced by financial penalties which will be levied by local authorities or trading standards.

About Client Money Protect:

Client Money Protect (CMP) is a client money protection Membership designed to protect client money held by Property Agents and Professionals. The Member’s clients are protected in the event that the Member misappropriates the client money held in the course of running their business.

Client Money Protect is a trading name of CM Protect Limited.
CM Protect Limited is a subsidiary of and an Introducer Appointed Representative of HFIS plc. who are authorised and regulated by the Financial Conduct Authority.

CMP is currently the only client money protection membership scheme in the UK that agents can join without having to become a member of a trade body.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Client Money Protection to be mandatory soon… | LandlordZONE.

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Tax hikes slow house-building claims Berkeley Group

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Landlord Tax:

A major house builder has blamed, in part, recent tax increases on private landlords as a reason for not increasing its house-building.

Berkeley Group said today that a fall in demand by domestic buy-to-let landlords was one of a number of reasons why it would be impossible to boost housing supply, beyond its current plans.

It cited especially the decision to restrict mortgage interest relief to the basic rate of income tax and the 3 per cent stamp duty levy on the purchase of new homes to rent out. It noted the importance of supporting landlords who, it said, “buy early in the cycle and provide security of cash flow to enable complex, capital intensive developments to be brought forward.”

It comes at the end of a week in which the Office for Budget Responsibility warned of “subdued growth in residential investment.”

Recent research by the Residential Landlord Association’s research exchange, PEARL, has found that of the almost 3,300 landlords responding to its survey, 69 per cent said that the stamp duty levy, introduced in 2016, is putting them off investing in further rental property.

David Smith, Policy Director for the RLA, said:

“We have long warned the Government of the dangers of its tax raid on the private rented sector. Now we see its impact, with investment in new homes slowing and house builders not confident to up their levels of house building.

“Rather than taxing new homes, it is time for smarter, pro-growth taxation that recognises the rental market as a crucial part of addressing the housing crisis.”

The Residential Landlords Association: The home for landlords

The RLA represents the interests of landlords in the private rented sector across England and Wales. We’re home to over 50,000 landlords nationwide, with a combined portfolio of over a quarter of a million properties. A growing community of landlords who trust and rely on us to deliver day-to-day support, expert advice, government campaigning, plus a range of high-quality services relevant to their needs.

A statement by Berkeley Group today states:

“The market conditions in London and the South East are unchanged from the first half with home movers and downsizers continuing to be constrained by high transaction costs, the 4.5x income multiple limit on mortgage borrowing and prevailing economic uncertainty.

“In addition, domestic buy-to-let investors, who buy early in the cycle and provide security of cash flow to enable complex, capital intensive developments to be brought forward, are further impacted by additional transaction costs and the removal of interest deductibility.

“These factors, together with the changing planning environment and the time and complexity of getting on site following planning approval, mean that Berkeley is currently unable to increase production beyond the business plan levels.”

The Office of Budget Responsibility has published its latest Economic and Fiscal Outlook. It can be accessed at: http://cdn.obr.uk/EFO-MaRch_2018.pdf   Page 67 notes:

“Real residential investment rose by 7.8 per cent in 2017, up from 7.6 per cent in 2016. In line with our forecasts for house prices and property transactions, we expect relatively subdued growth in residential investment over the forecast period. Housebuilding is expected to slow in the near term, reflecting subdued turnover in the housing market and modestly higher interest rates.

“Housebuilding is then expected to rise as housing market turnover picks up. Housing improvements are also expected to slow in the near term thanks to recent weakness in real wages, before picking up as real earnings growth picks up. Over the medium term, residential investment is expected to grow broadly in line with real GDP.”

RLA PEARL’s report, The Impact of Taxation Reform on Private Landlords, is available at: https://research.rla.org.uk/wp-content/uploads/impact-taxation-reform-landlords-2018.pdf   It surveyed almost 3,300 landlords, of which 69% said that the decision to impose a three per cent stamp duty levy on the purchase of new homes to rent in 2016 is putting them off investing in further rental property.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Tax hikes slow house-building claims Berkeley Group | LandlordZONE.

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Section 21 no-fault possession claims down nearly 5000

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Landlord Action responds to latest MoJ statistics:

The latest landlord possession figures released by The Ministry of Justice (MoJ) show that the number of accelerated possession cases (section 21 no-fault eviction) are on a downward trend, with nearly 5000 fewer cases in 2017 than in 2016.

Paul Shamplina, founder of Landlord Action, believes this could be attributed mostly to changes introduced as part of the Deregulation Act 2015, but says it is likely to increase again as the impact of changes to tax liabilities take hold.

Annual volumes of possession actions in 2017 have all decreased from 2016¹; claims are down 3%, orders down 6%, warrants down 5% and repossessions down 12%.

Interestingly, the volume of claims brought by social and private landlords under the standard procedure have remained stable, showing only marginal decline from 2016, down 1.4% and 5.4% respectively.

Whereas accelerated possession cases, which had previously followed a moderate upward trend since 2010 before peaking in 2015 (at 37,663), saw a 13.7% drop in 2017 to 29,611 from 34,303 in 2016².

The accelerated possession procedure, or Section 21 no-fault eviction as it is often referred to, enables orders to be made by the court solely on the basis of written evidence and without calling the parties to a hearing.

Despite the majority of cases handled by Landlord Action being as a result of rent arrears (73%³), many landlords choose to use accelerated possession procedure (61%⁴), even though they forfeit the opportunity to recover outstanding rental money, because it can be a faster way of recovering the property so that it can be re-let.

However, Paul Shamplina says that new legislation has made the accelerated procedure increasingly challenging to use and not always quicker as it relies on several conditions being met.

Paul points out that a lot of landlords are still unaware of their obligations under the Deregulation Act, which came into force in October 2015, and this is delaying or hindering landlords’ chances to use the accelerated procedure.

Mr Shamplina’s comments:

“In a number of recent cases, we’ve found that landlords have not provided tenants with an Energy Performance Certificate and a Gas Safety Certificate before the tenancy began, or they did not protect their tenant’s deposit, all of which are legal requirements in order to serve a section 21 notice. By the time landlords come to us, the relationship with the tenant has usually broken down making it harder to gain access to the property and deal with these issues, meaning the landlord can’t use a section 21.”

According to the MoJ, in October to December 2017, accelerated landlord possession cases took 7.3 weeks to progress from claim to order, compared with private landlord cases which took 8.2 weeks.

However, from claim to possession warrant, accelerated and private landlord cases took 15.9 and 14.4 weeks respectively and from claim to repossession by county court bailiff, accelerated cases took on average 23.1 weeks while private landlords took 21.8 weeks.

“The term ‘accelerated’ is not really an appropriate name for this procedure, as the statistics show, it is not actually quicker any more.  Despite this, I predict we will see another rise in use of the accelerated possession procedure over the next couple of years as more landlords are forced to sell of properties off the back of rising interest rates and increased tax liabilities” adds Mr Shamplina.

¹ Ministry of Justice Landlord and Mortgage Possession Statistics (October -December 2017)

²

³ 24 out of 33 landlords which used Landlord Action’s services was as a result of rent arrears

⁴ 20 out of 33 landlords which used Landlord Action’s services used no-fault Section 21 accelerated possession procedure

Landlord Action is a UK based organisation helping landlords, letting agents and other property professionals. As a champion for landlords, it has campaigned extensively and was instrumental in getting the law changed to make squatting a criminal offence.

It was founded in 1999 as the first ever fixed-fee tenant eviction specialist, they revolutionised this area of legal practice. They have now acted in more than 35,000 problem tenant cases and are considered the authority in this field.

Paul Shamplina is one of the key founders of Landlord Action with 25 years experience in the legal field. He has previously worked as a legal clerk, private investigator, debt collector and certified bailiff.

www.LandlordAction.co.uk

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