Claims that Section 21 is leading to homelessness plain wrong, says NLA

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Section 21:

The Section 21 possession process is set to be abolished
amid claims that it is a leading cause of homelessness. Negative publicity
surrounding no-fault evictions has long blamed the rise in homelessness on
Section 21 evictions, and this has been a major plank in the government’s
argument that accelerated possession needs to be abolished.

The National Landlords Association (NLA) however says claims that landlords’ use of the section 21 “no fault� eviction notices is the leading cause of homelessness in the UK are “factually incorrect, misleading and just plain wrong�, and it says it is taking the landlords’ case to direct to No. 10.

Research carried out by the landlords’ membership
organisation, representing 41,000 UK landlords, using the Government’s own
statistics*, found that of 33,020 households assessed by local authorities
between October and December 2018, just 11.8 percent (3,890) of those faced
homelessness as a result of being served with a Section 21 notice.

The data shows that the main reason why people become
homeless is that they have been living with relatives who decide they are no
longer willing or able to accommodate them, claims the NLA.  

Rent arrears comes high up on the scale of reasons why
tenants are evicted and become homeless, with around 29% of tenancies ending in
this way. Otherwise, the second most common reason is when a tenancy comes to
an end, including tenancies that are ended using the fault-based Section 8
process, and also when tenants abandon the property.

Previous research**, says the NLA, finds that landlords
resort to Section 21 primarily when their tenants fall into rent arrears or engage
in antisocial behaviour.

Richard Lambert, CEO of the NLA, says:

“Claims by the Government and tenant support groups that
Section 21 is the leading cause of homelessness are not supported by the
available evidence. They are factually incorrect, misleading and just plain
wrong. No reasonable landlord would seek to evict a tenant without good cause.

“Most evictions are a symptom of wider issues, such as the
freeze on local housing allowance, insecure jobs, and the lack of support for
vulnerable tenants to sustain private tenancies successfully.  The increase in the use of no-fault evictions
through Section 21 is because landlords simply don’t have faith in the courts
being able to deal with eviction cases, however justified their reason.

“That’s why we’re appealing directly to the Prime Minister
to save section 21. Landlords are running businesses and have very few options
when it comes to managing the risks they face. The focus should instead be on
fixing the issues that contribute to this risk.â€� 

*MHCLG Initial
Assessments of Statutory Homelessness Duties Owned

**Research conducted
by YouGov Plc on behalf of the NLA. Total sample size was 3,088 Landlords in
England and Wales. Fieldwork was undertaken between 21st – 27th December
2018.  The survey was carried out online.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Claims that Section 21 is leading to homelessness plain wrong, says NLA | LandlordZONE.

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Tax Planning Bodge Jobs – Limited Liability Partnerships “LLP’s”

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This is VITAL INFORMATION that all landlords need to know. Please share.

Whilst LLP’s are one of the most popular structures we recommend to landlords, the purpose of this article is to serve as a warning that some advisers are mis-selling the benefits of them.

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Tax Planning Bodge Jobs – inter company lending

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Having shared a Tax Planning case study on Facebook recently I have been amazed at how many landlords have bodged their tax planning in regards to lending money from their trading company to their property company.

The problem with such a structure is that in the event of the trading company failing

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Landlord points that should have been included by Panorama

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Yesterday I made the TV Video for The Good Estate Agent. The points that Landlords felt should have been included in the Panorama Programme were most definitely included in this video which is to be shown, uncut, on You Tube and takes 90 minutes.

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Conservative’s home ownership drive likely to bring pain for renters

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Home ownership:

It has long been Conservative Party policy to encourage home
ownership, as exemplified by the 1980s Thatcher government’s council house
sell-off.

For those with a real stake in society, a financial
commitment made by providing their own roof over their heads, and with mortgage
payments to meet every month, it means that on balance, not only will people
resist going on strike, they will likely vote Conservative.

The problem is – and this is the government’s conundrum – that
in today’s society, where asset (house) prices have hit the roof due to Quantitative
Easing (QE) and ultra-low interest rates, and where young people in particular
have come to value the flexibility of renting, discouraging landlords has
consequences.

An anti-landlord policy – extolled by successive governments
since George Osborne, and now possibly being accelerated by this new government
– has consequences not just for landlords but for those millions of tenants who
for various reasons have come to expect to rent, in some cases for the rest of
their lives.

Like any product in today’s society, people expect to have
it (Housing) at a competitive price. If prices become distorted through lack of
supply due to legislative measures (landlord taxation and regulations), or through
rent controls, as Labour is advocating, then expect trouble ahead.  

According to the RICS, landlord instructions are continuing
to fall across the national lettings market, worryingly at a time when short
term expectations for renting are on the rise. The result, as in any market
when supply falls, rising rents, a situation which will inevitably mean calls
for rent regulation.

The RICS headline tenant demand indicator (quarterly
seasonally adjusted data) has picked-up further, posting its highest level
since late 2016. Landlord instructions to letting agents at the same time have
fallen once again, extending a run of continuous decline going back over thirteen
quarters.

So, in the short-term, at a time when house sales are stagnant
at best, rent price growth expectations are being driven up. The government, it
would appear, is betting on the growth in institutional investment through
build-to-rent, expecting this to plug the gap in housing supply, thus stabilising
housing and renting prices.

RICS has said:

“…the lettings market data continues to send a very strong
message that institutions need to upscale their build to rent pipeline to
address the shortfall resulting from the decline in appetite from buy to let
investors. It is significant that the near-term rental expectations indicator
has climbed to a three-year high.”

David Smith, Policy Director the Residential Landlords
Association, has said:

“These figures demonstrate yet again that hitting the
private rented sector to boost homeownership serves only to hurt tenants.
Demand from tenants and new buyers is increasing at the same time. It is vital
that the needs of both groups are met.

“The Government needs to stop making landlords the scapegoat
for the housing crisis and embark on a raft of pro-growth measures to boost the
supply of homes for the private rented sector. If they do not, supply will
continue to fall, meaning higher rents, less choice, and a reduction in quality
for tenants.�

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Conservative’s home ownership drive likely to bring pain for renters | LandlordZONE.

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Getting a buy to let mortgage with bad credit

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Don’t let your poor credit history stop you investing in a rental property. Find out what to consider when thinking about applying for a buy to let mortgage

Don’t let your bad credit stop you becoming a landlord

If you’ve had adverse credit in the past you might think
that you’ll find it impossible to get a buy to let mortgage to purchase a
rental property.

However, there are bad credit buy to let mortgages out
there. You just need to understand where to find them and how you can get one. You
also need to understand the pros and cons of becoming a landlord, particularly
if you’ve had financial problems in the past.

Whether your poor credit history is due to a previous
property repossession, bankruptcy, or defaults on loans or credit cards, once
you’re more secure financially, investing in a rental property could help you
to continue your financial recovery.

The benefits of investing in a rental property

Historically investing property has been a winner. Property
prices have tended to rise and even when crashes have occurred, values tend to
rise again. Clearly there are no guarantees, but, as a long-term investment,
property is a relatively safe option for most people.

Investing in a rental property means that not only do you
gain an asset, but your tenants will be paying your mortgage for you. On top of
this the rental level should be enough to also provide additional income for
you.

The possible risks of investing in a rental property

As outlined above, as a long-term investment property
is pretty secure. However, if you want to access funds quickly and the property
market is in a downturn you may not be able to recoup your investment.

It can also be trickier to sell a property with tenants than
it is to sell a vacant property, depending on the tenancy agreement, as you’ll
need to talk to your tenants before the sale and agree the way forward. With
sitting tenants, it is much more difficult, in all likelihood you will be
restricted to selling to another landlord.

The benefits of owning a rental property as an investment
and source of income obviously only kick in if you can find tenants. Without a
rental income coming in you may struggle to cover your mortgage repayments.
Missed mortgage repayments have a very strong negative impact on your credit
history, something you should avoid at any time, but especially as you try to
improve your credit file.

How to make it work

There are some steps you can take when considering what
property to buy which can help make the most of your investment.

1. Is it the right time for you?

It’s great that you’re considering this route when you’ve had financial difficulties in the past, but it’s also doubly important that you are certain that you are now back on-track financially.

2. Be realistic

Buying a doer-upper to let out seems like an excellent way to maximise your investment. After all you can buy (relatively) cheaply and then charge more rent for a newly renovated property. However, do you have the funds to carry out any necessary repairs or renovations? Or if you’re planning to do the work yourself, do you have the skills and time?

3. Keep being realistic

Talking of time and skills, have you thought about what
being a landlord will mean? You’ll need to find and check prospective tenants,
as well as maintaining the property. If you’re not confident in doing all this
yourself then make sure that you factor in the cost of using an agent.

Of course, if you do decide to go it alone you’ll find loads of help and tips here at LandlordZONE.

4. Pick the right property

Once you’ve decided to make the leap, make sure that you
pick the right property. These are just a few of the things you might want to
consider

• Are there good transport links?
• Is it within a commuter belt?
• Would it appeal to young families?
• Is the area popular with students?
• What is the average level of rent in the area?

The thing to keep in mind is that you are not buying a home
for yourself, you are buying a property that will be attractive to renters.

Find the bad credit buy to let mortgage for you A poor credit history doesn’t mean you won’t be able to find a buy to let mortgage. You may need a bigger deposit and your choice of mortgage
lenders may be reduced but it is still possible.

Having said that, lenders generally require a higher deposit
for a buy to let property than for standard residential mortgages anyway.
Meaning that even with a good credit history you would need to find around 25%
of the property’s value before you would be considered.

As with standard residential mortgages, buy to let mortgage
lenders will evaluate your ability to repay your mortgage. Your credit history
will form part of this evaluation, but it is only part of it. Lenders will also
look at your income and your outgoings.

Importantly lenders will also consider the potential rental
income of the property you are thinking of buying. The rental income generated
by the property should amount to at least 125% of your monthly mortgage
repayments. Put simply, if your monthly repayment amount is £400, you should be
able to charge at least £500 per month rent. This is one reason that it is
important that you follow the advice above regarding picking the right
property.

You should also be aware that most buy to let mortgages are
interest only. While this makes monthly repayments lower, it does mean that you
will be liable to repay the loan amount at the end of the mortgage term. When
you take out the mortgage you should consider a plan that will allow you to do
this.

In summary if you have a sufficient deposit, your chosen
property will generate sufficient rental income and you meet the affordability
criteria you should be able to find a lender willing to give you a mortgage. By
far the best way to improve your chances is by using a mortgage broker who
specialises in working with people with poor credit history, as most high
street brokers have no experience of this.

Using an expert broker

At a recognised buy to let expert bad credit mortgage broker
like Simply
Adverse, you’ll be gaining the benefit of working with professional independent
mortgage brokers with experience of finding buy to let mortgages for people
with adverse credit.

A broker will have up-to-date knowledge of the current
criteria of mortgage lenders and so will be able to advise you which to apply
to maximise your chances of being accepted. For example, some lenders are much
more willing to take into account the reasons behind your bad credit than
others.

If you follow our advice about selecting the right property
to buy and using a specialist broker, getting a buy to let mortgage is
possible, even with a poor credit history.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Getting a buy to let mortgage with bad credit | LandlordZONE.

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New 1 bed apartments in the centre of Woking

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Property Investor Partnership is delighted to be offering 1 bed, build-complete apartments in the centre of Woking, exclusively discounted by 10% off list prices!

Prices start from £193,500 rising to £247,500 for a 1 bed apartment, with amazing predicted yields of up to 7.1%. 

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Selective Licensing costs used for Nottingham Carnival?

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Nottingham Selective Licensing are sponsoring the local Nottingham Carnival this year. I believe this is being paid for out of the money raised from Landlords via the Selective Licensing Scheme.

Now the government rules regarding Selective Licensing Schemes is very clear in that they are not allowed to make a profit from the money raised.

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Update on Errors in English Private Landlords Survey

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I have received this email from the Govt EPLS Survey Dept:
Re English Private Landlord Survey and English Housing Survey
By email: From: EPLS Date: Tue, 13 Aug 2019 at 11:27
Subject: RE: English Private Landlord Survey and English Housing Survey

Many thanks for your email and your interest in the English Private Landlord Survey (EPLS).

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Scotland’s best

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Landlords of rented properties in Aberdeen City and Aberdeenshire are being praised for renting responsibly after SafeDeposits Scotland researched rates of landlords failing to protect tenants’ deposits.

The research found only 17 cases relating to properties with AB postcodes of landlords being taken to the First-tier Tribunal for Scotland (Housing and Property Chamber) by their tenants for failing to protect their deposits.

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