Landlords – this is how to beat the Tenant Tax

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Over 90% of tenants look for new rental properties online, therefore making
your property competitive is essential. The Tenant Tax (aka Section 24, which
will be in full effect by April 2021), is going to cost any landlord with a
mortgage over £2,000 extra a year in tax. A shocking 44% of landlords surveyed
said they would be putting up prices to compensate but, this does not affect
those landlords without a mortgage – which makes up half of all landlords – as
such these landlords will be able to offer a simpler property at a better
price, making them the opposite of competitive.

There are two far better options, luckily: market smart and cut costs
elsewhere. After tax, a landlord’s next biggest costs are void periods and
tenant finder’s fee. Leaving a property sitting empty because the landlord has
priced themselves out of the market is ludicrous – especially when there are
five tenants chasing every vacancy. Void periods and using a traditional letting
agent both cost around £1,000 each, and the North East actually has the highest
number of voids in the UK. With the Tenant Tax, as one lot of costs have
skyrocketed, so it makes sense to cut back on these easily avoidable outgoings.
  

Ollie, who marketed his two-bed house
through Upad last month, says, ‘My dedicated
account manager suggested using an internal picture as my advert’s main
picture, advertising on Monday morning and writing the description in an online
blog format – which got me three offers and let by that Wednesday.’ Marketing
through an online letting agency like Upad
leverages the expertise of people whose job it is to be on the cutting edge of
the property market; they know when to post a property, what photography works
and even provide guides for landlords on their online landlord
hub that explain how to
successfully market your property in 2019. As to whether it works? Upad’s let
rate is a third higher than the average high street letting agent, sitting at over
90%.

Landlords also often turn
to outdated marketing channels to save money – most of the time they are
advertising in the wrong places like on Gumtree or with high street agents; yet
an online agent can cost around a third of what a high street agent costs, as
they simply don’t have office rents to pay for example. To find out all about
the benefits of using an online letting agency, check out Upad’s website today –
don’t let this new tax turn your property into yet another cost: https://www.upad.co.uk

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Landlords – this is how to beat the Tenant Tax | LandlordZONE.

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Proposed Manchester rent control powers simplistic and populist!

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Introducing rent controls in Manchester would choke of the supply of homes to rent making it more difficult of tenants to find a place to live. That is the warning from the Sale based Residential Landlords Association as a new report calls for the Greater Manchester Combined Authority to have powers to implement forms of rent control.

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Housing latest: Your daily update on politics and the private rented sector

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Monday 7th October 2019 Vast Majority of private rented sector Housing Unaffordable for Families In Receipt of Local Housing Allowance -new research reveals More than 94% of family homes are unaffordable to local housing allowance (LHA) claimants, according to analysis of private rental listings. Some towns had just one affordable property available, found the National […]

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Hat trick for Hamilton Fraser Total Landlord Insurance

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Landlords’ Insurance:

For the third year in a row, Hamilton Fraser Total Landlord Insurance has been crowned ‘Best Landlord Insurance Provider’ at the Insurance Choice Awards, beating tough competition from Endsleigh.

The Insurance Choice Awards aims to find the UK’s best insurance companies by asking consumers to vote and share their experiences. After 12 weeks of voting, more than 26,000 consumer votes were received across all categories. These awards not only provide an opportunity for organisations to benchmark themselves against competitors, but also to gauge their understanding of how they are perceived by consumers.

Eddie Hooker, CEO of Hamilton Fraser Total Landlord Insurance says:

“I am genuinely ecstatic at this result. Ordinarily the winning or losing does not matter, but in this instance, because this has come from the people who have trusted in our business, it validates just how hard the entire team works and the personal service I know they deliver.

“I’ve said it before but, being a good insurance provider is more than merely selling a product. It is built around a company’s ability to earn the trust of their consumers by listening to their needs and finding both the best product and price to match those needs, then delivering on those promises at a time when people need it the most – the point at which they make a claim. Our team puts customer service at the heart of everything they do, so winning this award once again is truly a privilege.”

In these uncertain times for landlords, Hamilton Fraser Total Landlord Insurance’s consistent success at these awards will help to reassure landlords that they have access to high-quality innovative landlord insurance cover that is designed with the customer in mind.

Mike Fortis, Founder of Smart Money People who launched the awards in 2016, said:

“The voting process has once again demonstrated that many insurance firms have made the jump from viewing their customers simply as policy numbers.

“It’s also particularly pleasing to see that innovative new propositions are starting to filter through and delight customers, with firms like By Miles, Laka, Digital Risks and FloodFlash representing this new wave of insurance firms.”

Hamilton Fraser Total Landlord Insurance is part of the Hamilton Fraser Group of companies, including mydeposits, Property Redress Scheme, CMP and Landlord Action. Their award-winning landlord insurance offering, Total Landlord Insurance, has been specialising in providing comprehensive cover for landlords since 1996.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Hat trick for Hamilton Fraser Total Landlord Insurance | LandlordZONE.

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Removal of Section 21 Housing Act 1988

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The Government consultation on “A new deal for renting: resetting the balance of rights and responsibilities between landlords and tenants” closes on 12th October. I would urge all landlords to make a submission: Click here. You can also email your submission and any comments to TenancyReform@communities.gov.uk Below is an extract from my submission

1.

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Property funds face stricter checks from September 2020

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Property Funds:

Britain’s
Financial Conduct Authority (FCA), the financial markets regulator,
published tougher rules this week for funds that invest in
hard-to-sell assets, typically property.

Following a string
of instances where open ended funds* have been unable to pay out
money when investors have requested it because illiquid assets such
as property cannot be sold at short notice. In a market downturn this
often presents a major problem for funds with a high proportion of
illiquid assets when investors rush for the exit.

Some so called
“Built on a lie” funds, those sold to investors who are no
aware of the illiquid nature of the investment will now face tougher
rules starting in September 2020.

Some funds investing
in property had to be “gated”, in other words they had to suspend
redemptions during market stress in June 2016 immediately after the
“leave” result of Britain’s referendum to leave the European
Union.

When these funds
were unable to meet promises of daily redemptions, it prompted Bank
of England Governor Mark Carney to describe them as “built on a
lie”.

The FCA came under
more pressure to make a change following the high-profile fund run by
Neil Woodford when he suspended redemptions from his flagship Equity
Income Fund in June this year, a fund which had promised easy daily
redemptions.

It turned out that
Woodford was unable to make payouts after investors lost confidence,
panic set-in and a flood of redemption requests came in. This
situation came about because Woodford had breached a rule limiting
how much it could invest in illiquid assets. But with property funds,
unlike Woodford’s, often all the fund it invested in
illiquid assets.

A new category of
funds therefore, those investing in inherently illiquid assets, or
FIIA funds, from September 2020, will be subject to additional
requirements, including standard risk warnings in financial
promotions, enhanced depositary oversight, and a requirement to
produce liquidity risk contingency plans, says the FCA.

Christopher Woolard,
the FCA’s executive director for strategy and competition, had
said:

“The new rules and
guidance are designed to protect the interests of investors,
particularly during stressed market conditions. This includes those
wishing to redeem their holdings, as well as those wishing to remain
invested in the fund.”

Ryan Hughes, head of
active portfolios at investment platform AJ Bell has said:

“This means we’re
likely to see funds suspend dealing more frequently and sooner than
they would have done in the past”

Ironically, the new
rules will not apply to EU-regulated funds like the Woodford fund,
even though FCA Chief Executive Andrew Bailey has described the EU’s
rules as “flawed” – the Woodford fund breached the rule that no
more than 10% should be in illiquid assets.

Britain’s
Investment Association has said that the FCA’s approach with its
new rules is “pragmatic and measured” recognising the need to
enable investment in illiquid assets through open-ended funds, albeit
under stricter new rules.

The pool of
open-ended property funds subject to daily monitoring has been
widened by the FCA meaning that smaller property funds, as well as
larger funds that suffered following the 2016 Brexit referendum, will
need to publish daily cash-flow updates.

*Open-end funds
are collective investment schemes that issue and redeem shares direct
to investors, rather than they purchase shares from existing
shareholders on the stock market.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Property funds face stricter checks from September 2020 | LandlordZONE.

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Courts failing to follow rules in housing cases

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Courts across the country are failing to follow their own rules when it comes to the speed of dealing with repossession cases. According to the civil procedure rules which provide a code to ensure courts deal with cases justly, the courts are expected to ensure cases are “dealt with expeditiously and fairly”. The rules show […]

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