Most read call of the weeks from 2019

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There are just days to go until it is time to ring in a new year-and a new decade, so it is a good time to reflect on the last twelve months. Every week, we shine a light on some of the things our members give our advice team a call about, and how we […]

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Berkshire estate agents fined for price fixing

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Price Fixing Cartel:

Three Berkshire estate agents have been fined by The Competition and Markets Authority (CMA) more than £600,000 for agreeing between themselves to fix minimum commission rates they charged their customers.

Following an investigation by the CMA, the companies involved in the illegal cartel, Michael Hardy, Prospect and Richard Worth, along with a fourth company, Romans, broke competition law by taking part in the price-fixing cartel, which began in September 2008.

The CMA claims that for almost 7 years the 4 companies conspired to set minimum commission rates for the sales of residential properties in Wokingham, Winnersh, Crowthorne, Bracknell and Warfield, locations where these companies were the leading estate agents at that time.

The firms were found to be exchanging confidential information on pricing and holding meetings between themselves to ensure the cartel members enforced and maintained the agreed minimum rates. The result was, says the CMA, that local home-owners were denied the chance of securing the best possible deals when selling their properties because they were unable to meaningfully shop around locally for a competitive price on commission rates.

Romans escaped a fine as it brought the illegal activity to the CMA’s attention and fully cooperated with the investigation, under the CMA’s Leniency Programme.

The fines imposed, according to the CMA, “take into account the behaviour of the companies involved. Michael Hardy’s and Prospect’s fines have been discounted to reflect the fact they admitted to illegal behaviour and agreed to cooperate with the CMA, thereby shortening the length of its investigation.”

In the case of Romans, which is part of the national Leaders chain, with 140 branches across the UK, was exempted from the fines as it had come clean and reported the matter to the CMA.

Peter Kavanagh, the chief executive of Romans told The Guardian newspaper:

“In June 2017, senior directors of Romans became aware that some years ago a small number of Romans residential sales executives across a few branches had acted in a manner totally contrary to the standards and values of the company. We immediately alerted the CMA.”

Michael Hardy’s and Prospect’s fines were reduced discounted to reflect the fact they admitted to illegal behaviour and agreed to cooperate with the CMA. Michael Hardy’s managing director, Neal Mackenzie, said: “A very poor decision was made and it is difficult not to conclude that a line that should not have been crossed was.”

Mark Hayward, chief executive of the National Association of Estate Agents told The Guardian:

“We are very aware of the implications of forming an estate agents’ cartel and have been vigorous in our promotion of the CMA’s Stop Cartels campaign to educate agents about price-fixing, market sharing and bid rigging. We continue to urge all our members to adhere to current legislation to ensure best practice to avoid falling foul of the law.”

CMA: Michael Hardy is being fined £142,843. This includes a reduction of 10% for settlement. Following the CMA’s provisional decision in June 2019, Michael Hardy agreed to settle the investigation with the CMA. By settling with the CMA, Michael Hardy admitted being part of the cartel, and agreed to pay the penalty and to a streamlined procedure. Prospect is being fined £268,765. This includes a reduction of 50% under the CMA’s Leniency Programme and 10% for settlement. As in the case of Michael Hardy, by settling following the CMA’s provisional decision, Prospect admitted being part of the cartel, and agreed to pay the penalty and to a streamlined procedure. Richard Worth is being fined £193,911.

Michael Grenfell, CMA Executive Director of Enforcement, had said:

“It is disappointing we’ve found yet another case of estate agents breaking competition law. We trust that the fines issued today (Wednesday 18 Dec 2019) will reinforce our message that we expect the sector to clean up its act and make sure customers are not being ripped off in this way. The industry needs to take note: this kind of behaviour will not be tolerated. If you break the law, you risk similar consequences.”

The latest case is the third one in recent years that the CMA has taken against estate agents. Others include the fining of three members of the Three Counties Estate Agent Association £735,000 and fining 4 estate agents in Somerset over £370,000 for similar offences.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Berkshire estate agents fined for price fixing | LandlordZONE.

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House prices and rents to rise next year…

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Rent Increases:

Landlords can perhaps be forgiven for rejoicing at the prospects of an early Christmas present, after all the uncertainty endured pre-election 2019.

House
prices are
expected to grow
twice as fast, and
rents
will accelerate next
year, following the decisive December
General Election
result,
that’s
according
to a new
RICS survey.

The
Royal Institution of Chartered Surveyors thinks
that house
prices will
grow
by 2% next year, more than doubling
the current
0.8
per cent growth rate. Likewise,
rents are likely to increase
by around
2.5%.

The
RICS
forecast
is
backed-up
by Rightmove’s
own assessment of the market for 2020. The
leading property listing website is also
predicting an
average UK house
price increase
of 2%
next year.

Rightmove
expects
a bumper demand
for the spring selling season. The
biggest price increases
are
expected in
the
north
of
England. Here
prices may rise between 2
and
4%,
whereas
in London
and the South East rises
could be more modest at around 1%.
Here,
prices may still be under a cloud, awaiting the outcome of the trade
negotiations with the EU.

A
RICS economist is quoted as saying:

“Challenges
around affordability and low stock levels will continue to drag on
the market, and Brexit uncertainty could resurface as the next
deadline draws closer. As such, we expect house prices to rise by
just 2 per cent next year, with the outlook for overall sales volumes
broadly flat”

RICS
says
that the continuing uncertainty
over
the final trade agreement with the EU would
still
have a slowing effect on sales numbers,
with
overall sales expected to flatline for the whole of next year.

Sales
figures actually fell between September
and December, according
to official figures, and there was a shortage of rental properties
coming
on
the
market. Landlord
instructions are down according to RICS
members
surveys, for the 14th
successive quarter. As
a result, average rents
are expected to rise by an average of 2.5%, and
in London this figure could be 3%.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – House prices and rents to rise next year… | LandlordZONE.

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BLOG: What does the Conservative victory mean for the Welsh Parliament election in 2021?

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RLA Welsh Policy & Public Affairs Officer Calum Davies shares his thoughts on the political landscape in Wales post-general election. Readers will be forgiven for thinking the General Election result will lead to seismic change everywhere. However, with housing and much more devolved to the Welsh Assembly – which has recently backed a law that […]

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Boris pledges £260m to eliminate homelessness and rough sleeping

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As part of his drive to tackle homelessness, over £260 million has been committed for local authorities to support people who are homeless or at risk of losing their homes. The funding will empower councils across England to provide the best services for local needs

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Housing Forecast 2020 highlights need for Government to prioritise housing policy

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The Royal Institution of Chartered Surveyors (RICS) Housing Forecast 2020 highlights the need for Government to prioritise housing policy, in order to inject activity into the market and create a favourable environment for developers to help address the housing crisis.

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First Home Fund launched in Scotland

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Last week the Scottish Government launched The First Home Fund. This is a £150 million shared equity pilot scheme that will provide first-time buyers with up to £25,000 to help them buy a property.

The scheme is open to all first-time buyers in Scotland and can be used to help buy new build and existing properties.

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Washing machine recall is a concern for landlords…

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Appliance Fires:

Most people will be
aware by now that Whirlpool, manufacturer of Hotpoint and Indesit
appliances, has recalled 519,000 washing machines that were sold from
October 2014 up until last year. This comes only months after the
company admitting it needed to recall millions of potentially
dangerous tumble dryers world-wide.

The recall also
follows Whirlpool this month agreeing a settlement with residents who
were left homeless when one of its faulty tumble dryers caused a
large fire. Thirty-seven people made legal claims against the company
following the tower block fire in Shepherd’s Bush Green, west London,
in August 2016.

The manufacturer has
admitted that 42 different Hotpoint and Indesit models could be
affected by an electrical fault that could cause overheating and
possibly catch fire. Washing machines purchased since October 2014
and to date could be affected by this recall.

The situation is
obviously of concern to landlords and they are being advised to carry
our checks to see if any of the appliances in their rental properties
are affected, and if so to arrangement for immediate remedial action.

Most rental
properties include some kinds of white goods even when the property
is let unfurnished, so with lives potentially are risk, regardless of
the risks to property, landlords should act promptly.

The appliances now
identified as at risk are Hotpoint or Indesit washing machines which
potentially have faulty door locking mechanisms; these can overheat
and burst into flames. 519,000 machines are affected in the UK, a
relatively small number compared to the five million tumble dryers
Whirlpool previously had to deal with.

Good practice for
landlords is to keep a property file with all supplied appliances
recorded, purchase invoice, make, model serial number, and any
guarantee etc, so there may be no need to visit if this information
is available.

It should be
possible to check online with Whirlpool to identify at risk
appliances, though demand for this has been heavy and has overloaded
their website, but if in doubt there is also a helpline available –
0800 3161442.

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The 5 Golden Rules of Property Investing

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When I first wrote my book “Property Magic” I wanted to come up with some simple guidelines which would help investors to minimise the risks of investing and maximise their returns. I observed that most investors

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Keeping your property safe and secure over the winter – LandlordZONE

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As a landlord, keeping your tenants and your property safe
and secure should be your top priority.

While property security is incredibly important all year
round, the cover of winter darkness and icy winter weather presents a greater challenge
for landlords and their tenants.

Earlier in the year, Hamilton
Fraser Total Landlord Insurance’s 10 years of claims report found
that insurance claims are more likely to occur during the winter months than in
summer. The rise in the number of claims during this time of year is partly due
to the harsher weather, and also the increased cover of darkness that helps to
embolden opportunistic criminals.

Luckily, there are a number of precautions that you can take
as a landlord to secure your property, and provide peace of mind for both you
and your tenants this winter.

Winter weather
conditions

Weather conditions that accompany the winter season bring an
increased risk of damage to your property. Snow, ice and damp weather can cause
problems for unprepared or poorly maintained properties. Understanding and
preparing for issues caused by severe weather can help to prevent unwanted
damages and costs further down the line.

While the UK may not face as severe winter weather as some
other countries, the UK is no stranger to certain severe weather events. Without
adequate preparation, severe weather such as storms, flooding and snow, can cause
major problems for your property and your tenants. Hamilton
Fraser Total Landlord Insurance report that 15.5 per cent of all
claims reported between January 2014 and January 2019 were for storm damage.

Property damage resulting from severe winter weather could include
broken roof tiles, falling trees, extensive flooding, collapsed fencing and frozen
and burst pipes, all of which could cost a small fortune to rectify.

It is therefore extremely important to understand the
precautions you can take to secure your property; they don’t have to cost the
earth. Some simple precautions include:

• Clearing your gutters of debris that could cause
  a blockage
• Inspecting the roof condition at regular
  intervals throughout the year
• Making sure that low hanging or loose tree
  branches are cut back to avoid property damage if they are dislodged during
  high winds
• If a storm is on the horizon advise tenants to
  secure outdoor furniture or pack away loose garden equipment

You can read more about how to protect
your property from severe winter weather.

Broken boilers – a
common winter issue

It is not just your property structure that may be at risk
from the winter weather. After a period of warmer weather during spring and
summer, many homes face boiler issues when it is finally time to turn them back
on. A cold, icy property is neither pleasant nor terribly safe for your tenants.

Preparing your boiler for winter doesn’t have to be
difficult; you can check your boiler health by:

• Carrying out a regular boiler inspection (both
  formal inspections from a professional once a year and an informal inspection
  yourself to look for any warning signs)
• Look for cracks and signs of leaks
• Check the pressure gauge
• Check and bleed your radiators
• Insulate your pipes

Read more about how to prepare your boiler for the winter months and the top five boiler problems and how to solve them.

Rise in break-ins

Break-ins spike every year around December through to
January, according to Hamilton
Fraser Total Landlord Insurance’s 10 years of claims report. Most
often this is caused by opportunistic thieves who can use the cover of darkness
to their advantage when breaking into your property.

In addition, the allure of presents under the Christmas
tree, or those left on the doorstep by the postman, can signal a potential
bounty for a burglar that is hard to resist. Luckily there are a number of
steps landlords can take and share with their tenants, in order to reduce the
risk of their property being targeted this Christmas.

• Invest in good quality doors and windows with
  secure locks and fittings to make it harder for thieves to gain access
• Consider using frosted reinforced glass – not
  only is this more difficult to break but also limits visibility into the
  property
• Make sure all property entry points are covered
  by the same level of security
• Advise tenants to keep their valuables out of
  sight
• Invest in motion triggered lighting outside your
  property – nothing acts as more of a deterrent for a burglar than being
  illuminated in the act!
• If you have a driveway, consider using pebbles
  or gravel, which can help to signal when someone is approaching the property
• If you have a garden make sure that tools and
  equipment are securely stored out of sight, or they could be used to break into
  your property
• Consider installing a security system
• Ask tenants to advise you if they are going away
  over the festive period so that someone you trust can keep an eye on the
  property and collect any post

You
can read more about how to keep your property secure over winter.

Keeping your tenants
in the loop

Maintaining a good relationship with your tenants is a great
way to make sure that your property remains safe and secure over the winter
period. As a landlord it is incredibly important to ensure that you have a positive
relationship with your tenants as they are your property’s eyes and ears.
Having a good relationship means tenants will be more likely to approach you promptly
if they notice an issue with the property, such as one caused by severe weather,
enabling you to address the problem before it escalates. . In addition, being
open with your tenants and sharing the above tips can help to prevent the
property falling foul to break-ins and burglary during the darker winter
months, as well as year round.

Despite taking precautions to protect your property, unfortunately
problems can still occur that cause not only damage but also security issues.
While tenants are responsible for protecting their own possessions, with their
own contents insurance, it is important that landlords make sure they adequately
protect their own contents and building. As a landlord, having a comprehensive
landlord insurance policy, such as that provided by Hamilton
Fraser Total Landlord Insurance’s, can also help to cover you for
the added risks that accompany a buy to let property, helping to keep your
property safe not just over the winter period but all year round.

Find out more about how a comprehensive landlord
insurance policy could help keep
your property safe and secure.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Keeping your property safe and secure over the winter – LandlordZONE | LandlordZONE.

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