MP calls for registration scheme for short-let hosts

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Vocal housing reform campaigner Karen Buck MP has joined calls for a short-term lets national registration scheme.

The Labour frontbencher and chair of the
All-Party Parliamentary Group on Short Lets says such a scheme would help
prevent abuses in the sector. Writing in The House magazine,
she explains: “Key to this is requiring those letting accommodation to simply
register that they are doing so, so we know who is letting, where and when.”

Although short on detail about who would run the scheme
and oversee inspections, Buck says: “Many of those letting out homes do so
unaware (and sometimes in defiance of) potential breaches of their lease or insurance,
which can have implications for everyone else in, for example, an apartment
block.

“No one wants to end the freedom for homeowners to
generate some extra cash, and we can all see the advantages, but the present
regulatory environment is not sustainable and now the Government needs to act.”

Last month, the Short Term Accommodation Association revealed that its members, who include Airbnb, accept that a simple national registration scheme is inevitable as continuing media coverage puts the sector under pressure.

However, the Residential Landlords Association believes the problem is not about a lack of regulation, but ensuring the rules already in place are properly enforced. Policy manager John Stewart says that London councils’ ability to enforce planning permission for those wanting to rent for more than 90 nights a year is variable.

He adds: “Outside of London, while such a limit does not apply, there are already a considerable number of powers available to local authorities to tackle properties causing disruption. What they lack are the resources to use them properly.”

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Edinburgh home-owner banned from short let in affordable housing

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Edinburgh Council is continuing its crackdown on the short-term letting sector by banning a home owner who bought a flat through an affordable housing scheme.

Enforcement officers stepped in after two neighbours
complained; one objected to noise disturbance and anti-social behaviour while
the other flagged up the fact the property had been bought through an
affordable housing initiative known as Golden Share. Under the council-backed initiative,
home-buyers can buy a property at 80% of the open market value – a significant
reduction in a block where the average property sells for just below £218,000.

Inspectors found the two-bedroom flat in
Elsie Inglis Way was being openly advertised for short-term holiday lets for
six people on various booking platforms, telling visitors they could check in
any time between 1pm and 11.30pm.

In their report, council enforcement officers
said the location of the flat on the ground floor and the number of people,
combined with the ability of guests to access areas of communal provision,
including a stairwell and landings, was having a detrimental impact on other
residents.

An Edinburgh Council spokeswoman
tells LandlordZONE: “We have taken enforcement action in this case and we’re
now working with Scottish Government to take forward new powers to regulate short-term
lets.”

The temptation to rent out to short term lets to reap the
large fees can be too great because it’s so lucrative, says Gavin Dick, local
authority policy officer at the National Landlords Association, but he adds: “There
are usually conditions around housing association purchases, such as if you
need to live there or are able to sub-let it because the council owns part of
the property.”

A licencing regime is set to be introduced by the
Scottish Government in the next couple of years.

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The National Landlord Investment Show

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The National Landlord Investment Show is celebrating its 70th show to date with a return to Olympia, London on 19th March 2020 with Andrew Neil and Michael Portillo. 

FROM kickstarting their journey at their very first show in Croydon

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Call of the Week- Fitness for Human Habitation and repairs

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This week the advice team were able to help a member to understand the Homes (Fitness for Human Habitation) Act 2018. This piece of legislation will apply to all tenancies in England from March 20th 2020, and we have recently received more calls relating to this legislation as this date approaches. One of our members […]

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Budget 2020 – Landlord Reactions

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Chancellor of the Exchequer Rishi Sunak’s first Budget speech concentrated on bringing stability and security to the country using £12bn of fiscal action to combat the temporary effects of Coronavirus. The NHS was promised whatever resources it needed to tackle the virus with a £5bn response fund put aside.

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How will the coronavirus impact landlords?

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The Virus:

We’re all worried about the impact the virus may have on our lives, and if you’re in the older group its a particular worry. Holidays and trips booked, events planed, forward commitments all put in on hold.

If you run a business it’s a double whammy: cash-flow and profits may well be adversely affected, and if you are unlucky enough to live in a flood affected area, you could be even be unfortunate enough to suffer a triple whammy, what a ghastly year it’s been up to now.

Like other businesses, landlords are vulnerable to having their cash-flows disrupted when tenants are self-isolating or sick with the virus, some unable to pay rent. We can only hope the government comes quickly to the rescue as promised.

Richard Murphy, a chartered accountant who campaigns on issues of tax avoidance and tax evasion, is calling in his Blog for landlords to declare a rent amnesty for tenants who suffer with the coronavirus.

An adviser to the Trades Union Congress on economics and taxation, and Professor of Practice in International Political Economy at City University London, Mr Murphy says:

“There is simply too little economic resilience within the population as a whole… Far too many people have too few savings to survive major periods of economic inactivity without massive prejudice to their short-term and long-term well-being”

However, I think Mr Murphy is perhaps falling into the common trap by assuming that all private landlords are next-door to the landowning aristocracy: rolling in cash and able to sustain themselves as well as their tenants in this time of crisis.

Many landlords may well be wealthy enough to provide that kind of support, but I suspect there’s a big proportion of private landlords today who are working folks themselves, dependant on regular rent payments to pay their mortgages.

But, in any event, landlords may be called upon to re-schedule rent payments if tenants fall into hardship, and therefore all landlords should plan accordingly, speak to mortgage providers and if necessary their banks.

How landlords and agents are likely to be affected has yet to be seen, but we can speculate. For a start, moving may be be delayed or put on hold for some time, likely to affect agents more than landlords.

The stock markets are anticipating an adverse effect on real estate generally, with property investment trusts under performed the market during the market sell-off. The sector fell by 11.3% last week, compared with 11.1% for equities in general, that’s according to Numis Securities.

Within those figures though some players fared even worse: student lettings company, Unite Group, Britain’s largest provider of student housing fell by 15%, and that’s despite them just reporting a strong set of annual results. Why?, because of investor’s worries about the potential impact of the coronavirus.

Unite has 74,000 beds in 27 cities and its portfolio is valued at around £5.2 billion. Its shares price is up 22.7% in 12 months following its £1.4 billion acquisition of Liberty Living, its main rival.

Like-for-like rental growth in 2019 was up 3.4% on the year, better than the previous year’s 3.2%. But now the coronavirus outbreak threatens – Chinese students are thought to make up around 13% of Unite’s tenants, though 50 per cent may be UK based.

Despite the threat, the company expects growth of between 3 and 3.5% for next year, thanks to a combination of price increases and prudent asset management. They expect the impact of covid-19 on student numbers to be offset by the new government’s supportive policies for attracting overseas students, and a boost in Britain’s 18-year-old population.

Student housing is likely to continue to be a growth area as evidenced by a record-breaking deal by the world leading property fund manager Blackstone. They agreed to buy the iQ student housing company from Goldman Sachs and Wellcome Trust for £4.7 billion in what will be the biggest UK private property deal on record when complete.

On the other hand, things don’t seem so rosy in the retail sector. Shares in the shopping centre owner Intu Group have fallen sharply after the indebted owner of Lakeside Essex and the Trafford shopping centres after it had said it would push ahead with a cash call on its investors thought to be in the region of £1bn.

Intu has been hit by weak demand for its high street retailers, with struggling groups including Arcadia and Debenhams occupying a lot of space in its centres, and the coronavirus is just going to add to its troubles.

In a recent press release the company has said that

“While a number of intu’s shareholders and potential new investors indicated their support for an equity raise, the Board believes the current uncertainty in the equity markets and retail property investment markets precluded a number of potential investors from committing capital into the business and intu was therefore unable to reach the target quantum at the current time. However, during this process, intu received several expressions of interest to explore alternative capital structures and asset disposals.”

Doubtless the big boys will be hit, but the crisis will be no less severe for the small-scale private landlord, the student landlord and the smaller commercial property landlords with high street retail premises. The latter will no doubt be watching closely the Chancellor’s speech today for any sign of the anticipated help with business rates.

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Bank Base Rate Slashed To 0.25%

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The Bank of England have decided to support today’s Budget, and the markets before they open, cutting Bank Base Rate by 0.5% from 0.75% to the previous post Credit Crisis low of 0.25%.

This is obviously helpful news for landlords who are on variable

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