Campaigners join forces to call for evictions ban extension in Scotland

admin    Uncategorized     agents

A coalition of housing and welfare organisations has made an urgent plea to the Scottish Government to extend eviction protection measures.

The coalition claims that “time is running out” for families at risk of losing their homes in the light of the Covid-19 crisis and that the Government must show leadership to help prevent hundreds of families from becoming homeless.

In an open letter signed by organisations including Shelter Scotland, Glasgow Night Shelter and the Scottish Refugee Council, the group calls on Housing Minister Kevin Stewart to extend emergency powers against eviction when Parliament meets on 11 August.

The letter comes just a week after the Joseph Rowntree Foundation recommended that the ban in Scotland be extended until September 2021.

The current protections against eviction are due to be lifted in September, and the coalition is calling on the Scottish Government to extend these measures to ensure that vulnerable households can remain in their homes until at least April 2021.

Shelter Scotland Director, Alison Watson, said: “We know the pandemic has had a terrible impact on household finances.

“Thousands have lost their jobs, rent arrears are increasing and we’ve seen big increases in homelessness applications and the use of temporary accommodation. We must act now to stop the situation from getting worse.”

“Scottish Ministers have shown real leadership in getting people off the streets and keeping families in their homes.

“Now we’re asking them to step up once again by protecting people from being evicted and preventing a wave of homelessness this autumn.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Campaigners join forces to call for evictions ban extension in Scotland | LandlordZONE.

View Full Article: Campaigners join forces to call for evictions ban extension in Scotland

Rents to drop by at least 5% over next four years as Covid recession hits tenant incomes

admin    Uncategorized     agents

Landlords are looking at a £5.7 billion drop in rental income over the next four years according to figures released by rental service provider Home Made.

Its projections, based on data from the UK’s last major recession in 2008, point to rents falling by at least 5% as a result of the pandemic, resulting in a total rent reduction of £5.7 billion.

London is expected to take the most serious hit in the post-Covid-19 recession, with a rental income decline of at least 9% between now and 2024 – according to Home Made’s data.

Within the capital, the boroughs of Westminster, Tower Hamlets and Wandsworth are likely to fare the worst, with Barking and Dagenham, Havering and Bexley being the least affected.

The total predicted loss of £5.7 billion is four times that of the rental income decline experienced during the 2008 recession. And Home Made’s report predicts that rental incomes are unlikely to return to their pre-Covid levels until 2024. 

Asaf Navot, its founder and CEO, says: “Landlords across the UK need to brace themselves for reduced returns.

In a recession, renters are less inclined to take a risk and move homes due to reduced disposable income and increased job market uncertainty which drives rents down. And the Covid-19 recession looks likely to hit harder than any in living memory. 

“The good news is that rental property is a more robust investment than others in a recession,” says Navot.

“Renters are still enquiring, and landlords who are willing to compromise and prioritise longer term income and smart cash flow management over short term profits are most likely to succeed.” 

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Rents to drop by at least 5% over next four years as Covid recession hits tenant incomes | LandlordZONE.

View Full Article: Rents to drop by at least 5% over next four years as Covid recession hits tenant incomes

Covid-19 Court Reactivation Rule?

admin    Uncategorized     agents

It seems that the stay on possession hearings, ending 23rd August, will require a further piece of work by landlords in England and Wales. Can anyone please tell me if the “Reactivation Notice” in the Civil Procedure (Amendment No. 4) (Corona Virus) Rules 2020 No 751 (L.17) applies to progress an accelerated claim for possession?

The post Covid-19 Court Reactivation Rule? appeared first on Property118.

View Full Article: Covid-19 Court Reactivation Rule?

Bounce-back loans “bounced back” on landlords

admin    Uncategorized     agents

The loans have been offered to businesses during the coronavirus crisis when they have lost vital revenue needed to keep their firms afloat and staff on the payroll.

The scheme has meant that businesses can borrow up to £50,000 interest-free for the first year of operation before payments kick-in at an interest rate of 2.5 per cent.

The generous Government scheme has resulted in some major controversy in the property investment community however. Some controversial “millionaire property guru” characters, the likes of Paul Smith and Samuel Leeds, have been running property training courses for amateur property investors and have been encouraging them to apply for the government loans to fund their property purchases.

However, investors are being warned that anti-fraud organisations and white-collar crime experts have raised significant concerns about the potential for loss to the public purse as a result of fraudulent claims for Coronavirus bounce-back loans. These property investment claims are clearly not what the Government intended the money to be used for and they leave claimants open to prosecution.

One landlord posting on the property Blog, Property Tribes, said he had received a £12,000 bounce-back loan when one of his properties came vacant during the lock-down, while another of his tenants was unable to pay rent.

The loan was taken out as a “precautionary measure” in case other tenants missed payments the landlord said, despite having a healthy bank balance. But when the landlord came to apply to remortgage one of his properties with Paragon Mortgages, so that he could release some equity, he was rejected.

The landlord said that:

“The mortgage was denied because they determined that the business was in financial difficulties as it had to rely on a bounce-back loan, even though my balance remained well in excess of the balance of the loan.”

In another case a landlord’s application was rejected by The Mortgage Works, part of the Nationwide Building Society, because the applicant had taken out a £27,000 bounce-back loan.

Richard Ignatowicz, a landlord and mortgage broker, told The Sunday Times:

“The lenders are taking the prudent view, and I agree, because landlords are expected to have at least three months of cash reserves to cover for typical eventualities like voids, maintenance and repairs. If you applied for a bounce back-loan, you had to declare that you have been financially affected by the coronavirus, so why would lenders lend to someone in financial distress?”

Other lenders are refusing to approve mortgage applications for landlords when they have taken mortgage payment holidays, again an indication to the lender that they have cash-flow issues. Lenders are very sensitive to borrowers who show signs of financial distress and so they have every right to do so.

Mortgage consultant Chris Sykes from Private Finance told the Sunday Times:

“Lenders can be picky in terms of who they lend to because it is their money. By the end of the year, perhaps lenders will be open to these clients again, but things aren’t back to normal yet.”

And Paragon said:

“We would not turn down an application purely because of a bounce back loan. As a prudent lender we take this into account as part of the overall credit assessment.”

The Mortgage Works said:

“If someone had a bounce back loan, it would be considered as part of the mortgage application. It isn’t a straight decline just because they have had such a loan.”

Speaking about the use of bounce-back loans to fund new property purchases Cyril Thomas, who heads up the Property Investors Bureau, told LandlordZONE:

“We would not encourage investors or individuals to do anything in breach of the terms of their loan – I don’t want to get into the moral maze of what these loans should or shouldn’t be used for, but to keep it factual.

INVESTIGATION: the ‘property gurus’ pushing Bounce Back loans as ‘free money’

The Bounce Back Loan Scheme

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Bounce-back loans “bounced back” on landlords | LandlordZONE.

View Full Article: Bounce-back loans “bounced back” on landlords

Enfranchisement and Lease amendments?

admin    Uncategorized     agents

Value of Enfranchisement? I am a freeholder of a small block of flat (3 in total). I live on the first floor and there are two flats on the ground floor both rented out by the current leasehold owners. Leasehold owners have shown interest in purchasing their share of freehold.

The post Enfranchisement and Lease amendments? appeared first on Property118.

View Full Article: Enfranchisement and Lease amendments?

Council votes through controversial licensing plan

admin    Uncategorized     agents

Scarborough Borough Council has approved a further expansion of its Selective Licensing scheme for the private rental sector.

At a meeting yesterday, the Council gave its unanimous support to the introduction of the ‘Scarborough South’ scheme, following a public consultation.

The scheme – which is in addition to existing licensing arrangements for Scarborough North and Scarborough Central – will require private landlords in the specified areas of Weaponness and Ramshill to apply for a ‘licence to operate’.

Licensing conditions concerning the safety of smoke alarms and gas and electrical appliances will need to be met and suitable tenancy agreements will become mandatory.

A consultation which ran between January and March of this year revealed majority support for the Scarborough South licencing scheme.

And although some eyebrows have been raised in terms of the Council prioritising these measures in the middle of a pandemic, it is thought that the scheme is likely to both improve safety standards for tenants and reduce incidences of anti-social behaviour.

Each licence will be issued at a cost of £550. With an estimated 550 licensable properties within the Scarborough South area, the new scheme could generate a total fee income of £334,000 for the Council.

Labour councillor Carl Maw (pictured, above), cabinet member for stronger communities and housing, believes the new scheme will improve the quality of life for tenants in the area as well as for neighbouring residents.

He says: “We have seen in other parts of Scarborough where selective licensing has made a significant positive difference to the lives of the local community.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Council votes through controversial licensing plan | LandlordZONE.

View Full Article: Council votes through controversial licensing plan

Government will not legislate over ‘No DSS’ issue, confirms minister

admin    Uncategorized     agents

The government has confirmed that it will not introduce legislation to prevent landlords rejecting prospective tenants if they are in receipt of Universal Credit.

Housing minister Christopher made the comments during a parliamentary Q&A session, in response to a challenge from Liberal Democrat acting leader Edward Davey (pictured) asking whether the government intended to legislate over the issue.

Although Pincher repeated the oft-made government line that ‘blanket bans’ on tenants in receipt of benefits ‘has no place in a modern housing market’, he said: “We have no plans at present to introduce legislation on this issue but are committed to bringing forward a Renters Reform Bill in due course, to deliver a better deal for renters and a fairer and more effective rental market.

“We strongly encourage landlords and agents to look at all potential and existing tenants claiming housing benefit on an individual basis, and have worked with the sector to find ways to prevent the practice of ‘No DSS’.”

Although Pincher mentioned recent commitments by portals Rightmove and Zoopla to remove ‘No DSS’ and other phrases from lettings adverts, the minister made no reference to Shelter’s recent claimed landmark ruling on the matter.

A judge at York County Court last month found that the ‘No DSS’ practice unfairly discriminated against a single mum-of-two with a disability, on the grounds of sex and disability under the Equality Act.

The woman had been turned down by a letting agent who refused to rent her any properties because of its long-standing policy of not accepting housing benefit tenants.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Government will not legislate over ‘No DSS’ issue, confirms minister | LandlordZONE.

View Full Article: Government will not legislate over ‘No DSS’ issue, confirms minister

David Smith is the new Legal Counsel for the NRLA

admin    Uncategorized     agents

Former RLA policy director David Smith has been announced as legal counsel for the National Residential Landlords Association (NRLA). David is a partner at JMW Solicitors in London, specialising in landlord and tenant and property litigation in the residential sector.

The post David Smith is the new Legal Counsel for the NRLA appeared first on Property118.

View Full Article: David Smith is the new Legal Counsel for the NRLA

Landlords ARE being penalised by lenders for taking mortgage holidays

admin    Uncategorized     agents

Warnings published on LandlordZONE in April that advised landlords to be wary of taking a mortgage holiday are turning out to be true.

Mortgage broker Daniel Lee, principal of Legacy Financial Consultants, told landlords to ‘think very carefully’ before taking a payment holiday, particularly if they then were to carry on receiving rent from their tenants.

But reports in national newspapers this week now show that landlords who took either mortgage holidays or applied for bounce-back loans are being marked down as a greater lending risk by mortgage lenders such as Paragon and The Mortgage Works.

Vanessa Warwick, the cofounder of Property Tribes, told The Times: “Covid has exposed weak business models, and taking a loan is signalling to lenders that you did not have a robust business.”

Daniel Lee says: “I’ve seen this problem gathering momentum over the past couple of weeks.

“Interestingly enough, it’s the bigger portfolio landlords who have been rejected by lenders after taking a mortgage holiday – I think some saw this as a way to build up a buffer zone to hedge against their tenants not being able to pay their rent in the future.

“But this was a dangerous approach – I’ve had a portfolio landlords get into this kind of trouble and interestingly it’s the ones who took the payment holidays but continued to collect the rent who have had the most difficulties.

“We’ve got to look at this from a lenders’ point of view – if a landlord doesn’t have the spare funds to cover a void period for a few months and has to go to the government for help, should they really be in this market in the first place?”.

Read our original article containing the warning.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Landlords ARE being penalised by lenders for taking mortgage holidays | LandlordZONE.

View Full Article: Landlords ARE being penalised by lenders for taking mortgage holidays