Landlord blasts council’s ‘pitiful’ handling of rule breaking within HMO sector

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Winchester City Council has taken a battering for its “pitiful” policing of HMO licensing.

Local labour party member Peter Rees says the Liberal Democrat-run council isn’t taking enough rogue landlords to task or properly staffing its licensing department.

He points to two recent cases of landlords who were prosecuted for not having an HMO licence, including that of Gurjiven Singh Chhokran – reported by LandlordZONE last month – who was handed a £28,000 rent repayment order for having an unlicensed seven-bed student HMO.

A first-tier tribunal ruled it couldn’t prove Chhokran’s claim that he had tried to get a licence.

“Enforcement and the policing of HMOs has become almost a joke that has allowed rogue landlords to flourish without proper monitoring and regulation,” Rees tells The Hampshire Chronicle. “The failure to act as the local authority is pitiful.”

He says the council only has four staff engaged in both monitoring and planning issues – two full-time and two part-time – as two other staff have left and weren’t replaced.

“Both the previous Tory administration and the Lib Dems have ignored the scale of rule and law breaking in this sector,” adds Rees (pictured).

“There are numerous examples of similar cases but it has not bothered to increase its enforcement to normal staffing levels or raise perpetual issues requiring enforcement action.

“There is clearly significant exploitation by landlords of students, the very low paid on zero hours and others. This is compounded by lack of interest from the previous and current administration.”

LandlordZONE has approached Winchester City Council for comment.

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Airbnb all but closes down for lockdown and says sorry to landlords

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Airbnb is curbing all stays in England until 2^nd December apart from long-term bookings made for specific reasons, vindicating many of its landlords’ recent switch back into more traditional lets.

While staying away from home overnight is outlawed during November, those guests booking long-term legally exempt stays can still use the homestay platform, including those travelling for work or those who are homeless or vulnerable.

Director of public policy, Patrick Robinson (left), says the move mirrors Airbnb’s actions during the first lockdown.

“As new lockdown restrictions begin, we want to be a good partner to communities and we’ve heard from hosts who want to help everyone follow the rules and stay safe,” says Robinson.

“Public safety is our priority, and we regret any impact for hosts and guests.

“We will closely monitor government guidance and keep the policy under review, and we look forward to when hosts can safely reopen their doors to guests.”

Party house clampdown

Meanwhile, Airbnb has announced that more than 800 UK listings have been removed or suspended in a crackdown on party houses.

It has also blocked more than 13,500 UK reservation attempts in a month after the introduction of a pilot scheme to tackle anti-social behaviour in August.

Its self-imposed crackdown on party houses bans under 25s from renting entire homes in their local area. Youngsters with fewer than three positive reviews can’t book entire home listings that are close to where they live in the UK.

Robinson adds: “Our measures are working and as the UK goes back into lockdown, our priority is to be good partners to communities and to help everyone stay safe.” 

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New lockdown won’t interrupt housing market, says leading economics expert

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A leading economics expert has told landlords that the current month-long lockdown is not going to prompt the same economic downturn seen during the first one earlier this year.

David Smith (pictured, above), who has been the economics editor of the Sunday Times since 1989, told online delegates to the National Landlord Investment Show that in economic terms the new lockdown is less restrictive than the first one.

“We’re not going to see the kind of big falls in GDP that were witnessed during the first lockdown,” he says.

“GDP shrank by 20% during the second quarter of the year before rebounding, but this time is will be more like 3%.”

Recovery

Smith says that although the second lockdown may slow down the remarkable recovery of the housing market since it reopened in May, it won’t prompt a reversal in activity, house prices and rents.

“Despite its miss-steps on several fronts, the government remains serious about supporting the housing market,” says Smith.

“This includes the extension to the furlough scheme which will reduce one of the major downside risks [for landlords] – a sharp increase in unemployment.”

Smith is also confident that the rental market, with the exception of London where rents are due to soften significantly, will weather the storm until next year, when he expects to see a strong economic recovery.

His comments were echoed during the show by Paul Maloney of Nova Financial, who believes existing predictions that house prices are still on track to rise over the next five years after a six to 18-month hiatus while the housing market recovers from Covid.

Watch David Smith’s presentation in full (requires registration).

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UK rented homes underinsured by £315 billion

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Landlords struggling in the wake of COVID-19 face another invisible threat in the form of underinsurance.

The latest data from RebuildCostASSESSMENT.com reveals a massive shortfall in cover among rented homes and business properties. The insurance valuation providers estimate that privately rented homes in Britain could be underinsured by a whopping £315 billion, while for UK commercial property, the estimated underinsurance total is around £325 billion.

“What this means is buildings across the country are woefully under-protected in the event of any kind of damage,” said Will Molland BSc MCIOB AssocRICS, director at Rebuild Cost Assessment Ltd.  “I fear that in the current financial climate many landlords simply would not survive the consequences of underinsurance.”

Will went on to explain that nine out of 10 properties in the UK are insured for the wrong amount. The vast majority (79%) are underinsured, which means that when a claim is made, the amount paid out to cover the damage can be severely reduced.

“We’ve recently seen with the situation around business interruption cover that insurance contracts can lead to confusion. Underinsurance often leads to disputes with insurers. On average, we find that buildings are only covered for 69% of the amount they should be, leading to a considerable shortfall in cover.”

Will added: “Now is not the time for anyone to discover their insurance policy won’t pay out the amount they’re expecting. This is a UK wide problem and it can only be resolved by landlords realising the risk they’re running and then making sure their buildings are insured for the right amount.”

RebuildCostASSESSMENT.com has recently produced an infographic highlighting its latest data around inaccurate buildings insurance, based on more than 11,000 property assessments over the past 12 months. It can be viewed and downloaded here.

We have partnered with property experts Hamilton Fraser Total Landlord Insurance to provide you with a webinar on ‘How to avoid underinsurance’ which will cover everything you need to know on the topic, from calculating your rebuild value to the true cost of underinsuring – look out for the webinar which will be going live on the 16 November 2020. Viewers will have exclusive access to a RebuildCostASSESSMENT.com discount code.

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Are my rental expenses from the LAST tax year allowable in THIS year’s return?

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We moved out of our home on 1st February 2019. Since December 2018, we had advertised the property to let from 1st Jan 2019, and put everything in place to satisfy our mortgage lender’s demands (landlord insurance etc) when we applied for ‘permission to let’

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LATEST: Flooding report recommends landlords be forced to offer tenants more insurance cover

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Landlords of properties in flood risk areas should be forced to offer tenants more support following a flood and upgrade their insurance to offer tenants more cover, a report into last year’s extreme weather events has recommended.

Lead by insurance industry chief Amanda Blanc (right), the report focusses on the flooding in South Yorkshire last year but has recommended changes on a national level.

Her report, commissioned by the government, reveals shocking differences in cover between home owners and renters.

While 95% of home owners canvassed had adequate General Insurance in place, only 45% of tenants in Doncaster had taken out contents insurance of any kind.

When asked about specific flood insurance, nearly three quarters of owners confirmed that they had either buildings or contents insurance that covered flood damage.

But only 25% of tenants said they had contents insurance that covered flood damage.

The report therefore calls for landlords to be compelled to inform tenants about their buildings insurance and what to do if a flood occurs; and legislate to force landlords to have policies that offer tenants alternative accommodation if they are ‘flooded out’ for an extended period.

“This Review is essential in identifying some of the barriers that are in place for residents in high flood risk areas and understanding how we can take positive action to improve the protection available to residents moving forward,” said MP Rebecca Pow (left) when launching the report in Parliament.

Ministers are expected to act on the recommendations ‘in due course’.

Read the report in full.
Read more about insurance and flooding.

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Latest lockdown offers fewer restrictions for the property industry

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The latest Health Protection (Coronavirus Restrictions) (England) (No. 4) Regulations 2020 relating to the second lockdown in 2020 will be of interest to landlords and property professionals throughout the UK property industry.

Participants will remember the regime in the first lockdown when there was virtually a total shut-down for sales and lettings – buyers and sellers, landlords and tenants had months in which they could not view houses and building sites or change tenancies, and all this added to complications for exchanging contracts, completing transactions and moving in and out of homes.

However, this time the new regulations allow significantly more exemptions across the board, including for the main property market, which should mean there is a lot less disruption this time around.

Residential property

As was the case previously, the new Regulations include a general prohibition on leaving your home ‘without reasonable cause’, but this time there is a list of exceptions and exemptions to the prohibition on leaving your home. Regulation 6(2) includes a list of activities connected with the purchase, sale, letting or rental of a residential property.

The exempted activities permitted include;

• visiting estate agents,
• viewing properties,
• preparing a property for a move,
• moving house
• visiting a property to ‘undertake any activities required for the rental or sale of that property’.

The list is quite comprehensive and offers a broad scope for activities around residential property. These exemptions should allow landlords, agents and property professionals to continue working and earning with the least amount of disruption under the present circumstances.

Commercial property

The regulations refer exclusively to residential property and there is no mention of commercial property, so the general leaving home prohibition will still apply. However, those involved with commercial property transactions may be permitted to leave their home under other wider exceptions.

Regulation 6(4)(a) according to legal information providers Lexology, permits a person to leave the house for work where it is not reasonably possible for them to work or provide their services from home.

Obviously, most physical aspects of commercial property work such as sales and letting agents’ viewings, surveyor’s inspections, repairs, refurbishments and fitting outs, cannot possibly be done from home.

Businesses which have been forced to close for the duration of the lockdown such as hospitality businesses and non-essential shops will however find themselves barred from working or carrying out works in the premises.

Construction

The Government has been keen to stress the importance of construction to the economy and this work can continue as before. The Prime Minister specifically mentioned construction and manufacturing in his statement as workplaces which can remain functioning.

Conclusion

The regulations will be in force for the four weeks of the lockdown ending on the 2^nd of December, after which time the government will have to produce a new set of regulations dependent on the situation at that time.

It does appear that the government intends to encourage the property industry generally to carry on with as little disruption as possible whilst still observing the general precautions placed on the general public namely, maintaining social distancing, mask wearing where appropriate, and personal hygiene measures such as regular hand washing.

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European Tenants?

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Hi, I have a number of European tenants and was wondering what is likely to happen if we leave Europe without a deal. I keep seeing adverts on TV about getting your business ready for Jan 01 -21.

Are their rights likely to change and possibly have to leave the country within a required timescale and what if they are in an AST that overruns that timescale?

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Meet Mark Smith (Barrister-At-Law) Landlord tax planning strategies – PIN Edinburgh

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Our Hon. Legal Counsel, Mark Smith, Head of Chambers at Cotswold Barristers will be presenting an overview of several landlords tax strategies including special strategies for Scottish landlords at the pin Edinburgh Thursday 19th November.

The events will be held Online and Attendees can expect first-class speakers and great networking opportunities.

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Lodger belongings being collected one trinket at a time?

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Hello, My lodger left the room alone after only 7 days of living in it. She looked like a normal person, but turned out to be very malicious and aggressive.  She left home on October 4th and from that day on hasn’t lived here any more.

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