Housing benefit causing young to choose between rent debt and health

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Young people are being forced to choose between racking up rent debts and risking their health due to rules limiting what they can claim for housing benefit. Those under 35 who are now relying on benefit to pay their rent for the first time will find that support will only be available to cover the cost of a room in a shared house.

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HMO landlord fined £70,500 after failing to upgrade properties in ‘shocking’ condition

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A rogue landlord who failed to repair her two run-down HMOs which had to be shut down, has been handed a £70,500 fine.

Lystra Dorval, of Oaks Lane, Ilford, was given ten penalty notices for poor management of the properties in Hayes Road, Clacton, where tenants endured a catalogue of faults, including blocked fire escapes, broken staircases and toilets, and dangerous electrics.

They reported being threatened with eviction for pointing out the problems, while neighbours also complained about anti-social behaviour and the properties’ poor condition.

Tendring Council in Essex gave Dorval a list of works to complete and a few months later told her to immediately repair the fire alarm.

Housing officers shut down the bedsits using an Emergency Prohibition Order and rehomed her tenants two days later when the work hadn’t been done.

Gas leak

The next day a gas leak and flooding were found after pipework was stolen, and during clear-up work further damage was revealed including floors at risk of collapse, drains blocked with rubble, and rotting waste.

Following “slow and unsatisfactory” progress on repairs to the building, enforcement notices were issued, and Dorval had her licences removed as the council said she was no longer a fit and proper person to run the HMOs.

She appealed, but a First Tier Housing Tribunal has now reached a similar decision, although it did reduce her original fine from £90,000 set by the council.

Paul Honeywood (pictured), Tendring councillor responsible for housing, says the case sends a strong message to landlords.

He adds: “We work closely with landlords as the vast majority want the same thing – a decent property which is good for the tenant and provides them with rental income. Sadly, this was not the case here.”

The property had been operated as a care home by Dorval for nearly three decades until 2014/15 before being investigated by the Care Home Commission and eventually shut down. It was then converted into two HMOs.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – HMO landlord fined £70,500 after failing to upgrade properties in ‘shocking’ condition | LandlordZONE.

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Top fund manager says Real Estate Investment Trusts offer exceptional value…

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Star fund manger Nick Train’s Lindsell Train UK Equity Fund has produced a total return of 352% since its launch in 2006, compared with an 83% return for the FTSE All-Share.

The Finsbury Growth & Income Trust that is also managed by Train has performed equally as well, producing a 65% return for its investors over five years to 31st August, compared to 17% for the FTSE All-Share index.

The famously long-term buy and hold investor has held many of the stocks and funds in his portfolios for over ten years, but recently he’s been on something of a buying spree, taking new stakes in soap manufacturer PZ Cussons, drinks firm Fever-Tree, and credit rating agency Experian.

Train’s latest quarterly report for investors in the Lindsell Train UK Equity Fund makes for interesting reading, noting in particular that he thinks a number of property-based investments – especially Real Estate Investment Trusts (REITs) – look oversold right now, and he’s been taking advantage.

Since the end of September, for instance, he’s taken positions in Supermarket Income REIT, the Schroder Real Estate Investment Trust, HICL Infrastructure, and Regional REIT.

Despite the turmoil caused by Covid-19, says Train, investors in the UK are really spoiled for choice right now, though he does stress the importance of steering clear of the worst-hit sectors, such as travel and hospitality. Even the most conservative of investors is likely to find stocks with obvious appeal, he says:

“I genuinely believe this in part reflects the long period of disappointing absolute and relative returns delivered by the UK stock market,” Train writes.

“It’s simply that more opportunities are being presented to us as other investors give up on the UK. I don’t exaggerate when I say ‘give up’: have you seen the industry data showing monthly outflows from across all UK equity funds? They are substantial and sobering.”

In other words, thinks Train, a bit of a valuation gulf has opened up between what global investors are valuing UK stock market at, and Train’s own view of prospects the UK has to offer, particularly the kinds of high-quality UK stocks that he traditionally goes for.

Despite his reputation for his investing patience, at times “sitting on his hands” for many years on his favoured investments, with little by way of trading action, he now sees many opportunities in the market that are too good to miss. He will likely be making more purchases for his funds in the months ahead. That increased activity for Train includes property investments.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Top fund manager says Real Estate Investment Trusts offer exceptional value… | LandlordZONE.

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BREAKING: Landlord mortgage arrears jump by 19%, latest lender figures reveal

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The number of landlords with buy-to-let mortgages in arrears has leapt by 19% over the past three months, latest figures from UK Finance reveal.

The organisation, which represents the UK’s mortgage lenders and personal finance firms, reveals that there were 5,400 buy-to-let mortgages in arrears last quarter owing more than 2.5% of the outstanding balance.

Of these, 1,350 were more serious arrears owing 10% or more of the balance.

Jonathan Harris, managing director of mortgage broker Forensic Property Finance, says: “The uptick of buy-to-let mortgages in arrears is from a low base, with the overall picture suggesting current levels remain lower than in previous years.”

UK Finance says this is largely down to the ‘mortgage holiday’ its members have offered struggling landlords, and the moratorium on repossessions enforced during the pandemic.

Repossessions

Just 230 buy-to-let mortgaged properties were taken into possession in the third quarter of 2020, 71 per cent fewer than in the same quarter of the previous year.

“Following the industry moratorium on involuntary possessions, these low possessions numbers in Q3 2020 for the most part reflect cases where the customer requested the possession to go ahead or where the property was vacant,” says UK Finance.

Harris adds: “The past few months have been difficult for landlords, however, with evictions put on hold, and many may be tempted to sell up once they have an opportunity to do so.”

But however worrying the leap in arrears may seem, the situation for landlords remains mild compared to the darkest day following the global financial crisis, when an estimated 14,000 buy-to-let mortgages were in arrears.

Read more about Coronavirus and the PRS.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BREAKING: Landlord mortgage arrears jump by 19%, latest lender figures reveal | LandlordZONE.

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CGT REVIEW proposals discussion LIVE on YouTube at 1:15pm this afternoon

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The Office of Tax Simplification has published its proposals to Chancellor Rishi Sunak in regards to CGT.

A link to the 131 page document can be found HERE.

The Breaking News Live video will be hosted by Ranjan Bhattacharya and myself.

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LATEST: New student Covid rules risk chaos in shared houses during mandatory tests

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The National Union of Students (NUS) has called for more support for students who test positive for Covid in private accommodation before the Christmas break.

New Government guidance on plans for the mass testing of students so they can travel home once national restrictions end on 2nd December, means if someone tests positive before they leave they’ll need to self-isolate for ten days. 

It says that moving all learning online by 9th December gives these students enough time to isolate and still get home for Christmas.  

Under current guidelines, their housemates will have to isolate too, however, if they’re living alone – particularly in an HMO – it could be a challenge to shop and feed themselves.

The Government advises that isolating students living in HMOs should discuss their circumstances with both their landlord and their college, who should, “work in tandem to ensure that necessary support is in place”.

However, the NUS says following massive lockdowns in student halls, students are unsure as to who counts as their household in cases of isolation. It wants clear and supportive guidance alongside the mass testing programme.

NUS President Larissa Kennedy (pictured) says: “We have seen universities try and get away with some shocking behaviour, including charging over £200 for a fortnight’s food for students.

Students deserve better than being extorted while they are vulnerable; it’s vital that they get wellbeing support and free food if they are unable to leave their accommodation – this includes those in private housing.” 

Despite universities’ best efforts, many students contracted the virus within days of arriving on campus earlier this term. An estimated 40,000 students have become infected while in their university towns, leading to thousands having to isolate.

Read more about student accommodation.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: New student Covid rules risk chaos in shared houses during mandatory tests | LandlordZONE.

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Guest blog: How Crisis is working WITH private landlords on ground-breaking pilot scheme

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When the coronavirus outbreak began early this year, homelessness organisations along with local councils and Scottish Government moved quickly to protect people experiencing homelessness, especially people who were sleeping rough, from the pandemic, providing them with somewhere safe to stay and self-isolate.

This undoubtedly saved lives.

Once in the hotels, organisations like Crisis have been working to provide support to people to move on into more permanent, stable accommodation.

Along with Streetwork and Cyrenians, we set up a new pilot scheme which focused on helping people move on from homelessness and into a privately rented home.

In April, the UK Government increased the rate of housing benefit so that it now covers the lowest third of rents across the rental market.

This meant that hundreds of properties were now affordable for people who relied on benefits in Edinburgh, offering a route out of homelessness.

The pilot, which is funded by Scottish Government, began in April, with the partners working to build the pathway from hotels to safe and settled homes for people with a range of support needs.

Crisis was able to build on the success of its Help to Rent scheme, which already works closely with landlords and people experiencing homelessness across Edinburgh to help find a settled home in the private rented sector.

We liaise closely with landlords and agencies, Cyrenians co-ordinates the service, and Streetwork ensures tenants have a full package of person-centred support.

Assessment process

This support is trauma informed and begins while the person is experiencing homelessness, assisting them through the assessment process which includes finding the right home for them.

Person centred, the support ranges from helping people to move in, set up and maintain a home, to supporting them to pursue their own goals in life.

Emotional support is a key aspect of the help provided to assist people to successfully leave homelessness behind for good.

We’re supporting people to leave homelessness behind for good because of the scheme.

We’ve built up stronger relationships with landlords and letting agencies and built our understanding of the support needs that people experiencing homelessness may have so that we can continue to successfully support people to find and maintain a tenancy in the private rented sector.

We know that ending homelessness is possible. Through access to the private rented sector and support to maintain a tenancy, we know that people are provided with a base to rebuild their lives and leave homelessness behind for good.

If you’re a letting agent or landlord and would like to discuss a potential property – or simply find out more on about Help to Rent or the PRS Pilot – please contact Crisis’ PRS Service Manager, Eluned McHardy on 0131 209 7700 or eluned.mchardy@crisis.org.uk

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Guest blog: How Crisis is working WITH private landlords on ground-breaking pilot scheme | LandlordZONE.

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Section 21 review hearing date and tenancy missing?

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Hello. After serving a section 21 I have just received a hearing date for a review.

The court papers advise me to do the following: Provide to the courts a bundle of all documents filed in the case to date and to provide a paper copy of that bundle to the defendant.

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‘Don’t believe ‘get rich quick’ claims about property investment, says leading landlord

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Property investment newbies have been warned that TV shows that claim making money from property is ‘easy’ should be taken with a pinch of salt.

Luton landlord Jonathan Schuman told some of the 36,000 people who subscribe to the All About Property Facebook group last night that there is no substitute for detailed local knowledge, research and good contacts with estate agents.

“Only if you do that will you eventually find the kind of deals where you can make money,” he says.

“So to speak, you’re after £1 properties that you can buy for £50p and then sell on for 75p, but that’s all about sourcing and persuading agents to come to you first with properties.

“It’s why I always say property investment is all about people and not property.

“You need to spend at least two or three weeks researching a market before you enter it – otherwise how do you know whether a property is an opportunity or not?

Deal costs

“Novice investors also need to understand that there are costs involved that aren’t talked about much on TV shows including the deposit, stamp duty, agency fees, legal fees and interest costs.”

Schuman, who revealed he is recovering from a mild bout of Covid after contracting the virus several weeks ago, was interviewed by Paul Shamplina.

The two discussed the current market and the effect of the pandemic on property investment.

Schuman surprised many of those viewing by saying neither stamp duty, unemployment or economic downturns were a determining factor in an active property investment market, but rather interest rates.

“If there is a serious recession in the coming months then it will be my fourth, but I can say with confidence that although things may look bleak and the least likely time to invest, given our low interest rates it will still be an ideal time to jump in.”

Read our interview with Jonathan Schuman.
Listen to a podcast on investing in property during the pandemic.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – ‘Don’t believe ‘get rich quick’ claims about property investment, says leading landlord | LandlordZONE.

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Landlords battle council over ‘pricey’ new HMO licensing scheme

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Welsh HMO landlords could find themselves required to pay an additional licence fee as well as the Rent Smart Wales registration fee after Swansea councillors approved a pricey new additional licensing scheme.

The National Residential Landlords Association (NRLA) says the high fee – between £714 and £1,020 – is like schemes in London where the operating costs would be expected to be higher.

Despite this, The City and County of Swansea is pushing ahead with the scheme for HMOs in the St Thomas electoral ward from February 2021 and is also renewing the scheme in the Castle and Uplands wards.

It reports that 41% of HMOs in the Castle ward were subject to complaints relating to poor waste management, while 38% were related to noise complaints.

Social issues

But the NRLA argues that this is typical of a general inner-city area and is the result of social issues and not the lack of bureaucracy around landlords.

It claims that with only 12 HMOs in the St Thomas ward, there’s insufficient need for a scheme there.

The council says additional licensing will be used as a tool to improve standards by working with landlords, while licence fees will go towards funding more HMO officers, although it acknowledges that recruitment will be challenging during the pandemic. 

NRLA Welsh policy officer Tim Thomas (pictured) says: “Given the difficulties the council are likely to face in recruiting officers to improve HMO properties in the area, the NRLA Wales have written to the deputy leader asking him to consider delaying the scheme until a time when recruitment will be less restricted.”

Read more: Are HMOs the way forward within the PRS?

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