Should landlords be worried by the pet changes in the latest Model Tenancy Agreement?

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The government has published its latest Model Tenancy Agreement and within it given tenants the right to rent a property with their pet, with the onus on landlords to explain why they think it’s inappropriate for the property.

Although this is a significant deviation from previous government policy, the new model agreement is only recommended to landlords and letting agents when issuing rental contracts. But it marks a significant shift by Ministers.

What do landlords and other players in the housing market think of this mild government U-turn on pets?

Suzy Hershman, mydeposits

“Unfortunately, The Tenant Fees Act scuppered all ways of taking extra money in return for allowing a tenant to keep a pet in the property, other than taking a well-advertised and ‘reasonably placed’ higher rent.

“A tenant is only responsible for leaving the property in the same condition it was in at the start, allowing for reasonable wear and tear.

“If you agree to a tenant with a pet, then ‘reasonable wear and tear’ could extend to minor damage caused by the pet. 

“Whether a deduction is made from a deposit or is a claim for a no-deposit alternative such as the Ome like any claim, it can only succeed for a breach of the tenancy agreement – i.e. damage that is beyond reasonable wear and tear, which is supported by evidence.”

The National Residential Landlords Association

A spokesperson says: “Pets are not always suitable in certain properties such as large dogs in small flats without gardens. There is often more a risk of damage to a property where there is a pet.

“We call on the Government to enable the level at which deposits are set to be more flexible to reflect this greater risk.

“We are also calling for a tenant to either have pet insurance or to pay the landlord for it to be allowed as a requirement for a tenancy where relevant.

“At present payments such as this are banned under the Tenant Fees Act.” 

Terri Dunne, Chief Delivery Officer at Hamilton Fraser

“Allowing responsible tenants to have pets will increase the market reach for the property and attract a wider supply of tenants and possibly longer tenancies.

“But it is generally accepted that no matter how well trained the pet is, there is likely to be damage to the property.

“Under a landlord property insurance policy there are likely to be exclusions or limitations regarding whether a claim can be submitted for any damage caused by a pet.

“As such, you should always check your landlord insurance policy or speak with your insurance broker.”               

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Cities will return to rental popularity once Covid ends, say landlords

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Landlords investing in property at the moment believe the UK’s cities will return to normal after the pandemic is over, and are ignoring claims that semi-rural suburbia is where home-working renters will want to live in the future.

Lender Paragon says it has found that landlords continue to target urban locations for buy-to-let purchases; 16% of landlords plan to buy an average of 2.2 properties in the next 12 months, with 68% looking at buying in urban areas.

Suitability for home working was only named by 27% of landlords as important, while proximity to green space was picked by 17% of those who plan to invest in the next year.

Paragon’s study of 846 landlords found that more than a third (36%) plan to buy in a suburban area and 6% are looking at rural locations. Two thirds (66%) of landlords are going to buy in the same area as their existing properties, with 10% targeting new areas, and 20% planning a mixture of both.

MD Richard Rowntree (pictured) says that while investors need to be able to adapt to changing market conditions, it’s also important to look at the bigger picture.

He adds: “While we have seen some move out of urban areas, this isn’t possible or desirable for everyone. The successful landlords will be the ones who invest with the intention of meeting the diverse demand for good quality, affordable housing.”

When deciding what to buy, terraced houses were cited as most popular, followed by semi-detached houses. Potential for rental yield is the most important aspect, according to most landlords, followed by the ability to add value.

Listen to the Hamilton Fraser podcast on mortgages for landlords.

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Kensington Flat For £45K At Auction?

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Property Auction Review video of some of the best property investment deals (both Residential & Commercial) coming at property auctions Allsop & Auction House London reviewed by myself, Rod Turner, Jay Howard and Piotr Rusinek.

In this episode

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One of us? New housing minister reveals he is also a landlord

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Landlords sometimes complain that those in Whitehall’s corridors of power do not understand the day-to-day challenges of being a landlord when fashioning new regulations and laws.

But now one of their own has been made a housing minister. Eddie Hughes MP, who was appointed to the housing ministry team on 18^th January following the resignation of Kelly Tolhurst for family reasons, has told the MCHLG committee during his first parliamentary outing that he is also an ‘accidental landlord’.

At the moment this is not mentioned in the parliamentary Register of Member Interests, which requires rental income over £10,000 and properties worth over £100,000 to be declared.

Hughes is not alone – a recent investigation among MPs using the Register during May last year found that out of the 650 MPs in the current parliament 110 (17%) are landlords.

This compares to the general population, among whom just 5% or one in 20 are landlords.

Conservative majority

More Conservatives are landlords than amost Labour or other party MPs; 87 out of 365 Tory MPs (24%) are landlords and 45 of those (or 15%) including Boris Johnson rent out more than one property.

Johnson has two rental properties – one in London and a 20% share in a rented property in Somerset.

The other parties are less landlord heavy. Two out of 11 Lib Dem MPs (18%) are landlords along with four out of 47 SNP MPs (9%) and 17 of 202 Labour MPs (8%).

These figures make the Conservative’s all-out assault on landlords all the more baffling – given 87 of its own party will personally feel the increased costs and taxation imposed on landlords since they took power in 2015.

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Landlords are in ‘last chance saloon’ to buy properties before Rishi’s stamp duty deadline

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Nearly half of all buy-to-let mortgage lenders say they will be unable to get new transaction across the line by the 31^st March stamp duty deadline, landlords have been warned.

The research, by a leading mortgage broker, reveals that even the lenders still capable of doing deals in this sort of time frame may well struggle to hit the deadline if solicitors or local authorities drag their feet.

“Typically, a landlord would want about 100 days to complete a purchase,” says Jeni Browne, director of Mortgages for Business.

“Clearly, landlords don’t have that sort of time on their hands anymore and I’d urge them to do everything they can to push through a new buy-to-let purchase before the stamp duty holiday ends.”

At the moment, although landlords still have to pay the additional 3% stamp duty levied on ‘second home’ property purchases, like all other home buyers they do not have to pay any ‘standard’ stamp duty on the value of the home they buy under £500,000.

Gutted

“I think most landlords would be completely gutted to miss the deadline simply because the lender they’d chosen couldn’t turn their transaction around in time,” says Browne (pictured, below)

“With volumes so high, many lender’s service levels have slipped – it’s taking some of the big players 10 minutes just to pick up a sales call while others are taking 35 working days just to undertake their processing. 

“It’s therefore absolutely critical that landlords speak to a specialist broker who can ensure they not only get a competitive deal but that they also get one that has a realistic chance of going through before the deadline runs out. 

“Frankly, it’s absolutely to the wire, even with the right lender.”

A parliamentary debate is due on the stamp duty deadline on Monday.

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New pet friendly standard government tenancy agreement

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The government has released its latest standard model tenancy agreement to cater for responsible tenants with well-behaved pets. Under the new Model Tenancy Agreement, announced by Housing Minister Rt Hon Christopher Pincher MP, landlords will no longer be able to issue blanket bans on pets.

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Developer Exit Finance when your lender is unhelpful

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During the current Covid-19 pandemic, we have received an increased number of enquiries regarding refinancing existing development finance. These have mainly been brought about by overruns either in terms of cost or time and their current lender not being helpful.

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