Government to make buying local authority-owned plots easier for property investors
Property investors are being asked to have their say about plans to make it easier to free up unused or underused land owned by public bodies after a previous scheme led to just one plat being released.
The Ministry of Housing, Communities and Local Government has launched a consultation to help shape a reform of the Right to Contest, to make the process more efficient.
Right to Contest currently allows people and businesses to request a disposal of unused or underused land, including vacant homes and garages, but it’s so little-known that only one direction to dispose has ever been issued.
Right to Regenerate
Following the consultation, it will be relaunched as the Right to Regenerate and should prove to be a quicker and easier way to identify, buy and redevelop land and bring it into better economic use. The aim is to regenerate local areas across England by providing new homes.
Launched in 2014 with great fanfare by the then Conservative government as ‘opening up £330 billion of property, since then a paltry 192 requests have been submitted.
Of these, 145 were refused, 10 were withdrawn, nine are still pending, 27 were not a valid request and one direction to order disposal was issued. Many requests are refused because the public body declares that it has an intended use for the land. This can mean some sites are left unused or underused for long periods while those plans materialise.
The government is considering incentivising temporary uses by ordering sales. It could also introduce a ‘right of first refusal’ to those who make the request, recognising that they might need extra time to prepare a bid. This would usually be for market value and would be for a limited period.
The consultation questionnaire, which closes on 20th March, can be done online.
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Government to make buying local authority-owned plots easier for property investors | LandlordZONE.
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BREAKING: Rents rising at fastest rate for six years as supply dwindles
Half of all landlords re-letting properties this year have been able to capitalise on the lack of available homes and increase their rent.
Research by Hamptons shows that would-be tenants are now faced with significantly less choice meaning that landlords have raised rents by an average of £60 per month.
It reports that rental growth nationally has been fuelled by a lack of stock; 300,000 fewer properties have come onto the rental market since the onset of the pandemic, nearly a fifth less than during the preceding 12 months.
The urban-rural divide has also continued to deepen, with 16% more homes available to rent in cities in February 2021 than at the same time last year, while towns and country locations recorded falls of 28% and 52% respectively.
Record rents
Rental growth outside London hit the highest figure on record since its monthly lettings index began in 2012; the average rent of a newly let property is now 8% or £68 per month higher than it was in February 2020. Across Great Britain, rents rose 5.6%, the fastest rate of growth since February 2015.
London is the only regional exception. Across Greater London rents fell 0.2% year-on-year, with the drop driven by falls in Inner London. In line with weak rental growth in the capital, fewer London landlords (37%) were able to secure higher rents, marking the lowest proportion recorded in any region.
However, head of research Aneisha Beveridge (pictured) believes there are signs of change as landlords looking to beat the original stamp duty deadline of the end of March, made more buy-to-let purchases.
She adds: “Meanwhile, the government announced a new Mortgage Guarantee Scheme in the budget which is aimed at helping would-be buyers with small deposits, many of whom are currently renting. Both factors, alongside the ending of the eviction ban in April, mean rental stock levels may have bottomed out.”
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BREAKING: Rents rising at fastest rate for six years as supply dwindles | LandlordZONE.
View Full Article: BREAKING: Rents rising at fastest rate for six years as supply dwindles
Budget 2021: More help for homebuyers
Chancellor Rishi Sunak’s Budget 2021 seems too good to be true for homebuyers, so here’s a look at what 95 per cent mortgages and an even longer Stamp Duty holiday means to both landlords and residential homebuyers.
With some delight, the Chancellor echoed the sentiments of Prime Minister Boris Johnson when he explained the Government’s goal of turning generation rent into generation buy.
What he said did not really come as a surprise as both measures were extensively leaked to the media some days earlier. However, papers published alongside the Budget 2021 speech added more information about what his plans mean for homebuyers.
Stamp Duty holiday extended
The Land Duty Stamp Tax – better known as Stamp Duty – holiday has been extended for house buyers in England from 31 March 2021 to June 2021.
“Extending the Stamp Duty holiday will help many landlords who would not have met the original deadline and I predict this will stimulate further sales” said Daniel Lee, Principal at Hamilton Fraser Total Landlord Mortgages.
Landlords should act sooner rather than later if they want the best Stamp Duty deal as the Chancellor plans to raise the bar again at the end of June before taking the rate back to pre-holiday levels in October.
The Stamp Duty holiday rates below apply to homebuyers in England and Northern Ireland. Scotland and Wales set their own taxes with different rates and thresholds from those in England.
The additional home rates for landlords and second homeowners remain unaffected by the Stamp Duty holiday.
These are the key dates and figures you need to keep in mind:
Stamp Duty rates until 30 June 2021 – If you buy a home valued at no more than £500,000, there’s no Stamp Duty to pay
Property value | SDLT rate |
Up to £500,000 | Zero |
The next £425,000 (the portion from £500,001 to £925,000) | 5% |
The next £575,000 (the portion from £925,001 to £1.5 million) | 10% |
The remaining amount (the portion above £1.5 million) | 12% |
Source: HM Revenue & Customs
Example
In March 2021 you buy a house for £625,000. Stamp Duty is calculated as:
- Zero per cent on the first £500,000 = £0
- Five per cent on the remaining £125,000 = £6,250
- Total stamp duty = £6,250
Stamp Duty rates from 1 July to 30 September 2021 – The zero rate threshold drops to £250,000.
First-time buyers pick up an extra discount from 1 July 2021 which keeps their zero rate threshold at £500,000 if they are genuine first time buyers and the property is valued at £500,000 or less.
Property value | SDLT rate |
Up to £250,000 | Zero |
The next £675,000 (the portion from £250,001 to £925,000) | 5% |
The next £575,000 (the portion from £925,001 to £1.5 million) | 10% |
The remaining amount (the portion above £1.5 million) | 12% |
Source: HM Revenue & Customs
Stamp Duty rates from 1 October – The zero rate threshold drops again to £125,000, which is the same as before the stamp duty holiday started on 8 July, 2020.
Property value | SDLT rate |
Up to £125,000 | Zero |
The next £125,000 (the portion from £125,001 to £250,000) | 2% |
The next £675,000 (the portion from £250,001 to £925,000) | 5% |
The next £575,000 (the portion from £925,001 to £1.5 million) | 10% |
The remaining amount (the portion above £1.5 million) | 12% |
Source: HM Revenue & Customs
What is the 95 per cent mortgage scheme?
When the property market in England reopened last spring, only a handful of low deposit mortgage deals remained, as banks and building societies reined in 95 per cent mortgage offers in the wake of the coronavirus pandemic.
Although nearly a year on from the outbreak of the pandemic, lenders are starting to offer low deposit deals again, the number of high loan to value loans plunged from nearly 400 a year ago to just five last month. And these were mostly special deals that were not available to every customer.
To free up house sales, the Chancellor needs to give cash-strapped buyers who can’t afford large deposits an incentive to borrow. He also needs to sweeten the deal for banks and building societies.
This is where the 95 per cent mortgage guarantee scheme comes in, as an attempt to appease both sides and bring back the low deposit mortgages that he previously said had ‘virtually disappeared’.
The guarantee is straightforward.
The Government will guarantee the high loan to value portion of the mortgage, which ranges from 80 per cent to 95 per cent of a property’s value. The buyer stakes five per cent and the mortgage lender covers the rest.
If the borrower defaults and the property is repossessed, the Government will settle the guarantee.
Most of the big lenders have already signed up, including the high street banks Lloyds, HSBC, NatWest, Santander and Barclays.
However, there are some conditions:
- The borrower must have a good credit rating
- The home must cost no more than £600,000
- The property must be the borrower’s main home – no holiday lets, second homes or rental properties are allowed
- First-time buyers and movers can apply for the guarantee
Details about interest rates are still awaited, but the rate is expected to be around 3.5 per cent to 4 per cent and the Government is demanding lenders offer a five-year fix without any expensive product fees.
Affordability will be assessed in the same way as standard mortgages.
What we think about Budget 2021 for homebuyers
“Although landlords don’t stand to benefit directly from the 95 per cent mortgage scheme, both these announcements are evidence of how in times of financial strain the Government will step in to keep the property market strong.
“With the Bank of England interest rate staying low, the Stamp Duty holiday extension and the 95 per cent mortgage scheme, along with the hope of coming out of this difficult period in history this is another sign of why people put their faith in bricks and mortar.” Daniel Lee, Principal of Total Landlord Mortgages.
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Budget 2021: More help for homebuyers | LandlordZONE.
View Full Article: Budget 2021: More help for homebuyers
Leading ‘property guru’ critic has YouTube channel taken down
A critic of ‘property guru’ Samuel Leeds has had his YouTube channel disabled by the video platform following complaints made by both Leeds and his partner, Amanda.
The pair complained to YouTube that clips taken from Leeds’ videos and used by Andrew Burgess in his own productions were an infringement of their copyright.
YouTube concurred and has deleted Burgess’ account including all his content because ‘one or more of your videos contained copyright material’. The platform has told Burgess that ‘copyright owners can choose to issue legal complaints that require YouTube to take down videos that contain their content’ and that ‘when you have three or more copyright strikes your account can be disabled’.
Video clips
Burgess is one of many YouTubers who have used video clips from material published by Leeds to highlight their criticisms of his business model, personal wealth claims and ongoing assertions that students can attain financial freedom with little or no money via property investment.
Leeds has been investigated by several national newspapers including after Danny Butcher, one of his former students, took his own life after falling further into debt after paying substantial sums to attend a course run by Leeds’ company, Property Investors.
But in recent months the property guru has been on the front foot, publishing dozens of ‘crash course’ videos as well as sending legal letters to publishers, campaigners, YouTubers and forum moderators via his legal representatives, Ellisons.
Appeal
“I have appealed the YouTube ban claiming ‘fair use’ and am waiting to hear but I don’t hold out much hope that they’ll reinstate my account,” says Burgess (pictured).
“I’ve lit the touch paper with my efforts and now many other people are looking more closely at how Leeds runs his business, so my work on YouTube is done.
“Leeds has tried everything including reporting me to the police and four sets of legal letters, all of which have not come to much, but I can’t fight an unaccountable platform like YouTube once they decide to take content down.”
Legal challenge
Burgess, who also runs a Facebook page that is a discussion platform on ‘property educators’ like Leeds, says he recently won a victory of sorts after referring Ellisons to the Solicitors Regulation Authority following multiple threatening letters from the firm, one of which gave him less than the SRA’s suggested 14 days replay period to respond.
“They gave me ten days to reply to a pretty robust letter which the SRA has agreed was not a long enough period, particularly given it was over the Christmas period when law firms were closed. The SRA has raised their concerns over this with Ellisons.”
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Leading ‘property guru’ critic has YouTube channel taken down | LandlordZONE.
View Full Article: Leading ‘property guru’ critic has YouTube channel taken down
ANALYSIS: From dark kitchens to e-bike rentals, here’s how retail landlords are surviving
As shopping centre values are hit by the decline in retail and a COVID induced home delivery trend, landlords are desperate to find alternative uses for redundant space, reports Tom Entwistle.
One company backed by Softbank, an international tech focussed venture capital fund, is offering shopping centre owners a possible solution to their problems.
Reef technology claims to transform under-utilised shopping centre space and car parks into fulfilment centres, neighbourhood kitchens, urban farms and e-scooter rental stations.
Creatives measures
Challenging times call for creative measures and perhaps there’s nothing much more challenging than revitalising a dead or dying neighbourhood shopping centre. This is one solution that just might work.
Miami based Reef Technology has signed a deal with Capital and Regional malls, a stock market listed-landlord with seven shopping centres around London.
Reef was originally a car parks management company trading as ParkJockey, and has since expanded its package into storage and fulfilment for home deliveries, with its own three-wheel Reef branded e-scooters for home deliveries.
Dark kitchens are where local restaurants and new food brands can prepare food for local delivery, and urban farms are there to market locally grown and environmentally-friendly produce.
Electric performance
Alternative uses can be added in the future including stations for e-bikes, electric vehicle (EV) charging points, and e-scooter rentals.
The $700million funded Reef already operates 4,500 locations in the US and Canada and has raised a further $300million from private equity investment specialists Oaktree Capital Management (which recently tried to buy estate agency giant Countrywide) to enable it to acquire strategic property assets.
It has been estimated that in the UK 16,000 shops closed for good last year and approaching a further 1,000 have closed already in 2021. In addition, landlords have been confronted with billions of pounds of lost or deferred rent payments since the start of the pandemic last year.
Glimmer of hope
Reef’s arrival therefore offers at least a glimmer of hope for shopping centre landlords, and an insight into how they can adopt a diversification strategy that has been proven to work.
Reef‘s MD Europe, Barak Zimerman, told The Times newspaper: “The need to adapt and transform retail has never been greater” Our platform will help Capital & Regional “drive its assets recovery as businesses evolve post-pandemic”.
Pic credit: Paul Wilkinson, Flickr.
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – ANALYSIS: From dark kitchens to e-bike rentals, here’s how retail landlords are surviving | LandlordZONE.
View Full Article: ANALYSIS: From dark kitchens to e-bike rentals, here’s how retail landlords are surviving
Tenant who illegally sub-let her flat is treated by court as rogue landlord
A tenant who illegally sub-let her flat as an HMO has, somewhat ironically, been convicted of being a rogue landlord.
Sonia Nascimento rented a converted, four-bedroom flat in St Pauls Avenue, London, in 2017 but went on to let the property to eight other tenants for a profit.
She has now been ordered to pay more than £9,000 in fines and costs for multiple housing breaches after Willesden Magistrates Court heard how a lack of smoke alarms and fire safety system put all the tenants in danger, including a four-month-old baby.
One of the tenants reported Nascimento to Brent Council’s private housing services last July, revealing that none of them had a tenancy agreement or had used a government-approved deposit scheme.
An inspection revealed that the property had no HMO licence and that Nascimento, who did not live in the flat but was ‘head tenant’, was in breach of housing management regulations.
The owner of the property, who paid occasional visits to the flat, was issued with a £2,500 civil penalty notice for failure to licence.
Taken to court
Nascimento was given a £5,000 community protection notice, but when she failed to pay it, the council took her to court.
Councillor Eleanor Southwood (pictured), lead member for housing and welfare reform, says: “Landlords who fail to license their properties or who are not following housing management regulations are breaking the law.
“Safety of tenants is our priority and we encourage anyone who suspects that their landlord may be acting outside the law to report their concerns to us.”
Read more about HMO tenancies.
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Tenant who illegally sub-let her flat is treated by court as rogue landlord | LandlordZONE.
View Full Article: Tenant who illegally sub-let her flat is treated by court as rogue landlord
I did not realise even insurers held us in such contempt?
I just applied for Home Insurance with Hiscox, I was declined because I am a Landlord!
I made it clear it was for my home only, but it made no difference.
I did not realise even insurers held us in such contempt.
The post I did not realise even insurers held us in such contempt? appeared first on Property118.
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Why UK Property Prices Will Rise in 2021
I correctly predicted last year, that there would be no housing market crash in 2021.
In this update, I consider some key announcements from the Budget and state why I feel property prices will rise in 2021 and beyond.
The post Why UK Property Prices Will Rise in 2021 appeared first on Property118.
View Full Article: Why UK Property Prices Will Rise in 2021
EXCLUSIVE: What the broken evictions system means for landlords when tenants go ‘nightmare’
Landlord couple Udayanga Vitharana and Kumari Sujantha have been let down by their letting agent, legal representatives, the benefits system and the courts in their attempt to evict a wayward tenant.
The woman stopped paying rent last April but has been running a beauty business from the house in Crawley, Sussex where she has hosted clients during lockdown.
She’s been exploiting the benefits system by falsely claiming extra Universal Credit and also blocked the couple’s three attempts to apply for an Alternative Payment Arrangement.
The tenant now owes the couple more than £14,000 in rent, but last week a court threw out a Section 8 notice they had issued in May after the unlicenced legal firm representing them omitted to tell the judge vital facts in the case and provide important paperwork. They found out months later she had paid £50 to their account just before this without telling them, to ensure she wasn’t two months’ in arrears.
Udayanga tells LandlordZONE that the tenant is using benefit and legal loopholes to stay in the three-bedroom property. He has no idea when they will get another court date – and in the meantime, they’re trying to pay two mortgages. “This issue has been very difficult for us mentally and physically over the past 10 months,” he says. “I suffer from a chronic illness and the stress caused by this is affecting my wellbeing.”
False references
The couple discovered she had given false information on her reference form which hadn’t been picked up by online lettings agency Open Rent. “She said she worked for a non-existent company,” says Udayanga. “We only wanted a professional person and wouldn’t have signed the contract if we’d known her situation – I expected more thorough checks.”
OpenRent says the couple’s complaint is being handled by its team. Founder Adam Hyslop tells LandlordZONE: “They are in dialogue with the customer and our referencing provider to determine what went wrong and propose a resolution to the customer based on those findings.”
The landlord couple then found out she had been claiming benefits for months – and it also transpired she was claiming for two people, receiving £750 instead of £480. The DWP is now investigating benefit fraud. “We finally started receiving direct payments in October but it doesn’t cover our mortgage,” he says.
Their tenant has refused access to the property since May and, as a result, an evaluation request was declined. “By doing so, she prevented us from getting a better re-mortgage deal,” adds Udayanga. “We are so fed up – we just want our house back.”
Read more about the problem of unlicenced legal firms.
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – EXCLUSIVE: What the broken evictions system means for landlords when tenants go ‘nightmare’ | LandlordZONE.
View Full Article: EXCLUSIVE: What the broken evictions system means for landlords when tenants go ‘nightmare’
Nerve agent house to be sold with unusual sub-let rental clause
The property in Salisbury where former Russian spy Sergei Skripal and his daughter Yulia were poisoned is to be bought by the local council and then sold with an unusual rental restriction attached to the property, it has been revealed.
The Skripals bought the 1990s-built detached house for £260,000 in 2011 but the address become notorious after the Skipals were poisoned in 2018 by deadly Novichock nerve agent that had been sprayed on their front door by two suspected Russian intelligence officers.
The pair survived the suspected assassination attempt although local women Dawn Sturgess, who unintendedly came into contact with the discarded bottle used in the attack, died.
After 32,000 hours of deep cleaning by a specialist team that saw the property cordoned off for months, it has now been bought by Wiltshire County Council in consultation with its neighbours.
Sub-letting clause
The property is to be offered via a shared ownership scheme and include a sub-clause in its sale contract that will prevent future owners sub-letting the property out including via short-let platforms such as Airbnb.
This, it is understood, is to deter future owners from cashing-in on ghoulish holiday makers seeking to stay at the property.
Leader of the council Philip Whitehead (pictured) told the BBC: “It will be good to see this house used as a home again.
“During the coming months, we will rebuild and refurbish the property to bring it back into use as a home, and to protect local residents, we will ensure that the property will not be used for anything other than a home.”
Another property in Salisbury, where Sturgess lived with her partner, was knocked down last year.
Renting out homes via short-lets platforms is becoming more difficult for owners including, as we reported last year, because insurers are stipulating that owners will be invalidating their homes and/or contents insurance if they do so.
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Nerve agent house to be sold with unusual sub-let rental clause | LandlordZONE.
View Full Article: Nerve agent house to be sold with unusual sub-let rental clause
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