LATEST: Labour attacks Sunak’s £545 million ‘landlord giveaway’ in Budget

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As many of our readers celebrate the extension of the stamp duty extension announced by Rishi Sunak on Wednesday, Labour has rounded on the Chancellor for ‘giving away half a billion pounds to second home-owners and landlords’.

Its calculation is based on Treasury documents that estimate the stamp duty extension zero-rate stamp duty scheme will cost the government £1.6 billion in lost revenue, and that 34% of sales last year were either buy-to-let properties, residential properties bought by companies or second homes.

On this basis Labour reckons landlords have been given a £545 million tax break by the Chancellor so far via the stamp duty holiday.

This, the party claims, is disappointing because there was no announcement during the Budget of help for the estimated 700,000 tenants who Universal Credit housing payments do not cover their 100% of their rent, or the 500,000 tenants who are in arrears.

Wrong priorities

Thangam Debbonaire MP, Labour’s Shadow Housing Secretary (main pic), says: “The Conservatives have shown once again they have the wrong priorities, giving tax breaks to landlords and second homeowners while failing to tackle runaway house prices and build truly affordable housing.

“After a decade of failure on housing, we needed a Budget that put us on the road to recovery and addressed the fundamental flaws in the housing market. Instead, we got reheated policies with no new ideas on housing.”

As reported in the budget, rather than ending on 31st March, the nil rate of £500,000 will be in place until 30 June 2021 for all purchases regardless of their category.

From 1 July to 30 September, the nil rate will be £250,000, before returning to the standard rate of £125,000 on 1 October 2021.

Labour’s criticism of landlords for being give a stamp duty holiday is not new – it made similar claims when the original zero-rate scheme was announced in July last year.

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End of LIBOR

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The FCA has now confirmed that all LIBOR settings will either cease to be provided or no longer be representative:

– Immediately after 31 December 2021, in the case of all sterling, euro, Swiss franc and Japanese yen settings

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Halifax House Price Index – February down 0.1%

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The February Halifax House Price index is 0.1% lower on a monthly basis against January, but in the latest quarter (December to February) house prices were 0.5% higher than in the preceding three months.

House prices were 5.2% higher annually than in February last year with the latest UK average property value now £251,697.

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Big mistake but I just want my house back?

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Hi, I am a landlord for one property, which was my old house. The tenant is refusing to leave with no rent for nearly a year, and we went to court on the 24th of February under a section 8.

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Landlords must get ready for a ‘pets-friendly PRS’ or risk huge bills

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Mishandled pet tenancies could cost landlords thousands of pounds in repairs, warns inventory services provider No Letting Go, whose CEO Nick Lyons says ‘blanket bans’ on pets will soon be a thing of the past.

Those who allow pets in their properties should get good insurance, compile a detailed inventory and make regular inspections to avoid being caught out, he says.

As well as the obvious need for extra cleaning and banishing animal smells, they need to be vigilant in identifying property damage caused by pets; claw marks on doors, torn and frayed carpets at the bottom of stairs and pet hairs on the back of curtains and blinds are often found by inventory clerks carrying out property visits.

Landlords also might have to deal with the expensive and destructive problem of pet urine on carpets.

MP Andrew Rosindell’s Dogs and Domestic Animals Accommodation Protection Bill was recently stalled at its second reading due to Covid issues, and although the government has rewritten its model standard tenancy agreement to include more pet-friendly elements, its new terms and conditions are voluntary.

Property damage

Despite this, as tenant demand for pets rises, landlords must have the measures in place to deal with the increased risk of property damage says Lyons (pictured), founder and CEO of No Letting Go, who believes we’re moving towards a scenario where blanket bans on pets are no longer an option.

He adds: “With this in mind, it’s time for letting agents and landlords to start preparing for a more pet-friendly PRS by making sure they have the right insurance in place, compile a detailed inventory and monitor damage through regular property inspections.”

Adds Lyons: “Having the necessary records and evidence of damage can make it easier for repairs and maintenance costs to be recouped from a tenant’s deposit at the end of a tenancy.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Landlords must get ready for a ‘pets-friendly PRS’ or risk huge bills | LandlordZONE.

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Telegraph requesting landlord feedback on Budget corporation tax increases

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Hello incorporated landlords!

I have had a request from a journalist at the Telegraph, Melissa Lawford, to find portfolio landlords (with profits of over £50k a year) who will be affected by the corporation tax rises in the Budget.

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Nice budget Rishi but shame about the lack of help for landlords and tenants

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Property experts have largely welcomed yesterday’s budget for not being the raid on the buy-to-let market that many had expected, however, Rishi Sunak has come under fire from those who believe he ignored the private rental sector.

Propertymark says he should have announced details to tackle Covid-related rent arrears.

According to policy and campaigns manager, Timothy Douglas (pictured, the extension to the temporary £20 per week increase to Universal Credit for a further six months doesn’t tackle the fundamental issues that continue to make the benefit inadequate and ineffective.

He says: “The government should give tenants choice over whether the housing element is paid direct to their landlord…and to tackle rent arrears the Universal Credit advance should be turned into a non-repayable grant from the first day of the claim.”

Generation Rent agrees that the Chancellor ignored the rent debt crisis.

Director Alicia Kennedy says his announcement of 95% mortgages is completely out of touch when 60% of private renters had no savings at the start of the pandemic and another 18% have had to use savings to pay their rent in the past year.

She adds: “Stoking demand with more lending and extending the stamp duty holiday will not fix the underlying shortage of homes available to buy.” 

Out in the cold

Cem Savas, CEO and co-founder of Plentific also believes renters have been left out in the cold while home-buyers get all the incentives. “It remains only a small section of society who have these options,” he says.

“At a time when many are struggling, the government should be considering how it can improve the quality of the UK’s rented homes and not solely focus on those fortunate enough to buy.”

David Alexander (pictured), joint CEO of apropos, reckons the delayed 6% increase in Corporation Tax (set to happen in April 2023) is a worry for landlords.

“For those businesses with a large portfolio of properties and substantial profits this will be a concern,” says Alexander. “The two-year delay may also put off many large-scale property investors who will see the substantial hike in Corporation Tax rates as unduly punitive when other international options are available. However, I welcome the fact that he has not gone after Capital Gains Tax at the moment.”

The lack of an announcement on Capital Gains Tax is a positive, agrees co-founder of UniHomes, Phil Greaves, who says: “It’s great news to see that for once, the government has decided to ease the pressure placed on the throats of hard-pressed landlords in recent years.

“Deterring landlords will only ever reduce the level of rental stock available to satisfy the huge number of people reliant on the sector in order to live.”

Read more about stamp duty.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Nice budget Rishi but shame about the lack of help for landlords and tenants | LandlordZONE.

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The Housing Crisis, Who’s to blame – Studio Interview Thursday (today) 8pm

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There are too few houses for tenants to rent and even those available for first-time buyers are too expensive. It’s all Landlords fault, or so the government and everyone else jumping on the bandwagon would have you believe.

Apparently

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Beware stamp duty holiday ‘postcode lottery’, landlords warned

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Landlords should think carefully about the location of their next purchase to avoid the rush of residential buyers trying to beat the stamp duty deadline.

Despite the tax holiday having been extended until the end of June, buy-to-let broker Mortgages for Business reports that many lenders are currently struggling to get mortgages approved where local authorities – often hit by pandemic-related staff shortages – are dragging their feet, with some taking more than 100 days to conduct property searches.

Hacked Hackney Borough Council’s is the worst offender (180 working days), along with Bedfordshire Council (65 working days), Caerphilly County Borough Council (60), Cambridge City Council (50), and North Warwickshire (50).

Mortgages for Business director Jeni Browne suggests that thinking about the effect a local authority could have on a purchase might ease landlords’ headaches. 

Turn of century!

“One search we ordered recently took 145 days to complete,” she says. “If you are considering purchasing a property in Hackney before the turn of the next century, you may want to rethink.”

The broker also advises investors to be prepared to rethink the type of property they’re targeting as well as considering using a portal to reduce waiting time.

It adds that it takes less time to process applications if they’re done via portals, with average deadlines cut from 73 working days to 53 – reducing the time it takes to process a transaction by 27%.

Its research has also found that transactions can take 11% longer if the property in question is a flat, rather than a semi-detached house.

Browne says: “Even if you’re not trying to hit the stamp duty deadline, you may well find that your deal gets caught in the crossfire. Picking a semi-detached house, rather than a flat will help smooth the way.”

Find out more about mortgages.

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Britain’s ‘worst rogue landlord’ banned until 2025

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A rogue landlord who rented out an HMO where children slept in cupboards has been banned from letting houses for four years.

As we reported last March, Deepak Singh Sachdeva, of Moresby Avenue in Surbiton, was found guilty of renting out poor quality living accommodation that posed a serious risk to life, and was fined £87,000 after inspectors found some of the worst living conditions they had ever seen.

The conditions at the Bristol property are in stark contrast to the smart suburban property in South London where Sachdeva’s various past businesses have been registered, and his luxury 4×4 vehicle.

When council officers investigated his Premier shop premises on Avonmouth Road in Avonmouth, they discovered nine people in two separate living spaces above the shop’s rear storage area, with three of them, including two young children, sleeping in cupboards in the eaves of the roof.

The property was in such poor structural condition and design that it posed a serious risk to life; there was barely any fire-resistant separation between the shop store and the flat above, with the floorboards of the living accommodation clearly visible from the storage area immediately below.

Banning order

Bristol City Council has now successfully applied for a banning order, which will also prevent Sachdeva from carrying out any property management work.

Council officers visited the property again in January 2021 to check on conditions and found someone sleeping in one room of the property, in contravention of a prohibition order.

He told them he was in the process of selling the lease, but the Property Tribunal heard that to date, he has failed to provide any proof that this is the case.

Sachdeva did not attend the hearing and has also not provided information about any other properties he might be renting out or letting agencies he is involved in. He will be added to the government’s Rogue Landlord Database and could face prison if he breaches the banning order.

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