BREAKING: Council launches huge HMO scheme with £520 PER ROOM fees

admin    Uncategorized     agents

One of London’s largest local authorities is planning to introduce a pricey and borough-wide additional licensing HMO scheme that, if approved, will go live in November.

Lambeth is the capital’s fourth largest borough with over a quarter of a million residents and the 32^nd largest in the UK with 10% of its PRS stock being HMOs.

The borough is already covered by a mandatory HMO licensing regime for properties with five or more unconnected people living in a property with shared facilities.

The new additional licensing scheme across the whole borough would bring houses and flats with three residents living in two more households within its regulatory clutches.

Habitable room

Also, the scheme will be expensive with landlords expected to pay £520 per habitable room – not property – for a licence, although discounts of up to 50% will be available in some circumstances.

A briefing document also reveals that Lambeth has revised up the number of HMOs within the borough to 5,000 from 1,900, which is the figure it quoted when consulting on additional licensing earlier this year.

To back up its proposal, Lambeth says anti-social behaviour or ASB rates per 1000 properties are significantly higher in the HMO sector when compared to the PRS as a whole and that 37% of the HMOs within Lambeth contain one or more serious hazards that affect the health and safety of the residents of Lambeth.

Lambeth also claims that the scheme will be self-financing, costing and raising – from landlords – approximately £10 million during its five-years of operation.

Cabinet Member for Housing and Homelessness, Councillor Maria Kay (pictured) has recommended the report which will now be scrutinised by Lambeth during a full Cabinet meeting.

Read more about HMOs regulation in Lambeth.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BREAKING: Council launches huge HMO scheme with £520 PER ROOM fees | LandlordZONE.

View Full Article: BREAKING: Council launches huge HMO scheme with £520 PER ROOM fees

Gas boiler sales face a 2026 ban

admin    Uncategorized     agents

The sale of new boilers that are only able to run on natural gas could face being banned by 2026 according to recent information published by the UK government.

The Government is currently consulting on plans to make sure that all new boilers are capable of running on hydrogen, or at least partly on hydrogen, instead of 100% gas.

Hydrogen does not produce carbon dioxide when burned and government ministers are hoping this alternative fuel for heating could be supplying up to 35pc of the UK’s energy consumption by 2050.

Government agencies are currently conducting tests to determine whether it hydrogen can be used safely and effectively to replace natural gas in UK homes.

On a new hydrogen strategy revealed last week, government officials have commented:

“We aim to consult later this year on the case for enabling, or requiring, new natural gas boilers to be easily convertible hydrogen use and be “hydrogen-ready’ by 2026.”

A potential complete ban on the sales of new natural gas-only boilers would effectively bring forward existing long-term plans to put an end to traditional boilers being installed in new-build homes by 2025.

A new direction for fuel production?

So far the production of hydrogen fuel in the UK is minimal. There are just a handful of startups in the business converting water and fossil fuels to hydrogen, but the government is encouraging suppliers to increase production and has launched a consultation on subsidies for producers.

A basic distinction is made between conventional hydrogen production based on fossil feedstocks, e.g. through steam reforming of natural gas, and renewable hydrogen production based on renewables such as bio-gen processes or electrolysis of water (H2O) with wind power, water power or solar energy.

Today, hydrogen is mainly produced by steam re-forming fossil fuels such as natural gas and some excess hydrogen is recovered as a by-product from various industrial processes. But even though hydrogen generated from fossil fuels has the advantage of zero emissions, the production chain still leaves a carbon footprint.

The long-term aim is to significantly increase the sustainable share in the hydrogen mix using renewable energy sources such as wind, water and biomass, while at present electrolysis of water using wind, water or solar power, and re-forming of biogas are viable alternatives that offer a zero-emission hydrogen energy cycle.

The carbon free challenge

Currently natural gas provides 74pc of the energy used for home and commercial heating and hot water, which produced about 85m tons of the carbon dioxide emitted in 2019.

The government is considering hydrogen as one option as an alternative to natural gas, along with heat pumps, which extract energy from the outside air and ground, though these also are not carbon neutral as they result in more consumption of electricity.

The use of hydrogen in domestic heating remains remains a hot topic of debate because they tend to be less fuel energy efficient and hydrogen has a corrosive effect on the infrastructure network – the pipes in other words.

The commercial reality

Boilers capable of multi-fuel use or pure hydrogen burning are yet in the commercial development state and work still needs to be done to set industry standards. Currently it is estimated around 1.6m boilers are replaced every year in the UK.

Carl Arntzen, chief executive of Worcestor Bosch, a company that makes heat pumps and boilers, has said:

“There is an air of urgency about these things, so the sooner the better. Supply chains can be scaled up within that sort of time frame.

“If the Government mandates hydrogen-ready boilers and then there is a hydrogen switch-over in an area, then we just need to change a couple of components on the hydrogen ready boiler which will take about 40 minutes, then that boiler is ready to fire 100pc hydrogen.”

Antony Green, hydrogen project director at National Grid, has said:

“I think it’s very good news the Government are planning to consult on it. It creates opportunity for us. Let’s establish hydrogen-ready boilers as the default, then as and when ready we can switch. It’s very akin to the digital TV switch-over.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Gas boiler sales face a 2026 ban | LandlordZONE.

View Full Article: Gas boiler sales face a 2026 ban

LATEST: Poll reveals landlord worries over looming EPC upgrade challenge

admin    Uncategorized     agents

A third of landlords are not confident their properties can be raised to the minimum EPC band C in time to meet the government’s deadline, a new poll has revealed.

All rented properties within England and Wales must reach the EPC band C level by 2025 for new tenancies and 2028 for all remaining ones, leaving landlords with just four years to plan and pay for upgrades.

Nationwide’s specialist lender The Mortgage Works canvassed 750 landlords on the subject and found that half of those struggling to attain the EPC rating said the limitation of their buildings – for example listed status – made upgrades difficult or impossible.

Other concerns included access to the property while tenants were in situ and the disruption caused, little or no payback on the investment, limited benefits for their tenants, difficulties finding reputable or available tradespeople, difficulty understanding the complicated rule governing upgrades and a lack of cash.

Smaller struggling

The poll also reveals that smaller portfolio landlord will be the least able to cope with the new EPC requirements, that 14% of landlord said they’d need to spend a whole year’s rent to upgrade their property and that one in ten just ‘have no idea where to start’ although 41% said they were aware of what needed to be done.

Daniel Clinton (pictured), Head of The Mortgage Works, which offers green upgrade financing, says: “Given the concerns and challenges facing landlords in not only making the necessary improvements, but financing them, it’s perhaps no surprise that more than a third of landlords are not confident they will be able to bring their properties up to the required EPC ‘C’ standard.

“It’s also great to hear that the Government would like to introduce a new financial support package to help people improve the energy efficiency of their homes, however, we hope that any such scheme would also be open to helping landlords meet their requirements.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Poll reveals landlord worries over looming EPC upgrade challenge | LandlordZONE.

View Full Article: LATEST: Poll reveals landlord worries over looming EPC upgrade challenge

Government looking to make Self Build a more mainstream option

admin    Uncategorized     agents

Richard Bacon MP’s review of Custom and Self Build, commissioned by the Prime Minister, finds huge potential in the Self Build sector which could deliver 30-40,000 more homes every year, and recommends a major-scaling up of self-built homes to boost the overall housing supply.

The post Government looking to make Self Build a more mainstream option appeared first on Property118.

View Full Article: Government looking to make Self Build a more mainstream option

Rent controls planned by new SNP/Green coalition

admin    Uncategorized     agents

The Scottish Government and the Scottish Green Party Parliamentary Group have agreed to work together over the next five years. Click here

A shared draft policy programme, ‘the Bute House Agreement’, has been agreed upon and includes the implement an effective national system of rent controls

The post Rent controls planned by new SNP/Green coalition appeared first on Property118.

View Full Article: Rent controls planned by new SNP/Green coalition

Key report on EPC changes, binning gas boilers and financing heat pumps due

admin    Uncategorized     agents

The government’s hotly-awaited Heat and Building Strategy review setting out its plan to eliminate gas boilers, roll out low-carbon alternatives and reform EPCs is only weeks away, it has been reported.

Landlords will have plenty to digest when it is published. If the government sticks to its plan to upgrade all rented properties to an EPC Band C by 2028 including new tenancies by 2025, then some 3.2 million properties will have to be improved in many cases at their landlord’s own expense.

Following the premature ending of the Green House Grant, landlord can now only get grants in limited circumstances.

It will also set out how the government expects to de-carbonise all homes within the UK. This will include replacing all gas boilers by 2025 with heat pumps (main pictured) and where that’s not practicable, replacing natural gas with hydrogen.

Landlords will face significant costs when doing this, The Times has claimed today.

It estimates that a semi-detached or mid-terrace property currently costs about £600 a year to heat. But after subsidies the current cost of installing a heat pump would be between £7,000 and £8,000, bringing down bills to about £500 a year.

Heat pump grant?

The government in considering a Clean Heat Grant that would give landlords £4,000 towards the cost of a heat pump, but this has not confirmed yet.

A hydrogen boiler would cost about £3,000 but hydrogen bills would be about £900 a year.

The Heat and Building Strategy review is also expected to suggest a reform of the EPC system which, as LandlordZONE has reported many times, is a one-size-fits-all approach that often produces wildly inaccurate results.

One example of this is supplied by landlord Tricia Urquart who told LandlordZONE earlier this year: “Several of my eight properties in areas without a gas supply had storage heaters so I bought top-of-the range modern radiators, but for an EPC assessment, that’s the same as buying a £25 convection heater that huffs out hot air.”

But the review is unlikely to go down with tenants well either – it is reported that Ministers want to charge those using gas boilers more money in order to subsidise the huge cost of getting low or zero-carbon alternatives up and running.

Read more: Will the new gas boiler ban impact buy-to-let landlords?

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Key report on EPC changes, binning gas boilers and financing heat pumps due | LandlordZONE.

View Full Article: Key report on EPC changes, binning gas boilers and financing heat pumps due

View on flooring clauses in a tenancy?

admin    Uncategorized     agents

Hi, I have just been having a discussion with my wife regarding costs and tenancy agreements, and I am curious about what other landlords do. I have just completed inspections on my portfolio and one of my tenants has just asked for new carpets on the hall

The post View on flooring clauses in a tenancy? appeared first on Property118.

View Full Article: View on flooring clauses in a tenancy?

Belvoir Rental Index Live; Your Questions Answered

admin    Uncategorized     agents

If you missed Belvoir’s Rental Index Live last month, hosted by Paul Shamplina and a panel of Belvoir franchisees from across the UK, don’t worry!

Below are the key questions asked by LandlordZone members during the webinar answered by the panel.

Belvoir has constantly watched the rental market over the past 11 years on a quarterly basis to produce a unique rental index, focusing on regional landlord and tenant trends across the country.

This resource is made freely available to landlords via the Belvoir website (www.belvoir.co.uk) and is well worth a read to see how rents are performing in your area.

Q: What is the best way to track a tenant who has left with arrears?

A: If you have utilised Money claim online or have a court order for the payment then you can seek an attachment of earnings (if they are still working) – Charlotte Baker, Belvoir Melton Mowbray & Bingham.

Q: What are the best ways to recover rent arrears after eviction?

A: Contact next of kin which you should have from when they applied for the property and politely ask where they might be?

Maybe you have post that you need to forward on. Once you have their new address you can use enforcement companies to recover the debt if you have a CCJ or court order instructing them to pay. We have used tracing agents in the past which has been successful.

They will try every six months or so to find the new address. If the person is not working and moved away though you may be unlikely to be successful in getting the money back but at least if you have secured a CCJ against them using money claim online a future landlord may not be caught out.

Rent Guarantee protection (good ones that have covered during the pandemic) have been so useful to our landlords when we have a non payer – they work with the tenant to get the payments back on track or if that’s not possible undertake the eviction process and costs while paying rent to the landlord – Charlotte Baker, Belvoir Melton Mowbray & Bingham.

Q: With rent arrears after the tenant has left, should the tenant, guarantor or both be pursued especially if you need to go to court?

A: You should be actively chasing both in writing and setting some deadlines.  Read the notes on the MCOL webpage for the next steps to recover your money – Davinder Gharial, Belvoir Hitchin, Welwyn & St Albans.

Q: I have a mixed portfolio with a few HMO’s. The HMO’s are rented to students in Hatfield. We have had several instances where students want to move out of one HMO into another because they did not know the others in the HMO at the start or because they want to go home, etc. The original AST was a Joint and Several with all 5 put together. Now when one moves out with only 5 months left to the end of the contract, basically at the start of the summer term, we find another student to move in. The question is … Does the new tenant have to have a minimum 6 month contract which now extends into the void maintenance period and possibly into the next student year, or is it possible to ASSIGN the remainder of one person’s term to a new tenant?

A: There are several solutions. The safest option will be to issue a new tenancy and treat the change of occupiers as a new tenancy with new gas safety, new EPC, new deposit protection etc.

Unfortunately, this does not always work with students where there is a strict annual turnover, and the new group would have a right to the minimum 6 month right of occupancy.

If this is an issue, the original group of tenants can remain as the tenants for the whole term and the new individual can essentially become their lodger.

The lodger has far less security of tenure and the minimum term does not apply. This does, however get over the short term issue, though the departing tenant needs to happy to agree to this and remain liable for rent when they are no longer in the property – Nathan Crombie, Belvoir Brighton & Hove.

Q: Are you finding the EPC software and general regime not fit for purpose? The software used by EPC assessors which they all have to use to carry out the check.

A: This is a technical question with respect to the software used by Domestic Energy Assessors (DEA) to calculate EPC ratings. 

As an estate agent, we subcontract out the commissioning of EPCs to suitably qualified 3^rd party contractors, so we have no direct experience of use of the software. 

But I am aware of the concerns that have been reported with respect to the accuracy of the assessments and that the software was recently updated to eliminate some potential flaws in the calculations which should have resulted in improvements to the ratings of some properties. 

I appreciate that any inaccuracy in an EPC rating can have significant consequences to a landlord it would be our standard approach to challenge any EPC rating that was just below MEES before suggesting to a landlord that they undertake potentially costly upgrade work. 

For example, there are several assumptions that a DEA will make in assessing the construction of a property which affect the rating as will the potential for them to take inaccurate floor measurements, so it is always worth challenging these so that the DEA discloses the assumptions and measurements that were used – Dave Roberts, Belvoir Wigan, Haydock & St Helen’s.

Q: I have heard that Joint and Several contracts for HMOs will be banned. We will be required to provide individual lets for each room … Do you have any information on this? 

A: I have heard some comments in the past suggesting that this might be the case but so far, I have not seen firm proposals on this or timescales for it being implemented.

I tend to listen out for changes that impact Scotland and Northern Ireland so the situation might be different in England and Wales – Andrew Jack, Belvoir Edinburgh & Belfast.

Q: Is licensing the right way to go now that so many councils are looking at this possibility particularly for HMOs? 

A: HMO licencing has been in force in Scotland and Northern Ireland (and all other areas of the UK) for many years and it has had a significant impact on raising standards and improving tenant safety so in this regard it has been a very positive step for the private rented sector and the vast majority of HMO landlords have been happy to comply.

But we need to be careful that the HMO licence renewal process and the constantly changing requirements don’t become an easy source of additional revenue for the local authorities who are responsible for issuing licences.

Changes to licencing requirements need to be reasonable, proportionate and implemented for the right reasons. I understand some Council areas have moved or are considering moving towards a licencing system for all rented property (not just HMOs) and whilst for a small number of landlords this may be necessary to force them to comply our experience of dealing with private landlords over many years shows that most of them willingly comply with legislation aimed at improving standards and protecting tenant safety without the need for a formal licencing scheme. 

Private landlords are crucial for the UK to be able to meet its current and future housing requirements so introducing unnecessary additional cost and bureaucracy could potentially turn investors away from property and further reduce available supply of rental property at a time when demand from tenants has never been higher – Andrew Jack, Belvoir Edinburgh & Belfast.

More information

Relax with our full management service… and enjoy the first three months for free* as part of our special offer for Landlord Zone members. We’ll handle the day to day management of your tenants and properties, in conjunction with our trusted team of reliable contractors. Visit our website to find your local Belvoir Office- https://www.belvoir.co.uk/offices/ and arrange a free, no obligation appointment.

^*Terms and conditions apply, speak to a member of staff for more information.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Belvoir Rental Index Live; Your Questions Answered | LandlordZONE.

View Full Article: Belvoir Rental Index Live; Your Questions Answered

REVEALED: HMRC’s double snooping trouble for landlords

admin    Uncategorized     agents

Landlords face two new schemes designed to help HMRC snoop on taxpayers’ financial activities following the launch of two recent government initiatives.

This includes an HMRC consultation on proposals to force Airbnb and other online short-let platforms to report individual property owner’s revenues from holiday lets.

This would include fines for the company’s involved for filing incomplete or inaccurate information or failing to collect such information at all but be more serious for landlords who not honest about their revenues within annual tax returns.

If HMRC adopts the key points of its proposals within the consultation, then landlords’ income from short lets would not only be more transparent, but available for up to five years after a booking has been made and a property owner has any received income.

Bank requests

The other is the Finance Bill 2021 which received Royal Assent in June. It allows, for the first time, HMRC officials to approach a taxpayers bank and make a request for financial details directly from their bank or building society without their permission.

Until now those being investigated have had to give permission for this information to be released on their behalf.

HMRC has been given these powers in to speed up requests by overseas tax authorities for information, saying the current system whereby these requests must go through a tribunal process takes too long and does not meet international standards.

“International obligations are no excuse for sweeping away established self-assessment safeguards and enabling HMRC to obtain information on taxpayers from financial institutions without prior approval, argues the accountancy industry trade body the ICAEW.

Read more: HMRC omits CGT from tax reforms but there’s a sting in the tail for holiday lets

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – REVEALED: HMRC’s double snooping trouble for landlords | LandlordZONE.

View Full Article: REVEALED: HMRC’s double snooping trouble for landlords

As the weather warms up, the risk of subsidence rises – are you covered?

admin    Uncategorized     agents

August got off to an unsettled and changeable start this year, with heavy rain and flooding in many parts of the UK. But the long-range weather forecast is now predicting warmer than usual conditions in late August, and potentially even a heat wave, with temperatures set to soar across some parts of the country.

Rising temperatures during the summer months can be problematic for some properties, increasing the risk of subsidence which can result in costly damage. With claims for subsidence increasing, it’s important that landlords make sure they have sufficient insurance cover in place and know when they may need to take action.

How common are claims for subsidence?

But how common are claims for subsidence? Melissa Choules (pictured), Senior Claims Technician at LandlordZONE’s insurance partner, Hamilton Fraser Total Landlord Insurance, explains. 

“When it comes to claims, subsidence is often overlooked as it is not as common as claims relating to perils like escape of water or storm, accounting for only 6.5 per cent of all our claims in the period 2015-2020.

“But subsidence claims have been increasing since 2014, resulting in a 24 per cent increase year on year.

“And the damage caused by subsidence can be particularly costly, with our average payout in the 2015-2020 period being £3,567.18 and individual claims of up to £82,900 in that same time frame. In extreme cases like this, the damage is so extensive that houses are uninhabitable while repairs are being carried out.”

What is subsidence?

Subsidence is the downward movement of the ground supporting the building. Typically, claims for subsidence increase over the warmer months as the lack of rain causes shrinkage of clay soils which expand and contract with changes in their moisture content. As a result, the property becomes unstable and can begin to crack and sink.

Although we’ve had a particularly wet start to the month, the ground can dry out very quickly – as illustrated by what happened in 2017, when 65 per cent of subsidence claims to Hamilton Fraser Total Landlord Insurance were reported between May and October, despite having a wetter than average summer that year.

What are the causes of subsidence?

Subsidence can be caused by a range of things including clay shrinkage, trees growing close to the foundations, water washing away soil beneath the property, used or disused mines, the formation of underground caverns and poor foundations.

But warmer weather causing clay soil shrinkage is one of the most common causes of subsidence – in 2018 alone, subsidence claims increased by 20 per cent because of the heatwave in the UK that year.

Settlement and subsidence are often confused so it’s important to understand the difference between the two. Settlement is when the ground beneath a property is compacted by the weight of the building, which usually happens in the first 10 years after the building is built – it is quite common and cracks in the walls caused by settlement are usually harmless.

Some insurers, including Hamilton Fraser Total Landlord Insurance, will cover subsidence, but not normal settlement.

What are the signs of subsidence?

Since it’s not possible to see what is going on underground, you’ll need to be aware of the signs above ground, such as ripples in the wallpaper. doors and windows that no longer fit and cracks. Although most cracks in the walls are harmless, cracks caused by subsidence tend to have certain characteristics. For example:

• They are wider at the top than at the bottom
• They are wider at any point than a 10p coin (about 3mm)
• They can be seen from both inside and outside the property
• They are close to weak spots like doors, windows and where extensions join the house

What should you do if you suspect subsidence?

Steve Barnes, Associate Director at Hamilton Fraser Total Landlord Insurance, urges landlords not to ignore subsidence if they suspect they may have a problem with it. He advises, “The key thing with subsidence is to take action right away.

Because in most cases, subsidence happens slowly, it can be tempting to put off dealing with it. But the longer you leave it, the more expensive your repairs will probably be, creating bigger problems such as a loss in your property’s value, serious structural damage and higher insurance premiums in the long run.

Cracks that appear and continue to grow, should be investigated to make sure that the property is structurally sound.”

How can you reduce the likelihood of subsidence?

There are a number of steps you can take to reduce the likelihood of subsidence damage to your property. Assessing your level of risk is the first step you need to take. For example, is your property built on clay ground? Are there any large trees in close proximity to your property? Does the ground your property is built on become water-logged during heavy rain or extremely dry during droughts?

How do you fix subsidence?

If you think you have a subsidence problem, the first thing you should do is contact your insurer. They will be able to advise on what to do next and you can find out more information on some of the solutions to subsidence, along with answers to other questions, such as whether you should buy a property with subsidence, in Hamilton Fraser Total Landlord Insurance’s guide, Subsidence: What is it, how do you spot it, and what should you do if you have it?

Can you insure a property with a history of subsidence?

This varies from insurer to insurer, but Hamilton Fraser Total Landlord Insurance will cover properties with subsidence issues. 

If you would like more information on subsidence, you can download Hamilton Fraser Total Landlord Insurance’s free infographic on buying, selling and letting a property with a history of subsidence here.

If you have questions about subsidence, or want to discuss subsidence in your property, feel free to contact the Hamilton Fraser Total Landlord Insurance team. A comprehensive policy such as our Essential and Premier policies will cover all of the costs to repair damage caused by subsidence.

As a valued LandlordZONE reader you’re entitled to 20 per cent off Hamilton Fraser Total Landlord Insurance’s policies, call the team today on 0800 63 43 880 quoting code LZ2021 or get a quote online in under 4 minutes. 

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – As the weather warms up, the risk of subsidence rises – are you covered? | LandlordZONE.

View Full Article: As the weather warms up, the risk of subsidence rises – are you covered?