Moving into a former home and PRR?

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Hi, this question mainly relates to Capital Gains Tax (CGT) and Principal Private Residence Relief (PRR). I know you are going to tell me to speak to my advisers, but they are simply not property experts and just don’t know.

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Victory! Landlord challenges council’s £54,000 benefit overpayment bill

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A London landlord is celebrating after successfully challenging a £54,500 Housing Benefit overpayment bill from his council.

The demand was made in July when a ‘cousin’ of the tenant told both the council and the landlord that the tenant had left the property back in 2017 – and insisted the landlord had been informed at the time.

The council then revised the benefit award retrospectively for four years, creating a £54,000 overpayment.

UC Advice & Advocacy Ltd’s Bill Irvine (pictured) appealed against the decision, pointing out that the tenant had never notified the landlord and had even reported heating faults in 2018, allowed access to contractors and had continued to make top-up payments until mid-July 2018.

Irvine believes that the tenant probably handed the keys to a friend or relative who then occupied the property, knowing that housing benefit was covering most of the rent.

Legitimacy

“I questioned the legitimacy of the council acting on information provided by someone other than the tenant,” Irvine tells LandlordZONE.

“The cousin had no authority to act on behalf of the landlord, however the tenant had an obligation to report the fact he had left to both the council, as a recipient of housing benefit, and his landlord, as he had agreed to this under the terms of his tenancy.”

Councils will pursue landlords on the basis that they could have known about a tenant’s activities and if they’ve got other benefit-claiming tenants, councils can take money from their payments until the overpayment is cleared. The DWP encourages authorities to recover these and if they’re successful, will award them a bonus of 40% of the amount.

It’s a way of generating income, adds Irvine, who advises landlords to either challenge decisions themselves or get advice, particularly if the alleged overpayments are for more than a few thousand pounds. He adds: “While that challenge is ongoing the council will supress recovery and you’ve got nothing to lose. Every time I’ve challenged one, it has been conceded.”

Read more about other housing benefit fraud cases.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Victory! Landlord challenges council’s £54,000 benefit overpayment bill | LandlordZONE.

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EICR Inspection carried out by unregistered electrical contractor?

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I have recently applied for selective licensing as required by the council. After submitting relevant documents, the council have rejected the EICR as the contractor is not registered to carry out inspections, only domestic installation.

I have subsequently managed to verify this too with NICEIC who have asked me to supply them with a copy of EICR with their trademark to warn him not to use it for EICR

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INTERVIEW: The Instagram landlord couple with an unusual portfolio strategy

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If you think 30-somethings haven’t got a hope of establishing a property portfolio in today’s competitive and expensive housing market then a few minutes in the company of Terri Baxandall may change your mind.

She and her husband Will are about to buy their ninth buy-to-let and are hoping to give up their day jobs and become full-time property investors, developers and landlords within two years – which will be just shy of six years after setting off on their investment journey.

Their voyage from ‘zero’ to ‘hero’ will raise eyebrows among traditional buy-to-let landlords; they paid for a course via a property academy fronted by TV star Martin Roberts and use alternative funding sources to buy their properties.

Terri, 32, who works part-time as a dental nurse, says they paid a significant sum to complete the course after attending earlier introduction events.

Her partner Will, 33, works full-time in site management for a new-build developer.

“We didn’t have a passion or anything like that,” she says. “Instead, we went to a free two-hour seminar about investing in property and it grew from there.”

Terri says the courses cost ‘a lot of money’ but that she believes it was the best thing they ever did despite still owing money for the original training.

“I think now we wouldn’t pay to do the courses because there’s a lot more information available online that wasn’t available then,” she adds.

“But because the course cost so much, we thought ‘this needs to work’ and we committed to it more than we would have done otherwise.”

Northern venture

Originally living on the Isle of Wight, they moved to Portsmouth to get better jobs and buy their first home, but soon realised they couldn’t crack the city’s buy-to-let market.

They then made the bold decision to make their first investments in Rotherham and went there ‘every weekend’ in order to get to know its housing market and property professionals, later relocating to Newark (an hour away) as their portfolio grew.

“Our first Rotherham property cost £26,000 in January 2019 but it needed a lot of work, much of which we did after sacking the builder,” she adds. “But it made us appreciate the cost and speed benefits of doing our own refurb work. Also, we realised it meant we could buy properties other investors wouldn’t touch.”

Terri urges others not to think that she and Will have’ made money fast’ and to remember that education is key – both to get the model right and from a regulatory perspective – in order to have a ‘viable business’.

“You still need to know what’s going on,” she adds. “And ours is a long-term plan, not a get-rich-quick scheme; at the moment we put all our profits back into the business.”

The couple has also taken an unusual approach to finance. This has included buying properties, doing them up and then refinancing them but they also court private investors – and their social media fees on Instagram and Facebook plug their proven returns on investment.

“The people who lend us the money know, like and trust us, but it takes time to gather these kinds of investors around you, and to prove you know what you’re doing,” she says.

Terry and Will’s investment activities can be seen on their Instagram account.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – INTERVIEW: The Instagram landlord couple with an unusual portfolio strategy | LandlordZONE.

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‘Too few councils prosecuting criminal and rogue landlords’

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Councils’ failure to take action against criminal landlords risks damaging the reputation of the sector ever further, the National Residential Landlords Association (NRLA) has claimed.

Research gained via Freedom of Information Act requests shows that two-thirds of English councils have not brought any rogue landlord to book over the past three years, while 10% have secured a single prosecution.

The organisation also says there is ‘no clear link’ between a council having implemented a selective licensing scheme and increased levels of enforcement.

Instead, as LandlordZONE’s regular updates show and the NRLA’s research confirms, a core 20 councils are responsible for three-quarters of all rogue landlord prosecutions including three of the most prolific, Southwark, Birmingham, and Hull.

The NRLA also says the data shows that fewer than a thousand criminal landlords have been prosecuted since 2018, far fewer than the 10,500 that, in the past, Ministers have claimed stalk the sector.

Undermine

While the Government has pledged to publish a white paper on reform of the private rented sector next year, the NRLA is warning that a failure to enforce the wide range of powers already available to tackle criminal and rogue landlords will critically undermine further reform.

The NRLA is calling on the Government to provide councils with the multi-year funding needed to ensure they are properly resourced to take action against criminal landlords.

“The vast majority of responsible landlords are sick and tired of a failure to root out the minority who bring the sector into disrepute,” says NRLA Chief Executive Ben Beadle (pictured).

“The problem is not a lack of powers, but a failure by councils to enforce them properly.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – ‘Too few councils prosecuting criminal and rogue landlords’ | LandlordZONE.

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