‘Use a letting agent to avoid getting stung like me’ warns landlord facing £14k arrears

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A landlord who is owed £14,000 in rent arrears and is in the throes of trying to evict his errant tenant has warned others to use professional letting agents to protect their investments.

The tenant, a former friend, has always been on benefits that were originally paid directly to landlord Max Ferzoli until a few years ago.

Problems started in 2020 when he stopped paying and Ferzoli tried unsuccessfully to get the DWP to revert to direct payments. Civil servants refused to switch to direct because they said Ferzoli didn’t have his tenant’s consent to do so – a common problem LandlordZONE has highlighted many times before.

Ferzoli served a Section 21 followed, with Landlord Action’s help, by a Section 8 in March 2021 and finally got a possession order last November.

As the tenant just stayed put, he has the bailiffs ready to step in next week, but the frustrated landlord reckons his tenant’s past history and unpredictability mean it might not go to plan.

‘Awful situation’

“We started out as friends and I didn’t take a deposit – based on trust – which was admittedly amateurish,” he tells LandlordZONE. “It’s an awful situation – I’ve pleaded with him to pay me the money and even let him off paying a rent increase as a favour but it didn’t help.”

Ferzoli, who’s self-employed, already has possession of the downstairs flat at the property in Hounslow and when his tenant leaves the upstairs flat, aims to convert it into an HMO so he can spend some money on updating the electrics and then get a better return.

However, he’s now reluctant to take any more benefit claimants: “Another tenant recently left me with £7,000 worth of repairs after trashing the property which cancelled out the capital appreciation,” he adds.

“I plan to only use letting agents in future and do most maintenance myself to save money. It might be cheaper not to go through an agent but if it all goes wrong, it’s more expensive in the long-term.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – ‘Use a letting agent to avoid getting stung like me’ warns landlord facing £14k arrears | LandlordZONE.

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Developer reveals big push into London’s ‘booming’ build-to-rent market

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Developer Avanton has launched its first 20 build-to-rent apartments in London, heralding a major expansion that will see it build hundreds more across the capital.

The luxury furnished two-bedroom apartments at the 23-storey Coda block in Battersea are being sold under Avanton’s A:Living brand, with prices from £650 to £1,000 per week, where tenants get a private residents’ club lounge, concierge, and state-of-the-art fitness studio.

Avanton says the build-to-rent sector is rapidly growing across the capital and last year committed to a three-year expansion into the sector, seeking land and strategic opportunities to deliver high-quality purpose-built stock.

The firm now has several key pipeline projects alongside a £500 million fund for strategic land acquisitions, including the £730 million Ruby Triangle project on Old Kent Road in Southwark, to provide 1,414 new homes, half of which will be build-to-rent.

Record investment

According to global real estate advisor CBRE, investors ploughed £4.1 billion into build-to-rent last year, £500m more than 2020’s previous record, while almost £2 billion worth of deals are already in the pipeline for this year.

A recent report also revealed that the sector is no longer the preserve of affluent young professionals living in cities, but is increasingly popular with older people and families who are leaving the PRS to set up home in the new blocks.

David Ronson (pictured), Avanton’s sales and marketing director, adds that its Coda launch offers a new option for Londoners. 

“A:Living will provide exceptional homes with stylish interiors curated by highly regarded designers,” says Ronson.

“Build-to-rent homes provide a solution to help with the capital’s housing shortage, and these multiple tenure schemes offer tenants a sought-after lifestyle at competitive prices.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Developer reveals big push into London’s ‘booming’ build-to-rent market | LandlordZONE.

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BREAKING: Controversial Welsh rent reform legislation to go live in six months

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The Welsh government is to go live with its controversial Renting Homes Wales Act on 15^th July this year despite calls by landlords to ensure that it is ‘fit for purpose’.

Described by the country’s housing minister Julie James as the biggest shift in housing law in Wales for decades, it will usher in significant changes to the way landlords can evict tenants, issue tenancy contracts, and manage their properties.

This includes an already-in-place six-month notice requirement for a landlord to end a contract where the tenant is not at fault and a minimum ‘security of tenure’ of one year from the date of moving in.

This means that contract-holders in Wales will have the greatest protection from the start of their contract than in any other part of the UK, the minister claims.

Retaliatory evictions

The Act also gives protection against retaliatory eviction. If a landlord responds to a request for repairs by issuing a possession notice, they will no longer be automatically entitled to possession if the Court is satisfied the landlord issued the notice to avoid carrying out the repair.

Joint tenancies

Also, joint contract-holders can be added or removed from occupation contracts without the need to end one contract and start another.

This will make managing joint contracts easier and help those experiencing domestic abuse by enabling the perpetrator to be targeted for eviction.

Chris Norris, Director of Policy & Campaigns at the NRLA (pictured), says: “While we welcome the introduction of the Act, it is vital that the supporting legislation is fit for purpose and scrutinised sufficiently.

“In particular, the occupation contract terms, which all landlords must use, needs to improve significantly from its original consultation draft.

“These important steps must be taken before more complex regulations are introduced by the Welsh Government over the course of this year.”

The announcement has been made today because James promised last July to give landlords six months’ notice of the new rules, which will be available on its website from January 14^th onwards.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BREAKING: Controversial Welsh rent reform legislation to go live in six months | LandlordZONE.

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Compulsory EPC band “C” by 2025 causing confusion

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Compulsory EPC band “C” by 2025 causing confusion

There have been recent confusing reports put out that from 2025, all newly rented properties in England & Wales will be required to have an EPC rating of band C or above.

This is somewhat misleading and “jumping the gun” as so far this is only a Government proposal following a recent energy performance consultation. But it does form part of the Minimum Energy Performance of Buildings (No. 2) Bill currently wending its way through Parliament.

And, given the Government’s public commitment to net zero by 2050 at the recent international COP 26 hosted in Glasgow last year, it is looking as if the new standards will come in or at least something very close to the proposed changes.

The Bill states:

The Secretary of State must amend the Energy Efficiency (Private Rented 15 Property) (England and Wales) Regulations 2015 (SI 2015/962) to require that, subject to subsection (2)—

(a) all new tenancies must have an energy efficiency performance of at least EPC Band C from 31 December 2025; and

(b) all existing tenancies must be at least EPC Band C from 31 December 20 2028 where practical, cost-effective and affordable as defined under section 1(4).

What are the current regulations?

Currently, any property in England, Scotland or Wales that is either being built, marketed for sale or let as an entire property requires an Energy Performance Certificate (EPC). Since the 1st of October 2008, landlords letting whole properties must have a valid EPC rated at “E” or above to provide to prospective tenants. EPCs are valid for ten years. After this time, landlords are only required to get a new EPC if they are re-letting to a new tenant.

The Government’s proposal in the Bill is that rental properties meet a compulsory energy performance certificate rating of band “C” on new tenancies by December 2025, and on all rented properties by December 2028. Consequently these proposals must be taken seriously, but we’re not there yet.

Small-landlords confused or not yet aware

According to a recent House of Lords report on housing demand, around 45% of landlords own just one rental property, and another 38% own between two and four properties. Given that many of these people don’t follow developments too closely, many will be unaware of these potential changes which will affected them financially.

Some rental properties will require the substantial sums needed to bring them up to EPC band “C” and this is scary territory for many rental property owners, it’s causing a lot of concern.

One recent report by The Daily Mail’s This is Money claims that one-third of landlords were “not confident” they would be able to get their properties up to this standard. Some had said they were unable to afford the required improvements which may include such things as replacing old gas boilers, improving floor, ceiling and wall insulation insulation and installing double glazing in windows and doors.

Others said they did not see how they could do the necessary work with tenants in situ, and that they did not want to face the expense and loss of income by evicting them or finding temporary alternative accommodation. Others said they were unclear as to what they would need to do to bring their properties up to this standard because the Government had not provided enough guidance.

Plan ahead

Although there is still uncertainty as to what the final rules will be, or even if the change will happen, the fact remains that sooner or later the standards will need to be improved.

Landlords might as well “bite the bullet” sooner rather than later and plan to make impoundments when opportunities arise. One such opportunity would be when tenancies come to an end and before a new one begins.

Start off by taking a look at the recommendations in the current EPC document. This should give a guide, though it is perhaps more beneficial to get some builders’ estimates from people who know what they are doing when it comes to energy efficiency improvements.

See: Landlords advised to future-proof properties by aiming higher with EPC standards

The Government and many campaigning groups see improving energy efficiency in British rental homes as a priority and there is no doubt that many of these homes have woeful standards which not only add a lost to the cost of heating, they affect the occupants’ health.

According to the latest figures available from the Department for Business, Energy and Industrial Strategy, UK homes account for 15 per cent of the county’s greenhouse gas emissions, a lot of which is down to poor insulation standards, heat is being paid for and lost unnecessarily.

Is there any financial assistance for property EPC upgrades?

The Government tried in the past to offer support through Green Homes Grant, available to landlords as well as homeowners, but the scheme was quickly abandoned. Given that there is a lot of political pressure to meet green energy targets however, it is possible that some form of financial support may be offered to landlords in the future, but so far there is nothing on the table.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Compulsory EPC band “C” by 2025 causing confusion | LandlordZONE.

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UK average rent stabalises with small increase – Homelet

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The Latest Homelet rental market report indicates the average UK rent has continued to stabilise with the December 2021 figure showing a £2 increase to £1,060pcm and excluding London, this figure is £893.

Greater London sees the most significant year-on-year price rise in the UK with a 12.6% jump in the last year

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Cost of little know stamp duty niche to high value rents

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London lettings and estate agent, Benham and Reeves, has highlighted how the nation’s high-value renters could find themselves paying significant penalties due to a little-known law that may require them to pay Stamp Duty Land Tax (SDLT) despite not actually owning their rental property.

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LATEST: Investors give green initiative £5.5m to kickstart PRS ‘upgrade revolution’

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Energy technology firm Sero has been given a multi-million-pound cash injection to develop products and services to help landlords and building societies provide low carbon solutions for new-build and existing homes.

Cardiff-based Sero aims to create more net zero homes throughout the UK using a £5.5 million investment from Legal & General Capital and Hodge, a specialist in mortgages, commercial finance and savings.

It currently has links with 30 social landlords but has anambition to work with private landlords – both individuals and institutions – in the near future.

To achieve the UK’s target of net zero by 2050, almost every home will need to be improved or retrofitted with a combination of enhanced energy efficiency and low carbon heating, according to Sero, which has forged relationships within the housing sector, creating tailored net-zero energy retrofit plans for homes.

CEO James Williams (main pic centre, under letter ‘R’) says improving the energy efficiency of the UK’s homes can provide long term economic benefit and comfort to residents, as well as reducing carbon emissions.

Huge milestone

He adds: “This investment is a huge milestone for Sero as we grow and bring new products to market to help the UK in its delivery of net-zero.

“We look forward to now working together to create strategic opportunities for the business, in particular expanding our presence within new and emerging sectors, such as working with banks and building societies to support the development of green finance products.”

Later this spring, Sero will launch its Building Passport, a digital app that gives homeowners a better understanding of the carbon footprint of their home and how they can make it more energy efficient, tracking its progress.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Investors give green initiative £5.5m to kickstart PRS ‘upgrade revolution’ | LandlordZONE.

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Why tenants prefer wooden flooring

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Laminate flooring or engineered wood flooring is the ideal choice for a rental property.

There are several reasons why this is the case, so if you need persuading then… read on.

Affordability

As well as cost, most landlords want flooring to be a balance between durability, aesthetics and ease of cleaning – because that’s what most tenants want too.

Happily, both engineered wood flooring and laminate flooring achieve this balance.

Aesthetic appeal

Laminate flooring helps to provide the natural look that most people love about wood, but it is considerably cheaper.

Rental properties tend to need a more neutral-looking floor that most people would be happy with.

Vibrant colours and extensive patterns may suit some, but most tenants prefer to have something that looks a lot more neutral.

There are not many people who do not like the natural look of wood either.

Another bonus of laminate flooring is that printing technology has made it very difficult to tell laminate apart from a real wood floor.

And tenants who want to opt for a much more vibrant look can easily place a rug of their choosing to brighten up the space.

Easy to install

Laminate planks are easy to install. The best thing about them is that they essentially click together.

A local floor company will not usually charge a lot for the installation. If you opt for flooring such as tile or even carpet however then you may end up paying more for them to put it down for you, and you will probably need to replace it sooner too. This is the last thing that you want, as it’ll eat into your profits.

The seamless installation process also helps you to get a clean finish, every time.

Long-lasting

If you opt for a good quality laminate, then this can last between 15 and 20 years.

Some laminate floors have been known to last up to 30 years if there are not many tenants and if they treat it very gently.

If you buy a good-quality laminate floor from a trusted company then you may find that they come with a very solid protective coating.

This means that the floor is far more scratch-resistant when compared to other types of flooring and it is also stain-resistant too. If an area does become damaged, then it is very easy to replace it if you buy a few extra planks.

Convenient to clean

Laminate flooring is preferred because it just needs a quick sweep and mopping. If tenants leave and they have not kept the floor clean, it doesn’t take long to rectify the situation. It doesn’t stain easily and, should it get overly wet, it is very easy to dry.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Why tenants prefer wooden flooring | LandlordZONE.

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UK’s biggest secret landlord reveals why he’s selling up most of his portfolio

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LandlordZONE sits down with one of London’s most prolific but little-known landlords who has spent 30 years amassing a huge portfolio in the East End and West End areas of the capital.

For reasons of privacy, and a desire to remain ‘behind the scenes’, he doesn’t want to reveal his identity.

But his story – and worries over the future of the private rented sector, will ring bells with many of the other landlords who set out on their buy-to-let journey during the ‘boomtime’ 1990s.

Why did you get into property?

“My brother and I ran a company operating in the house building sector which went bust during the post-1990 recession, so it was time to try something new and we bought our first property using personal credit cards – a one-bedroom flat for £6,500.

“We then bought approximately six properties using this method. In those days that meant assuming low or no capital growth, because we didn’t believe flats in Hackney would ever rise in value so instead, we relied on the rent to provide the profit.”

How did you grow so fast?

“We discovered that the local council was offering landlords £5,000 a year to rent a one-bed apartment to tenants on benefits and on that basis we turned to a major bank, Allied Irish, who appreciated the opportunity and helped us finance further purchases – although we paid 30% annual interest on what were essentially bridging loans. But with figures like that it didn’t matter.

“Not for the first time we then ended up being in the right place at the right time – during the mid-1990s the first buy-to-let mortgages came out, so we transferred the whole portfolio over and, because the properties had shot up in value as the East End became gentrified – or yuppified as we used to say – so the LTV ratios worked. We reduced the interest we paid from 30% to 10%.

“We then carried on, gathering 250 properties.”

What happened next?

“The portfolio became a monster but happily many of the properties had gone from £10,000 to £200,000 in 10/15 years, so we sold a lot of the East End ones and bought more upmarket properties in the West End – so fewer properties but higher value.

“We took advantage of the weak sales market at the time in central London just after the 9/11 event in the US.

“Developers had unsold off-plan units that often came with the deposit paid by investors who had then withdrawn – so in return for taking the deposits we took on the contracts.

“It was a huge gamble, but by the time they were completed, the flats had doubled in value. Again, in the right time and in the right place.

“Then we had 100 properties in the East End, and 50 in central London – the beast had been tamed!”.

What next?

“I went to a meeting just before the Covid pandemic began that revealed how government’s plans to ban Section 21 which scared the hell out of me – our model of finance and operation was based on being able to evict tenants who caused problems or didn’t pay their rent relatively easily.

“If that process is going to become more difficult then our business model doesn’t stack up, so I began selling off some of the portfolio. My aim is to have around 40 mainly in the West End. That way I can keep a more personal tab on the tenants.

“Saying that, over the past 30 years the portfolio has always achieved 99% of its income and we’ve had few problems with bad debt because we’ve stuck to what we know and where we know – as soon as you get out of your comfort zone you are exposed.”

What would you say to the next generation?

“I’m going to be in my mid-sixties soon, so I feel it’s time for the next generation to pick up the reins. I believe that the future of landlording is more corporate and ‘professional’ and the bigger portfolios be increasingly funded via investment finance.

“These days you couldn’t start up as we did – the extra regulations and other responsibilities mean it’s a much more serious commitment now, and self-management on a large scale is much more of a challenge. Instead, I am going to invest in art and continue my philanthropic projects.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – UK’s biggest secret landlord reveals why he’s selling up most of his portfolio | LandlordZONE.

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Rent being held back by agent after slipping on to periodic tenancy?

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When starting out as a landlord 10+ years ago, I used letting agents to find tenants. One extreme annoyance was having to carefully read through (and often modify) each agent’s own tenancy agreement. After a year, I stopped using agents and worked with my own template agreement that I drew up with the help of a solicitor

Fast-forwarding to late 2020

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