Housing minister promises England will never see ‘un-Conservative’ rent controls

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Housing Minister Eddie Hughes has emphatically shut down suggestions that rent controls could be part of PRS reform.

Following the publication of the White Paper – A Fairer Private Rented Sector – some rent campaigners had voiced hopes that it would usher in tougher rent rules, but Hughes told the Commons: “I have to be blunt and say, ‘Under no circumstances’ – that is simply not a Conservative policy and it is not something we are going to pursue.”

Instead, it appears that the less radical option suggested in the White Paper will attempt to curb rises.

Namely, the government is proposing to only allow rent increases once a year (replicating existing mechanisms) and will increase the minimum notice landlords must give of any change in rent to two months.

Rent increases

The use of rent review clauses would also come to an end, preventing tenants being locked into automatic rent increases that are vague or may not reflect changes in the market price.

The White Paper goes on to say: “Most landlords do not increase rents by an unreasonable amount but in cases where increases are disproportionate, we will make sure that tenants have the confidence to challenge unjustified rent increases through the First-tier Tribunal.

“We will prevent the tribunal increasing rent beyond the amount landlords initially asked for when they proposed a rent increase.”

Commentary within the notes published alongside the Queen’s Speech had also suggested the government would consider rent controls ‘via the back door’.

Dissenting voice

But not all Conservatives agree with him. A letter in The Telegraph from Devon-based Tory supported John Dodwell, in response to a column within the paper yesterday criticising the rent reform White Paper, said: “I believe in the Conservative principles of self-reliance and independence, but it is obvious that a “free market” in property – whether buying or renting – is no longer tenable.

“For such a market to exist and operate fairly, it requires a reasonable equilibrium between supply and demand, and there is little chance of that happening.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Housing minister promises England will never see ‘un-Conservative’ rent controls | LandlordZONE.

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Structure your property business to protect your legacy and always refinance on Interest only Mortgage

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Interest Only Mortgages are great for property investors, but what happens when you’re simply too old to remortgage.

In this episode of The Property Tax Show, I’m joined once again by Alex Norian, the tax specialist, from Property 118 to discuss how you can structure your property business to protect your legacy while continuing to refinance on Interest Only mortgages forever.

View Full Article: Structure your property business to protect your legacy and always refinance on Interest only Mortgage

OFFICIAL report reveals ‘hit and miss’ results of under-funded PRS enforcement

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A lack of hard information about local private rental sectors means many councils find it hard to make decisions, while some under-staffed teams are mostly ‘fire-fighting’ rather than going after rogue landlords, it has been revealed.

Those without political or local backing also find it hard to robustly enforce PRS standards, leaving many councils to operate a reactive, rather than proactive service that only targets the worst properties, finds a new government report based on a survey of 140 local authorities across England.

It follows comments within the government’s renting reform White Paper last week that Ministers intend to strengthen local councils’ enforcement powers and ability to crack down on criminal landlords by seeking to increase investigative powers and strengthening the fine regime for serious offences.

Effectiveness

Gathering evidence was described as one of the biggest challenges that enforcement officers face, with few authorities able to demonstrate convincingly that their approach was driven by the effectiveness of their actions.

The DLUHC report says: “Some explained limited use of enforcement with reference to high levels of landlord compliance with informal requests but acknowledged that they were unlikely to encounter the worst properties.”

Just under two-thirds (63%) conducted a survey of the housing stock – this was often undertaken infrequently or on an ad hoc basis. Instead, much time was spent simply identifying landlords, agents and properties which eroded teams’ capacity to take enforcement action.

Local authorities were also not making much use of the Rogue Landlord Database, blaming its restrictive criteria or the fact it isn’t public, or user-friendly.

RROs

Councils report that rent repayment orders (RROs) act as an incentive to landlords to comply with HMO licensing and although most do not think it a worthwhile use of their resources to apply themselves, they are more enthusiastic about supporting tenants to apply.

Mandatory licensing of HMOs and selective licensing was widely praised for helping to improve standards and conditions, and seen as a good way of collecting data.

But officers called for a mandatory register of landlords and agents to help facilitate their work, along with better access to financial data such as bank records. Local authorities would also like to see a simpler legislative framework for enforcement.

Read: A complete guide to running an HMO.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – OFFICIAL report reveals ‘hit and miss’ results of under-funded PRS enforcement | LandlordZONE.

View Full Article: OFFICIAL report reveals ‘hit and miss’ results of under-funded PRS enforcement

Surging electric car sales leads to two tier housing market

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Houses with off-road parking space will not only command a higher sale price, the rental value will also be boosted as more people buy electric cars.

Surge in EV sales

The electric vehicle (EV) market is booming, which will inevitably have its impact on property prices. With a limited number of charging points on the road network, having a home charging point is an absolute necessity for most electric car owners.

According to the latest vehicle statistics, electric car sales nearly doubled during Covid in 2020, and EV sales enjoyed another record year in 2021 – more battery electric vehicles were sold than over the previous five years combined, hitting nearly 12 percent of all new car sales, and another 7 per cent were plug-in hybrid electric vehicles, making nearly one-fifth overall.

January to May 2022 saw electric car sales statistics continuing their record sales growth. March 2022 saw the highest volume of battery only registrations ever recorded in a single month – as a result electric vehicles of all types comprised just short of 28 percent of all new car registrations during April following the March 1 plate change.

Now, with soaring fuel prices, there’s another reason for people to go electric. Coupled with the Covid effect of increased demand for more space – home offices and gardens – the soaring fuel prices are resulting in even higher demand for electric vehicles, clear signals that properties with driveways and more space will command premium prices.

Savills confirms it has seen a surge in demand for houses with off road parking and more space for home working, office / garden /garage.

In the London suburbs Savills says that homes with driveways now command a 5 per cent premium over similar properties without the facility to charge a vehicle. But in the most expensive parts of the city this premium can increase to one-third – a full 33 per cent higher price with a driveway, even more that the premium a large garden usually commands. 

More space and a driveway give value boost

A big garden, says Savills, is still worth more than a driveway in some of the more leafy parts of London,  where they will increase a property’s value by as much as 10pc.

The nationwide dearth of vehicle charging points means that the house price premium for homes with off-street parking is likely to be with us for some time. According to Savills, a home with a driveway in suburban London could add £23,500 to the price of a £500,000 home.

Will Watson, of agents The Buying Solution, told The Daily Telegraph that off-street parking in London could easily add as much as 20pc to the price of a family home. He says: 

“The huge concern for London is that people will have an issue charging electric vehicles if they don’t have a parking space. This premium is set to potentially get a lot higher.”

So far these price premiums have mostly affected the capital, that’s because London has been the place in the country where most people have been purchasing electric cars. However, property experts are predicting that this price-premium is set to spread fast to other prime commuter towns in the home counties and beyond.

Lucian Cook, of Savills, Head of Residential Research and one of the country’s most respected housing market commentators, having been a director in the Savills research team since 2007, said that the places in the country where electric vehicle ownership greatly outnumbers charging points are those most likely to see a big impact on home values. He says: 

“As the gap between demand for electric cars and public charging points grows, we can expect to see homes that offer private charging provisions to come at a premium.”

Likewise, Charles Davenport, of Knight Frank estate agents’ in Elmbridge, told The Daily Telegraph that off-street parking was becoming a deal-breaker for buyers with electric cars.

He said: “We had a house in Cobham and the couple looking at it had an electric car and they said sorry we can’t because there is no off-street parking and it is absolutely essential for us.” 

In the last two years, the combined number of electric cars registered has increased by nearly 200 percent, while the number of charging points has increased by only 72 percent.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Surging electric car sales leads to two tier housing market | LandlordZONE.

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LATEST: HMRC names dozens of landlords who dodged tax totalling £6.7m

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HMRC has named and shamed 26 property tax dodgers who collectively tried to avoid paying more than £6.7 million.

The deliberate tax defrauders earned income from either rental property, property developing or property tax advising, and have all been investigated and fined for either making deliberate errors in their tax returns or deliberately failing to comply with tax rules.

Amounts payable ranged from just over £25,000 to more than £4m, owed by Erica Stanford, of Meadow Cottage, Hockett Lane in Cookham, who was fined £2.8m for property rental and cryptoasset-related activities.

‘Deliberate tax defrauder’ is a taxpayer who has been investigated by HMRC and charged a penalty of over £25,000 for deliberate errors in their tax returns or who has deliberately failed to comply with the tax rules.

Here’s the full list:

• Michael Lawrence, of 9 Arabia Close, Chingford, owed £152,819;
• Calandra Jadwiga Balfour, of 26A Richmond Place, Brighton (£72,061);
• Erica Claire Stanford, of Meadow Cottage, Hockett Lane, Cookham (£4,040,378);
• CHG Holdings Ltd, of 37 Commercial Road, Poole (£441,031);
• Dilbagh Singh, of 3 Gainsborough Place, Chigwell (£34,811);
• Gurdev Kaur, of 3 Gainsborough Place, Chigwell (£39,370);
• Surriaya Latif, of Harkaway, Whittington, Worcester (£51,650);
• Haroon Sheikh Latif, of Harkaway, Whittington, Worcester (£28,494);
• Hassan Mahdi Salih, of Longhouse Close, Lisvane, Cardiff (£30,858);
• David Warren Hannah, of The White House, Welford Road, Arnesby (£30,600);
• Umar Hayat Khan, of 170 Yardley Wood Road, Moseley, (£61,125);
• Farida Jhetam, of 3 Lichfield Road, Woodford Green (£84,526);
• Akbar Jhetam, of 2A Tennyson Road, London (£34,513); Manoharan Sellaih, of 26 Khartoum Road, Ilford (£25,685);
• Joseph Bernard Cremin, of 39 Hamilton Road, Ealing (£428,832);
• Pew Homes Ltd, of 39 Lantry Lodge, Moira, Craigavon (£67,971);
• Jay Lance Stevens, of 20 Providence Street, Greenhithe (£57,859);
• Piara Singh Sehajpal, of 1 Honeysuckle Close, Iver (£226,005);
• D J Murphey Construction Ltd, of International House, 24 Holborn Viaduct (£99,000);
• Michael Walsh, of 59 Dellow Close, Ilford (£321,925);
• Vickram Singh, of 8 Claypit Close, South Shields (£51,405);
• Shurif Uddin Shaikh, of 207 Shakespeare Crescent, Manor Park (£37,572); Stephen John Bentley, of Long Ridge, Egerton House Road, Egerton (£152,171);
• Vilay Patel, of 6 Samuel Gray Gardens, Kingston upon Thames (£84,414); Kalpana Patel, of 6 Samuel Gray Gardens, Kingston upon Thames (£45,152); and Chang Ling Lin, of 20 Stephen Oake Close, Manchester (£25,332).

HMRC warns that they may no longer be at the address and the business now operating from there may have no connection with them.

Read more about landlord tax and HMRC.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: HMRC names dozens of landlords who dodged tax totalling £6.7m | LandlordZONE.

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Telegraph needs landlord feedback on Renters Reform Bill please – Article Written

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Hi, my name is Melissa Lawford and I’m the property correspondent at The Telegraph. The Government will be publishing its Renters Reform Bill white paper on Thursday and I’m keen to talk to landlords about how this will affect them.

View Full Article: Telegraph needs landlord feedback on Renters Reform Bill please – Article Written

Spouse/Partner Leave to Remain visa?

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I have had an application that gives this detail (Spouse/Partner leave to remain) on the biometric card. I have asked for a share code from the prospective tenant. Looking this up on the government website it states: Apply as a partner or spouse

To apply as a partner

View Full Article: Spouse/Partner Leave to Remain visa?

UPDATED: FIVE leading landlord figures pick holes in renting reform White Paper

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Landlord group leaders have begun picking holes in the government’s radical Renters Reform Bill white paper.

While welcoming some of the proposals, Portsmouth & District Private Landlords Association chair, Martin Silman (pictured), believes removing Section 21 notices could spell disaster if problems with the courts aren’t fixed too.

He also points to potential problems for student landlords following a move to allowing tenants to give just two months’ notice.

“They need to put a loophole for students who have to be on a fixed-term contract otherwise the whole model falls apart,” he tells LandlordZONE.

“You need the confidence that students will leave at the end of the academic year – if one of them decides to stay on for a few months, you couldn’t operate as a student landlord.”

Silman believes this could also create an issue by combining tourists with tenants needing a house as it would be cheaper to stay in an HMO for a couple of months (by moving in and then giving notice) than in some Airbnbs.

“It will mean that those looking to move back to an area or wanting to come here more permanently but who have not yet secured a job will no longer easily find accommodation.”

Biggest problem

Charles Clarke, vice chair of the Eastern Landlords Association, says: “I don’t like the idea of having periodic tenancies as you wouldn’t want people to leave in only a few months time after you’ve gone to the trouble of paying for an inventory.

Also, the proposal about not being able to refuse children will probably be easy to circumvent as landlords could just say they have chosen a more suitable tenant if they didn’t want a particular family – it’s a free market after all.

“The biggest problem is a shortage of rental accommodation and these proposals will only make that worse as those landlords who only have one or two properties will probably say the new legislation is too onerous and will sell up. The government needs to commit to building more affordable housing.”

Damaging

Giving notice soon after moving in could be damaging for many landlords who might have paid a letting agent up to £1,000 to find a family, agrees Giles Inman (pictured), business development director at EMPO, who says many anxious landlords will be making some serious decisions if these proposals come to pass.

He believes the suggestion about using an ombudsman for mediation would be largely ineffective. “99% of the time our members have to evict tenants due to arrears, so usually the relationship has broken down completely and no level of mediation would bring it back on track,” he tells LandlordZONE.

On the subject of being forced to take pets and for tenants to get insurance, Inman is also unconvinced.

“Pet insurance doesn’t cover damage over time such as scratching which is most common, just single incidents. Landlords would get scared if they can’t say no to a massive dog. It would be more logical to ask for a deposit for pets.”

Read the White Paper in full.

iHowz CEO Peter Littlewood (pictured) says that a leasehold landlord with an existing clause in their lease preventing pets won’t be allowed to take them under the new proposals.

He tells LandlordZONE: “Even if a landlord sees appropriate pet insurance before handing over the keys, there is nothing stopping the tenant from cancelling the policy after they get the keys. And how can a landlord ensure the policy is renewed at the end of the first year?”

The group is also concerned that the policy of banning Section 21 notices will hurt the people it is intended to protect. Littlewood says: “Many landlords will be unwilling to offer a tenancy unless the applicant has perfect references.

“This will lead to further stress in the social housing sector when vulnerable tenants can no longer be housed in the PRS, and a reduced supply of rental properties will drive up rents and associated housing benefit costs. More landlords will leave.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – UPDATED: FIVE leading landlord figures pick holes in renting reform White Paper | LandlordZONE.

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