Growing costs force landlords to consider rent rises

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More than 40% of landlords are likely to increase rent on one or more properties during the next year despite tenants’ ability to pay rent being their number one concern.

A HomeLet/Dataloft survey of 1,000 landlords found that over half of them would be raising rent to cover their increased costs while an additional third would do so in response to market pressures. Concerns about the abolition of Section 21 notices and other taxation or legislative issues also rate highly.

Top concern

However, the study found that 36% of landlords have no plans to increase the rent on any of their portfolio over the next 18 months – no doubt a relief to the 78% of renters who are worried about how they will pay their rent. In the firms’ other study of 12,000 renters it is ranked by one in four as their top concern in the next year, closely followed by worries about landlords increasing rent.

HomeLet CEO Andy Halstead says landlords know the pressure on tenants, but sometimes have to put rent up due to growing costs. “There simply isn’t enough housing stock,” he explains. “Many landlords are choosing to exit the market, which only causes further strain on stock levels and letting agent businesses.”

Rough ride

Adds Halstead: “The government’s commitment to legislation in the market through the Renters’ Reform Bill will provide the most significant change to rental law in a generation and I can’t see any positives. We are in for a rough ride.”

Dataloft MD Sandra Jones believes lessons can be learned from the build-to-rent sector where providers understand the importance of consistently managing customer expectations. “They use their scale and resources to negotiate with utility suppliers, offering greater security and cost predictability,” she adds. “With costs and concerns rising, this is a time when all renters will value a professional and engaged relationship with their landlord.”

View Full Article: Growing costs force landlords to consider rent rises

EMERGENCY Recession Webinar

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The news is currently full of talk about recession. In fact, it feels like we are talking ourselves into a recession. If we do go into a recession, what will this mean for you and your property investing?

This is VERY important for you because the next 24 months could literally be make or break.

View Full Article: EMERGENCY Recession Webinar

Complaints lead council to consider curbs on Northampton HMOs

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West Northamptonshire Council could get tougher on Northampton’s HMOs after launching a long-awaited review into the sector.

It will investigate claims that its 1,300 registered HMOs are having a detrimental impact on the local community with issues raised including general poor maintenance, rubbish causing a fire hazard and streets crammed with parked cars.

Robust analysis

Deputy leader, councillor Adam Brown, says the review will include a robust analysis of current policies concerning HMOs in Northampton, as well as ways to use best practice from elsewhere in the country. He adds: “We wanted to get the review started as quickly as possible, but we’re also aware of the fact that it needs to be done as thoroughly and as well as it can possibly be done in order to deliver the results that will have the faith of the public. There’s never any point in rushing through an inadequate process and leaving people unsatisfied with the results at the end of it all.”

Final decision

As part of the study, the local authority will quiz landlords, tenants, estate and letting agents, residents and resident associations, colleges, businesses, students and key workers. A resulting draft report will provide another opportunity for stakeholders to give their views and it expects to make a final decision in the Autumn. The review was originally announced last year and should have been completed in April.

The council introduced an additional licensing scheme, covering properties with three or four occupants in two or more houses, in February 2020.

View Full Article: Complaints lead council to consider curbs on Northampton HMOs

Landlords urge MSPs to think again before landmark eviction vote

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Landlord and housing groups have made an 11^th hour appeal to the Scottish Parliament to ditch potentially devastating new eviction laws.

It is due to debate the final stage of the Coronavirus (Recovery and Reform) Bill tomorrow (28^th June) which includes plans to give tribunals the final say on tenant evictions in Scotland. All eviction grounds would become discretionary, including non-payment of rent, and would also require the First-tier Tribunal to consider whether landlords had complied with a pre-action protocol for rent arrears eviction cases.

Shatter confidence

Organisations which represent landlords believe the measure will shatter confidence in the rental sector and lead to large numbers of homes being withdrawn from the market. For those landlords who want to sell their rental property – either to fund retirement or to free up capital – not being able to end the tenancy will significantly reduce its value. They estimate up to one in five landlords could withdraw from the market as a result.

The Scottish Association of Landlords, NFUS Scotland, the National Trust for Scotland and Scottish Land & Estates have warned that although the proposals aim to offer greater protection to a very small number of tenants facing eviction, they will backfire on a far greater number of people looking to rent homes.

Real danger

John Blackwood, chief executive of the Scottish Association of Landlords, says: “There is a tried and tested eviction process which already works well and protects tenants and landlords. There is a very real danger that if this goes ahead landlords will lose confidence and simply sell homes at a time when they are in great need.”

View Full Article: Landlords urge MSPs to think again before landmark eviction vote

Demand presures on the PRS are not easing and still pushing up rents

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The latest Propertymark PRS report indicates properties available per branch are remaining static at 10, but demand from tenants is continuing to increase.

In May there was an average of 113 new applicants registered per member branch.

View Full Article: Demand presures on the PRS are not easing and still pushing up rents

Banning of Landlords using Airbnb?

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Hi Everyone, I’ve just read in ‘The Daily Mail and The Telegraph’, that Gove (in all his wisdom!), is now proposing banning Landlords from using short-term holiday let web portals such as Airbnb. He is also considering implementing the minimum term for holiday lets to be 90 days or over!

View Full Article: Banning of Landlords using Airbnb?

What is the best way to sell buy-to-let property?

admin    Uncategorized     agents

With inflation at a 40 year high, interest rates are at a 13 year high, a lot of landlords are planning to sell some properties in their portfolios to use the equity tied into them to pay off the mortgages on other properties to avoid further rises but selling buy-to-let property can be a very slow process.

So what options do landlords have to sell rental properties?

The High Street Options

Sell Buy–to–let Properties with Vacant Possession

The main advantage of this option is an uncompromised selling price but be prepared to spend a lot of time and money (especially if legal action and bailiffs are required) to provide vacant possession which will affect the ‘walk away’ funds available after agency fees and legal costs are deducted.

Sell Buy–to–let Properties with Tenants in Situ

The advantage of this option (if tenants cooperate) is less VOID time than selling with vacant possession while the disadvantages are the added complications and higher risks of the sale collapsing.

Most investors will not pay full market value for a property so sellers should expect to accept an offer in the region of 85 – 95% of the market value and legal costs will be higher than routine sales.

Estate agents do not collect information about tenants so sellers will need to provide buyers with the information themselves or allocate the role to someone else.

Alternative Options – Landlord Sales Agency

Landlord Sales Agency sell buy–to–let properties with vacant possession or tenants in situ.

• They manage the process with less disruption to tenants
• They manage the process with minimal seller involvement
• They sell properties as individual lots or as portfolios
• They have buyers who will make an offer without even viewing properties due to the legal safeguards Landlord Sales Agency put in place to ensure the data they collect is reliable
• They secure all offers as soon as they are accepted to ensure buyers do not try to renegotiate later in the process and fewer sales collapse
• They sell individual properties and portfolios ranging from £100,000 – £10M
• They sell and complete fast (typically 12 – 16 weeks or slightly longer depending on the circumstances)

Sellers typically receive between 80 – 90% of the property value, depending on the number of tenancies and the complexity of the sale. They pay up to £720 (inc VAT) towards legal costs so in most cases, the amount sellers receive is their walk away figure.

David Coughlin founder and CEO of Landlord Sales Agency said,

“We’re all about delivering speed, efficiency, and exceptional customer service. With the rise in popularity of HMOs in the last 10 years, landlords are now finding it more and more difficult to sell ex rental properties with vacant possession without having to wait years for multiple tenancies to end. The simple and obvious answer is to sell to other investors who see established and trusted tenants as a bonus, not a problem.

We recently paid £2.3m into a client’s bank just 16 weeks after listing her tenanted, 23 property portfolio. We sold it and completed in less than 16 weeks.”

Contact us now to find out how we can help you sell your portfolio fast.

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View Full Article: What is the best way to sell buy-to-let property?