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.

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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

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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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Free webinar to see industry duo take questions on renting reform White Paper

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Landlords and agents will get some expert views on this week’s big story, namely the government’s renting reform White Paper, when Sean Hooker (main pic) will take questions during a dedicated and free webinar on Monday at 10am.

Hosted by lettings platform Goodlord it will feature both Hooker, who is Head of Redress at the Property Redress Scheme and Oli Sherlock.

He is Head of Insurance at Goodlord and both men will cover a raft of topics, now that crucial details have been provided on the upcoming reforms, which follow years of speculation.

Topics to discuss will include:

• The proposal to move all renters onto a single system of periodic tenancies;
• How the scrapping of Section 21 is likely to work in practice;
• New rules around pets and how they will be enforced;
• The launch of a tech-powered property portal for landlords;
• The creation of a new Private Renters’ Ombudsman to arbitrate disputes;
• New rules around when and why rent increases can be introduced.

 Long wait

“After a long wait, all of a sudden the industry has an avalanche of new detail and fresh proposals to contend with,” says Hooker

“It’s a lot to take in and this webinar will help agents start to make sense of this seminal document and begin the process of getting organised for the changes it will bring.”

Oli Sherlock (main pic), Director of Insurance at Goodlord, adds: This webinar will provide the first step in bringing some clarity to proceedings amongst the noise.”

Full details

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Free webinar to see industry duo take questions on renting reform White Paper | LandlordZONE.

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Add rented homes to national flood reinsurance scheme, says leading council

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Westminster Council is calling on the government to expand its flood reinsurance scheme to cover private renters.

Flood Re, which steps in when normal insurance firms won’t insure a property at the greatest risk of flooding, is unavailable to properties in blocks of more than four flats, or for private renters, according to newspaper reports

After suffering 253 flooding-related incidents last year, 70 more than any other London borough, the local authority believes the scheme is insufficient due to its restrictive criteria. Last July, amajor incident was declared when a month’s worth of rain fell in one day, causing severe damage to hundreds of homes and businesses in the borough.

Personal toll

Geoff Barraclough (pictured), member for planning and economic development, says the damage caused by the floods destroyed many residents’ homes, ruined their life-long possessions and took a personal toll on many people.

He adds: “The government should urgently review Flood Re’s needlessly restrictive eligibility criteria so that the scheme can protect all of our residents.”

The Department for Energy, Food and Rural Affairs (Defra), says renters and landlords can obtain contents insurance through Flood Re when full home insurance policies are not available.

But landlords are unable to make use of it since landlord insurance is classified as a commercial business insurance, which is not available through the scheme.

A Defra spokesperson told The Standard: “Tenants and leaseholders can obtain contents insurance supported by this scheme. Landlord insurance is often covered by bespoke policies, and we’ve worked with the industry to set up a new flood insurance directory to signpost customers to when they cannot offer flood cover.”

In 2021/22, 256,634 properties across the country were covered by the scheme.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Add rented homes to national flood reinsurance scheme, says leading council | LandlordZONE.

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REVEALED: Why ‘deposit passports’ were dropped from renting reform White Paper

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The government has parked proposals for rental deposit passports or ‘lifetime deposits’ after a lack of enthusiasm from landlords, tenants and letting agents, despite it being a ‘government priority’ three years ago.

Its call for evidence on tenancy deposit reform asked whether the Department for Levelling Up, Housing and Communities (DLUHC) should continue to explore ‘passporting’ part of renters’ deposits before the end of their old tenancy.

Of those surveyed, 53% said it shouldn’t, mainly because they believed damage could be hidden until the tenant had left and deductions couldn’t be calculated before leaving, or they thought it would increase risk for landlords, and take too long.

Those in favour believed passports would speed the process up, remove the need for a second deposit and make the moving process easier for tenants.

However, while most (70%) agreed that passporting would lead to a change in landlord and tenant behaviour, when asked what measures could be put in place to tackle or prevent negative behaviour, the largest response (42%) suggested not putting passporting in place altogether.

Too slow

Perhaps not surprisingly, most tenants (90%) agreed that the process for returning a deposit is too slow whereas the majority of individual landlords disagreed (54%) or neither agreed nor disagreed (26%).

Other proposals included paying in instalments, financial education for tenants, and the creation of an insurance deposit product and deposit replacement products.

Read more about deposits.

In its report, the DLUHC said: “The market has evolved since the call for evidence and has begun to develop innovative solutions to affordability issues, for example, loan and insurance products to bridge the period a tenant has a period where deposit requirements overlap. Private solutions have the potential to offer innovative and flexible solutions for different groups.”

Instead, it plans to monitor these solutions, including their affordability and accessibility, and to explore the findings with the Tenancy Deposit Protection Working Group, made up of deposit protection experts and tenant, landlord, and student industry bodies.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – REVEALED: Why ‘deposit passports’ were dropped from renting reform White Paper | LandlordZONE.

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Selling a small portfolio?

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Dear 118 members, I’m looking for some feedback/advice on selling a small property portfolio and would like to know how members have found the process.

We have 6 flats, 1 house and a shop as well as the freeholds

View Full Article: Selling a small portfolio?