Advice needed on the allocation of residential service charges

admin    Uncategorized     agents

Hello everyone, I am a leaseholder in a small block of 6 flats that is self-managed through a limited company in which each leaseholder has an equal share (the Management Company).

The flats were created in 1989 by converting a 5-storey Victorian house.

View Full Article: Advice needed on the allocation of residential service charges

London is home to a quarter of the nation’s HMOs

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Almost a quarter of all HMOs in England are located in London (24%), however, it is the South East and East Midlands that currently offer the most opportunities for investors.

That’s according to the latest market analysis by Revolution Brokers

View Full Article: London is home to a quarter of the nation’s HMOs

Making Tax Doable for Landlords

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With Making Tax Digital for Income Tax, getting closer and closer to mandation, it is getting even more important for landlords to get an MTD appropriate solution in place.

Rental property owners are set to be some of the most affected by the changes put in place for making tax digital – many have a system, spreadsheet or calculation, that they have used for years to calculate their Self Assessment Tax Return for the year. Even more still keep entirely paper records – but with just one annual return per year, this was an adequate system.

But MTD is just over 18 months away. And with that comes the need for digital record keeping, and quarterly tax submission.

APARI has always listened to our landlord users, and the feedback provided from LandlordZone readers has been absolutely crucial to helping us build the best solution for Landlords being majorly affected by MTD – here’s how;

Bank Connections

Uploading individual transactions into a software can be tedious and often time consuming! Many landlords keep a separate bank account for their property income, and so one of our biggest introductions in the last year has been our banking connection.

Powered by Open Banking Technology, you can connect your bank account directly to APARI, and the transactions in that account will automatically feed through – just leaving you to log in and allocate those transactions to the appropriate category. 

If you don’t have a separate bank account, then that’s fine too – you can just allocate anything irrelevant to private expenditure, but we would recommend at least considering having a seperate account, even if just for MTD purposes.

Receiving the net amount from your Agent

Are you one of the many landlords who uses a letting agent? If so then a major aspect of MTD is the need to show not just the amount received from your letting agent in the month, but the separate transactions of the amount of rental income and the letting agents fee, which make up the net amount that hits your bank account.

This has frequently been mentioned as a concern by landlord’s – so APARI has introduced the Split Transaction feature on all transactions uploaded into the software.

This handy feature allows users to segment a transaction in the bank feed, into the individual parts that make it up e.g. Your property is managed by an agency and you receive a net income of £1,100. However, the actual rental income is £1500, the agency fee is £150 and a property repair is completed on your behalf for £250.

Any split transaction will need to recalculate the net of the transaction pulled through, so any non-business parts of the transaction will need to be allocated to non-business.

Jointly owned property

I know we only spoke about this last month – but we are SO proud of this feature, so will continue to shout about it for a while!

Taxpayers who own a property with another person (eg. spouses, business partners, etc) will soon need to show each transaction relating to their ownership of a property. That’s (at least) double the work!

But with the APARI joint property feature, we can automate this split – meaning one transaction upload, one allocation, gets automatically uploaded into your co-owners APARI account. Simple!

So in summary – yes MTD is going to be more work for landlords! But using a product like APARI can really help reduce this burden.

Don’t believe us? Try it out for a month, FREE!

View Full Article: Making Tax Doable for Landlords

LATEST: Student sector faces shortfall of 450,000 beds by 2025

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Rising student numbers and a slowing supply of new student housing will create a shortfall of 450,000 beds in the UK by 2025.

According to data from StuRents, 248,000 beds are set to be delivered between 2017 and 2025, however, an additional 700,000 students will need accommodation and there is already a shortage of 207,000 beds.

The student accommodation portal reports that the supply shortage is partly due to the fact that planning applications have slowed dramatically following a high in 2016. Head of research Richard Ward says availability of sites, oversupply in some markets and construction costs are all affecting planning applications for new purpose-built student accommodation, while the growing use of Article 4 directions has also made an impact.

“This could be because councils don’t want to be seen to be allowing landlords to reduce the number of properties available for families,” he says.

Harder

“Although an Article 4 doesn’t make it impossible for landlords to turn properties into student lets, it does make it harder and creates further barriers to supply growth of student properties. The recently announced Renters Reform Bill, which impacts HMOs could also have a detrimental impact – although the outcome is unclear at this stage.”

Other factors that could further squeeze supply are the rising 18-year-old population and the UK’s policy of increasing the number of international students.

Earlier this year, Octane Capital reported that HMO numbers in England dropped by 3% to 497,884 in the last year as many landlords offloaded their buy-to-let stock instead of negotiating more legislative hurdles.

View Full Article: LATEST: Student sector faces shortfall of 450,000 beds by 2025

Tenants rush to find ‘bills included’ rental properties on Rightmove

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‘Bills included’ has become the most popular renter search term on Rightmove, overtaking pets and gardens for the first time.

The rising cost of living and increased rents – forecast to jump 8% this year – has prompted tenants to want more certainty in their outgoings; last year bills included was just outside the top five in keyword searches, but now also tops the search for balconies or furnished properties.

With the average asking rent outside London already 19% higher than two years ago, up from £949 a month to a record £1,126, many renters are also considering available rental properties across a much bigger area than four years ago, reports the property platform.

Trying to find somewhere in budget along with hybrid working are likely factors in growing the average search area from 70km2 in July 2018 to 137km2.

25% down

The number of new rental properties coming to market continues to improve, up by 3% in July versus June, although the number of available properties is still 25% lower than this time last year.

The result is a fiercely competitive and fast-moving rental market, with prospective tenants seeing properties being snapped up twice as quickly as they were two years ago.

Rightmove’s property expert Tim Bannister (pictured) says the lack of homes is down to more people choosing to stay put and sign longer contracts, some landlords selling up due to more onerous taxes and others taking advantage of record house prices, and hybrid working shifting some demand to more rural and suburban areas.

He adds: “This has all led to a fiercely competitive rental market in many areas with agents reporting that in some cases properties are being rented out in just a few hours.”

View Full Article: Tenants rush to find ‘bills included’ rental properties on Rightmove

Half of tenants have been asked to pay higher rent, says Generation Rent

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Generation Rent has urged the government to impose a rent freeze as it reports that nearly half of private renters faced a rent increase in the last year.

Its poll of 1,074 tenants reveals that nearly half who had lived in their home for longer than a year (45%) have been asked to pay a higher rent. Of those, 81% paid what their landlord asked for, with just 14% able to negotiate a lower rent.

One in five renters (20%) experiencing a rent increase during their current tenancy were asked to pay more than £100 extra per month. Just over half of them paid it (54%), while 28% negotiated a smaller increase and 13% had to move out.

Benefits

It says tenants on benefits are more likely to have been handed an increase in rent, despite Local Housing Allowance being frozen since March 2020; 46% have been asked to pay more compared with 43% of private renters not receiving benefits.

When asked by the pressure group how they would cope with the cost of living crisis, the most common answer among private renters not getting benefits is using their savings (35%) while for private renters getting benefits, 39% answered “don’t know”.

Director Baroness Alicia Kennedy (main picture) says: “Renters are terrified, knowing they face a winter of destitution. Ultimately that will lead to a further rise in evictions and homelessness.

“The government must intervene and temporarily stop landlords from raising the rent, as well as pausing evictions to keep renters in their homes.”

Market rents increased by 11.8% between Q2 2021 and Q2 2022 in the UK, according to Rightmove.

Read more: How to legally increase your rent.

View Full Article: Half of tenants have been asked to pay higher rent, says Generation Rent

Cavity wall insulation to get block down to EPC rating C?

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I have a flat I rent. It is 1 of 4 in a block. It is located on the first floor. The other flat on the same floor is also rented. The 2 flats on the ground floor are both privately owned.

View Full Article: Cavity wall insulation to get block down to EPC rating C?

Renters Reform white paper not fit-for-purpose when it comes to HMOs

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As the government continues to work on the proposed Renters Reform Bill, we will be urging them to reconsider the impact of proposals in the white paper on multiple occupancy properties.

 Although the Bill specifically exempts purpose-built student accommodation

View Full Article: Renters Reform white paper not fit-for-purpose when it comes to HMOs

Landlord faces prosecution after Tribunal uncovers illegal eviction

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A landlord who chucked a tenant out of his unlicensed HMO has been handed a £2,825 Rent Repayment Order by a First Tier Property Tribunal.

Imtiaz Khan admitted that he had not given the tenant notice but instead entered the man’s room without lawful authority and re-let it without properly terminating the tenancy. Newham Council now has to decide whether to bring a criminal prosecution for illegal eviction.

Penalties for such actions can be severe – last week a landlord in Liverpool was given a suspended jail sentence for a similar illegal eviction.

Khan’s six-bedroom HMO in Upton Lane, London, comes under the authority’s mandatory licensing scheme; Khan also admitted that he had not applied for a licence until November 2020 – after the tenant’s application for an RRO.

Legal requirement

The tribunal ruled that Khan was not a professional landlord as he only owned one property, but that as he had been a landlord for more than five years, should have been aware of the legal requirements of licensing.

It heard that he could not substantiate his claim that the tenant owed £1,200 in rent arrears, and which the tenant agreed was £725.

The arrears and the £1,900 paid to the tenant in Universal Credit between August and December 2020 were deducted from his original claim of £5,450.

Read the decision in full.

View Full Article: Landlord faces prosecution after Tribunal uncovers illegal eviction

19% inflation and 6% Bank Base Rate

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Only this week, Citibank predicted that UK inflation would exceed 18% by January next year and that the Bank of England would feel compelled to increase the base rate to 6%.

How many of us are prepared for this?

View Full Article: 19% inflation and 6% Bank Base Rate