Keir Starmer hints at new housing market restrictions for buy-to-let investors

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Labour’s leader Keir Starmer has hinted that buy-to-let landlords and second home owners may be prevented from buying properties meant for first-time buyers.

His comments came during today’s address to the Labour conference in Blackpool, during which he also said a Labour government would seek to raise home ownership to 70%.

This will be a challenge – the national homeownership rate peaked in 2003 at 71% but has been steadily declining ever since and currently stands at 63%.

Starmer said he wanted to see “no more buy-to-let landlords or second homeowners getting in first” and that he wanted to “help real first-time buyers onto the ladder with a new mortgage guarantee scheme” and “reform planning so speculators can’t stop communities getting shovels in the ground”.

Tilt the balance

His comments about landlords follow a speech by Lisa Nandy on Monday during which she said a Labour government would, for private renters, “tilt the balance of power back to you through a powerful new renters’ charter and a new decent homes standard written into law”.

Starmer’s speech will leave many landlords wondering if any of the parties support the idea of buy-to-let at all – Labour’s pitch in recent days has sounded almost identical to the Conservatives’, while the LibDems and Greens aren’t far off and, in the latter’s case, are even more radical.

Ben Beadle (pictured), Chief Executive of the NRLA, says: “It is depressing that the Labour Party is once again demonising all landlords.

“The vast majority do a good job, providing a fifth of all housing in the country. That is why private tenants are more likely to be satisfied with their accommodation than those in the social rented sector.”

View Full Article: Keir Starmer hints at new housing market restrictions for buy-to-let investors

Can anyone recommend smoke and CO alarm installation forms?

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Hi, I have fitted new smoke and CO alarms to replace the ones already installed, as it is a fresh start with the new regulations regarding fitting.

Although I had the required alarms already fitted, I decided total replacements were the way to go.

View Full Article: Can anyone recommend smoke and CO alarm installation forms?

Keir Starmer promises clampdown on BTL landlords

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The leader of the Labour Party, Sir Keir Starmer, says his government will clamp down on buy to let landlords if his party takes power.

In his speech to the party conference in Liverpool, Sir Keir said he would promote home ownership –

View Full Article: Keir Starmer promises clampdown on BTL landlords

EXCLUSIVE: Landlord wins £11k after judge rules on rent guarantee ‘Covid clause’

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A student landlord has won its court case against rent guarantee firm Housing Hand for issuing a pandemic exclusion clause to exempt tenants from paying their rent due to Covid.

The London firm successfully claimed back nearly £11,000 that it lost in rent arrears during the nine months the clause was in place and believes there may be many other landlords and agents who used Housing Hand as a guarantor during the pandemic but who have written off the debt.

In September 2020, Housing Hand told LandlordZONE that it had contacted 2,000 landlords and agents about accepting ‘Covid clauses’ and that 95% had agreed ‘reluctantly’ to accept them.

A judge at the London County Court (pictured) ruled that as the landlord’s agent had signed the pandemic exclusion agreement, it could enforce the guarantee against Housing Hand because the landlord itself had never agreed to the clause.

In addition, she ruled that if there was already an entire agreement clause – which in this case there was – this supersedes any pandemic exclusion clause.

The successful landlord tells LandlordZONE: “It was unfair that Housing Hand used the agreement to wiggle out of paying.

Claim call

“There may be other landlords out there who can claim against Housing Hand despite their agent having signed the pandemic exclusion clause and probably telling them that the money is unrecoverable. These landlords may now be missing out on rent legally due from Housing Hand.”

Housing Hand says the case was quite unusual as the rent arrears related to a property that had been sold mid-tenancy.

A spokesman says: “The position of the court was that the obligation on us as the guarantor would automatically transfer to the new owners, but the pandemic variation would not – and naturally we respect that decision.”

He adds: “Throughout the academic year of 2020-21 we promptly paid out to affected landlords and are working on corresponding sympathetic repayment plans with most of the tenants in question given the effects of the pandemic. The pandemic variation has been applicable in less than 3% of all claims that we have received throughout that academic year.”

View Full Article: EXCLUSIVE: Landlord wins £11k after judge rules on rent guarantee ‘Covid clause’

Landlords chase higher-yield properties as mortgage and maintenance costs rise

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A record 73% of new buy-to-let purchases earnt gross yields above 5% this year, up from 63% in 2016, reports Hamptons.

Its Monthly Lettings Index reveals that 23% earnt yields of 8% or above – largely helped by a move away from the capital; a fifth (20%) of London investors have bought properties in the North of England, up from 9% in 2016 and just 1% a decade ago. 

It’s hardly surprising, as London – which has an average gross yield of 4.9% – offers the weakest returns of any region in England and Wales, in stark contrast to the average 7.4% yield in the North of England, outpacing the 6.1% average.

Two-thirds (66%) of London-based investors bought properties outside the capital this year, up from just 26% a decade ago, while 29% of all properties bought as a buy-to-let are now in the North West, North East or Yorkshire & Humber, three times the figure 10 years ago. 

Base rate losses

However, the agent warns that an average higher-rate taxpaying investor with a typical 75% LTV mortgage is likely to start making a loss if the base rate reaches 2.5%.

They’ll need to yield at least 7% to stay out of the red – a figure only achievable in about 23% of local authorities in England and Wales, 65% of which are in the north of England.

Since August 2021, the average rate has risen from 1.79% to 3.51%, meaning that a landlord who bought a £222,000 buy-to-let last year will likely see their annual interest-only mortgage payments nearly double from £3,010 to £5,903 if they re-mortgaged last month. 

If the 0.5% base rate rise to 2.25% is fully passed on, this will increase payments to £6,743 for a re-mortgaging investor. As a result, net annual profit made by a higher-rate taxpaying investor who earns an average yield of 6.1% could fall from £3,198 in August 2021 to £212.

Read more: How to get the best mortgage deal.

View Full Article: Landlords chase higher-yield properties as mortgage and maintenance costs rise

How to contact uncontactable tenants?

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Hi,

Has anyone experienced a situation where you can’t get hold of the tenants?

I’ve been trying to contact my tenants to arrange access for a surveyor to do a valuation, but there’s been no response whatsoever from both tenants.

View Full Article: How to contact uncontactable tenants?

Warning issued as plans to abolish S21 evictions and fixed-term tenancies proceed

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A group representing the entire PRS has given a strong warning to the Government that its ‘Fairer Renting’ white paper proposals need a significant rethink.

The Lettings Industry Council (TLIC) includes representatives from the NRLA, 30+ leading national letting agents, surveyors, property managers, redress and deposit protection schemes and consumer groups including Generation Rent and Which?.

Its new report is designed to set alarm bells ringing in Whitehall, highlighting how official plans to both abolish Section 21 evictions and replace fixed-term tenancies with periodic ones will “negatively impact shared households, lead to significant job losses in the sector and prejudice applicants who require a guarantor”.

TLIC instead says that if Section 21 evictions are to go, fixed-term tenancies must remain, pointing out that the Welsh Government U-turned on its periodic tenancy plans recently.

The report also warns that unless its proposal is adopted, even more landlords will quit the sector making the current problems with rental stock even worse.

And as LandlordZONE reported exclusively last month, student landlords in particular are horrified by the proposal to switch all tenancies to periodic given the way student rentals work.

Paul Shamplina, founder of Landlord Action and Chief Commercial Officer at Hamilton Fraser, who has been working closely with TLIC to find workable solutions to the abolition of Section 21, adds: “Landlords need to have quick and simple routes for gaining possession of their property, and the courts need to improve to facilitate this.

“In addition, without bailiff reform, enforcement will be even more challenging. We believe the suggestions in this report help strike a better balance between the need to give tenants more security and offering landlords greater confidence in the system.”

Theresa Wallace, (main pic) Chair of TLIC, says: “It is vital to maintain the supply of desperately needed properties to rent, to prevent a further rise in homelessness and living costs which will inevitably affect the most vulnerable tenants on the lowest incomes.

“Although it is growing, the Build to Rent (B2R) sector predominantly provides one and two bed apartments but it is family homes that the PRS has a severe shortage of. B2R is not currently the solution to filling this gap.

Exiting landlords

“We are calling for any changes to the PRS to be very carefully considered and thorough impact assessments conducted, so as to ensure that the proposed changes do not cause more landlords to exit the sector at a point where property is so desperately needed by tenants.”

But her report also urges Ministers to consider improving the way the PRS works including the courts, council tax payments, the proposed Decent Homes Standard, enforcement of rogue landlords, how the landlord ombudsman and property portal will work, how selective and additional licence schemes can be improved.

TLIC is also calling for landlords and agents to given more time to adjust to the Renters Reform Bill, which is expected next year.

You can read the full report HERE

View Full Article: Warning issued as plans to abolish S21 evictions and fixed-term tenancies proceed

Can tenants take in Ukrainian refugees?

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Hi, I am a letting agent and an unrelated landlord has asked for some advice, his tenants (a couple) have moved in Ukrainian refugees into the rented property without his permission or discussion etc. and they are receiving £350 for this.

View Full Article: Can tenants take in Ukrainian refugees?

Labour ‘demonises landlords’ and will empower tenants

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Labour has unveiled plans to deliver a new renters’ charter and a decent homes standard for the country’s private rental sector.

But the criticism at the party’s conference in Liverpool of private landlords has been slammed by one organisation as ‘demonising all landlords’.

View Full Article: Labour ‘demonises landlords’ and will empower tenants

Landlords worry they can’t afford green property upgrades amid rising costs

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Rising costs are piling the pressure on private landlords who say they can’t afford to implement the measures needed to improve their rental property’s EPC rating, a bank says.

The Secure Trust Bank has found that investors and landlords fear that they will not hit the government’s proposed energy efficiency targets for their rental homes.

View Full Article: Landlords worry they can’t afford green property upgrades amid rising costs