Rental stock shortage to give rogue landlords ‘free rein’ warns buy-to-let firm

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Landlords’ increasing power and a dearth of rental homes is likely to give rogue operators free rein, according to a snap poll by GetGround.

Half of those quizzed have seen an increase in demand for their properties in the last year, prompting more than two-thirds (69%) to believe that the balance of power has shifted in their favour, while 81% reckon a lack of housing threatens to allow disreputable landlords to harm the rental market.   

GetGround reports that 57% of landlords say tenants are willing to pay higher rents to secure tenancies, accept higher bills for utilities (55%) and accept unplanned rent increases (69%).

Only one in eight (13%) think tenants are expecting or demanding more from their landlords.

CEO Moubin Faizullah Khan (pictured) says: “With recent history as our guide, it’s easy to imagine how the private rental sector could be brought into disrepute by bad actors: disproportionately high rents, unexpected bill increases, unfairly terminated tenancies and so on.

“Landlords and tenants alike need the right protections and safeguards to ensure none of this poor behaviour is able to happen, particularly as high mortgage and energy costs continue to put even more pressure on landlords to find means to stay solvent.”  

Perfect storm

NRLA chief executive Ben Beadle (pictured) believes the poll data highlights the arrival of a perfect storm, combining the increased cost of living with rising rents.

“That rents continue to rise is due to the impact of a lack of supply and record demand in the private rented sector,” he adds.

“It’s time for the government to reverse this failed approach by reversing mortgage interest tax changes, abolishing the 3% stamp duty land tax surcharge, investing in social housing and unfreezing local housing allowance for renters.”

View Full Article: Rental stock shortage to give rogue landlords ‘free rein’ warns buy-to-let firm

INTERVIEW: The group helping hundreds of tenants pursue rent repayment orders

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Tenants are more likely to take their landlord to tribunal if they feel mistreated or their legal counsel is ill-informed or aggressive, according to Justice For Tenants, one of the main not-for-profit organisations helping tenants tackle bad landlords.

Once a landlord has been banged to rights by the council for an offence such as failing to do repairs or not having an HMO licence, tenants don’t necessarily want to haul them before a court, the non-profit’s local housing authority training and outreach lead, Al Mcclenahan (pictured), tells LandlordZONE.

“Tenants don’t usually want to bring a rent repayment order case unless they’ve been mistreated,” he says.

“Reasonable landlords will want to settle really quickly – they’ll make an offer, and we tell tenants what they could be awarded if it went to a tribunal, but the tenants will usually take the landlord’s offer because they’ve been treated reasonably.”

In 80–85% of cases, landlords will try and settle when Justice For Tenants is involved, and about 50% end up settling.

The outcome can also depend on how aggressive the landlord’s representative is, explains Mcclenahan, who adds that some haven’t even done a bar course and can exploit these landlords.

“If they make all sorts of claims about the tenant, a tenant will feel they’ve been treated unfairly and will want a hearing.”

Sometimes landlords won’t settle because they think the tenants are paying Justice For Tenants an hourly rate, so they’ll try and keep engaging to ‘spend them out’ (however, the group gets a flat fee of 30% of the award) or they don’t realise the case creates a public record, he says.

Enforcement toolkit

Justice For Tenants has recently created a tribunal enforcement toolkit for local councils which it will use to deliver training to 50 authorities.

Where councils haven’t taken any enforcement action for many years, rogue landlords know there’s little chance of them getting a penalty – but this initiative could result in a doubling in national enforcement actions over the next few years, predicts Mcclenahan.

“Our training is about making sure councils’ procedure is that a housing debt not paid will result in a charge against a landlord’s property which would ultimately mean the council could sell the property from underneath them if that debt reaches £20,000.”

Read more about rent repayment orders.

View Full Article: INTERVIEW: The group helping hundreds of tenants pursue rent repayment orders

Tenants ‘paying the price’ of Government’s assault on PRS, new figures show

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Rental unaffordability for single earners has hit a 10-year high, highlighting the need for more investment in the PRS to address the chronic imbalance between supply and demand.

Annual rental growth now stands at 12%, accounting for 35% of a single earner’s average income, according to Zoopla’s Rental Market Report.

The average monthly rent for a new letting is up £117 since last year, to £1,078, with rental stock down 38% compared to the five-year average and down 4% on last November.

Rental enquiries

Zoopla reveals that in stark comparison, rental enquiries per estate agency branch are 46% above the five-year average. 

Monthly rents are increasing fastest in the UK’s largest cities with large student populations; up 17% or £273 in London, Manchester (+15.6%), Birmingham (+12.3%), Glasgow (+14.1%), Bristol (+12.9%) and Sheffield (+12.4%).

As rental increases in tenancies are much lower at 3.8%, it’s prompting growing numbers of renters to stay put and avoid price rises, compounding supply problems.

Increase investment

Zoopla believes increasing investment in the PRS is the only way to ease the affordability pressures on renters in the medium term and to create a more sustainable rental market.

Executive director Richard Donnell (pictured) says renters are paying the price for low levels of new investment in private rented housing over the last six years. “Renters are having to adopt a range of strategies to deal with rising rents,” he explains.

“We have seen a rapid increase in demand for one and two-bed flats while some renters are now considering sharing a property to cover the cost of rent. Others may now need to stay at home with parents or relatives for longer until they can afford to rent privately.”

Adds Donnell: “In the short term, we expect the growing unaffordability of renting to reduce rental increases in 2023 to 5%.” 

Read more: Major landlords calls on Government to change direction on PRS.

View Full Article: Tenants ‘paying the price’ of Government’s assault on PRS, new figures show

Why should landlords deal with lies and damned statistics?

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It has been another interesting week in the life of a landlord in the UK – and none of it good.

My attention has been drawn to the use of statistics to prove that all landlords are bad –

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Only 3 for an HMO beware the sting in the tail?

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Hello, As of 9th December 2021 the Lambeth BC decided to reduce the number of unrelated people using shared facilities from 5 to 3 to class it as an HMO.

At that time we had 3 gents living in the flat under AST which commenced in September 2019 and became a rolling AST from September 2020.

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BLOG: This is what many private landlords will soon be competing with in cities

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A couple of weeks ago I was invited by the owners of a build-to-rent development in Wembley to see at first-hand what this emerging kind of rental property looks like – in this case a 440-unit just off the A406 called WemLondon.

As I walked in, immediately I could sense the positive energy of a communal environment with loads of young professionals either coming out of the gym or sitting in the restaurant bar area. 

I wanted to see what the claimed ‘tenant customer focus’ looks like in the flesh and, after speaking to a few tenants, I could see the satisfaction they have from living in a co-living community with amenities.

But how much for a home at WemLondon? Studio and one-bed apartments are 340-420 sq ft, with average rents £1,500 a month plus bills, although I noticed that one-bed apartments in similar blocks nearby can reach £2,195 a month.

All the amenities were on the ground floor including a large shared workspace for the residents many of whom were sat working in silence on their laptops with their flat-white coffees.

And there was even a barber shop in the building too.

The area around Wembley stadium is awash with large shiny high-rise buildings like this, all offering a very different rental experience to their customers which focus on creating communities.

Growing trend

And it’s a growing trend. There are 237,000 build-to-rent units in the UK including 73,000 completed, 47,000 under construction and 115,000 in planning, although the majority are in London.

What surprises me when I’m travelling around the country doing talks for landlords is that very few are fully aware of the how fast build to rent is growing, and the experience they offer to tenants. 

The reality is that if you are renting out property in urban areas, it’s likely that a competitor will be this sort of accommodation.

For the moment, the competition is weak as dozens of tenants fight over every property within the private rental market, regardless of quality.

But as the number of build to rent properties rises, quality and tenant experience will become more important including what’s offered as part of their monthly rental.

When I spoke to the MD of Canada Israel UK Real Estate, which is the company behind WemLondon, he said it was his company’s first build to rent development in the UK, which has been a huge success and that they are planning to build another 1,000 units on site.
We clearly need more international developers to create more housing for the rental market.

www.wemlondon.uk

Read more: What does build to rent mean for buy to let?

View Full Article: BLOG: This is what many private landlords will soon be competing with in cities

Agency says prime rental demand is ‘unprecedented’

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A leading lettings agency says that prime rental demand in the UK is running at an unprecedented level and is up by more than 20% year-on-year.

That’s according to Nicky Stevenson, the managing director of Fine & Country UK

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