NEW: Report says 87% of landlords will face full cost of EPC upgrades

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Just 0.2% of private landlords would qualify for full state support to help upgrade their properties under a proposed scheme to get the UK’s walls insulated, while 87% would be liable for the full costs.

The Economy 2030 Inquiry says simply basing hand-outs on means-tested benefits misses out too many poorer households, while using council tax bands includes too many richer ones. Instead, it suggests basing a model on the social care financial assessment to means tests assets and income which would share costs equitably between households and the state.

In its report – Hitting a brick wall – the think-tank says the PRS in England has the worst problem of very poor walls, with 25% of all rented properties having rock-bottom-rated walls, and a further 15% having poor walls.

Rental premium

It says that given that properties rated A to C on the EPC scale typically command a rental premium of about 5% on their D-rated counterparts, landlords can eventually recoup their outlay. When they come to sell, they would also be able to cash in on similar premiums seen in sale prices for more efficient properties.

It believes that insisting insulation upgrades are made at or around the point of sale would be a more effective policy approach for private rented stock than for owner occupied homes.

Read advice on energy efficiency laws.

Just one-in-eight (16%) of private rented properties in England with an EPC rating of D or below have not changed hands in the past decade, compared with two-thirds (67%) of low-efficiency properties in the owner-occupied sector.

The government is planning to extend the Minimum Energy Efficiency Standards; draft proposals suggest that the minimum EPC requirement for rental properties could be increased to C for new tenancies in 2025 and existing tenancies in 2028.

Read the report in full.

View Full Article: NEW: Report says 87% of landlords will face full cost of EPC upgrades

Why now is the time to buy?

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So this isn’t going to be a subject everyone wants to hear! With the doom and gloom of property world war 3, are we landing our troops, or coming out of the ashes??

In other words, is now the time to buy or are we all going to see our portfolios drop in value?

The post Why now is the time to buy? appeared first on Property118.

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LATEST: Government appears to confirm ‘biggest change to tenancy law in a generation’

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The Government appears to have confirmed that it will get rid of both Assured Periodic Tenancies and fixed-term tenancies in favour of a single, universal ‘periodic tenancy’.

This was originally flagged up in its Fairer Renting white paper published in June as a proposal but now officials want to hear the views of landlords, agents and tenants within a consultation due to finish on 25^th January 2023.

This consultation is part of a technical review of the effects on homelessness following the move to periodic tenancies and the abolition  of Section 21 ‘no fault’ evictions in favour of a revised list of mandatory of discretionary Section 8 grounds (see full list here).

It is designed to give renters more flexibility, stability and security in within the private and social rented sector, the consultation says.

But it will have one onerous consequence for landlords – all evictions will soon require a court hearing to evict a tenant at which a landlord will have to ‘prove grounds’.

This is different from the current situation, in which a Section 21 notice can be issued and an eviction notice secured (under certain circumstances) without having to give a reason.

Move quickly

“This quick-fire consultation on the impact on homelessness from the proposed Renters Reform Bill just shows that they are looking to move quickly next year and that they are concerned about the impact on local authority resourcing – and also that all references to Section 21, assured shorthold tenancies and fixed term tenancies are due to be removed,” says Tim Frome (pictured) of the Hamilton Fraser Group.

“Whether they have listened to the industry and allow fixed-term tenancies in certain sectors such as the student market remains to be seen.

“2023 is going to see the biggest change in tenancy law in a generation so all landlords and agents need to keep themselves updated with what is going on.”

View Full Article: LATEST: Government appears to confirm ‘biggest change to tenancy law in a generation’

Landlords for homelessness charity to compete with Shelter and Crisis?

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Well, that got your attention didn’t it!

But is it such a crazy idea? What if landlords got together and started a charity that helped the same people that Shelter and Crisis claim to. Fundraise the same way

The post Landlords for homelessness charity to compete with Shelter and Crisis? appeared first on Property118.

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Scots rent and evictions freeze prompts ‘staggering’ landlord exit response

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A staggering 85% of letting agents in Scotland report that landlords want to sell up following the government’s move to ban evictions and rent increases until next April.

Propertymark members in Scotland say that even more worryingly, 68% of agents had already seen an increase in notices to sell due to the emergency Cost of Living (Tenant Protection) (Scotland) Act – and that the legislation had actually had the reverse effect.

While many landlords had not increased rents in the last year, 83% would now be inclined to do so because of the Act.

They want reassurance that they could cover any rental loss as well as the rising cost of maintenance and repairs, utilities and mortgage interest hikes.

One agent explains: “Many landlords who have not increased rent and had properties below market value for years are now considering this position and feeling they must raise [their property] to market rent from now on and keep up with annual increases, whereby before they had not considered it.”

Timothy Douglas (pictured), Propertymark head of policy and campaigns, says the measures are disproportionate to the scale of the problem and have only driven more landlords out of the sector.

He adds: “Alarmingly, the temporary nature of the legislation means that the impact is not fully realised yet but if the changes are extended then there will be greater consequences.

“The private rented sector is a key solution to resolve the housing crisis but if the Scottish Government continue with policies that disincentive landlords this will only make the situation worse.”

Scottish Ministers must report and review every three months on the need for the provisions to either be continued or end; the first report will be laid before the Scottish Parliament by 14th January.

Read more about the Scots freeze.

View Full Article: Scots rent and evictions freeze prompts ‘staggering’ landlord exit response

Property prices continue falling as buyers watch and wait

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A bigger seasonal dip than usual has seen property prices continue their slide with sellers dropping the price on a new listing by 2.1%, Rightmove reports.

That price fall equates to an average of £7,862 and is a bigger drop than is usually seen at this time of year.

The post Property prices continue falling as buyers watch and wait appeared first on Property118.

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Rising margins tempting landlords back to BTL, says leading agency

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Buy-to-let investors look set to outnumber first-time buyers next year as rising rents tempt more landlords to pick up deals.

Hamptons Monthly Lettings Index reports that 12.2% of homes were bought by investors in 2022, the highest share since 2016 and up from 11.7% last year.

But sales remain below their 15.5% peak in 2015, the year before the 3% stamp duty surcharge was introduced.                       

The number of landlords registering in Hamptons’ branches is up 9% on last year as they seek out homes which have been lingering on the market. In November, 37% of offers by landlords were on homes without any competing offers, up from 14% in January. 

A less competitive market means that last month, just 25% of investor purchases were agreed above the asking price, compared to 30% among first-time buyers.

League table

Landlords’ slow re-emergence has been underpinned by investment in towns and cities towards the top of the yield league table, according to Hamptons.

So far this year 56% of new investor purchases have been in places with average yields of 6% and above, up from 40% a decade ago. 

Hartlepool offered new investors the highest average gross yield (9.9%) in England and Wales for the second year running. Meanwhile, 85% of homes sold by investors were generating a yield of below 6%.

Aneisha Beveridge (pictured), head of research at Hamptons, says that while house price growth is slowing, rental growth continues to strengthen, offsetting some, but not all, of landlord’s increased costs. 

She adds: “It’s these rising costs which are likely to mean rental growth will remain high for the next few years. In Scotland, where landlords are capped in their ability to pass on higher costs to sitting tenants, rents on newly let properties will likely continue topping the growth charts. 

“When a tenant leaves and a home is re-advertised, the jump back up to market rate is much larger.”

Read the index in full.

View Full Article: Rising margins tempting landlords back to BTL, says leading agency

Scotland set to see exodus of landlords

admin    Uncategorized     agents

Letting agents in Scotland say that 85% of their landlord clients are planning to leave the private rented sector (PRS) after emergency measures introduced by the Scottish Government brought in a rent freeze and a ban on evictions.

The claim is made by Propertymark who point to agents saying that fed-up landlords have told them they are planning to sell up.

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View Full Article: Scotland set to see exodus of landlords