‘Dear Mr Gove, stop hammering the PRS’ say leading figures in open letter

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We, the undersigned, are business leaders within the Private Rented Sector across the UK. 

With inflation hitting levels not seen since October 1981, we believe that current government policy in the rental sector — covering 35% of UK homes — is stoking housing inflation, the largest single component of the cost of living. 

As set out in the recent Renters’ Reform Bill White Paper, current policy objectives include improving housing quality and giving tenants greater peace of mind about being evicted.

These are worthy objectives which we, and most tenants, support. But tenants – whether professionals or students – also want their housing to be affordable, and current policy appears to ignore this point.

A recent survey of tenants confirms that rising levels of rent are tenants’ biggest single concern, cited by 86% of respondents.

By contrast, the condition of rented properties, a priority of the Renters’ Reform Bill, while also a significant concern, is cited by fewer than half as many tenants: 42%. 

Government policies to restrict landlords’ legal rights, raise minimum energy efficiency standards to an EPC band C, extend mandatory local licensing, raise taxes on property income and transactions, enhance compliance obligations for HMOs, and increase maintenance costs are putting undue pressure on landlords — most of whom have only one or two rental properties.

Already, we see net negative repercussions on rental supply, with many landlords leaving the sector; property portal data shows that supply is down 46% compared with the five-year average. 

At the same time, tenant demand is at an all-time high, with portal traffic up 142%. Many surviving landlords are understandably looking to cover their increased costs via higher rents.

Landlords who agree with this letter's points can sign the open letter here.

Goodlord’s Rental Index saw rents on new tenancies in September hit £1,249 PCM, up 13% on the same period in 2021. Rent increases restrict mobility and supply, with tenants frightened to move house for fear of facing even higher rents in a new home. 

By failing to encourage adequate supply, government policy is directly contributing to the sharp increases in rental prices. 

Freezing rents in response, as recently introduced in Scotland and proposed by London’s Mayor, would further damage the sector, restricting supply to a greater extent and fuelling landlords’ withdrawal from the sector.

We urge the government instead to consider ways to improve supply – while continuing its aspirations to ensure quality homes for tenants – by ensuring the rental sector remains an attractive place to invest without relying on skyrocketing — and ultimately inflationary — rents.

Signed (to date) by:

Ben Beadle, NRLA
Theresa Wallace, Savills
William Reeve, Goodlord
Peter Knight, Property Academy
Gary Wright, Flatfair
Heidi Shackell, The Lettings Hub
Ben Grech – Reposit
Chris Hutchinson – Canopy
Kristjan Byfield – The Depositary
Eric Walker –  Martin & Co

View Full Article: ‘Dear Mr Gove, stop hammering the PRS’ say leading figures in open letter

It’s not the tenant that’s the problem!

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Is there anything you can do when it’s the neighbours who are being antisocial and affecting YOUR tenants?

I HAD lovely tenants with 2 autistic children living in a property. All was well, until the lovely old man next door died

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NEW: Minister reveals more detail on looming holiday lets registration scheme

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The government has announced its new registration scheme for short lets will launch next autumn, scotching opposition MPs’ repeated calls for a licensing scheme.

During the latest Commons debate about a new clause to the Levelling Up and Regeneration Bill, Housing Minister Lucy Frazer (main picture) promised to consult on the issue of making short-term lets a separate category of planning use early in the new year, which would hopefully be followed by legislation.

While Airbnb has long called for a national register for the short-term lets sector, Labour and Lib Dem MPs including Rachel Maskell asked the minister why she wasn’t bringing in a scheme that would enable local authorities to determine areas where they could exclude the expansion of Airbnbs or control licences.

Landlord switching

Conservative Derek Thomas said there should be a way to curtail the opportunity for a landlord to switch a home to a holiday let. “I ask the Minister to consider including second homes in the consultation,” he said.

“With that measure in place, Cornwall Council and other local authorities can assess the housing need and choose to decline a change of use application, protecting the home for permanent residents.”

Frazer said it was important to first establish which areas were causing issues so it could make evidence-based policies, ensuring those communities were not hollowed out.

Work better

“Our amendments focus on making the planning system, and the systems that interact with it, work better, innovating and improving for the benefit of all our constituents.”

Chair of the UK Short Term Accommodation Association, Merilee Karr (pictured), supports a registration scheme which she says must be simple and low cost for hosts to register with and straightforward for authorities to run.

“It must also take into account the benefits that the short-term holiday lets industry brings to local communities and support owners who rent out properties that would otherwise sit empty,” she adds.

View Full Article: NEW: Minister reveals more detail on looming holiday lets registration scheme

NatWest latest big firm to join the BTR funding push via 3,000 home package

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NatWest is the latest big corporation to fund build to rent schemes, following in the footsteps of Legal & General and John Lewis, which have both invested in the popular private renting option.

The bank has put up part of the £285 million funding for global investment group EQT Exeter and Sigma Capital Group’s joint venture housing project to create high-quality apartment blocks and houses in more affordable parts of Greater London and commuter towns.

After agreeing an initial £150 million debt package along with Leumi UK bank earlier this year, the NatWest team brought Allied Irish Bank and Dutch-bank NIBC onboard, which agreed to provide further development finance to build the 3,000 homes. 

Local community

Sigma Capital Group, a residential development and urban regeneration specialist, launched the project two years ago with the aim of delivering buildings with strong sustainability credentials; wherever possible, the homes will tap into local community heating networks and utilise photovoltaic panels, include cycle storage and be located near green outdoor areas.

The homes will operate under Sigma Capital’s Simple Life London brand and will be let at affordable rent specific to each location’s average household income.

Graham Barnet (pictured), CEO at Sigma, says: “We thank NatWest and the other institutions within the lending group for supporting organisations such as ours looking to deliver significant social impact by providing housing to renters in affordable locations as well as offering community services within Greater London and its commuter towns.”

Read more: What does BTR mean for BTL?

View Full Article: NatWest latest big firm to join the BTR funding push via 3,000 home package

Commercial landlords need new investment to retain good tenants

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Despite a faltering economy, staff and skill shortages in companies mean that in many cases staff are virtually unsackable and they are pressing increasing demands on employers for improved fringe benefits. Companies are responding both to retain and attract new talent.

The result is a requirement to up-grade existing facilities in offices and other business premises. The tech industry is perhaps at the “tip of the iceberg” here, but other employers are under pressure to follow suit and offer employees better work-place facilities, not to mention the urgent need to improve energy efficiency.

New research

A recent study by MRI Software, a global leader in real estate software, found that two-thirds of employees want ‘hotel-style’ amenities at their offices. The new survey tapped 6,000+ US, UK, and Australian office workers for their opinions. The results show an increasing trend in these types of real estate settings, modern workplace features are now expected, and necessary to attract and retain the best talent, in a post-pandemic world.

Skill shartages

Almost 50 per cent of companies are finding it difficult to fill one or more job vacancies and see the need to improve not just the oft quoted “work-life-balance” for staff, but also the facilities available whilst they are at work, given that in some instances many are still working-from-home (WFH).

The lifting of lockdowns in the West, following the fortuitous and timely roll-out of effective Covid vaccines, resulted initially in surging consumer spending. Encouraged by strong household balance sheets after a year or more of forced saving the increased demand, coupled with supply shortages due to Covid, led to a ramping up of inflation. This at the same time as governments were tightening fiscal policies to deal with the debt overhang left by bailing out individuals and companies is leading to recession.

The war in Ukraine, with its increased energy and food prices, has only added to the woes of Western countries, but the looming recession seems to have done nothing to improve the jobs / labour supply problem. Long-Covid, career changes, part-time instead of full-time working and early retirements are blamed for much of the shortage of staff issue.

Hotel style office facilities

The result is, especially in the office sector, ‘hotel-style’ office amenities and user-friendly work tools are emerging as a key part of the employer play-book for winning over new and existing staff, that’s according to the new survey which was commissioned by global PropTech giant MRI Software, a UK leader in property solutions.

The survey of 6,000+ US, UK, and Australian consumers (2,004 in the UK) shows that almost two-thirds (64%) of employees now look for workplace amenities such as areas for socializing, outdoor spaces, on-site cafes, state-of-the-art infrastructure, air conditioning and flexible work facilities. These are crucial insights for employers to draw on to keep talent in a post-pandemic world.

Work campuses

One example of the trend is FI Real Estate Management’s programme of refurbishment works at the former IBM work campus in Warwick. The £4.5m investment package being put in will involve the firm undertaking a complete refurbishment of its two-storey development on Haywood Park.

The development will provide office space at a variety of sizes, also incorporating co-working space for freelancers, small businesses and those looking for satellite offices. The fit-out work will be completed by workplace specialist Office Principles, and will also see the scheme rebranded to become “The Woods” [Pictured above].

FI Real Estate Management has said of the scheme:

“The Woods, our newly branded development in Warwick, is an exceptional office space and we have been very excited about its refurbishment this year. We have been working closely with Office Principles to develop designs that will transform the space into vibrant offices with a contemporary look and feel.

“The development’s location and the size of space available have already drawn major interest from the West Midlands and beyond. With the refurbishment now underway, we are significantly elevating our offer, bringing fresh and invigorating space to the market in Warwick.”

Dockland’s developments

Likewise, UK real estate British Land behemoth’s strategy is to develop along the campus concept theme, combing “well connected, high quality and sustainable buildings with an attractive public realm where businesses can cluster together to drive growth and innovation.”

The company are delivering a fourth Campus at Canada Water in London’s Docklands, and says it has identified opportunities to take this successful model outside London, targeting centres of innovation such as Oxford, Cambridge and well established research parks

British Land says that “employers are increasingly using office space to attract and retain key talent; buildings which promote health and productivity are an important part of this approach, so our developments and refurbishments incorporate wellbeing principles by design. We also look beyond our campuses; we invest in local communities and our events and activities bring people together and enliven our space for everyone who uses it.”

Hybrid working

The MRI Software research study shows that hybrid working is leading organisations to rethink the workplace as most people want the flexibility to combine work-from-home with in-office options.

The key findings include:

· 19% say amenities are “critical” to deciding whether to work at a job or not

· 11% say “If an employer doesn’t have a lot of these things, I’m not interested”

· Over a third (34%) see them as key factors after the nature of the job itself

· Only 15% of people want to work at home every day

MRI is a leading player in the UK property technology market and counts Savills, Knight Frank, Lloyds Pharmacy, Holland & Barrett, and the UK Government’s Foreign and Commonwealth Office among its 4000+ clients worldwide.

Similar issues in the trades

Andy Walker’s engineering firm told The Daily Telegraph that a problem usually associated with an economic boom, too few workers, is persisting even with a recession looming. It appears that companies are focussing on pay restrain rather than looking to lay-off staff:

“Everyone you speak to in the industry seems to be struggling to get trades people,” says Mr Walker who is the managing director of Lancashire-based Walker Engineering. “I think we lost a lot [of staff] in Covid around the 60 year age that decided enough was enough.”

In the immediate period after the lifting of lockdowns staff enjoyed a period of job security when labour shortages were allowing them to bid-up wage levels throughout the economy. Many workers changed jobs or careers, while others deemed it time to call it a day!

Although the era of the almost “unsackable” worker may be drawing to a close with recession indicators rising, employers seem reluctant to let good staff go and are doing all they can to retain good talent and skills.

They realise that reducing staff on the way down could leave them short when the tied turns. Most employers will do all they can to keep good staff – and that includes improving work-place facilities – when economists are warning that labour shortages are here for the long-haul.

View Full Article: Commercial landlords need new investment to retain good tenants

Charity begins with a home?

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Hello, How about rather than LL’s setting up a charity [see ‘Landlords for homelessness charity to compete with Shelter and Crisis?‘] we instead set up a not for profit home building company for the low paid and homeless?

The post Charity begins with a home? appeared first on Property118.

View Full Article: Charity begins with a home?

Avoid the Minefield – Free Landlord Insurance Consultancy

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Property 118 is offering readers a free landlord insurance consultancy through The Home Insurer to make sure you are not paying too much and have the proper cover in place. Let property insurance is a minefield that can catch out landlords if you are not careful.

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BREAKING: NRLA signs innovative deal with Crisis to help reduce homelessness

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The National Residential Landlords Association (NRLA) has struck a partnership with homelessness charity Crisis.

This two-way deal will see the NRLA work to persuade more private landlords to offer those who have faced homelessness in the past properties to rent via Crisis, while existing landlords who do this will be offered NRLA membership and greater support to tenants to help sustain tenancies.

“Together we’ll be offering a range of tailored services and advice to landlords, supporting them to take on tenancies, with confidence and security, with people who have previously been homeless,” says Matt Downie (pictured), Chief Executive of Crisis.

The aim is that though this collaboration, both organisations will be able to play a greater role in helping reduce homelessness across the UK by improving access to the private rented sector.

Ben Beadle, the NRLA’s Chief Executive, says: “This partnership recognises the importance that the private rented sector and responsible landlords play in providing safe, decent and secure accommodation, and gives practical support to both renters and landlords to sustain tenancies.

“We are delighted to be starting this innovative project with our friends at Crisis. Unlike some housing charities, Crisis works practically to assist homeless individuals to secure homes, get back on their feet and maintain tenancies for the long-term.

“We at the NRLA identify closely with this approach and believe that by working together we can go some way towards ending homelessness across the UK.”

Affordable properties

Downie adds: “If we have enough secure, affordable properties for people to rent, thousands of people can avoid falling into homelessness.

“That’s why we are delighted to work with the NRLA, drawing on their wealth of experience to support and identify landlords who want to be part of the solution to ending homelessness, while improving the experience for tenants and landlords alike.

“This includes a designated point of contact throughout the tenancy, matching the right tenant to the property, mediation and tenancy breakdown prevention and free rental insurance.”

“This partnership provides an important opportunity for Crisis and the NRLA to join forces to make the Private Rented Sector a better and fairer place for all involved.”

Main pic credit: Crisis.

View Full Article: BREAKING: NRLA signs innovative deal with Crisis to help reduce homelessness

Home repossessions defy predictions after mortgage rate rises

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The number of home repossessions by finance lenders after mortgage rates went up has decreased significantly – defying the expected trend that more people would lose their homes.

The findings come from the House Buyer Bureau which points out that since the Bank of England started raising interest rates at the end of 2021

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View Full Article: Home repossessions defy predictions after mortgage rate rises