Plans for rental reform will ’cause chaos for students’

admin    Uncategorized     agents

‘The future vitality of the education sector is uncertain.’

That’s the warning from several organisations after plans by the government to reform the PRS run the risk of making it more challenging for poorer students to enter higher education.

View Full Article: Plans for rental reform will ’cause chaos for students’

Minister told looming tenancy reform will reduce student housing supply

admin    Uncategorized     agents

The government has been urged to exempt all student housing from its plans for open-ended tenancies or risk making it harder for students to enter higher education.

Groups representing universities and student accommodation providers – along with the NRLA – have written to Housing Minister Felicity Buchan (pictured) explaining that a shortage of this accommodation has already led some academic institutions to call for a limit to be placed on student intakes for as long as the next five years.

It warns: “The proposed introduction of open-ended tenancies and inevitable reduction in housing supply is therefore likely to further constrain the expansion of the education sector, to the detriment of prospective students and wider society.”

The government’s White Paper on rental reform proposes that all student housing, except for purpose-built blocks, would be subject to open-ended tenancies, meaning landlords would be unable to guarantee that accommodation will be available for the start of each academic year, unless sitting tenants have handed in their notice to leave. As a result, students couldn’t plan where they want to live and with whom.

Disadvantaged

“Reduced supply and rising costs in the private rented sector are increasingly likely to preclude economically disadvantaged students from living on or near campus,” add the groups.

They argue that where a landlord rents their property to a group of students, a fixed term tenancy agreement should be permissible, and call for measures to allow student landlords to give two months’ notice to repossess a property when it is needed for incoming students.

To provide these students protection, they suggest that such notice should only be given during the final two months of a tenancy agreement.

Read more about the campaign to persuade ministers of rental reforms and the student sector.

View Full Article: Minister told looming tenancy reform will reduce student housing supply

Daily Telegraph wants to talk to landlords who have recently sold new build properties

admin    Uncategorized     agents

Are you a landlord who has recently sold new build properties for less than what they paid? Then, Alexa Phillips, the personal finance reporter for the Telegraph would like to speak with you.

Alexa would like to know:

When did you buy the property?

View Full Article: Daily Telegraph wants to talk to landlords who have recently sold new build properties

Landlords are taking action as tax bills and refurb costs rise above rent yields

admin    Uncategorized     agents

The festive period is over, and as we head towards the second month of 2023, the year has well and truly begun. For many landlords, 2022 was a mixture of tough decisions, calls to action, and the realisation of a potentially rocky road ahead.

View Full Article: Landlords are taking action as tax bills and refurb costs rise above rent yields

NEW: Activists urge landlords and agents to stop property ‘bidding wars’

admin    Uncategorized     agents

Tenants’ union Acorn has pledged to continue targeting letting agents in the city until they stop encouraging ‘bidding wars’ to help landlords achieve higher rents.

Members launched a noisy protest outside a number of branches; some agents which had started talks with Acorn about signing the pledge were left alone, but others were visited by Acorn reps who said they would follow up requests and repeat the protest until the agencies agreed to end the practice.

“We’re trying to stop letting agents pitting tenants against each other to force up the price of rents, driving loads of people out of the city, out of their homes that they’ve been in for years, and breaking apart communities, and this is something that is going on all the time – it’s affecting loads of our members,” Acorn organiser Ewan Maclennan (pictured) told the Bristol Post.

He explained that agents sometimes encouraged people to bid £50 or £100 higher to increase their chances of securing a property or gave out a formalised offer form to tenants.

“It’s almost part of the formal process for a lot of these letting agents,” added Maclennan.

Council motion

Earlier this month, Bristol City Council acknowledged the prevalence of bidding wars and their negative effect for renters, particularly low-income households.

It passed a motion backing calls for new rent controls in Bristol and promised to publish an annual living rent index, showing what affordable rents would look like in the city. A publicly accessible list will also show all enforcement notices issued to landlords while a new regular renters’ forum would engage with private tenants.

Read more about Bristol.

View Full Article: NEW: Activists urge landlords and agents to stop property ‘bidding wars’

Where are the most affordable places to rent?

admin    Uncategorized     agents

The current turmoil in the rental market shows no signs of slowing down with UK rents in the fourth quarter of 2022 hitting an all-time high, increasing 13% year-on-year, according to a new survey.

The flatshare site, SpareRoom

View Full Article: Where are the most affordable places to rent?

Shamplina webinar reveals biggest issues vexing landlords right now

admin    Uncategorized     agents

The most pressing questions on LandlordZONE readers’ minds were revealed during a recent webinar hosted by Chief Commercial Officer of the HFIS group, Paul Shamplina (main pic).

He joined forces with industry figure David Coughlin (main pic, inset) to help landlords identify the key steps to achieve the highest profits from their portfolios this year, but the pair were also inundated with questions from those watching.

Coughlin is the co-founder of the National Association of Property Buyers and director/founder of both National Residential and the Landlord Sales Agency.

This included the tricks of the trade when looking for the best mortgage particularly for first-time landlords; the practicalities of incorporating an existing property portfolio; the best heating systems for rented homes during the current energy price hike crisis; how to manage tenants who are struggling to pay their rent and what constitutes a ‘fair’ rent increase.

Shamplina and Coughlin were asked nearly 40 questions on these subjects both during and after the webinar, which was watched by hundreds of landlords.

One of the most frequent issues vexing landlords, the webinar revealed, is whether to operate existing or newly-purchased properties via a limited company umbrella. It’s a strategy that, although more time-consuming than personal ownership, is becoming more popular as a way to reduce a landlord’s tax bill and overall improve profitability. Learn more on limited company ownership of property and find out the pros and cons.

Check out the answers to some of your questions below:

Q: How would a first time buyer go about getting a buy to let mortgage? Are their any specialist mortgage providers?

A: Usually you would need a residential property mortgage before applying for a buy to let mortgage as lenders would like to see experience. Or you can buy your first property as residential and convert it to buy to let which is a good strategy for beginners

Q: What is your advice on increasing rent in the current climate? What would a fair increase percentage be?

A: You need to consider the market rent versus what they are paying. Advise your tenants what this is and that you need to agree on a rent increase closer to market rent for long term financial stability for yourself and their tenancy. Communicate and make it clear that with interest rates rising and future repair costs you cannot afford to run at a loss. Work with your tenants to come to an agreement and even offer to stagger the increase

Q: When incorporating properties how much stamp and capital gains tax needs to be paid?

A: This depends on whether you have commercial property in your portfolio and if you are running your rental portfolio as a partnership. You can pay 0% CGT if incorporating a partnership or pay 1% if it is a mixed residential-commercial portfolio. Alternatively, you may have to pay the full prevailing stamp that would apply

Q: Is it worth transferring a buy to let property into a company (that I own as a sole trader) for tax purposes?

A: For one property maybe not as the tax-costs benefits may be negligible. Incorporating is an expensive and complex business and the cheapest and simplest way for you would be purchasing from yourself in an SPV.  If you are intending to purchase more properties then it is advisable to set up an SPV for future purposes and maybe in time you can transfer this property

Q: As a basic rate tax payer with one HMO property in my name is it worth moving to limited company ownership? What might be the costs involved?

A: Firstly, add the rental income to your salary and if you stay in the basic rate bracket then there is nothing further to do. If you are pushed into a higher rate then consider purchasing the property from yourself in the limited company and benefit from the tax efficiency. It is worth considering you might also be able to increase your pension contributions to reduce salary and keep in line with the basic rate

Watch the webinar for free in full here.

View Full Article: Shamplina webinar reveals biggest issues vexing landlords right now

Disabled Tenant In DESPERATE Need of Good Advice

admin    Uncategorized     agents

I consider my landlord to be a perfect Gentleman and have been renting the same property for nearly 17 years without any issues whatsoever. That was until I received the letter below from him a few days ago. I don’t know how to respond or what my options are.

View Full Article: Disabled Tenant In DESPERATE Need of Good Advice

Revealed: The UK’s best buy-to-let areas

admin    Uncategorized     agents

Landlord insurance provider Simply Business has researched the buy-to-let areas that are most popular with landlords.

It says that London is still the best city for buy-to-let landlords for the second year running.

The firm says that more than 39,000 BTL insurance policies have been taken out in the capital.

View Full Article: Revealed: The UK’s best buy-to-let areas

Opinion: dealing with the thorny issue of damp and mould

admin    Uncategorized     agents

Damp and mould has always been a very difficult issue to deal with for landlords, but the recent case of Awaab Ishak and the rapid and direct involvement of Government has really brought matters to a head.

The death of a Rochdale social housing tenant’s son, Awaab Ishak, has led to a public outcry about black mould in housing, both socially rented and privately rented, and it’s prompted Michael Gove’s Department for Levelling Up, Housing and Communities to instigate a review of damp and mould guidance to landlords in the wake of this tragedy.

The outcome of the review, Michael Gove has said, will be added to the Social Housing Regulation Bill by way of an amendment, to be included as ‘Awaab’s Law’, a fundamental legal change being called for by campaigners to offer tenants more protection than they currently enjoy.

We will have to await the outcome of the review to find out what measures will be proposed and it will be interesting to see what solutions, if any, the review can come up with.

It will be little comfort to the parents of Awaab, whose death, it was found by an inquest, was a result of prolonged exposure to toxic mould growth in a Rochdale social housing flat being managed by Boroughwide Housing (RBH).

Housing charities such as Shelter fully expect that the review and Awaab’s Law will give more rights in law to tenants living in mould ridden homes, more rights and protections afforded tenants in a high profile Shelter campaign, This was conducted through the Manchester Evening News, in Shelter’s words, “make sure no other child, or anyone else, dies due to mould in their home”.

Damp and mould prevalent in rentals

The issue of mould in rental housing, and mould does seem a problem prevalent in rentals, it’s a thorny issue one for everyone involved, whether that be Government, the legal profession, property managers, landlords or tenants.

That’s because, when all is said and done, it boils down to who is responsible and who gets the blame? It’s very easy for Michael Gove to go round saying that we should not automatically point the finger at tenants over this, while implying that property owners / managers can suddenly do something to solve the problem overnight, implying that they are wholly responsible.

It seems to me that landlords will always point the finger at tenants when black mould appears, whereas tenants will blame the owner, or should I say the owner’s property. Clearly, legally the issue is such a grey area that blame can be apportioned either way, or somewhere in between the two, both parties may be partially to blame, therefore how do you determine that?

Traditionally lawyers have dealt with the matter in a fairly black and white fashion: if there’s a problem with the building’s structure, leaking walls, roof, rising damp or leaking pipes then clearly it’s the landlord’s problem.

On the other hand if none of these problems exist then legally it all boils down to the tenant, either because the property is not being adequately heated during cold weather or steam generated through cooking, washing or drying clothes, is not being properly vented to the outside, but rather allowed to condense on cold surfaces. Or just as likely, a combination of the two.

Unfit housing

But, there’s a half way house, excuse the pun, when a property, although free from the above defects, may be inadequate in other ways: insufficiently insulated or with a heating system that is ineffective or exorbitantly costly to run, or with insufficient means of adequately ventilating kitchens and bathrooms when this is required.

What a recent House of Commons Library paper titled Helping tenants with damp and mouldy housing (England), calls unfit housing would fit the description. Landlords have a statutory duty to provide their tenants with properties that are are “fit for human habitation” at the commencement and maintained throughout a tenancy.

One of the main categories of hazard in the Housing Health and Safety Rating System (HHSRS) used by local authority environmental housing inspectors (EHOs) is that the house is free from damp or fungal growth, both caused by dampness and/or high humidity and excess cold might amount to a category 1 hazard.

Inspections

Private and housing association tenants can contact their council and request an inspection by an EHO. Where an EHO identifies category 1 hazards under the HHSRS the council must then take action to ensure that the hazard is removed. This usually involves the landlord receiving an improvement notice and the council has further enforcement powers where landlords don’t comply.

In the case of social housing and with council tenants a house falling into this category creates something of an anomaly has the council in effect will be acting against itself.

Who decides?

The difficulty with damp and mould comes back to this thorny issue of establishing a cause and who is responsible. HHSRS may well be an objective process, a risk assessment system designed to standardise results, but then human nature intervenes.

A truly experienced EHO, private surveyor or damp specialist could be expected to pinpoint a cause and a remedy. But not all inspectors and surveyors are truly experienced in damp and mould in practice. What’s more, damp specialists often have a vested interest in finding work.

If it comes to a dispute, and thereby we get into a lot of expense, expert witnesses are needed to advise the legal representatives and judges of the facts, and of course then we get into an adversarial system.

Decent homes

The next stage in the government’s legislative programme on housing scheduled for this year is the introduction for the first time in the Private Rented Sector (PRS) is the Decent Homes Standard (DHS).

Introduced by the Labour Government in 1997, DHS was a standard designed for registered providers of social housing to meet. When recently under review it was concluded that the standard “remained broadly suitable and effective” but said an update would be beneficial.

Although full of good intentions on the part of the Government, the introduction of this additional layer of standards, at the end of the day, requires skill in correctly determining cause and effect and sensible solutions which are clear to all involved, if time consuming and expensive disputes are to be avoided.

Gove’s directive

The Secretary of State at the Department for Levelling Up, Housing and Communities, Michael Gove, wrote to all council leaders and social housing providers last November setting out his expectations relating to damp and mould.

He issued a direction under section 3(3) of the Housing Act 2004 which said all homes must meet the DHS and that those failing the test should have “rapid remedial works” carried out. In particular he highlighted the “thorny” issue of damp and mould.

Legal duty

There are now proposals to place a legal duty on private landlords to ensure properties meet the DHS. Local authorities would be tasked to investigate complaints. A breach will be a criminal offence which could incur a civil penalty or resulting in prosecution in the Magistrate’s Court.

The PRS housing stock consists of an overwhelming majority of older properties, properties that are less well equipped with good insulation, up-to-date heating systems and good means of ventilation. If these properties are to meet the proposed energy performance rating of EPC “C” by 2025 for new tenancies (2028 for existing tenancies) then a considerable amount of money will have to be spend on many of them (capped at £10,000) for these up-grades to be effective.

However, a housing stock brought up to full decent homes standard, and meeting EPC “C”, would solve a lot of the thorny issues surrounding damp and mould.

View Full Article: Opinion: dealing with the thorny issue of damp and mould