Birmingham proceeds with HMO licensing expansion despite opposition

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Birmingham council has concluded its consultation into an additional licensing scheme across the city that would include 9,500 properties in all 69 wards.

Following a full cabinet meeting report on the scheme’s consultation which included several landlords sessions organised by the NRLA, the council is to proceed with the scheme unaltered despite nearly half of landlords and letting agents who responded saying they opposed it.

The council’s existing mandatory licensing scheme covers 4,000 larger properties with five or more occupants but it now hopes to improve standards in smaller HMOs. Landlords will soon need to pay a £755 licence fee under the scheme which could go live as early as 1st April.

Biggest scheme

In March last year, the council approved the UK’s biggest selective licensing scheme and is now waiting for Levelling Up Secretary Michael Gove to give it the go-ahead. Landlords across 25 wards including North Edgbaston, South Yardley and Sparkhill are set to need a licence in a scheme covering 40,000 properties.

Sajeela Naseer (pictured), the council’s head of licensing, says years of data-gathering shows a clear correlation between HMOs and antisocial behaviour, waste and some serious home hazards.

She adds: “Licence conditions would include requiring landlords to work with the council to tackle anti-social behaviour arising from their properties, to have appropriate waste management arrangements in place and ensure that their properties are safe.”

Anti-social behaviour

Councillor Sharon Thompson (pictured), cabinet member for homes and homelessness, says it wants to hear from tenants living in HMOs and landlords who are responsible for them.

“Our research has shown that there are potentially 8,000 HMOs without a licence and that many are badly managed and give rise to a lot of anti-social behaviour,” says Thompson.

“The licence would give the council extra powers to proactively identify HMOs and join up with other services such as the police to tackle the issues. This is why we believe that designating a city-wide additional licensing area is the right course of action.”

Read the council report in full.

View Full Article: Birmingham proceeds with HMO licensing expansion despite opposition

‘Heartless’ landlord fined £175,000 over dilapidated and unlicensed HMO

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A rogue landlord who let out an unlicensed HMO with no working kitchen, unusable toilets, blocked drains and rats, has been fined a whopping £175,000.

Adam Ali had turned the former Anchor Hotel in Cobham Road, Westcliff-on-Sea (pictured), into an HMO where 18 tenants paid a total of more than £5,800 rent each month to Coastal Living Southend Ltd to live in 11 of the 15 bedrooms.

Neighbours reported anti-social behaviour, drug use, poor living conditions and rats to Southend-on-Sea Council.

It found that the property was seriously dilapidated, with no working kitchen, unusable toilets, interrupted gas supply, blocked drains and restricted fire escapes.

It was in such a bad state that an emergency prohibition order was served which closed the property immediately, and all 18 tenants were housed in emergency accommodation.

The council’s investigation took some time because the people involved had created a complex web of different limited companies and names. It was finally established that Adam Ali of Trulea Estates Ltd, trading as Coastal Living Southend Ltd, operated the premises under a short-term agreement with M F Gregory Ltd.

‘Naive and incompetent’

At a hearing at Chelmsford Magistrates’ Court, Ali and the three companies involved were fined a total of £152,900, with £21,872 costs and £680 victim surcharge. The judge said the fine was, “both a deterrent for naive and incompetent landlords as well as a deterrent to company directors”.

Councillor Martin Terry (pictured), cabinet member for public protection, says it was unbelievable that those involved were able to operate in such a heartless way, exploiting residents and providing squalid living conditions.

He adds: “I want to thank the regulatory team for their hard work in securing the evidence that led to this prosecution and thanks to the court system for making an example of Mr Ali. It’s rogue landlords like him that cause such issues within the private rental market.”

Read more: Complete guide to running an HMO.

View Full Article: ‘Heartless’ landlord fined £175,000 over dilapidated and unlicensed HMO

Daily Telegraph wants to talk to Scottish landlords now buying in England

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If you are a Scottish landlord now buying properties in England because the policies are more favourable than in Scotland, Alexa Phillips, the personal finance reporter for the Telegraph would like to speak with you.

Alexa would be interested to know:

Which part of England are you buying in?

View Full Article: Daily Telegraph wants to talk to Scottish landlords now buying in England

Big Issue founder: Ministers must help landlords to prevent evictions

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Big Issue founder John Bird has called on the government to help landlords prevent rent rises.

The magazine’s editor-in-chief – a crossbench peer in the House of Lords – says it needs to stop households who cannot pay their rent from being evicted, warning of a surge in homelessness.

As well as providing more financial support to people struggling to pay for food and energy, the government should be assisting landlords financially to avoid rent rises and cut evictions, Bird told the Observer.

“I’m not saying I am not concerned about people who can’t feed themselves or heat themselves, but the worst possible thing to add to that is if hundreds of thousands of people are made homeless …then it completely goes off the Richter scale,” he said.

The number of homeless households is expected to rise to 300,000 a night this year, Crisis predicts, a 32% rise on 2020.

Cash boost

Last month, councils across England were gifted a cash boost to help fund more mediation with landlords in a bid to avoid evictions as part of a £654 million package that will also let councils target support at vulnerable families and people at risk of rough sleeping.

Bird admitted that the Big Issue narrowly avoided going bust during the pandemic as sales were hit by the cost-of-living crisis, which prompted it to start offering subscriptions to help vendors who couldn’t sell it on the streets. The magazine’s sales are still being affected by the crisis.

Bird added that the convergence of Brexit, Covid and war in Ukraine, as well as last year’s Conservative leadership crisis, reminded him of the series of storms that engulfed Britain in the 1970s.

“But the difference now is they’re coming together all at once,” he added. “And there is not anybody who’s out there to rescue us.”

Pic credit: Big Issue.

View Full Article: Big Issue founder: Ministers must help landlords to prevent evictions

Landlords still ‘none the wiser’ about new EPC rating

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Landlord association iHowz has called on the government to publish the new Energy Performance Certificate (EPC) and Minimum Energy Efficiency Standard (MEES) requirements for the private rented sector (PRS).

It says that landlords are still ‘none the wiser’

View Full Article: Landlords still ‘none the wiser’ about new EPC rating

Scottish landlords launch legal action over rent cap

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Landlords and agents in Scotland are to seek a Judicial Review of the Scottish Government’s rent control and eviction ban legislation.

A coalition of the Scottish Association of Landlords (SAL); Scottish Land and Estates (SLE) and Propertymark is to submit a Petition to the Court of Session in Edinburgh.

View Full Article: Scottish landlords launch legal action over rent cap

Should offers to buy properties be accompanied by a deposit?

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If you’re anywhere near to being as passionate about property as I am, Netflix reality TV shows such as Selling Sunset are likely to have come onto your radar at some point. Love or hate the program, there is always something to learn from every episode

View Full Article: Should offers to buy properties be accompanied by a deposit?

NEW: Serial NW rogue landlord banned from PRS for three years

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A serial rogue landlord has become the first in the North West region to be served with a banning order after he failed to improve poor housing conditions in his unlicensed properties.

Wirral Council had previously prosecuted Frank Morrow from New Brighton on two separate occasions for failing to comply with improvement notices concerning poor conditions and failing to obtain selective licences for both his rental properties in Birkenhead Road, Seacombe (pictured).

In September 2021, he was fined more than £7,000 after being found guilty of failing to get the licences as well as failing to carry out safety checks and necessary repairs.

In 2020, Morrow was fined almost £4,000 after admitting six offences including failing to carry out gas and electricity checks, as well as not licensing the two properties.

Rogue database

After he was first prosecuted, Morrow was added to the national Rogue Landlord Database. A First Tier Property Tribunal has now ruled that the landlord cannot let or manage property for three years; if he breaches the banning order, he could face up to 51 weeks in jail and/or an unlimited fine, or a civil financial penalty of up to £30,000.

Councillor Tony Jones (pictured), chair of the economy regeneration & housing committee, says: “The majority of landlords in Wirral provide decent and safe homes for their tenants – however, a minority continue to exploit their tenants and let sub-standard housing.

“This case demonstrates that the council will take firm action against rogue landlords, and we will use all the powers available to stop criminal landlords from operating in Wirral.”

Read more about rogue landlords.

View Full Article: NEW: Serial NW rogue landlord banned from PRS for three years

Deadline looms for overseas landlords to register properties

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Overseas entities that bought UK property before 1st August 2022 must register with Companies House by 31st January or risk a fine and jail time.

The Economic Crime (Transparency and Enforcement) Act 2022 applies to offshore companies, partnerships and foundations which, according to Land Registry data, own 93,877 properties in England and Wales.

Individuals who want to protect their privacy often choose to hold UK property through an overseas company but keeping your name off Land Registry records comes at price, says accountancy and business advisory firm BDO, as they must now pay stamp duty of 17% when buying UK residential property.

Dawn Register (pictured), head of tax dispute resolution at BDO, says the government is conscious that a previous lack of transparency allowed those wanting to conceal their identify for other reasons – sometimes illicit ones – to invest in UK property.

“This is why part of the new registration process involves declaring the beneficial owners of the company to Companies House,” she explains.

Criminal offence

“Failure to register is a criminal offence, and the officers of the entity could face a fine and up to two years in jail – or five years in some extreme cases – if they do not comply.

“Similarly, failure of beneficial owners to supply information can also be a criminal offence under UK law so it’s important that affected parties take urgent action to comply.”

The register will be publicly available and HMRC is likely to take a keen interest in the companies and individuals that appear, possibly questioning them about the source of funds to purchase property.  

Overseas landlords will be taxable on UK rental income and HMRC will also want to check whether any Annual Tax on Enveloped Dwellings is due; this is generally payable on residential property with a value of more than £500,000.

Read the complete tax guide for landlords.

View Full Article: Deadline looms for overseas landlords to register properties

Early Repayment Penalty against CGT?

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Hello helpful peeps. I am wondering if a Lender’s Early Repayment Penalty can be used as a Capital Cost and offset against CGT?

Many Thanks.

Helen

Hi Helen, My colleague Alex Norian who is an accountant and a Property118 tax consultant has very helpfully provided a Loom video to answer your question

In summary

View Full Article: Early Repayment Penalty against CGT?