Meet the hero landlord who hasn’t raised rents for 25 years

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A good Samaritan landlord is bucking the national trend by not raising his rents for more than 25 years.

Mick Musson, who owns eight flats at the former Blue Horse Pub (inset), in Great Ponton, Lincolnshire, hasn’t increased the rent since he took over the property, and now counts the tenants as his friends.

One, Rob Podum, was homeless before moving into a one-bedroom flat in the block in 2006 and admits he was at his lowest ebb, reports The Grantham Journal.

Podem, 56, says Musson is a brilliant landlord and doesn’t want to move. “It’s been brilliant, and I have known Mick a long time,” he says. “I’m still paying what I paid when I first moved in, and I offered to pay him more to cover the electric as I wouldn’t want to see him suffer.”

Exploited

Adds Podum: “You hear about these people who are exploited by landlords. However, Mick is great.”

Follow tenant Alan Hodgson, 68, also lives in a one-bedroom flat in the property and says

Musson has been “good as gold” since he first moved in four years ago. Hodgson adds: “He’s the best landlord anyone could ever have. If you have a problem, he’ll be there. All the time it’s been the same rate and he’s never ripped anyone off. He’s a good man.”

Musson explains that he tells tenants the rent they pay when they move in won’t change. “I don’t think they will leave unless they have a certain reason,” he adds. “They are friends. They will come down to pay their rent and then end up having a cup of coffee.”

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View Full Article: Meet the hero landlord who hasn’t raised rents for 25 years

Early BTL investors are retiring and selling up

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Most BTL investor sales are from those landlords who were among the first to invest after buy to let mortgages were launched in 1996, research reveals.

The findings from Hamptons show that landlords are now retiring and selling up in increasing numbers –

View Full Article: Early BTL investors are retiring and selling up

Tenants in the capital will be most affected by EPC changes

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Renters in London will be the worst hit by the government’s proposed energy performance certificate (EPC) laws, research reveals.

That’s the view of data science firm Outra which says that tenants will have to leave unlettable properties if the government imposes a minimum EPC rating of C by 2028.

View Full Article: Tenants in the capital will be most affected by EPC changes

Propertymark calls for council tax reforms

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A leading industry body has called on the government to change council tax housing banding for HMOs.

Propertymark has submitted a response to the Department for Levelling Up, Housing and Communities’ consultation arguing that HMOs should be banded as one property under one council tax band

View Full Article: Propertymark calls for council tax reforms

Crunch time for PRS revealed as increasing numbers of ‘pioneer’ landlords retire

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Thousands of landlords who entered the private rented sector following the introduction of dedicated buy-to-let mortgages in 1996 are now retiring in increasing numbers, it has been revealed.

Research by estate agency Hamptons reveals that some 140,000 landlords retired in 2022, representing 73% of all the properties sold by BTL investors.

Purchases made by this ‘original cohort’ of landlords some 15-25 years ago following the introduction of the buy-to-let mortgage still make up the majority of privately rented homes in Great Britain, the report says.

Just over half of today’s outstanding buy-to-let mortgages were taken out between 1996 and 2007.

Spike

Last year saw an unusual spike in landlords withdrawing from the market after deciding to retire and cash-in their properties, but Hamptons says a further 96,000 landlords are expected to retire this year and each year afterwards.

This in addition to the 924,000 who are already over the age of 65 but are still renting out properties.

During the past 12 years between 2010 and 2022 the agency estimates the number of landlords retiring annually has doubled as their demographic ages.

These figures will be particularly worrying for Ministers as the trend will further put pressure on stock and see rents rise.

Hamptons says recent tax and regulatory for private landlords mean many younger people are put off investing in the PRS and that the “number of new purchases by landlords has remained relatively muted”, says its head of research, Aneisha Beveridge (pictured).

“Millennials, who have struggled to get onto the housing ladder, have not been in a position to afford or consider purchasing a buy-to-let too.”

View Full Article: Crunch time for PRS revealed as increasing numbers of ‘pioneer’ landlords retire

Legal: Commercial landlord regains possession against opposition…

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In the case of B&M Retail Ltd v HSBC Bank Pension Trust (UK) Ltd [2023], The Central London County Court was asked to rule on a claim for possession by the landlord under the rules of the Landlord and Tenant Act 1954.

The landlord was seeking possession against the tenant’s security of tenure under the Act when it wanted to exercise Ground F of the Act. It wanted to redevelop the premises, against the tenant’s wishes to renew its lease.

The Landlord and Tenant Act 1954 (Part II) affects most commercial (business) tenancies in England and Wales.

Note: This article refers to English law. It is not a definitive interpretation of the law. Every case is different, rules change over time and only a court can decide – always seek expert advice before taking action or not.

The Act recognises that businesses need some protection as they stand to lose goodwill when they may have spent years building-up a business in a location, not to mention investment in stock and equipment, if they were to be summarily evicted when their lease expires.

Accordingly, the Act, which has stood the test of time since the 1950s, gives business tenants a right to remain in their premises and renew their leases, at a full market rent, but on similar terms to the original lease.

Landlords and tenants have the option of avoiding this strict security of tenure protection providing the tenant agrees to exclude the provisions for security of tenure – known as letting outside the Act – before ageing a tenancy, by following a strict documentary procedure.

Restricted right to possession

Landlords also have a right to possession at the end of the lease term under certain restricted conditions. So a tenant’s right to renew can be resisted by the landlord only on one or more of seven grounds set out in the Act:

Ground A: Breach of the repairing covenants, a discretionary ground – the judge decides – when there’s been failure to keep the premises in good repair, but like other grounds it does not on its own automatically entitle a landlord to possession.

Ground B: Persistent delay in paying rent, another discretionary ground which means the landlord must show the tenant should not be granted a new tenancy in view of its persistent failure to pay the rent on time. There is a danger for the landlord here if it has habitually accepted the late payments.

Ground C: Breaches of other obligations, yet another discretionary ground where the landlord must show the breaches were serious enough to deprived the tenant of a new tenancy, but any evidence of acquiescence in a breach will destroy the landlord’s argument.

Ground D: Where there is the availability of suitable alternative accommodation, the court has little or no discretion here. The landlord must show that they have offered suitable alternative premises to the tenant on lease terms that are reasonable.

Ground E: Where the property is sublet in part, the superior lease it ended, and possession required for letting or disposing of whole of property, it’s another discretionary ground.

Ground F: Where the landlord intends to redevelop the premises. This is a mandatory ground where the landlord must show that it intends to demolish or to reconstruct the premises which could not be achieved without possession. This ground is more likely to succeed if the premises are old and in need of major works. There are fines if this proves to be a sham.

Ground G: Where Landlord intends re-occupy the premises itself, again a mandatory ground. The landlord must have owned the premises for at lease five years before the leases ended and must show it intends to occupy the premises for its own business purposes or as its residence.

Where a tenant is removed from the premises compensation under grounds E, F & G on a scale set within the Act will be payable by the landlord.

The outcome

In the above case of B&M Retail Ltd v HSBC Bank Pension Trust (UK) Ltd the court ruled in the landlord’s favour granting it a redevelopment break operable immediately on six months’ notice.

This decision is important because it involved a situation where the landlord had failed to serve a required counter notice of its opposition to a new tenancy when the tenant served its notice to renew under section 26 of the act.

Usually these rules are very strictly adhered to and these claims for possession are by no mean certain under any of the above grounds, but it this case the court showed a degree flexibility which favoured the landlord.

The Background

HSBC Bank Pension Trust (UK) Ltd owned the premises in North London let to B&M Retail Ltd, as a retail store. The lease ended in December 2020 following HSBC’s negotiations with Aldi Stores Limited for the grant of a conditional agreement for a lease, subject to obtaining vacant possession and planning approval for Aldi to carry out redevelopment works.

HSBC served notice in May 2021 seeking to terminate the lease with B&M citing redevelopment under Ground F of the Act.

But B&M had already served its own request in January 2021 under section 26 of the Act for the grant of a new lease, and HSBC had failed to respond to that notice within the required two months’ deadline. HSBC claimed internal mail delays due to Covid.

Given HSBC’s inability to avoid granting a new lease it requested a development break clause pending the planning permission being granted for the Aldi development, which after some argument over this possibility the court granted the break clause.

The inclusion of the redevelopment break clause was exercisable immediately on six months’ notice allowing the new lease to be brought to an end, allowing time for the HSBC agreed development works with Aldi.

This court decision is likely to be welcomed by commercial landlords who find themselves in this situation as the court indicated that it will only disrupt a landlord’s redevelopment plans where there is clear evidence that the redevelopment proposals are not viable.

The case was won by HSBC at considerable cost to itself and it goes to underscore the importance of serving notices under The Landlord and Tenant Act 1954 correctly and in good time.

However, it should be remembered that this is the decision of a County Court and may yet be subject to appeal to a higher court.

View Full Article: Legal: Commercial landlord regains possession against opposition…

Consultation reveals majority of residents oppose wider selective licencing

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Plans to bring in a vast new selective licencing scheme within Brent have been given a resounding thumbs down from both landlords and, surprisingly, the London borough’s residents too.

Brent’s housing team has been operating a small selective scheme in Dollis Hill and Kensal Rise since 2018 but that is now due to end this month.

Councillors conducted an energetic 12-week public consultation that ended in January on two proposals to renew the existing scheme for another five years with landlords due to be charged £640 for a five-year licence.

But the proposals also include a second phase that would add a further 18 wards where there are ‘poor housing’ standards.

Unlike other consultations, where opinions on selective licencing are usually split starkly between landlords/agent and residents, this time opposition to an expanded, 21-ward scheme in Brent is more balanced.

Of all the 853 respondents to the consultation 46% opposed the larger scheme while 43% supported it (see results box above).

Among landlords, 75% opposed the larger scheme, while 25% of local residents and businesses also opposed it.

Comments from landlords and residents widely viewed the larger scheme as an addition financial burden on the PRS, some describing it as a ‘money grab’, ‘cash grabbing’ and a ‘cash collecting’ scheme, the council’s consultation results reveal.

One landlords said: “I paid the fee [for the original scheme] and have seen nothing from the council. No checks, no property inspection.”

Brent councillors must now vote on the proposals following the consultation at a Cabinet meeting due on Monday (17^th April).

The 18 wards to be added to scheme

Alperton, Barnhill, Brondesbury Park, Cricklewood & Mapesbury, Kenton, Kilburn, Kingsbury, Northwick Park, Preston, Queens Park, Queensbury, Roundwood, Stonebridge, Sudbury, Tokyngton, Welsh Harp, Wembley Central and Wembley Hill.

View Full Article: Consultation reveals majority of residents oppose wider selective licencing

AIRBNB: Tory ‘free marketeers’ attack Gove over short-lets clamp-down

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Michael Gove’s plans announced yesterday to require owners of holiday lets in tourist hotspots to get planning permission for their properties has not gone down well in some quarters of the Conservative party.

The proposals, which are being consulted on until early June by the Department of Levelling Up, Housing and Communities, have been slammed by several figures on the right of the party, who claim the measures are ‘anti-business’.

Writing on Twitter former housing secretary Simon Clarke (pictured) said today that: “So many of our interventions in the housing market, from anti-business ones like this to very costly demand-side subsidies like Help to Buy, stem from our failure to build enough homes, and to make the argument to the public about why this matters”.

His comments were supported by former business secretary and free marketeer Jacob Rees-Mogg (main picture) who, speaking on TV, questioned why property owners should not be able to rent their homes out “to whosoever they liked and freely – what has the Government got to interfere and create cost and regulation for people who aren’t creating any harm”.

Divisions

His comments are entirely at odds with yesterdays announcement by Gove, suggesting divisions are now beginning to appear within the Conservative party on housing policy.

The consultation launch yesterday was emphatically on the side of communities where more properties are being turned over the short-let holiday rentals, albeit without damaging local tourism.

“The government has listened to calls from local people in tourist hotspots that they are priced out of homes to rent or to buy and need housing that is more affordable so they can continue to work and live in the place they call home,” the announcement said.

“The proposed planning changes would support sustainable communities, supporting local people and businesses and local services.”

View Full Article: AIRBNB: Tory ‘free marketeers’ attack Gove over short-lets clamp-down

Room rents reach record high in London

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For the first time ever there’s not a single London postcode with an average monthly room for rent at less than £700, new data reveals.

The findings by flatshare site SpareRoom reveal that average monthly room rents in the capital have now soared to £952

View Full Article: Room rents reach record high in London

Landlord mortgage costs rising faster than rent rises, research shows

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Landlords’ mortgage costs have been faster than rent rises over the past two years, new research has highlighted.

Estate agency Barrows and Forrester says its analysis of average landlord borrowing costs show a BTL investor with a variable rate repayment mortgage is now paying a 20% more a month than in 2021, or £1,113 compared to £942.

Figures for interest only BTL mortgages are even more severe, revealing a 44% increase from £486 to £703 a month.

Although only a guide only to rising costs for landlords which don’t reflect the differing debt levels and interest-rate deals landlords have, what they show is mortgage costs running away faster than rent rises.

Data from referencing firm Homelet reveals that rents across the UK have increased on average by £120 a month over the past two years, or an 11.7% increase, substantially lower than the mortgage costs increases.

Higher cost

“As it stands, the nation’s landlords are yet to hand down the far higher cost of borrowing to their tenants and while rents have climbed of late, they haven’t increased at the same rate as the monthly cost of a mortgage,” says James Forrester, the agency’s MD (pictured).

“This is partly due to the fact that many landlords will have secured a favourable rate on a fixed product before interest rates started to climb. But those that managed to do so are likely to be approaching the end of their fixed term this year and will be hit with far higher rates when they do.

“Unfortunately for the nation’s tenants, [landlords] are left with little choice but to recoup this higher cost via an increase in rents and so we expect to see sharp upward growth in the average cost of renting as the year progresses.”

The data is based on a BTL mortgage for a property costing the UK’s average house price of £289,818.

View Full Article: Landlord mortgage costs rising faster than rent rises, research shows