Unusual legal win by landlord shows appealing council fines can be worth it

admin    Uncategorized     agents

Landlords operating good-quality and well managed rented properties and who are of good character should fight unfair council fines for failing to licence properties, an unusual case has shown.

A virtual Tribunal hearing of landlord Chris Knight’s appeal against a £7,500 fine for non-compliance with the London Borough of Hackney’s selective licensing scheme saw judges reduce his fine to £2,400 after he argued that it was ‘too high’ at eight times the licencing scheme’s application fee, and that he operated the property at a loss after no increasing the rent since 2017.

Although the judges disagreed with these arguments, and Knight’s further point that he should have been warned that a fine was pending and that he wasn’t’ told Hackney operated a licencing scheme, he won a substantial reduction.

The saga began in March 2022 when council officers discovered during door-to-door enquiries that his two-bedroom apartment in Stoke Newington, North London (pictured), had not been licenced.

Reduced

Knight was told that a £7,500 fine would be payable but after he made representations, this was reduced to £5,000 as long as he applied for a licence within 28 days, which he did.

But the landlord, who represented himself at the Tribunal, held his nerve and appealed the fine, and the Tribunal has now reduced it.

This includes £1,000 in ‘mitigation’, a £2,000 reduction for the good condition of the property and his ‘good character’, a £1,000 reduction for applying for a licence promptly and a further reduction for his cooperation. If he now pays the fine promptly it will be reduced by 20% further, taking it to £2,400.

Read the judgement in full.

Image: Savills.com
   

View Full Article: Unusual legal win by landlord shows appealing council fines can be worth it

Landlord company registrations rise as many seek to avoid higher tax bills

admin    Uncategorized     agents

Higher taxes and the pandemic have significantly increased the number of landlords starting up limited companies rather than owning and operating properties personally, new research shows.

While some 15,800 landlord companies were launched in 2019, last year that figure was 28,130.

The study, which used Companies House listings and was commissioned by Easy Offices, also shows a significant increase in the number of younger landlords entering the fray via limited companies (107 in 2019 versus 1,178 last year) although the largest group are the over 50s who made up some 40% of last year’s total.

Younger landlords also tend to be urban and concentrated in London, Manchester, Birmingham, Leeds and Leicester. Easy Offices says these findings within the property sector are in line with wider research which suggests the pandemic was a catalyst for young people starting their own businesses.

A 2022 study that looked at some 2.3 million UK businesses across many industries showed the percentage of start-up owners aged under 35 had more than doubled since March 2020, rising from 16.4% to 34%. A similar study found that 11% of BTL properties are now owned through a corporate structure.

But unlike other industries, the jump in the number of limited companies has also been driven by HMRC’s changes to landlord tax via the ‘Section 24’ rules that saw tax relief on mortgage interest payments dramatically reduced for those owning properties personally.

The only way to avoid this punitive ‘tax on income rather than profits’ as it is called is to transfer BTL businesses to a limited company or, as these figures show, when starting up using such structures from the outset.

Bold steps

“This spike of new businesses following the pandemic shows how it drove a large number of people to take bold steps,” says John Williams (pictured), Chief Marketing Officer at Easy Offices.

“We have seen the number of sole traders and small businesses looking for office space leap year on year.

“This trend is based on a lot of more experienced workers leaving behind their white collar jobs with blue chip companies and looking to start their own ventures after the pandemic.

“It is the rise of the midlife entrepreneur, similar to that we saw in the aftermath of the Global Financial Crisis in 2008.”

Landlord firms as defined by Companies House are those who owners identify them as ‘letting and operating own or leased real estate’.

View Full Article: Landlord company registrations rise as many seek to avoid higher tax bills

More growth predicted for the UK’s holiday accommodation sector

admin    Uncategorized     agents

The UK’s holiday accommodation sector is poised for continued growth this year and offers savvy property investors an opportunity, one property development firm says.

Research from Stripe Property Group shows that despite experiencing a setback due to the pandemic in 2021 which saw the market decline by 24%

View Full Article: More growth predicted for the UK’s holiday accommodation sector

Tenants earning £30k are not eligible for affordable rent schemes

admin    Uncategorized     agents

Some London residents earning more than £30,000 are being excluded from so-called affordable rent schemes provided by social housing providers, the BBC reveals.

These schemes are designed to provide housing options below market rates for those with lower incomes.

View Full Article: Tenants earning £30k are not eligible for affordable rent schemes