Ministers have ‘needlessly spooked’ landlords with renting reform plans

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A leading buy-to-let mortgage broker has said the Government has ‘needlessly spooked’ landlords with its rhetoric designed to ‘curry favour with tenants’.

The comments have been made by Gavin Richardson, MD of Mortgages for Business, who says the Government’s plans to reform evictions including abolishing Section 21 notices are not the huge threat that many think it will be.

He was responding to reports in the Financial Times that a group of Conservative MPs including several within the Government whips office, have been calling for the Renters (Reform) Bill to be watered down.

“I want to reassure the whips that we don’t think the reforms will prove to be that bad for landlords,” says Richardson.

“First, sensible landlords — even those working in the Conservative whips’ office — rarely turf out good tenants who pay their rent as they want them to stick around. 

“So this reform will disproportionately hit the minority of bad landlords who have abused Section 21 notices, rather than the reputable end of the market.

“Second, tenancies can still be ended if there has been a breach of the tenancy by the tenant.  And the government has said it will introduce a new ombudsman to settle disputes between tenants and landlords without the need to go to court. 

“The government has also promised to digitise the courts’ agenda ahead of these reforms to ensure a swift resolution to these cases. That will speed up processes where possession cases require them.

But this is somewhat optimistic given recent complaints from both eviction experts and the Law Society that court delays are getting worse, not better, for landlords.

Real danger

Richardson continues: “Third, the whips will always be able to end a tenancy if they plan to move back in or sell it — that was the real danger of this reform, anything that inadvertently risked landlords’ ability to realise the value of their housing assets through disposal.”

“The loss of full tax relief on mortgage interest payments for individual landlords, and the stamp duty surcharge on additional property purchases were far more significant for landlords.”

Nearly 90 MPs of all political hues are landlords who collectively operate some 167 rental properties each providing £10,000 or more in rental income – the threshold at which such income must be declared as a ‘member’s interests’ filing.

Read more about the Renters Reform Bill.

View Full Article: Ministers have ‘needlessly spooked’ landlords with renting reform plans

Big London council to begin regulation for over 8,500 HMO properties

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Wandsworth Council is to launch a consultation into borough-wide additional licensing and a selective licensing scheme in three of its wards.

The proposed selective scheme covers an estimated 8,600 properties in Tooting Bec, Tooting Broadway and Furzedown, where it predicts a prevalence of the most serious housing hazards.

It says it could then investigate expanding the scheme across other areas with the Secretary of State’s approval. 

Wandsworth has had a mandatory HMO licensing scheme since 2006, under which 615 licensed properties are on the HMO register.

The council reports that the five-person threshold means some landlords opt to reduce occupancy levels to avoid licensing and the increased scrutiny it delivers.

Grown rapidly

The PRS makes up more than 30% of housing in the borough and has grown rapidly in recent years, partly due to the unaffordability of home ownership in Wandsworth, with the average house price now topping £650,000.

Meanwhile, it has seen a steady increase in the number of service requests made by private sector housing tenants reporting disrepair issues each year, up from 449 in 2017 to 742 in 2021.

Aydin Dikerdem (pictured), cabinet member for housing, says: “The schemes we are proposing would mean that the council is able to take more robust action on sub-standard homes and increase the support available to tenants – improving standards in the private rental market and creating a fairer borough for everyone.”

After the 12-week consultation, its housing committee will decide whether to implement the schemes.

Join the debate on LandlordZONE Forums about HMO licencing in the borough.

View Full Article: Big London council to begin regulation for over 8,500 HMO properties

How to chase back the outstanding rent from tenants?

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Hello, I have rented my house to a couple for 2 years with 2 children. The male tenant told me he’s split up with his wife and moved out, leaving the female tenant behind with their two children.

The male tenant has a well-paid job as a driver and the wife is now on benefits.

View Full Article: How to chase back the outstanding rent from tenants?

NEW: Rents still rising fast in London as up to 38 tenants chase each property

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Latest rental market data from London reveals a private rental sector still on fire as rents rise by 11% year-on-year, says agency Foxtons.

This has been driven in part by a seasonal six percent surge in demand during August as those returning from holiday start their search for a new home and less organised students seek properties to rent ahead of the semester start.

But the most extraordinary figures are the average numbers registering their interest in homes which remain high at 23 per new rental instruction overall but reaching 38 per property in East London.

Rents are likely to continue going up in the short term – Foxtons says its analysis of Zoopla data revealed some 35,000 new properties coming onto the rental market, an eight percent increases year on year.

Ease off

But in the medium to long-term, pressure on the capital’s private rental sector should reduce as the number of renters registering to look for rental properties begins to ease off, the data shows.

Higher rents will hopefully persuade fewer to quit the sector as many face higher costs as mortgage rates continue to remain high, although London has a long way to go before yields compare favourably with the rest of the UK.

A top ten list of ‘best places to rent out property’ issued by DigitalLoft over the weekend revealed all are outside of London and the South East with New Newcastle upon Tyne at poll position featuring a gross rental yield of 4.58%.

Gradual

“August remained in line with our expectations and there was gradual, steady market growth throughout the year,” says Gareth Atkins, Managing Director of Lettings at Foxtons (pictured).

“Compared to July, demand rose, supply fell and prices remained consistently high.

“But competition was not nearly as frenetic as it was in 2022 and as such. Across our office network, we continue to see more landlords requesting our management service to protect their asset from a financial and compliance perspective.”

View Full Article: NEW: Rents still rising fast in London as up to 38 tenants chase each property

Older tenants fear being evicted as rents rise

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Almost half of older private tenants had their rent raised in the past year, and more than one in five can no longer comfortably afford to pay their bills, a survey reveals.

The ‘Hidden Renters’ report published by Independent Age

View Full Article: Older tenants fear being evicted as rents rise