So what does an aging small landlord do?

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I’m a small landlord, 4 BTL properties acquired over the last 13 years. 3 are in a limited company (no mortgages), 1 is owned privately. The privately owned one was re-mortgaged to fund the last property purchased, which I managed to slide into the company just prior to all the changes.

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ONS take £70bn of Housing Association debt off Government Balance sheet

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In 2015 the Office for National Statistics (ONS) decided that Housing Associations were under such direct levels of control by the government they could no longer be classified as charities or private businesses and so added their debt to government borrowing.

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“Save the High Street” campaign, a failure…

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Retail Trends:

The “Save the High Street” campaign, a government sponsored experiment led by TV presenter and retail shop expert, Mary Portas, has proved a failure, as the towns involved in the trial have seen 1,000 shops close in five years.

The idea was to show that with the right approach, the application of good town centre management principles, markets, coffee shops and community cafes, and the rejuvenation of a few key shops, trade would increase by attracting more footfall and other shops would follow.

The experiment started in 2012, selecting twelve towns which presumably were thought to have the potential to show the most improvement: Bedford, Croydon, Dartford, Greater Bedminster, Liskeard, Margate, Market Rasen, Nelson, Newbiggin-by-the-Sea, Stockport, Stockton-on-Tees and Wolverhampton.

All have since gone on to lose nearly almost one-in-five (20%) of their shops, that’s according to research group, Local Data Company’s data. This rate of decline has exactly matched that of the rest of the country.

The government-backed plan involved a £1.2million government grant which was thought would transform these centres back into the thriving retail hubs they once were.

The campaign was launched in a blaze of publicity by Mary Portas, based around her TV performances as the “Queen of Shops”, the 12 towns involved were each given £100,000 to bring about this town centre transformation.

However, controversy soon reigned as Ms Portas accused the Government of just using her campaign as a PR exercise, but not backing it up, as she saw it, with its policies, namely not reducing business rates.

She has lobbied the Chancellor, Philip Hammond, to cancel the recent increases in business rates, predicting that they would kill off 33% of shops. Ms Portas told The Daily Telegraph:

“It feels like there was this great splash from Government, that they were getting behind businesses. But they can’t say that and then treble rates.”

Can businesses swim against the tide of internet shopping revolution and home delivery, as even more expansion of this trend, now into groceries, from the likes of Amazon takes place?

There were reported to be around 15 shop closures a day across the UK in the first half of 2016 and new shop openings fell to the lowest level in five years, according to research by the Local Data Company.

Over the period covered by their 2016 report, produced by accountancy firm PwC and the Local Data Company, BHS went into administration, which increased the figures, but these were still a small proportion of the whole.

The retail mix is changing, and other shops still opening are giving town centres a different character from before. Matthew Hopkinson, the director of the Local Data Company, has said:

“The spaces left by the traditional occupants of our high streets are being increasingly filled by health care operators, food and beverage operators and the ongoing rise of the discounters.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – “Save the High Street” campaign, a failure… | LandlordZONE.

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Moving parents into an FHL – what would I owe to HMRC

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I’ve a tax question concerning furnished holiday lets and personal occupation

In 2016 I bought a flat and spent £20k on renovating it, with a view to making it a furnished holiday let (FHL) in the short term.

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DWP inquiry into UC rent arrears

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Finally the DWP announce that they are launching an inquiry into whether Universal Credit (UC) is pushing claimants into rent arrears.

This was revealed by Caroline Dineage, Parliamentary Under-Secretary (Department for Work and Pensions),  in the House of Commons and I’m sure we as landlords will be very interested to see this report.

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Agent letter evicting UC tenants read out by Corbyn in PMQs

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Jeremy Corbyn used one of his 5 questions to the Prime Minister in the House of Commons PMQs to read out a letter from GAP Property saying it was giving every single one of its Universal Credit (UC) tenants two months’ notice ahead of the roll-out of UC in the area.

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More Student Accommodation on the way…

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New Developments:

The number of new student accommodation developments across the UK is rising to meet the expect increase in students forecast over the next 10 years.

According to recent research by Savills’, Bath is the UK’s top hotspot for student accommodation developments, because of strong demand characteristics, high occupancy levels, strong rents and good prospects for rental growth. In second position is Birmingham followed by Brighton, Bristol, Edinburgh and Exeter.  This year saw three new places moved up to the top ten, including Exeter, Guildford and Leeds.

The London market represents the largest city in the UK for student housing. According to JLL, London’s full-time student population is expected to rise by 50% over the next 10 years, which will exacerbate the existing shortfall in student housing supply.

According to Savills, investment volumes are to reach £5.3bn in 2017, up 17% on 2016 as investor confidence returns after the EU referendum.

Jeremy Robinson, Managing Director of Housing Hand comments:

“Just this month, the University of Brighton was granted planning permission for a new student accommodation project for £60-80 million, which will see the development of 804 rooms in two towers, with construction due to be completed by September 2019.

“These new developments are popping up all over the UK and are good news for students.  Historically, many have found it difficult to find affordable accommodation close to universities and have had to opt for purpose built student accommodation (PBSA).

Fig 1 Savills Student Housing Development League 2017

“Typically, rents are high in this type of accommodation, all though the spec is high, which proves very attractive to international students.

“Students are paying £280 – £500 per week for a studio apartment and many more are unable to provide a UK guarantor to secure accommodation. Based on these figures, potential UK and international students without a UK guarantor in London would have to find up to £26,000 to cover the deposit and six month’s rent. Even if potential tenants can pay in advance, they may still need a UK guarantor. This can be a huge worry and for many, a real obstacle to going to university.

“However, we mitigate all the risks for letting agents and landlords by becoming the potential tenant’s UK guarantor.  We provide UK and international students who have failed a credit check with guarantor liability insurance policy.  This ensures that the rent payments are paid in the event of the tenant defaulting on the rent. Landlords and letting agents who are partnered with us have been able to increase occupancy, due to larger pool of applicants that can now qualify and they have been able to eliminate the risk of rent loss, due to tenant default, at no cost to them.

“According to Savills research, the UK attracted 112,000 fulltime students from the EU and 285,000 from other countries last year, making up just under 23% of the full-time student population. These students contribute £25bn (Universities UK) to the UK economy each year through tuition fees and other spending such as accommodation and services.

“Forecasts show that international student numbers are to rise by 6% per year over the next three years. University applications from Chinese students have almost doubled over the last decade, to 14,000 in 2016. With the sterling – yuan exchange rate 8% lower than it was before the EU referendum, this growth is expected to continue.”

For more information, www.housinghand.co.uk

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – More Student Accommodation on the way… | LandlordZONE.

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The private rented sector is ready to help fix the ‘broken housing market’

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Housing will take centre stage in the forthcoming Budget, with the emphasis on building more homes and on increasing the number of owner-occupiers.

If, however, the Government wants a country which works for everyone, it also needs to address the needs of those who will never be able to buy.

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Scotland the Brave?

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From the 1st of December 2017 the new PRT ( Scotland ) kicks in, laying rest to the AST.
One of the key toxic terms enshrined in this new set up is – there is no fixed period for the tenant.

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Good Reasons For Landlords To Become Non-Resident For Tax Purposes

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Did you know; if you become non-resident for tax purposes you only pay CGT on capital appreciation since April 2015 on your rental properties?

A few weeks ago I shared a tax planning strategy based on this (link here) and since then I have already been contacted by four landlords who are now residing in the Southern Hemisphere.

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