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

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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

20 years of property training experience and how you can access it at no cost

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Today I have released episode No200 of the Property Magic Podcast.

In the 200th Anniversary episode, I answer the frequently asked question: “Is now a good time to invest in property?”

I also share the changes I have seen happen over the past 20 years and my prediction for the next 20 years.

View Full Article: 20 years of property training experience and how you can access it at no cost

Free legal help offered to tenants facing eviction

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Tenants facing eviction in England and Wales can now get free legal advice – and access to a lawyer in court – from a new government-backed scheme.

Designed to help tenants avoid losing their home and from going through stressful and expensive court proceedings

View Full Article: Free legal help offered to tenants facing eviction

MARKET: Rents hit historic high of £1,367 a month as void periods plunge

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The average rent for a property in the UK has hit a historic high of £1,367 a month, helping push void periods between tenancies down to their lowest ever, an average of nine days.

These extraordinary figures are within the latest Goodlord renting index, which uses data from tens of thousands of tenancies arranged though its platform each month.

Its average national rent figure of £1,367 is the highest level ever recorded by the Index and is 9.4% higher than the previous record, set in September 2022, of £1,249.

It is also 19% higher than the month before and 10% higher year-on-year.

These figures will prompt campaigning groups to warn the government, as they have before, that the private rented sector is dangerously unbalanced, over-run by a glut of tenants unable to get on the property ladder and dogged by stock levels reduced by more landlords than usual exiting the sector.

Staggering

“This month’s numbers are quite staggering,” says William Reeve, CEO of Goodlord (pictured).

“In July we do usually expect to see an increase in rents and a reduction in voids – and all indicators pointed to a particularly red hot summer for the rental market, if not the weather.

“So while the 10% year-on-year increase is a big shift, the sharp drop in void periods is also particularly surprising. 

“Digging into the data, we can see a large number of multiple occupancy student lets being confirmed during July, which has pushed up average prices in key regions such as the North East and South West.

“Traditionally, rental costs continue to increase until September before cooling off in the autumn, which could mean these aren’t the last records we’ll see broken before the year is out.”

View Full Article: MARKET: Rents hit historic high of £1,367 a month as void periods plunge

OPINION: Is it fair that councils are ‘poacher and gamekeeper’ in housing?

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There is a burning issue within the rented homes market that is grossly unfair on private landlords and that is never discussed by politicians or the trade associations that operate within it.

The issue is that many local councils who regularly take private landlords to court or fine them over their poor property management practices are all too often themselves guilty of similar crimes and misdemeanours.

One obvious and recent example is Camden Council. It has recently been investigated by the Regulator of Social Housing after it was fined £500,000 over a fatal fire at a Hampstead property in November 2017.

The investigation discovered that over 9,000 fire remedial actions are currently overdue, just under 400 of which were deemed “high-risk”.

Also, a third of the fire safety jobs should have been completed within 10 days and the remainder in 30 days.

This is the same council that only a month ago took a landlord operating an HMO within its boundaries to court over fire safety breaches.

The court heard that the landlord, Monsoon Properties Ltd, had admitted violations relating to a range of issues at the flat in London’s Tavistock Place.

Inadequate

This included inadequate fire detection system, obstructions to the means of escape, defective fire doors, defective oven and hob and smashed wall tiles.

Highbury Corner Magistrates Court fined the landlord £10,000 for each breach of regulations, as well as costs of £7,020 and a £12,000 surcharge – or nearly £50,000 in total.

It seems extraordinary that Camden can be both poacher and game-keeper in this way – although it is not alone in this regard.

Nevertheless, Camden is particularly keen on fining rogue landlords, and last year it announced it had secured four banning orders against four after they were found to be letting an unlicensed and unsafe home in Kilburn.

This is course needs to happen – those who ignore their responsibilities or wilfully dodge them when operating PRS properties should be punished.

But when councils like Camden do the same thing, none of the property managers within their housing teams lose their jobs, do they?

Justice imbalance

This disparity in levels of justice for the same crimes cannot go on particularly when private landlords already face several other unfair rules such as being taxed on their turnover, not profits, unlike other businesses.

Landlords of all kinds whether in the public or private domain should operate on the same playing field and face the same consequences for illegal or irresponsible behaviour.

And perhaps more importantly, the organisation that chases down bad landlords locally should not be property managers themselves.

We need an independent national housing ‘police force’ backed up by a specialist property court to solve this situation.

Nigel Lewis is the editor of LandlordZONE>

View Full Article: OPINION: Is it fair that councils are ‘poacher and gamekeeper’ in housing?

LATEST: NW council to double size of selective licencing scheme

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Two selective licencing schemes operated by Wirral Council in and around Birkenhead are to be renewed with a further two schemes about to be launched following a consultation.

The additional areas added by the council mean an almost doubling of the number of streets in the area where landlords will have to licence their rented properties, a council meeting at its town hall (pictured) has decided.

Wirral’s plans, which are now open for consultation, are part of a growing trend for councils to extend existing selective licencing schemes on renewal at the end of their five-year period. This includes in neighbouring Liverpool, where a huge scheme covering some 45,000 properties began last year.

Unusual

But the council is unusual because it is promising to charge a lower licencing fee to landlords for the enlarged set of schemes.

A council spokesperson tells LandlordZONE that: “The exact fee hasn’t been determined yet but the [consultation] information says [that] the council proposes to recover some costs by charging a licensing fee.

“The cost for a licence has reduced since the initial scheme and the council will continue to work hard to streamline costs for future designations and keep the fee as low as possible.”

Selective licencing began in the area during 2015 but the council has been slowly expanding coverage since to include some 3,500 licences.

The areas within the existing schemes to be renewed are Bidstone & St James West and Birkenhead West while the new areas cover Egremont North and Secombe St Paul’s.

Decent homes

Chair of Economy, Regeneration and Housing Committee, Cllr Tony Jones (pictured), said: “Selective Licensing is about making sure people live in decent homes.

“We know that most landlords take their responsibilities seriously, but some others profit from renting out homes which are unacceptable and not fit for purpose – and they are the ones we are determined to target.

“The use of Selective Licensing will help us in tackling rogue landlords and protecting tenants in Wirral.”

Landlords affected by the renewal and extension plans in the area can find out more information on the council’s consultation website.

View Full Article: LATEST: NW council to double size of selective licencing scheme

Call for financial help for landlords to carry out energy improvements

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Rightmove says that just 40% of homes for sale and 50% of homes for rent on its platform currently have an energy performance certificate (EPC) rating of C or above.

The rest have a rating of D or below and this has led the firm to urge more government incentives to encourage landlords and homeowners to invest in green improvements.

View Full Article: Call for financial help for landlords to carry out energy improvements

LAW: Landlord duo to pay tenants £12,500 because ‘innocence is no defence’

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Being ignorant of landlord law is no defence, a brutal legal point that has cost a landlord duo in London dearly after they were told by judges to repay their tenants £12,500 via a Rent Repayment Order.

The two Slovakian tenants, Amanda and Miroslav Jesensky, who do not reside in the UK any longer, have successfully claimed the cash off Mohammed and Ghazala Butt

This followed the discovery that their East London rented house owned (pictured) by the Butts had not been licenced under Waltham Forest’s long-established selective licencing scheme during their tenure.

The couple rented the property for nearly ten years during which two successive selective licencing schemes have been in operation, each promoted by the council via advertising, mail-shots and information on the council’s website.

The Butts pleaded innocence of the scheme, blaming the council for its failure to inform them of their statutory duty to licence the property.

No defence

But judges at the Property Tribunal hearing pointed out that innocence of the law was no defence in such Rent Repayment Order cases, in accordance with the Housing and Planning Act 2016.

They added somewhat candidly to the Butts that: “Becoming a landlord is a serious undertaking – a landlord can literally hold the lives of their tenants and their families in their hands.

“It is not only that ignorance of the law is no excuse but that it is incumbent on landlords to familiarise themselves with the legal requirements to which they are subject.

“They are not entitled to keep quiet and wait until the local authority catches up with them.”

The landlords were lucky to one extent – the Jesensky’s original claim was for nearly £16,000 but this was reduced as it was a ‘first offence’ and the judges also took the landlords’ financial position into consideration.

They have until 10^th August to appeal the decision. Read the decision document in full.

Pic credit: Google Streetview.

View Full Article: LAW: Landlord duo to pay tenants £12,500 because ‘innocence is no defence’

City office space under threat as personified by Canary Wharf exodus

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The pattern of office working is changing and nowhere is its effect on commercial property being felt more strongly than in London’s Docklands’ Canary Wharf.

A once thriving financial centre

The development of the wharf into a thriving financial centre just outside the City of London breathed new life into a run-down legacy of the days when London was a major shipping port, transforming the once poverty-stricken location.

The transformation was the brainchild of international developers and was conceived well before anyone had even thought the world would be turned upside down by a major pandemic. The resulting shift in the way people adapted to it – using technology to enable working from home (WFH) with Teams and Zoom conducting business meetings and customer services remotely – has hit commercial office occupancy rates hard.

These dockside property developments were risky even in the 1980s, that was until a critical mass of financial institutions started to move into the shiny glass towners at the Wharf. It was initially too cut-off from the London business and financial centre, too far away from where the wealthy bankers, lawyers and accountants traditionally did business. But this changed later as transport links were improved and these services moved in.

Property crash of the 1990s

The development came down with a mighty crash in a commercial property crisis of 1992 but the Canadian developer, Olympia & York, bought it back from the ashes and set about selling the office development idea hard. With new transport links including the Docklands Light Railway, a new tube station, boat transport access and an a city airport, and the project developed a momentum of its own.

It was hailed as a triumph of London’s post-industrial world, a child of Margaret Thatcher’s city revolution. The giant steel and glass towers were taken up by the leading banks and city institutions, while every day, hordes of workers used the gleaming new transport links to fill the massive floor plates of these symbols of London’s financial success.

WFH establishes a pattern

Today, post-Covid, it’s all looking a tad different. What looks like becoming a newly established pattern of office working, the WFH hybrid model, has changed all the success that went before. The working week for capitals around the world has become one of work at home for one, two or even three days, while the balance is spent in the office.

You don’t have to be a property genius to see that the effect of this is to dramatically reduce the space these great financial institutions need to operate their businesses in. Surveys show that to date, London has been one of the centres most affected by WFH.

People are commonly staying home Mondays and Fridays and travelling into work in between. The result is the once packed-to-overcrowding transport links are now under used for much of the time and the service infrastructure of retail outlets for workers, the coffee shops and the restaurants, the clothing and footwear stores, are all suffering substantially.

At first people were sceptical that WFH would not last, that people would gradually drift back to their commuter schedules, back to their offices lives full-time after Covid subsided, and all would be back to normal. That this did not happen has surprised many and left commercial property owners licking their wounds and wondering how to adapt.

Reduced demand for space

A study by estate agent Knight Frank and another by international management consultants McKinsey and Co, find that at lease 50 per cent of all large, multinational companies are planning to reduce their office space as their workforces’ needs and preferences have altered radically in a matter of a couple of years.

The result is a dramatic reappraisal of the values of commercial properties in most major cities around the developed world. Schroders Investment Management claims that the value of UK commercial office property has lost over 20 per cent of its value since June 2022, driven it says by the WFH trend.

The employers of today, in a post-pandemic world, are likely to be looking for smaller, more flexible spaces. Open plan will be the order of the day with everyone, including senior staff, working closely together, and in many cases sharing desks and meeting spaces. In a world of mobile working, an office full of staff every day may be a thing of the past.

Once a mark of prestige to have an office location in Canary Wharf, it could become a sign of being left behind, out on a limb and stuck in a location that is becoming no longer fashionable? That’s the danger for Canary Wharf.

Valuation downgrades

The Canary Wharf Group, owned by Qatar’s sovereign wealth fund and Brookfield Asset Management, has had the embarrassment of recently being downgraded by Moody’s the international business analysis and credit ratings agency, noting that the company would in future have difficulty in filling and ultimately selling its offices “without offering substantial discounts”.

The exodus

What’s more, Moody’s itself looks like it might join the Canary Wharf exit. There it currently has around 1200 employees and is said to be seeking to reduce its current footprint of 170,000 sq ft., though it declined The Daily Telegraph’s request for comment on its office plans.

The Moody’s threat to depart comes after major blow to the centre as one of the most visible iconic buildings, HSBC’s glass tower, will be vacated as the Bank announced that in 2027 it will abandon its Docklands tower for one back in the City of London.

The 45-storey HSBC skyscraper will move its staff base to a smaller office at the former BT head office near St Paul’s, while “Magic Circle” law firm Clifford Chance last year also announced it was leaving the Docklands for the City of London. In addition, Barclays has sublet 500,000 sq ft of space at its Canary Wharf offices.

Credit Suisse is another bank trying to sub-let empty space at its Canary Wharf headquarters.

The effort to adapt

The Canary Wharf Group also declined to comment on its plans, but it is rumoured that it is now attempting to reinvent itself as a home for life sciences as it seems there’s a chronic shortage of suitable laboratory space.

Efforts to turn the location into a shopping and leisure destination appear to be struggling as one shop worker told The Guardian: “Mondays and Fridays are dead. This shop used to take a fair bit before Covid but now everything’s changed.”

Despite the Group’s efforts, adding shops, bars and restaurants over recent years, landscaping between its glass-and-steel towers, creating a public art trail, and free events aimed at families, it is struggling to shake off the wharf’s sterile and chilly atmosphere.

View Full Article: City office space under threat as personified by Canary Wharf exodus

Looming EPC changes already skewing the buy-to-let market, claims finance boss

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The Government’s plans to force landlords to upgrade their properties to a minimum ‘C’ energy efficiency standard is already affecting how rental properties are being purchased, the boss of a big money firm has claimed.

Louisa Sedgwick, Commercial Director at Paragon Bank (main picture), says her firm’s poll of some 1,200 landlords has revealed that a quarter have already sought rental properties to purchase only if they already meet the likely minimum MEES certificate due to be introduced or require some work to get them to reach it.

Also, nearly two thirds of landlords said they would factor in the new EPC rules when buying future homes to rent.

Under the Government proposals, new rental tenancies will require a minimum EPC of C by April 2025, with all tenancies meeting that standard by 2028.

Two years

But it is over two years since the proposals were announced and Michael Gove, Secretary of State for Levelling Up, Housing and Communities has recently hinted that their implementation will be delayed.

Nevertheless, Paragon says the proposals are influencing landlords’ business strategies more broadly with nearly two thirds having taken some form of action as a result.

This includes 20% having already made improvements to bring a property’s EPC rating up to C or above while a similar proportion are in the process of retrofitting their properties with energy-saving measures to increase the EPC rating to C or above.

Upgrade work

Approximately 10% of landlords said they had sold properties rather than pay for upgrade work while 7% said their properties would never make a ‘C’ certificate.

“Michael Gove’s recent comments mean it’s looking increasingly likely that any new PRS energy efficiency standards will be delayed,” says Sedgwick.

“Nevertheless, it’s encouraging to see landlords are already building on the progress made over the last decade in making privately rented homes more sustainable.” 

View Full Article: Looming EPC changes already skewing the buy-to-let market, claims finance boss