Industry finds holes in energy scheme’s bid to cut bills

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Propertymark has voiced fears that the government’s ECO plus scheme risks excluding many landlords with low-rated properties.

In its response to the Department for Business, Energy and Industrial Strategy’s consultation into the scheme to help fund home insulation, the industry body warns of the dangers of omitting those landlords who have invested in properties rated with an F and G Environmental Performance Certificate (EPC).

Funding eligibility

It says: “We agree that PRS households in EPC bands D and E should be eligible for ECO+ but argue that it would be more efficient for the administration of the scheme to allow PRS households in EPC bands F and G to be eligible for funding. Under the proposals any landlords investing in properties that have an F or G rating could be trapped with this asset with no real mechanism of support to improve the property to get the property fit for human habitation and energy efficient.”

Under the proposals, PRS households would also not be eligible for secondary measures – anything other than primary measures such as underfloor heating, party wall, cavity wall and roof insulation. This rule wouldn’t apply to the social rented sector, which Propertymark believes is unfair.

Accredited suppliers

It challenges “overzealous” proposals that retrofitters should comply with both TrustMark and PAS2035 standards, based on the difficulty finding even Trustmark accredited suppliers for the Green Homes Grant.

It also urges the government to rethink its plans to exclude PRS households from being eligible for cavity and loft insulation grants. Propertymark adds: “According to the 2019 English Housing Survey, private rented dwellings had the highest proportion of uninsulated cavity walls across tenures (25%), with owner-occupied (20.8%), local authority properties (24%) and housing association homes (20.2%) at lower but still significant level. This would be a golden opportunity to address this shortfall and to achieve a baseline across all tenures.”

View Full Article: Industry finds holes in energy scheme’s bid to cut bills

Get a move on with PRS reforms, council tells Gove

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Cherwell District Council has pressed the government to urgently introduce the long-awaited Renters Reform Bill to help it rebalance the relationship between landlords and tenants.

The north Oxfordshire authority has written to Housing Secretary Michael Gove asking him to bring forward proposals as soon as possible. It says it is responding to public concern over the dangers of substandard housing and wants greater powers for local authorities to intervene when it becomes necessary.

Housing Minister

There’s still no timetable for the Bill, although Housing Minister Felicity Buchan told the Levelling Up, Housing and Communities committee in November that it was a priority and there was a “desire to get on with it”.

Councillor Nicholas Mawer, portfolio holder for housing, says making sure everyone has housing that meets their needs is a key commitment but that all too often it finds troubling examples of bad practice, placing more stress and pressure on tenants. “When required we will not hesitate to take enforcement action to support tenants, and the promised measures – including fresh powers to tackle failings by social housing landlords – would enable us to do more for our residents,” Mawer explains.

Tenant Charter

“We are keen to support this rebalancing of the relationship between tenants and landlords locally and are in conversation with tenants and social housing providers to help shape a new Tenant Charter for our area.”

The council has form as a proactive authority; in 2020, it began rewarding prompt paying HMO landlords by giving them one of the biggest ever discounts handed out by a local authority. Non-compliant landlords can expect to pay up to £1,050 for a new licence, but compliant landlords can renew a five-year licence from just £450 (£650 for first time applications).

View Full Article: Get a move on with PRS reforms, council tells Gove

Petition to reverse Section 24 forces government to respond

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A petition urging the reversal of the controversial Section 24 tax changes for landlords will get a written response from the government after topping the necessary 10,000 signatures.

Simon Foster’s e-petition has now gathered 17,266 names, up from 9,811 signatures just before Christmas. Landlords in Orpington, Ilford North, Ruislip, Enfield and Harrow have been particularly keen to put their name to the petition, where at least 100 have signed up in each constituency.

Finance costs

The Midlands-based investor wants the government to reinstate the ability of landlords to set the full amount of mortgage interest against rental income before tax is calculated. Announced by George Osborne in 2015, the tax relief was replaced by a basic rate reduction from their income tax liability for their finance costs of 20%.

Foster explains that as a small, well-established private landlord, he is now struggling to make any money from letting properties. “Unless the ability to offset mortgage interest against rental income is reinstated, I will – like many – be forced to sell my properties,” he adds. “This could reduce the number of properties available on the private rental market.”

Parliamentary debate

The government has promised to respond in the next 16 days to the petition which runs until 10th May. If it tops 100,000 signatures by then, it will force MPs to debate the topic in parliament. Some e-petitions are considered for a debate before they reach 100,000 signatures, but this is rare.

You can sign the petition here.

View Full Article: Petition to reverse Section 24 forces government to respond

Bernie Wales: Why leasehold law is never boring

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He’s a well-known character among landlords and for anyone interested in leasehold property management, he is the ‘leasehold guru’.

And with 40 years of experience in the sector, Bernie has built up lots of experience.

He also warns that many leaseholders will need to take note of a new law taking effect that could have a huge impact on their building –

View Full Article: Bernie Wales: Why leasehold law is never boring

Record number of sellers leads to a ‘Boxing Day bounce’

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The number of new sellers putting their home on the market on Boxing Day leapt by 46% compared with the year before to set a record, Rightmove says.

There was also a big jump in the number of sellers wanting their home valued between Boxing Day and New Year’s Day –

View Full Article: Record number of sellers leads to a ‘Boxing Day bounce’

Modest drop in rental costs heralds busy start to the year

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The average cost of rent fell slightly during December, dropping 1.47% to £1,071, according to the latest Rental Index from Goodlord.

The South West saw the largest reduction of 2.68% to £1,066 while the only region to see an increase was the North East, where prices moved up 1.36% to £800. Average rental costs are now at their lowest since June 2022, however, the year ended with rents up by 8.7% across England compared with 2021. 

Highest prices

The highest rental prices were found in Greater London (£1,796) and the lowest in the North East (£810), the same regional split as Goodlord recorded in 2021.

It reports that the average void period remained unchanged at 20 days during last month as tenant demand continues to come up against lack of stock. The most significant shift was seen in the South West, with a 8.7% decrease, followed by the East Midlands, which experienced a drop of 8%. Greater London had the highest percentage increase in voids up from 12 days to 13 days – a jump of 8.3%. This was followed by the South East, which saw a 5.6% rise in voids, and the West Midlands, with a 4.8% increase. 

Incomes rise

Meanwhile, tenants’ average income fell 2.4% to £30,346 in December, although there was an average 11.1% increase across all regions during 2022. With rental costs rising by 8.7% during the same period, the average increase in tenant incomes outstripped the pace of rent rises.  

Goodlord COO Tom Mundy says: “We always expect to see a dip in activity and a drop in rental averages during November and December, so the steadiness of voids and the very marginal shift in rental costs this month mean we’re likely to see a very brisk pace across the lettings market in the early months of 2023.”

View Full Article: Modest drop in rental costs heralds busy start to the year

Ban for letting agent who claimed £100K in Bounce Back loans

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A letting agency boss has been hit with an 11-year ban after repeatedly abusing the Bounce Back Loan scheme.

Laszlo Szabo, the sole director of Letting Base Ltd in London’s Holloway Road, applied for – and was granted – a Bounce Back Loan of £38,000 to support his business, which had formerly traded as Hungarian Lettings Ltd. Five days later he applied for another Bounce Back Loan of £50,000, this time from a different bank. Ten days after this he applied for a £12,000 top-up to the first loan, taking the total borrowed up to £100,000.

Rejected application

The following day he returned to the second bank, seeking a further top-up of £50,000 to the second loan. This time the application was rejected. Under the rules of the government scheme, which aimed to keep companies afloat during the pandemic, a business could only take out one loan, although they could apply for a top-up if the original loan was less than the maximum to which they were entitled.

Letting Base Ltd went into liquidation in January 2022 owing more than £243,000, triggering an investigation by the Insolvency Service. Szabo’s disqualification prevents him from directly or indirectly becoming involved in the promotion, formation or management of a company, without the permission of the court.

Blatant abuse

However, due to Szabo’s personal circumstances, it is unlikely that repayment of the Bounce Back Loans will be made, says Nina Cassar, deputy head of investigations at the Insolvency Service. She adds: “His blatant and repeated abuse of taxpayer’s money has resulted in a lengthy disqualification, which will serve to safeguard the economy from traders who exploit financial support packages designed to help UK businesses.”

View Full Article: Ban for letting agent who claimed £100K in Bounce Back loans

Demand for London’s rental homes is ‘unseasonably high’

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Tenant demand for homes to rent in London is ‘unseasonably high’ but rent rises are beginning to slow down, one agent reveals.

According to Chestertons, they saw the first signs of the capital’s rental market cooling down in October –

View Full Article: Demand for London’s rental homes is ‘unseasonably high’

Replacement guarantor?

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Hello, We rent a house to a young family who have been tenants for 2 years. At the time we asked for a guarantor, which they were happy to provide by way of a family member.

The tenants are now saying that they have had a fallout with the guarantor and would like them removed from the agreement.

View Full Article: Replacement guarantor?

TENANT BLOG: What I think of the Government’s looming renting reforms

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If you haven’t heard of it before, the Renters’ Reform Bill is set to be voted on before May 2023, bringing with it a plethora of proposed changes for landlords and tenants alike.

Shelter, who along with other organisations are campaigning for a fairer deal for tenants, believes that they deserve greater long-term security. Among this list of changes is:

• The abolishment of the Section 21 Notice.
• The formation of a property ombudsman.
• A ‘decent homes’ standard.
• Mandatory registration for Landlords.
• Double the required notice period for rental increases.

My question is…

Why wouldn’t a tenant who follows the rules and pays rent on time feel secure in their own home? Surely landlords aren’t booting out suitable tenants for no good reason?

What about those that are consistently late with rental payments? Those that breach their tenancy agreements?

It’s pretty time consuming and expensive enough to take non-paying tenants to court as it is.

To me, it feels like the last thing the PRS needs is more red tape that affords terrible tenants flexibility that they don’t entirely deserve.

Everybody deserves security in their own home, don’t get me wrong. But what about landlords?

Who’s looking out for their income and livelihood that is ultimately affected by the minority of tenants who just don’t want to play fair?

Thrashing

Over the last few years, landlords have taken a thrashing. Heavy legislative changes have been introduced and it’s getting to the point where a lot of smaller landlords are selling up because:

1. They don’t have the time nor energy to keep up with the consistent turning tide.
2. The passion they once had for property has dwindled.
3. It’s got to a point where their investment is no longer a sensible one.

To me, it’s odd. As a tenant myself and someone who works in the property industry, most landlords I talk to operate by the book.

I find it odd that various third parties like to paint a picture of monstrous, margherita-sipping, beach-dwelling landlords when it couldn’t be further from the truth.

Being a landlord isn’t always passive income for little to no work. If you take property seriously (a very large portion do) then you’ll find that renting out a property can be strenuous at best.

Many landlords I have spoken to have had sleepless nights from non-paying tenants and some have even experienced total devastation at the hands of reckless tenants, with their properties being trashed with little to no support from local authorities or the government.

If you’re reading this and are already at wits end. Hang in there.

Landlords have a fantastic network of support such as work that’s being carried about by organisations like LandlordZONE, who we’re proud to be exclusively partnered with because of the fantastic stuff the team do.

You can also connect with me on LinkedIn here or follow Alphaletz by subscribing to our newsletter in just a couple of clicks.

Part and parcel of what I do in the property industry is I aim to make the lives of landlords easier, not just with introducing technology to their day to day processes, but by giving out content that might help with tenant referencing, inventories and inspections.

Author bio

Connor (main picture, inset) is an experienced marketing executive within the property industry, working predominantly with property management software. He currently works with Alphaletz and interacts with plenty of landlords, helping them make life easier with the assistance of technology. All views here are his own.

View Full Article: TENANT BLOG: What I think of the Government’s looming renting reforms