House prices feeling the heat – Emergency Recession Webinar

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Yesterday the UK saw record high temperatures, but it’s not just the weather settings records.

• House prices rose 14% in the year to June. The highest rate since 2004.
• House prices rose month-to-month 1.8% in June.

View Full Article: House prices feeling the heat – Emergency Recession Webinar

OPINION: Why do landlords get the blame for rejecting tenants on Universal Credit?

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An official briefing document for MPs has underlined the contradictory position the government has manoeuvred itself into over landlords and letting agents who advertise properties as ‘No DSS’.

The House of Commons Library document makes for interesting reading because, based on the facts, it lays the problem directly at the feet of the current government’s policies.

It is called ‘Can private landlords refuse to let to Housing Benefit claimants?’ and is intended to inform MPs involved in the upcoming debates that will create the Renters Reform Bill.

As proposed, it “will make it illegal for landlords or agents to have blanket bans on renting to families with children or those in receipt of benefits”.

This initiative has largely been created by Shelter’s energetic lobbying, as well as its sponsorship of a landmark case in 2020 at York County Court during which a judge considered the case of a disabled single parent whose application for private rented housing was refused by a letting agent because she received Housing Benefit.

The judge agreed it was discriminatory, although the decision did not change the law.

Reluctant

But the briefing explains concisely why some landlords are reluctant to take on DSS claimants.

This includes the well-documented problems landlords face when interacting with the processing system that underpins Universal Credit housing payments, and the fact that payments go direct to tenants rather than landlords following the 2008 introduction of the Local Housing Allowance (LHA).

Other more recent factors include the freezing of the LHA from 2016 onwards until the onset of Covid, which has meant many ‘DSS’ tenants experience a significant shortfall between their benefit payments and the rent they pay.

Landlords also face restrictions on renting to these tenants from mortgage lenders and insurers and, as the document outlines, the recent mortgage interest tax relief reductions which have led many landlords to focus on less ‘risky’ tenants.

Read more: the ultimate guide to tenant referencing.

But in a move which is increasingly typical of some policy, blaming landlords for the situation is as the document lays bare largely of the Government’s own doing.

Nigel Lewis is Editor of LandlordZONE

View Full Article: OPINION: Why do landlords get the blame for rejecting tenants on Universal Credit?

Holiday lets – the dream solution?

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With the Renters’ Reform white paper making residential buy-to-lets less attractive, is it time to look at snapping up a country cottage holiday let? It may be, but be careful, warns Richard Reed.

We’ve all probably dreamed of owning a cosy country cottage in an idyllic part of the country

View Full Article: Holiday lets – the dream solution?

Exempt accommodation providers – who are their agents?

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Has anyone released their property to or entered into short-term lease arrangements with a managing agent who then goes on to organise the accommodation and support services for Exempt providers in the Birmingham area?

Are you an Agent that provides properties for this purpose?

View Full Article: Exempt accommodation providers – who are their agents?

Claims history declaration on rent guarantee insurance?

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Hi, Could I please ask for a specialist opinion? I have had a claim made on my Rent Guarantee Insurance. When I am now quoting for my Landlord Insurance (building only) I am asked about claims in the last 5 years.

View Full Article: Claims history declaration on rent guarantee insurance?

Labour’s shadow housing secretary promises to wage war on holiday let landlords

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Labour has vowed to introduce licensing for holiday lets to preserve the spirit of coastal and rural communities.

Shadow levelling up secretary Lisa Nandy says this would allow areas to “to reap the rewards of thriving tourism”, while guarding against ghost towns at the end of the holiday season when locals are priced out of their own neighbourhoods just for homes to stand empty for months.

“By trusting the community, working with the community, we can find the right balance to bring growth and jobs and income, but protect the spirit and the fabric of a community that matter so much,” she says.

Community approach

In her speech, Nandy also set out plans for a strengthened community right-to-buy initiative to enable local people to take control of assets such as live music venues and football clubs that come up for sale or fall into disrepair. They would be given first refusal on assets of community value, including the right to buy them without competition.

Communities would also have the right to force a sale of land or buildings that have fallen into a state of significant disrepair and would get 12 months to raise finance – double the current allowance.

Short lets

Last month, the government announced a new study to investigate how short-term holiday lets impact housing supply across cities and coastal resorts in England. Proposals include checks on premises to ensure rules on health and safety, noise and anti-social behaviour are obeyed and a self-certification scheme for hosts.

In Scotland, all short-lets will need a licence by July 2024, while Wales plans to introduce a statutory licensing scheme for all visitor accommodation, including short-term holiday lets, to help raise standards across the tourism industry.

View Full Article: Labour’s shadow housing secretary promises to wage war on holiday let landlords

Many UK buildings are in danger of becoming unusable in heatwaves

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As temperatures in England and Wales soar this week, many office buildings will become unusable says real estate sustainability expert Chris Bennett of consultancy Evora Global – it should act as a powerful warning for real estate investors he says.

Bennett, who is co-founder and managing director of the sustainability services company says: “The climate emergency has huge, long-term implications for the real estate market.”

Those high-rise blocks

No less affected are those high-rise blocks of flats whose residents are being forced to seek-out shelter in buildings with air conditioning to work and sleep in, and some even sleep out in the corridors.

“We are obsessed with building with glass. Our city centres are dominated by glazed steel skyscrapers – giant airtight greenhouses that trap the sun’s heat and don’t let it go,” says Henrik Schoenefeldt, professor of sustainable architecture at the University of Kent.

Air-Con the saviour?

It is only by providing air conditioning that enables people to live and work in many of these “glass palaces” – typically high-rise blocks facing south – that are becoming wholly unsustainable environmentally.

It is only by artificially cooling these office blocks and residences that we can even step foot inside them. “You can’t actually inhabit a glass tower without it being mechanically’ air conditioned – it is actually not possible,” Schoenefeldt says.

Relying on air conditioning to offset the extreme temperatures generated inside glass fronted buildings is creating what the International Energy Agency (IEA) has called a “cold crunch”. Air conditioning now accounts for around 10 per cent of the world’s electricity demand.

But with two in every three global households expected to have air conditioning by 2050, according to one new report, with China, India and Indonesia accounting for half the total number, it means the stock of air conditioners will grow to 5.6 billion by then, from 1.6 billion today. The impact will be around 10 new ACs sold every second for the next 30 years says the IEA. This will consume more new electricity by 2050 than is currently used by the US, EU and Japan combined.

Clearly this is not sustainable long-term and flies in the face of energy efficiency targets. It’s not good news, unless you’re in the air-conditioning business, so something has to be done. Bob Ward, policy director of the Grantham Research Institute on Climate Change at the London School of Economics told The Sunday Times:

“We’re baking in – literally baking in – a massive cost in terms of future retrofitting, as well as increasingly uncomfortable working and living circumstances.”

Schoenefeldt warns that we face a new kind of fuel poverty crisis:

“We have to stop building homes and offices that can’t cope with the heat and then have to rely very heavily on air-conditioning,” he says “which isn’t to do with the inability to heat a home but actually to cool it down”.

Chris Bennett of Evora Global, whose clients include Legal and General, Hines and M&G says the current heatwave is final warning for real estate:

“The climate emergency has huge, long-term implications for the real estate market. The UK’s buildings and offices aren’t designed for temperatures in the high 30Cs, let alone the 40Cs.

“A stiflingly hot office is not a pleasant or productive place to be. Extreme heat will render some workplaces unusable, or barely usable. Some will be practically deserted as working from home re-emerges. When there is such competition to get employees back into the workplace, uncomfortable offices will become devalued.

“All of this will bring into question their overall value. Workplaces that can cost effectively cope with a heatwave will be valued more highly than those which are effectively forced to shut down. Investors could be looking to invest in real estate assets that are easy and cheap to keep cool; for people, for perishable goods and for IT. Properties that have the capacity to cope with high temperatures.

“Does the office have the capacity to keep cool without costing the Earth? Can the building manager see how the building is working and how much energy this is using? And still hit their emissions targets?

Domestic homes too have their temperature problems: floor-to-ceiling bifold doors, glass roof kitchen extensions and conservatories are all increasingly popular, but for small homes with south facing gardens and little by way of building mass and airflow become oven-like in summer.

Meeting the highest standards

Passivhaus standard homes might well cope because with soaring temperatures as ventilation is built into the buildings, are carefully orientated according to the the direction of the sun’s path. But few new homes going up on modern UK housing estates have this advantage and meet these standards today.

The new Part O Building Regulation that deals with overheating in domestic dwellings and residential type commercial buildings such as care homes and student accommodation, limits glazing areas to no more than 26% of floor area.

The new regulations take effect from 15 June 2022, but progress is likely to be slow – any development that is subject to a building notice, has made a full plans application, or submitted an initial notice before this date will not have to comply, provided that the work is started on site before the 15 June 2023.

Guidance given to builders states that, “it would still be good practice to reduce overheating as much as possible within a development even if not bound by the Building Regulations. There may also be other deciding factors such as Planning Conditions that need to be satisfied regarding overheating.”

London mayor, Sadiq Khan, has issued guidance that major developments in London should reduce the amount of heat entering buildings in the summer by: careful orientation of a property, providing shading, fenestration (window openings design), insulation, green roofs and walls, all heat reduction techniques often suggested.

Relearning old lessons

As has often been the case in building architecture and design, the lessons learned in the past, the old methods, need to be brought back. Schoenefeldt says this: “look back in time and get back to architectural basics when early glass structures” – Crystal Palace being a case in point, was shaded on the outside with canvas screens, as were older greenhouses.

Wooden shutters and shades were standard fixtures in on fittings on older properties, along with recessed balconies and smaller windows. Ward has suggested that UK architects look to French and Tuscan farmhouses as examples:

“We’re going to have to fit shutters and get used to shutting them in the day.” That’s because external shutters are much more effective at reflecting the heat than are internal blinds.

Stefan Thor Smith, associate professor at the University of Reading’s school of construction management and engineering, told The Sunday Times, that these old lessons, “go beyond how we keep out the sun and extend to the very fabric of our buildings. Over the past 20 years or so we’ve been building with lightweight construction and lots of insulation. The more thermal mass you have, it alleviates some of the problems.”

Heavy building materials including stone, brick and concrete will absorb the heat by day and release it at night. Buildings like this will smooth out the heat curves inside and outside, cool in summer and acting like radiators to provide warmth in winter, once they have reached their optimum temperature.

Contrast this with the modern tower block and the relatively thin skin and glazed exterior. Many even have limited inside ventilation. Smith has suggested that insulation or cladding be installed on the outside rather than the inside of these buildings, providing it has the correct fire rating after the lessons of Grenfell, to offset the effects of poor building materials mass.

View Full Article: Many UK buildings are in danger of becoming unusable in heatwaves

What’s the catch? Platform offers to pay tenants’ annual rent in advance to landlords

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Upfront rental platform Wectory is looking to link up with more letting agents as a way to address the shortage in rental properties.

With growing numbers of landlords quitting the sector, it believes offering up to a year’s rent in advance is one way to encourage them to stay put.

Head of sales Jamie Osborne (main image) tells LandlordZONE: “We already work with thousands of single and multiple property portfolio landlords and are now looking for more letting agent partners who have already done their due diligence such as anti-money laundering checks on tenants.”

Increased rent, record inflation and the basic cost of living crisis are all set to cause a potentially damaging loss of earnings for letting agents and landlords, driving suitable accommodation further out of the reach of many, says Osborne.

Landlords

“Our aim is to provide agents with something new, easy and free to use to protect their stock. We can help our partners attract new landlords, increase stock and provide a new timely service to existing clients.”

Its partners often see landlords renewing their tenancy agreements ahead of schedule to secure a larger advance, he explains. “This in turn means more security for the tenant, more fluidity for the landlord and their ability to increase their portfolio and more properties for the agent to manage and let on their behalf.”

Wectory also offers reward schemes for partner agents using its services as well as the option of providing management fees upfront to improve cash flow.

View Full Article: What’s the catch? Platform offers to pay tenants’ annual rent in advance to landlords

Structure Your Property Business To Protect Your Families From Inheritance Tax Using Smart Companies

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Structuring to protect your family’s Inheritance is crucial in your property business.

Make sure you don’t lose 40p to HMRC for every pound you leave behind!

In this video, I’m joined once again by Alex Norian

View Full Article: Structure Your Property Business To Protect Your Families From Inheritance Tax Using Smart Companies

Well-known landlord jailed after defrauding HMRC out of £500,000

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A landlord who defrauded HMRC out of almost £500,000 by keeping deductions from his employees’ wages has been jailed for three years.

Michael Stainer, 74, (inset, main picture) was found guilty of two counts of cheating the public revenue and one of fraud by false representation while running The Grand on Folkestone seafront – primarily made up of leasehold apartments as well as hotel rooms, bars and restaurants.

During the trial at Southwark Crown Court, the jury heard how money totalling £473,097 taken from staff pay-packets and meant for HMRC were instead pocketed by Stainer from 2006 to 2010.

After a visit by revenue officials, he tried to make submissions to HMRC but the company’s PAYE account had been cancelled because of inactivity.

His wife, 60-year-old Doris Stainer, appeared charged with the same crimes but was found not guilty.

Chartered accountant

Judge Gregory Perins told Stainer: “Many, if not all, of your employees were on low or minimum wage and you were ultimately responsible for paying these wages and deducting PAYE and National Insurance.

“However, you took the calculated decision not to do that and, although you deducted the amount of PAYE and National Insurance, you did not pass that money on and instead kept it.”

Stainer, a chartered accountant, owned The Grand for more than 40 years but the couple were forced to step away after being declared bankrupt.

Last year, residents of the building bought the former hotel at auction for just £448,000 after its previous owner, Hallam Estates, was put into administration.

Richard Wilkinson, assistant director of the HMRC fraud investigation service, says: “We welcome today’s conviction of Michael Stainer, an employer who was stealing from his own staff. Instead of lining his pockets with their stolen tax contributions, this money should have been funding our vital public services, such as hospitals and schools.”

Watch Michael Stainer talking about The Grand.

Read more about landlords caught avoiding tax.

View Full Article: Well-known landlord jailed after defrauding HMRC out of £500,000