A few simple tricks can prevent your property being sold off under your nose

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The Land Registry titles register is a new target for criminal gangs and literally millions of pounds are at risk if your home or rental property is wholly owned and mortgage free.

According to official figures, something like 99pc of property owners have failed to signed up to vital safeguards at the Land Registry, a simple measure that is sure to protect you from this type of crime. There are numerous variations on this crime theme and these clever scams have multiplied recently during the pandemic property boom.

It’s a free protection process

For those who take advantage of the Land Registry’s free alert service a notification will be sent to you (and if you like, your solicitor as well) when any local authority searches are made. A search is a red flag that a conveyancer is preparing your property for sale.

Setting up the service on the Land Registry website is a task that takes just a few minutes, but unfortunately only a minority of people actually take the time, either because they don’t know about it, or they just can’t be bothered.

The Land Registry says that just around one quarter million of Britain’s 29 million homes have been set up on the Land Registry’s anti-fraud “property alert service” which has been available free since 2014.

The Daily Telegraph reports the recent case of a Luton man who returned home from working away to find his house had been sold by these scammer criminals and all his furniture had been removed from the house. When he arrive home after neighbours had called him he was greeted by the new owner of the house, the illusive scammers having syphoned off the sale proceeds.

This is not an isolated incident. It’s been happening for years, with hundred of people being affected, and it’s getting worse as time goes on. Last year The Land Registry was forced to pay compensation of £3.5m to owners of properties who fell victim to the scams, a figure which is over 60% up on the previous year.

Fortunately owners have state protection, a state guarantee through a special indemnity fund for financial crime that will compensate owners, but this nowhere near compensates for the stress and upheaval, let alone the consequential losses suffered.

Title fraud and registration fraud

Title fraud is where a criminal steals a property owner’s identity and changes the property title from the owner’s name to their own. They will do this through the Land Registry website, making an application without your knowledge by registering a forged transfer or mortgage. The criminals then apply for loans using the property as collateral.

During the Covid period people have been self-isolating in their own homes and many now have a business property that is unoccupied. Business premises are not safe either from these fraudsters who have been taking advantage of the pandemic to make more money in this way.

Even when you live in the property, this won’t stop these fraudsters from perpetrating their clever tricks.

Those most at risk

Most at risk from these types of fraud are people who own their properties outright, without the encumbrance of a mortgage. Secondly, an empty or tenanted property is more at risk.

• Those owners not registered with the LR alert service
• absent owners, either abroad, in hospital, in care homes etc
• landlords and those with tenanted properties
• beneficiaries of owners who have died
• long-time owners with more equity in their property
• sole owners
• properties at most risk are
• high value properties
• empty properties

The Land Registry says that combating these types of fraud is priority.

“Our specialist counter fraud teams focus on detection, prevention and education, working with professional conveyancers, such as solicitors, who are required to make checks to prevent fraud and money laundering. We are actively encouraging conveyancers to use digital cryptographic ID checking as a more secure means of identifying people,” a spokesperson has said.

What can you do to stay safe?

Us the Land Registry’s Property Alert service. Simply sign up on the website to receive email alerts from HM Land Registry by setting up a Property Alert account. The Land Registry says you can monitor the property of friends or family and any commercial property you own. If anyone applies to change the register for a property you are monitoring, you (and if you like someone else, like your solicitor) will be notified immediately.

Bear in mind, landlords are more at risk than the general population. Make sure HM Land Registry has your up-to-date details, correct name and address and email. Without this you might miss official letters or notices alerting you to a fraudulent application.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – A few simple tricks can prevent your property being sold off under your nose | LandlordZONE.

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Moving into a former home and PRR?

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Hi, this question mainly relates to Capital Gains Tax (CGT) and Principal Private Residence Relief (PRR). I know you are going to tell me to speak to my advisers, but they are simply not property experts and just don’t know.

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Victory! Landlord challenges council’s £54,000 benefit overpayment bill

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A London landlord is celebrating after successfully challenging a £54,500 Housing Benefit overpayment bill from his council.

The demand was made in July when a ‘cousin’ of the tenant told both the council and the landlord that the tenant had left the property back in 2017 – and insisted the landlord had been informed at the time.

The council then revised the benefit award retrospectively for four years, creating a £54,000 overpayment.

UC Advice & Advocacy Ltd’s Bill Irvine (pictured) appealed against the decision, pointing out that the tenant had never notified the landlord and had even reported heating faults in 2018, allowed access to contractors and had continued to make top-up payments until mid-July 2018.

Irvine believes that the tenant probably handed the keys to a friend or relative who then occupied the property, knowing that housing benefit was covering most of the rent.

Legitimacy

“I questioned the legitimacy of the council acting on information provided by someone other than the tenant,” Irvine tells LandlordZONE.

“The cousin had no authority to act on behalf of the landlord, however the tenant had an obligation to report the fact he had left to both the council, as a recipient of housing benefit, and his landlord, as he had agreed to this under the terms of his tenancy.”

Councils will pursue landlords on the basis that they could have known about a tenant’s activities and if they’ve got other benefit-claiming tenants, councils can take money from their payments until the overpayment is cleared. The DWP encourages authorities to recover these and if they’re successful, will award them a bonus of 40% of the amount.

It’s a way of generating income, adds Irvine, who advises landlords to either challenge decisions themselves or get advice, particularly if the alleged overpayments are for more than a few thousand pounds. He adds: “While that challenge is ongoing the council will supress recovery and you’ve got nothing to lose. Every time I’ve challenged one, it has been conceded.”

Read more about other housing benefit fraud cases.

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EICR Inspection carried out by unregistered electrical contractor?

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I have recently applied for selective licensing as required by the council. After submitting relevant documents, the council have rejected the EICR as the contractor is not registered to carry out inspections, only domestic installation.

I have subsequently managed to verify this too with NICEIC who have asked me to supply them with a copy of EICR with their trademark to warn him not to use it for EICR

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INTERVIEW: The Instagram landlord couple with an unusual portfolio strategy

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If you think 30-somethings haven’t got a hope of establishing a property portfolio in today’s competitive and expensive housing market then a few minutes in the company of Terri Baxandall may change your mind.

She and her husband Will are about to buy their ninth buy-to-let and are hoping to give up their day jobs and become full-time property investors, developers and landlords within two years – which will be just shy of six years after setting off on their investment journey.

Their voyage from ‘zero’ to ‘hero’ will raise eyebrows among traditional buy-to-let landlords; they paid for a course via a property academy fronted by TV star Martin Roberts and use alternative funding sources to buy their properties.

Terri, 32, who works part-time as a dental nurse, says they paid a significant sum to complete the course after attending earlier introduction events.

Her partner Will, 33, works full-time in site management for a new-build developer.

“We didn’t have a passion or anything like that,” she says. “Instead, we went to a free two-hour seminar about investing in property and it grew from there.”

Terri says the courses cost ‘a lot of money’ but that she believes it was the best thing they ever did despite still owing money for the original training.

“I think now we wouldn’t pay to do the courses because there’s a lot more information available online that wasn’t available then,” she adds.

“But because the course cost so much, we thought ‘this needs to work’ and we committed to it more than we would have done otherwise.”

Northern venture

Originally living on the Isle of Wight, they moved to Portsmouth to get better jobs and buy their first home, but soon realised they couldn’t crack the city’s buy-to-let market.

They then made the bold decision to make their first investments in Rotherham and went there ‘every weekend’ in order to get to know its housing market and property professionals, later relocating to Newark (an hour away) as their portfolio grew.

“Our first Rotherham property cost £26,000 in January 2019 but it needed a lot of work, much of which we did after sacking the builder,” she adds. “But it made us appreciate the cost and speed benefits of doing our own refurb work. Also, we realised it meant we could buy properties other investors wouldn’t touch.”

Terri urges others not to think that she and Will have’ made money fast’ and to remember that education is key – both to get the model right and from a regulatory perspective – in order to have a ‘viable business’.

“You still need to know what’s going on,” she adds. “And ours is a long-term plan, not a get-rich-quick scheme; at the moment we put all our profits back into the business.”

The couple has also taken an unusual approach to finance. This has included buying properties, doing them up and then refinancing them but they also court private investors – and their social media fees on Instagram and Facebook plug their proven returns on investment.

“The people who lend us the money know, like and trust us, but it takes time to gather these kinds of investors around you, and to prove you know what you’re doing,” she says.

Terry and Will’s investment activities can be seen on their Instagram account.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – INTERVIEW: The Instagram landlord couple with an unusual portfolio strategy | LandlordZONE.

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‘Too few councils prosecuting criminal and rogue landlords’

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Councils’ failure to take action against criminal landlords risks damaging the reputation of the sector ever further, the National Residential Landlords Association (NRLA) has claimed.

Research gained via Freedom of Information Act requests shows that two-thirds of English councils have not brought any rogue landlord to book over the past three years, while 10% have secured a single prosecution.

The organisation also says there is ‘no clear link’ between a council having implemented a selective licensing scheme and increased levels of enforcement.

Instead, as LandlordZONE’s regular updates show and the NRLA’s research confirms, a core 20 councils are responsible for three-quarters of all rogue landlord prosecutions including three of the most prolific, Southwark, Birmingham, and Hull.

The NRLA also says the data shows that fewer than a thousand criminal landlords have been prosecuted since 2018, far fewer than the 10,500 that, in the past, Ministers have claimed stalk the sector.

Undermine

While the Government has pledged to publish a white paper on reform of the private rented sector next year, the NRLA is warning that a failure to enforce the wide range of powers already available to tackle criminal and rogue landlords will critically undermine further reform.

The NRLA is calling on the Government to provide councils with the multi-year funding needed to ensure they are properly resourced to take action against criminal landlords.

“The vast majority of responsible landlords are sick and tired of a failure to root out the minority who bring the sector into disrepute,” says NRLA Chief Executive Ben Beadle (pictured).

“The problem is not a lack of powers, but a failure by councils to enforce them properly.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – ‘Too few councils prosecuting criminal and rogue landlords’ | LandlordZONE.

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Opinion: Should landlords dive into heat pumps?

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The move to provide home heating and hot water by this method is part of a Government strategy aimed at making deep cuts to greenhouse gas emissions and decarbonizing the UK’s power sector by 2035.

Prime Minister Boris Johnson says the scheme was designed to bring low-carbon heat pumps to a similar price as gas boilers, currently the most widely used heat source across the country, but they are running on natural gas, a fossil fuel made mostly of methane.

Methane is harmful to the atmosphere and contributes to climate change. But what exactly are heat pumps and should landlords consider fitting them to rental properties?

An air source heat pump looks like a large air conditioning unit on the outside of buildings, and it works a like a fridge in reverse. It uses electricity (which costs more than mains gas) to extract energy from the outside air and warm it up with a compressor. It then pumps this heat through your radiators. A ground source system works on the same principle but it uses underground water pipes to extract heat from the earth.

They are said by some to be the frontrunner to replace gas boilers over the coming decades as the country moves towards net zero. The Government has set a target for 600,000 of the devices to be installed each year by 2028, while gas boilers will be phased out.

Its a controversial decision

The decision to push heat pumps however has proven controversial, with many homeowners and experts not supporting the upcoming gas boiler ban, and some experts doubting the efficacy of heat pumps, that’s according to research by home heating experts, “Boiler Guide”, a private network of both gas and heat pump engineers.

The Government’s drive to offer homeowners £5,000 to make homes more energy efficient by replacing their gas boilers with heat pump greener technology could leave landlords and tenants out in the cold, some experts have warned.

The grant is part of the Government’s plans under its Heat and Buildings Strategy with the “Boiler Upgrade Scheme” to completely phase out gas boilers by 2035. But there are detractors and it’s even been suggested that the move could result in another major mis-selling scandal.

Ministers have stressed that homeowners will not be forced to rip out their existing gas boilers, but will they will be unable to buy a replacement after that date.

It’s been confirmed that landlords and other home owners in England and Wales will be offered the subsidies of £5,000 from April to help replace old gas boilers with heat pumps, but the fund will be limited, and should landlords even consider the move?

Improving technology

The technology is evolving, likely to improve significantly and costs will fall in the coming years, but so far heat pumps have had a mixed reception. You only need to go online to see the negative comments and about poor experiences some people – the trailblazers of this technology – have had.

Here are some reasons why it would be prudent to wait before investing thousands into systems that might struggle to heat homes adequately:

1. The cost and payback periods are prohibitive. While a replacement gas boiler can cost you around £1,000 to £3,000, an air source heat pump comes in at between £6,000 and £13,000 to purchase and fit, while a ground source heat pump, recognised to be the more effective, can cost anything between £14,000 and £30,000.

Although the Government is offering grants of £5,000 to help people switch to heat pumps, it has earmarked just £450m to fund the scheme – it means only 90,000 homes will get funded.

2. If heat pumps do prove to be the better solution to providing alternatives to gas boilers, better technology will become available in the future. The Boiler Guide estimates that around 32,000 heat pumps were installed in Britain in 2020, well below the Government’s 600,000 target, and a drop in the ocean compared to the 1.6 million gas boilers fitted over that same period.

3. Heat pumps have widely different characteristics to gas boilers, being much slower to bring a home up to temperature. A heat pump will only heat the water to a maximum of around 65C, compared to the 75C of a gas boiler, which means that not only will they take longer to warm, people will need to get used to this lower temperature system. Some tenants will not adapt well, hence it could be a constant source of landlord-tenant friction.

3. Heat pumps prove inadequate in poorly insulated homes. Many rental properties are poorly insulated and even the best rarely meet the highest modern standards.

These devices work at lower temperatures, they will struggle to get and keep a house warm without top notch insulation and draft proofing. So any landlord contemplating one of these systems, if they want to avoid constant complaints from tenants, needs to consider the cost of thoroughly insulating the property first.

There are said to be around 25 million homes in Britain with inadequate insulation, many of which will be rentals, and bringing a poorly-insulated home up to scratch will cost thousands of pounds. For most people, that cost on that on top of the heat pump installation just does not make economic sense.

4. They don’t suit every situation. Most houses can find space for an air source heat pump, but flats may struggle to find the necessary outside space for the pump cabinet, which is quite large. Ground source heat pumps on the other hand require a suitable strip of land.

Heat pumps need a large indoor cylinder, something most modern houses have done away with when a combination boiler is installed. Most people won’t want to lose their shower to a heat pump cylinder! Small flats and even houses may lack the indoor space required for the hot water cylinder – a large closet type cupboard is needed. Also, because the system runs cooler, larger radiators are needed. These systems suit underfloor heating best.

5. Air source heat pumps are noisy. The outdoor cabinet houses a large electrically driven fan which generates a considerable amount of noise when working, especially in cold weather, and fans just get noisier as they age. This can potentially annoy neighbours.

6. Running costs and payback. The saving in gas usage is somewhat offset by the increased electricity bills – electricity is much more expensive than gas – so overall there may be little by way of running cost savings.

7. Being new technology, there are a limited number of firms and engineers with the right level of expertise both to properly survey a property and install a correct system, and repair it if it goes wrong.

There are many nightmare stories where an expensive heat pump system has been inadequately matched to the property, or it is unreliable, and where repeated calls for improvements fail to get met, and even instances where installer firm has gone bust in the meantime.

Fuel of the future

This all seems rather negative from me. Some people have heat pumps and they are very happy with them. But the must meet the exacting requirements discussed above.

Given time and experience heat pump technology will be refined and improved, but so far even Government ministers have admitted that they are “still in their infancy”. In the meantime, other forms of technology are coming along, such as Hydrogen (H2) gas and Bio-propane gas, which may eventually prove a better and cheaper option.

My advice to landlords would be to hold off until the dust settles. There’s still plenty of time to adapt your property before the boiler ban and your money is better spent in the meantime bringing your rental property up to modern insulation standards, your tenants will appreciate that.

I recommend you listen to this video by Martyn Bridges, Director of Marketing and Technical Support at Worcester Bosch Group

Hydrogen Boilers, Heat Pumps & The Future of Heating

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Opinion: Should landlords dive into heat pumps? | LandlordZONE.

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OFFICIAL: Post-ban ‘evictions tsunami’ has failed to materialise

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Landlord possession actions dropped significantly during the months after the bailiff eviction ban ended compared with pre-Covid times, new government figures show.

Despite warnings of a tsunami of evictions from housing and tenant groups such as Generation Rent, the latest Ministry of Justice statistics for July to September 2021 tell a different story after the evictions ban ended at the end of May.

Compared with 2019, landlord claims (10,202), possession orders (5,600), warrants (4,492) and repossessions (4,853) by county court bailiffs fell by 64%, 75%, 69% and 35% respectively.

The median average time from claim to landlord repossession has risen to 68.4 weeks, up from 20.1 weeks in the same period in 2019.

Private landlord claims account for the largest proportion of total landlord activity, with 43% in Q3 2021 compared with pre-Covid-19 trends where the majority were social landlord claims.

Across all regions

The fall in claim and orders volumes was seen across all geographical regions. As in previous quarters, there was a concentration in London, with 2,712 landlord claims and 1,537 landlord orders in the capital’s courts in July to September 2021, accounting for 27% of all landlord possession claims and orders respectively.

Despite this, there was still a fall of 59% (from 6,638) for landlord claims and a decrease of 67% for landlord orders (from 4,724 in July to September 2019).

The largest regional number of landlord warrants (1,410) was found in London, making up 31% of all landlord warrants. Despite this, there was a decrease of 60% in the capital (from 3,542 in 2019 to 1,410 in 2021).

The MoJ says it expects to see a continued increase in volume across all actions as the courts continue to manage the backlog while also dealing with new cases.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – OFFICIAL: Post-ban ‘evictions tsunami’ has failed to materialise | LandlordZONE.

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Landlords to be given access to HMRC experts during live tax webinar

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Landlords have few opportunities to talk directly to the government department that taxes them, but LandlordZONE readers will have a rare opportunity to do just that on November 30^th.

Our tax partner APARI is hosting a free online webinar at which representatives from HMRC will be on hand to take questions from those attending the event.

There will be plenty to discuss. HMRC recently pushed forward the implementation of its Making Tax Digital scheme which will see any landlord with a gross rental income of £10,000 a year (or £850 a month) move to quarterly rather than annual tax returns.

Not only will this require all landlords covered by MTD to begin digitising the way they collect and report their income and expenses, but for those who use accountants to file their tax returns, costs could also rise.

Higher costs

“Accountancy firms are trying to work out how they’ll charge landlords for their services as they move from a single annual tax filing event to five,” says Anish Mehta, UK Managing Partner at APARI.

“Landlords are going to have to be far more on the ball about keeping their records up to date, but there are easy to use tools for this.

“In return, they’ll be much more aware of their likely tax liability as each year progresses, rather than getting a surprise tax bill after the year has ended.”

Originally scheduled to go live at the beginning of April 2023, MTD was pushed forward a further 12 months.

Register for the free event.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Landlords to be given access to HMRC experts during live tax webinar | LandlordZONE.

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Council secretly votes through HMO planning restrictions following petition pressure

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Councillors at a London council have voted through two Article 4 Direction schemes to curtain planning rules for landlords seeking to convert homes to smaller HMOs, it has been reported.

Consultancy London Property Licensing (LPL) says Bromley council has, without any apparent publicity for the initiative, voted in both immediate Article 4 Direction planning restrictions for the conversion of single family properties into a small HMO with three to six occupants in the Biggin Hill and Darwin areas.

Councillors have also approved a second Article 4 Direction that will cover the whole borough from September 1^st next year.

This means landlords seeking to establish such HMOs will have to go through a review process via its planning department and a local consultation for local residents before permission can be granted.

Pressure on the council has been mounting following a local campaign by residents, 1,823 of whom signed a Change.org petition in April calling for the Article 4 Direction measures to be introduced.

“As the process currently stands no planning permission is required for HMOs [and] they are being set up in locations unsuitable and at the detriment to local residents who now face having multiple HMOs on their doorstep,” it said.

Although Article 4 Direction schemes are not unusual, but it is the way the borough has introduced both schemes has shocked Richard Tacagni, who founded LPL.

Little evidence

He has posted a detailed blog in which he reveals the council’s preparation to bring in the two schemes since May and its decision to ignore a report by its own officers that found there was little evidence to suggest a concentration of HMOs had caused any adverse impacts.

The report also said there was no ‘in-principle harm associated with HMOs’, adding that ‘there is currently little justification for putting in place Article 4 Directions to remove the C3 to C4 permitted development right, either borough-wide or in specific areas’.

Nevertheless, the council has ploughed on, but no press statements or updates on its website make any mention of the changes, or of the consultation on them that has now closed.

Read more about Article 4 Direction restrictions.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Council secretly votes through HMO planning restrictions following petition pressure | LandlordZONE.

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