Minister reveals bid to re-launch commonhold with help from new ‘industry council’

admin    Uncategorized     agents

The government has launched an initiative to re-ignite interest in Commonhold, the tenure introduced in 2002 by the then Labour government but which has failed to catch on.

Housing secretary Robert Jenrick (pictured) has announced a Commonhold Council which will be charged with reinvigorating interest in the tenure, which he says is a key plank in the government’s plans to give property owners ‘more control over their home and building’.

The announcement is one of the key recommendations into reforming property market made by The Law Commission last year.

Commonhold enables property owners, usually within apartment blocks, to take collective control of a building and take greater control of who manages it and the costs involved.

But the tenure has not taken off in the way many had hoped, largely because developers and freeholders find leasehold more lucrative via ground rents and other charges.

Also, commonhold doesn’t suit the many mixed-use developments that are being built these days and it hasn’t been supported by mortgage lenders.

To remedy this the Commonhold Council is to have representatives from many organisations within the property market.

This includes RICS, the British Property Federation, Building Societies Association, Federation of Private Residents’ Associations, Home Buying and Selling Group, Home Builders Federation, Law Society, campaigning Leasehold Knowledge Partnership and 12 others.

Rather oddly, though, no representatives from the property management sector are on the council.

“We are taking forward the biggest reforms to English property law for 40 years – and the widespread introduction of commonhold builds on our work to provide more security for millions of existing leaseholders across England, putting an end to rip-off charges and creating a fairer system,” says Jenrick.

Simon Law (pictured), Chairperson of the Society of Licenced Conveyancers, says: “We have long campaigned for reform of leasehold legislation and a move to widespread adoption of Commonhold in its place.
“It is greatly encouraging that the Government is now taking this seriously.”

Read more about the government’s plans.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Minister reveals bid to re-launch commonhold with help from new ‘industry council’ | LandlordZONE.

View Full Article: Minister reveals bid to re-launch commonhold with help from new ‘industry council’

LEGAL latest: Landlord’s cavalier approach to deposit ends up in court

admin    Uncategorized     agents

A prospective tenant has been awarded his holding deposit back by a First Tier Tribunal after realising the landlord had demanded too much money.

Student Oluseyi Aina agreed to take a room at a house in Southbridge Road, Croydon, after seeing an advert on spareroom.com.

Landlord Janice Oliver requested £300 as a holding deposit, which he paid by bank transfer, but then found out this was not allowed because the rent was £500 per month and the maximum permitted payment was £115.38 – one week’s rent.

Aina asked for a refund but Oliver told him she would only return £100 and would keep £200 as admin fees. She added that the property had since been let out by her husband. After the conversation, he had sought advice from the Shelter helpline.

Oliver told the court that Aina had difficulty in raising the money for the rent and that she decided to let the property out for a fortnight to give him time to do this.

Daily rent charge

Oliver indicated that a daily rent would be charged which would be forfeited if he did not take up the tenancy.

She said he told her he no longer wanted the property and suggested that he had made the application because she was unwilling to return the full sum of £300.

However, the tribunal ruled that: “A landlord must not require a relevant person to make a prohibited payment to the landlord in connection with a tenancy of housing in England.”

It said the payment of £300 fell within the definition of a holding deposit and that as it represented more than one week’s rent, the excess over £115.38 was a prohibited payment. The landlord and tenant had also failed to enter into a tenancy agreement before the deadline for agreement.

Read more about holding deposits and the law.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LEGAL latest: Landlord’s cavalier approach to deposit ends up in court | LandlordZONE.

View Full Article: LEGAL latest: Landlord’s cavalier approach to deposit ends up in court

LATEST: Landlords waiting 37 weeks longer to evict tenants, official figures show

admin    Uncategorized     agents

Landlord repossessions took an average of nearly 58 weeks in the first quarter of the year, up from 21 weeks during the same period in 2020.

The Ministry of Justice’s mortgage and landlord possession statistics report for January to March has revealed the true impact of the evictions ban, showing how landlord possession claims (6,377), orders for possession (5,427), warrants (2,480) and repossessions (262) by county court bailiffs have dropped by 74%, 72%, 80% and 96% respectively.

While the government this week announced plans to wind down the ban, which will see bailiffs restart their work on 1st June, it’s expected that it could take many months before the courts return to normal.

According to a recent report by LSE London, the courts are set to buckle under the pressure once the eviction ban ends with delays unlikely to reduce.

A fall in volumes was seen across the country but applications were focused in London, where 1,965 landlord claims and 1,152 landlord orders were made at the capital’s courts during January to March, accounting for 31% and 21% of all claims and orders respectively.

Local variations

Landlord repossessions were highest in Exeter with 22 per 100,000 households, but were mainly concentrated in the South East, followed by London, the West Midlands and the South West.

Private landlords made up the largest proportion of landlord claims (44% or 2,833), in contrast to the same quarter in 2020, when they made up 24% of all claims.

The report says timeliness is volatile for landlord orders, warrants and repossessions due to low volumes being processed. But it adds:

“This should be taken in the context of extremely small volumes and the invariable additional time needed where normal courts procedures could not be followed.”

However, Landlord Action founder Paul Shamplina tells LandlordZONE that the courts were already struggling prior to Covid.

He believes cases will ramp up and predicts there will be 150,000 possession claims made in 2022.

Shamplina adds: “It’s been horrendous for those landlords who have accumulated rent arrears – we’ve never seen so many cases where landlords are owed more than a year’s rent with very little likelihood of getting it back.”

Pic credit: Channel 5/DCBL Ltd

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Landlords waiting 37 weeks longer to evict tenants, official figures show | LandlordZONE.

View Full Article: LATEST: Landlords waiting 37 weeks longer to evict tenants, official figures show

Portfolio Landlords: Now is the time to sell your properties for the best price

admin    Uncategorized     agents

House prices are predicted by many to fall following the end of the stamp duty holiday and tax bills are high. If you’re a portfolio landlord, now could be the perfect window to sell part or all of your buy-to-lets

The post Portfolio Landlords: Now is the time to sell your properties for the best price appeared first on Property118.

View Full Article: Portfolio Landlords: Now is the time to sell your properties for the best price

Lack of new properties to let putting pressure on prospective tenants

admin    Uncategorized     agents

A slowdown in the supply of new homes in April has seen price growth accelerate across the UK, according to the RICS Residential Market survey, April 2021. Meanwhile, a lack of new properties to let has also put pressure on prospective renters.

The post Lack of new properties to let putting pressure on prospective tenants appeared first on Property118.

View Full Article: Lack of new properties to let putting pressure on prospective tenants

5 Top UK Buy To Let Property Investment Hotspots

admin    Uncategorized     agents

Where to find property investment hotspots for Buy To Let (BTL) in the UK.

In this video, I go through the top 5 Buy To Let Hotspots in 2021 and the number one best strategy to capitalise in hotspot areas.

The post 5 Top UK Buy To Let Property Investment Hotspots appeared first on Property118.

View Full Article: 5 Top UK Buy To Let Property Investment Hotspots

OPINION: Is banning Section 21 evictions a bridge too far for the government?

admin    Uncategorized     agents

In January LandlordZONE predicted that the Renters Reform Bill was to have been well on its way through parliament by now.

At the time, the government had been promising for month after month to fix the ‘broken’ private rental market.

Ministers had said repeatedly this was to be achieved through the Bill which would ban Section 21 evictions, give tenants more security in their tenure via longer contracts and make it easier to manage deposits, among other things.

But this week’s Queen’s Speech ‘kicked all of this into the long grass’, as one senior landlord figure put it to me; the government is starting from scratch with a White Paper in the Autumn, after which fresh proposals and legislation may be announced.

Landlords, letting agents and even tenants’ organisations are baffled by this – there have already been two consultations for the Renters Reform Bill, so who why do it all again?

The ‘real politick’ of this is that giving renters more rights sounds great during hustings but is very tricky to implement on the ground, whatever Shelter might say, and also expensive to police.

Keeping tabs on deposits and redress within the rental deposit can be done by people on call centres. Ensuring tenants are treated properly requires boots on the ground, knocking on doors.

Two-year roadmap

So action is to be delayed. And looking at the schedule, for some time. LandlordZONE estimates that if the White Paper is published in September, followed by a 12-week consultation and then draft legislation is laid in parliament in early 2022, it will take around nine months to make it to Royal Assent.

So late 2022 at the earliest, with implementation likely to take another 12 months to give landlords, agents and tech time to get ready (like the Tenant Fees Act did) – so a potential 28-month or two year roadmap, which would take it perilously close to the May 2024 election.

Most experts agree that the government will, instead, cut out all the difficult stuff like lifetime deposits and instead focus on balancing the rights of tenants and landlords so that renters get longer, more stable tenancies should they want them, and courts are given more discretion when granting evictions.

I suspect, as The Law Society has suggested, landlords will have to grant longer contracts, give tenants much longer notice periods when seeking to regain possession and even reimburse tenants should they wish to move back in or sell a property earlier than agreed.

On the other hand, tenants who deliberately dodge paying their rent, make too much noise or sell drugs from their front door, for example, will be ejected much more quickly and cheaply than now.

Unfortunately, we will have to wait another four months to find out.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – OPINION: Is banning Section 21 evictions a bridge too far for the government? | LandlordZONE.

View Full Article: OPINION: Is banning Section 21 evictions a bridge too far for the government?

Fad or the future? Letting agency reveals Bitcoin rent payments system

admin    Uncategorized     agents

Lettings platform Mashroom has begun allowing tenants to use cryptocurrency to pay their rent. 

The online agency now accepts Bitcoin and other cryptocurrencies which it processes through a crypto payment service, converts into pounds and then sends directly to landlords.

LandlordZONE believes Mashroom is the fourth major accommodation provider to accept cryptocurrencies. In 2015 agency RE/MAX became the trailblazer, followed by London BTR property developer The Collective and in February this year Essex estate agency PropertyVine.

Despite this slow adoption, Mashroom says virtual currencies are increasing in popularity, acceptance and use at many retailers and – with lower transaction fees – cryptocurrencies are often cheaper than standard credit card payments.

For customers, the process is like paying by card, where the financial exchange is taken care of by a secure third party, before being returned to the vendor. 

It adds that in the very traditional world of property, there has been a real boost in technological adoption, with many tenants and landlords now much more comfortable using online platforms.

The lockdown has also accelerated changes with an increase in video viewings and online signing.

Stepan Dobrovolskiy, Mashroom CEO and founder (pictured), says that as it’s possible to go through the whole process without stepping foot outside your door, the next logical step is to pay with digital currencies too. 

He adds: “For an increasing number of renters, cryptocurrency is the payment method of choice. With such a large demographic, we have to move with the times to avoid alienating anyone, and accepting crypto payments is the natural next step for a business in 2021.” 

Mashroom is encouraging tenants wanting to pay rent with cryptocurrency to encourage their landlord to sign up to the platform.

Read more about tech for landlords and tenants.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Fad or the future? Letting agency reveals Bitcoin rent payments system | LandlordZONE.

View Full Article: Fad or the future? Letting agency reveals Bitcoin rent payments system

Tenant on the run following ‘reckless’ attempt to implicate landlord’s partner in terrorist attack

admin    Uncategorized     agents

A tenant who tried to frame his landlord’s partner for the 2017 Westminster Bridge terrorist attack following a dispute over his tenancy has been convicted of perverting the course of justice.

Gerald Banyard (pictured), who lives in Lancashire, tried to implicate his Sussex landlord’s partner by sending package to police stations in Brighton and Eastbourne implicating him in the terrorist atrocity in London.

Although he has been convicted, Banyard did not attend his hearing at Southwark Crown Court this week and a warrant has been issued for his arrest.

His actions followed the attack by Khalid Masood during which he ploughed his car into pedestrians on the bridge and then killing an unarmed police officer outside the Houses of Parliament, Keith Palmer.

“Banyard looked to exploit an extremely tragic and serious situation to try and settle what was a private dispute with his landlord,” says Commander Richard Smith, head of the Metropolitan Police Counter Terrorism Command.

“His actions meant that counter-terrorism resources were diverted to investigate what turned out to be a completely fabricated story which implicated an innocent man.

“His actions were disgraceful and completely reckless.”

Innocent

After the packages were sent, counter-terrorism detectives questioned the landlord’s partner and confirmed he was completely innocent.

He identified Banyard as a possible suspect because he was involved in a tenant-landlord dispute with his partner.

A handwriting expert confirmed that Banyard had written the notes sent to police.

PIC Credit: Metropolitan Police.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Tenant on the run following ‘reckless’ attempt to implicate landlord’s partner in terrorist attack | LandlordZONE.

View Full Article: Tenant on the run following ‘reckless’ attempt to implicate landlord’s partner in terrorist attack

ADVICE: Rent arrears and the new ‘breathing space’ debt scheme

admin    Uncategorized     agents

The government has shown concern during the pandemic about people with debts they cannot immediately repay, but how does it work asks Tom Entwistle.

As the country continues on the way to recovery from the pandemic crisis, and is moving back to something like normality, many people are experiencing long-term debt problems.

As a way forward the government has introduced legislation designed to alleviate the pressure on these people and help them recover their debt fee position.

The Debt Respite Scheme (Breathing Space Moratorium and Mental health Crisis Moratorium) (England and Wales) Regulations 2020 were passed last November to help those people through the crisis who are in serious debt. It becomes effective from 4^th May 2021.

This situation could easily apply to landlords as to tenants, but it is something landlords and agents should be aware of should their tenants fall into this category.

There is some sensitivity around this matter as landlords and agents are not allowed to initiate conversations about an individual’s private affairs such their debt situation, but it is perfectly acceptable to respond if the tenant raises the matter.

It is also acceptable where, discussing other matters such as repairs, damages or rent arrears where this naturally leads to the tenants claiming that debt is the real issue. Advice can be offered and a knowledge of the various debt services can be useful.

Correct channels

This legislation covers all forms of debt, not just rent arrears but in order for a debtor to qualify for a debt ‘breathing space’ they must go through the correct channels, that is a FCA approved debt advisor, private advisory service, or a local authority debt advisory service.

The decision to offer a breathing space rests with the debt advisor though there are some mandatory eligibility requirements set in the legislation which are not open to discussion or negotiation.

Condition one is that the debtor can maintain the current repayment amounts as they fall due, though they are not in a position to address the existing arrears amount. The idea is that after the breathing space the existing debts will not be any larger that at the commencement of the breathing space.

Interest charges

The breathing space period will be reviewed at regular intervals and can be revoked if the debtor fails to maintain the current payments. No interest or late payment charges can be applied to the debts during the breathing space.

Condition two is that during the breathing space the advisor works with the debtor to plan a longer-term way of getting out of debt. The breathing space is designed to take the stress off the debtor in the short term, giving them the space to think, to plan and to act to reduce their debt position. During this period landlords and agents are not allowed to contact the debtor about debt repayments.

Landlords and agents are being warned in this regard not to send out letters or even standard letters that inadvertently make demands which go against the principle of the breathing space, adding more unnecessary stress for the debtor.

The “standard” breathing space lasts for some 60 days and during this time not only must the landlord or agent refrain from making demands, they are prevented from initiating eviction proceedings under Section 8 of the Housing Act 1988. Any proceedings under way at the time of the grant of a breathing space must be notified to the court. A section 21 application, unless it is motivated because of a debt, may succeed.

Only one breathing space is allowed within any 12-month period.

Landlords and agents are advised to consult with the debt advisor to make sure the whole of the debt is included in the arrangement.

In the case of a mental health debt breathing space, the request for this must originate from the mental health professional treating the individual. Unfortunately for the landlord intermediate payments during the mental health crisis would be suspended, but it is expected that mental health breathing space grants will be quite rare.

Read more about rent arrears.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – ADVICE: Rent arrears and the new ‘breathing space’ debt scheme | LandlordZONE.

View Full Article: ADVICE: Rent arrears and the new ‘breathing space’ debt scheme