Could the Conservative government be driving Landlords to the Brexit Party

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Dr Rosalind Beck wrote an article for Conservative home titled, ‘It’s not just EU policy that’s driving conservative voters towards the Brexit Party.’ Click here to view the full article.

In this article Dr Beck quotes that 40% of Tory councillors and 60% of Tory activists say they will vote for the Brexit Party and asks if Nigel Farage’s prediction of a realignment of British politics is that far-fetched.

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Protest with Care

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The European Elections are on us next week. If you wish to exercise a Protest Vote then do so with care.

If you wish to not vote for the Party you normally vote for that is one vote less for that Party!

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USB report: “Global property boom is over�

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Property Prices:

It is likely that the property market peaked last year, that’s
according to the multinational Swiss investment bank, USB. The bank predicts though,
that proving interest rates remain low, and cheap credit remains available, rather
than a crash, the property markets around the world are facing the prospect of
a gradual slowdown.

Slowing growth, high asset prices and increasing risks are
indicators of the final stages of the long recovery after the financial crisis
of 2008, warns USB.

Interest rates at near zero since the great recession have
served to keep property asset prices rising, but the signs are that buyers are
stretched finically, and investors are facing low returns, especially on prime
investment property.

“Prices have run out of room to grow in many parts of the
world in commercial and residential property, and the market cycle is thought
to have peaked around nine months ago, the investment bank says, according to a
report by The Daily Telegraph.

While interest rates remain at historically ultra-low rates,
USB suggests that a property crash can be avoided, further supported by a safer
banking regime following the experience of the credit crunch in 2008.

Historical Bank Base
Rates since 1970 – currently at 0.75%

Source: Trading Economics | Bank of England

Thomas Veraguth UBS’s chief investment officer, has said:

“In the past 50-60 years a typical cycle was
overheating, creating higher interest rates as central banks tried to cool down
the economy, and those financing costs killed the [property market] cycle.

“Now we are in a situation where interest rates are
very low, so what we think is going to happen is a much more gradual downturn,
so it is not a crash that we expect. We would really need a severe recession to
drive a big correction, but that is not our base case,” Mr Veraguth told The Daily Telegraph.

Most borrowers, including homebuyers and investors in commercial
property, already enjoy lower interest rates with their fixed interest mortgages
locked-in. This gives borrows some protection against a slump and helps support
the market.

High Street commercial retail property has already seen a substantial
decline in values as changes in shopping habits, including the growth of online
shopping, are bringing about structural changes.

USB forecasts that achieving a gradual slowdown will depend
on market conditions remaining, and borrowing costs low, but there are no
guarantees as central banks have already warned of higher interest rates.   

The International Monetary Fund has warned that housing
markets in some of the leading world economies are overvalued by up to 12%, leading
to fears that a rapid correction could lead to another property slump and a recession.

According to USB, Britain has some of the most expensive
property in the world, so predicts there is little room for growth, and indeed
there will most likely be a fall by “low single digits� in coming months, unless
there is a breakthrough with a Brexit solution.

Although undoubtedly property prices have been pushed to unprecedented
highs following the financial crises, due to ultra-low interest rates and quantitative
easing, cheap money has supported the market until now. Also, says USB, debt levels
secured on property, compared to total bank debt, and pre-crisis levels, is at
its lowest level for 17 years.

So far this year there’s been a slump in first-time buyers
taking out mortgages, numbers falling by 2.4% year-on-year, according to UK
Finance, and home mover sales have dropped by over 6%.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – USB report: “Global property boom is overâ€� | LandlordZONE.

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Tenant Fees Act 2019 – Elephant trap for the unwary!

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Landlords be warned – From 1st June 2019 if you take a holding deposit (which must not exceed one week’s rent) ahead of a new letting, the Tenant Fees Act 2019 says it must be repaid if you go ahead with the tenancy agreement.

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Section 21 Possession Surveys for landlords

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Section 21: 

Both the main landlord associations, NLA and RLA have
recently put out surveys asking landlords for their opinions on the proposed
removal of the Section 21 no-fault eviction process ahead of the government’s
consultation process. Make sure you have your say – see below.

Landlords need to have their say as their opinions are an important
element in influencing the outcome of the two association’s efforts in lobbying
Government on this vital issue.

Last month the Government announced plans to abolish Section
21, which the landlords’ bodies believe will have severe negative implications
for private landlords. The National Landlords Association and the Residential Landlords’
Association are both campaigning to make the Government change its mind, but to
do this they will need to understand what private landlords think about Section
21, the experiences they have had, and the effects its removal may have.

So far more than 6,000 landlords have responded to the
Residential Landlord Association’s survey asking what a post-Section 21 private
rented sector should look like – a record response.

The survey went live just days after the government
announced plans to axe Section 21 repossessions – so-called ‘no fault’
evictions – last month.

The responses to the surveys will be used by the NLA and the
RLA as the basis for their response to the government’s formal consultation
when it is launched – date not yet announced.

The RLA argues that it is vital landlords are confident that
they can swiftly and easily repossess a property for legitimate reasons such as
rent arrears, anti-social behaviour and needing to sell the property.

The RLA says that number of people responding to its survey,
which closes next week, has already broken the association’s previous record.

David Smith, Policy Director for the RLA, said:

“The scale of responses to this important survey shows the
strength of feeling in the sector.

“The survey closes next Monday, and we would encourage all
those who want the opportunity to have their say and shape the future of the
sector to take the time to respond.�

• There were 6,085 responses to the survey as of
  12 noon on Monday 13^th May 2019. The RLA’s previous biggest
  highest response was to its longer-term tenancy survey in July/August 2018.
  This secured 4,970 responses.
• The Residential Landlords Association represents
  the interests of landlords in the private rented sector across England and
  Wales.

The RLA’s survey can be accessed here:

https://tinyurl.com/y2hhxdhf

The NLA’s survey can be accessed here:

Section 21 – NLA Member Survey May 2019

The NLA are also running a postcard campaign to show the
Prime Minister directly the impact this will have on the market. It takes less
than two minutes to add your support to the campaign to #SaveSection21 –
details can be found here

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Section 21 Possession Surveys for landlords | LandlordZONE.

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2020 CGT changes and the implications of no PPR relief?

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We bought the property in 1988 for 79K. its current value is 500 – 550K. In 2011 I became ill and could no longer work so we rented out the property in Wokingham as it was cheaper to live on one salary in the north where we had bought another property.

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Short term finance to help landlords purchase and improve property

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Paragon is expanding its specialist buy-to-let mortgage range with new short term finance products for property acquisition and refurbishment.

The short term finance products are designed to help landlords planning to purchase and improve property, as well as those looking to upgrade already-owned property to achieve a better yield.

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Build Complete Apartments in Ilkeston – 1 beds from only £71,960

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Prices start from only £71,960 for a spacious, one bed apartment with secure parking, rising to only £85,596 for a two bed. We are delighted to have secured 20% off the list prices!

Leef Properties have given us predicted rentals PCM of up to £475 for a one-bed and up to £575 for a two-bed

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Tenancy deposit disputes being resolved before adjudication

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Early intervention between landlords and tenants across the UK is resulting in many more deposit disputes being resolved by agreement, without the need to go to adjudication according to Tenancy Deposit Scheme (TDS).

By law, each deposit protection scheme must offer free dispute resolution services for tenants

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The “evolving tenant� demands flexibility…

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Rental Management:

With Brexit on the horizon, landlords need to consider the
needs of the modern tenant, the “evolving tenant� as Sanjeev Patel, is managing
director of PPP Capital, terms him or her.

Writing for Property
Week, Mr Patel thinks that Brexit is having an impact in the rental as well
as the for-sale market.

Given the multifarious changes to the market: regulation
changes and consequent risk for landlords; slowing growth or in some cases declining
rental prices, dips in property values; possible interest rate hikes and the
return of inflation, with the consequent impact on landlords’ profit margins
and tenant affordability, and the uncertainty for EU nationals as tenants,
there are challenges ahead.

But, says Mr Patel, this turbulence can be an opportunity
for landlords who are able to “bring some stability to the rental sector and
move forward with the evolving tenant.� While we wait for the eventual outcome
of Brexit, landlords can take a responsible tenant-centred approach, an enlightened
approach which will benefit not only their tenants, but their businesses as
well.

Speaking from the point of view of an institutional investor
as MD of PPP Capital, his views are no less pertinent for small-scale or small portfolio
landlords who compete in the same marketplace.

Starting in 1971 as a standalone Confectionary, Tobacco and
Newspaper (CTN) store in Paddington, central London, PPP Capital now controls a
large international group with interests in real-estate development and property
management as well as retail and leisure.

PPP has been developing and renting property for over 15
years, but in the past few years, says Patel, “we have had to think more
creatively in the face of Brexit uncertainty about our approach to the evolving
tenant.�

Patel thinks he has found strategies in property management which
have proved effective in attracting and retaining good tenants, and he is confident
his approach will help PPP’s portfolio whatever Brexit brings.

Tenant’s Changing
Profile:

Many tenants are now pet owners, says Patel. “Landlords are
often reluctant to accept pets, but we give applying tenants the chance to
describe their pet before we decide whether to accept. We also suggest putting
a clause in the contract about having pets in the property. In our experience,
if we show flexibility and care as a landlord, we receive the same respect in
return.�

Mr Patel is a big believer in engaging in efficient two-way
conversations with his tenants: PPP uses property maintenance software that
updates tenants in real time. This, he says, makes tenants feel connected to
their landlord and eliminates rounds of calls or emails. It speeds up simple
maintenance requests, but also builds trust between both parties, he says.

This software enables a management company, tenants,
contractors and tradespeople to access a central hub, separately and
simultaneously making things easier for all involved. The digital maintenance
log created also helps the company to analyse costs and see if properties are
costing more than budgeted.

More tenants now enjoy the flexibility of renting and see
themselves as long-term tenants rather than homeowners. From the landlord’s
perspective, if this is achieved, it can give them longer term security, free
from expensive void periods. This type of tenant will generally show extra care
for the property, treating it more like their own home, and when they are happy
with the package as a whole, will stay for years. So, thinks Patel, “it is
often worth investing in some ‘extras’ such as smart home systems, underfloor
heating or safety features such as alarm systems and great outdoor lighting.�

Another innovative idea that Mr Patel advocates is giving something
back to the community; sponsoring local community initiatives, green initiatives
and giving to local charities, all helping to create goodwill between the
landlord, tenants and the community they live in.

Renters’ needs are evolving, says Patel, and tenants’
decisions to stay long-term are predicated on not just the basics that every
tenant would expect, but on a landlords’ attitude to the peripherals, such
things as diverse tenants and how responsible they are as a landlord.

“There are ambiguous times ahead, but private and corporate
landlords with mid-to long-term buy-to-let and build-to-rent properties should
remain very optimistic about the future… Let’s focus on the long-term yield
while doing our best to be responsible landlords with solid portfolios occupied
by respectful tenants.� says Mr Patel.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – The “evolving tenantâ€� demands flexibility… | LandlordZONE.

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