Housing market will be hit by strike action at Registers of Scotland

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Scotland’s housing market will slow down at a time when it is already facing delays after the Public and Commercial Services (PCS) union announced strike action.

That’s the view of DJ Alexander Ltd, the largest lettings and estate agency in Scotland.

View Full Article: Housing market will be hit by strike action at Registers of Scotland

Landlord deals to come under close scrutiny as cost-of-living rises bite

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Tougher checks on lending to buy-to-let investors are on the cards after the Bank of England warned it would scrutinise risky areas more heavily due to rising interest rates and a surge in inflation. 

It has told banks that lending to landlords and small businesses will face greater oversight, as well as borrowing on credit cards as it braces itself for a wave of defaults.

David Bailey, executive director at the Bank’s financial watchdog, the Prudential Regulation Authority, says lenders have already become more careful about their lending, however, he warns these measures were “untested under the current combination of risk factors”.

Robust practices

“Our assessment of firms’ credit risk management will include a focus on traditionally higher risk areas including retail credit card portfolios, unsecured personal loans, leveraged lending, commercial real estate, buy-to-let, and lending to small- and medium-sized enterprises,” explains Bailey.

He ordered lenders to be “ready for a prolonged period of credit stress” in a letter to bank chief executives. Bailey said: “The operating environment for firms remains challenging. The impact of increasing interest rates, inflation and high cost of living, geo-political uncertainty, and supply chain disruptions is expected to pose challenges to firms’ credit portfolios.”

Monthly repayments

The average buy-to-let two-year fixed-rate deal stood at 6% last month, according to the data company Moneyfacts, up from 2.89% a year earlier – adding around £389 to typical monthly repayments.

A growing number of those investing in property are women, according to data from HM Revenue and Customs which reports that they now make up 48% of the UK’s 2.7 million buy-to-let investors, up from 46% in 2016. The number of women who are residential property landlords has now reached 1.3 million, a 14% increase on the 1.1 million in 2016.

View Full Article: Landlord deals to come under close scrutiny as cost-of-living rises bite

Propertymark says banks are still misinterpreting AML rules

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Propertymark says that letting agents still face difficulties maintaining their pooled client accounts from high street banks that are still misinterpreting anti-money laundering (AML) regulations.

The organisation says it is regularly engaging with banks, industry bodies and government officials on behalf of members who have had accounts closed or restricted unnecessarily.

View Full Article: Propertymark says banks are still misinterpreting AML rules

House price crash ‘looks increasingly unlikely’

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After several real estate firms, lenders and property platforms predicted that house prices would fall in 2023 by up to 10%, one organisation says that a steep fall won’t happen for a range of reasons.

The National Association of Property Buyers (NAPB) says that a predicted house price crash for the UK ‘looks increasingly unlikely’

View Full Article: House price crash ‘looks increasingly unlikely’

Bank of England orders lenders to be ready prolonged period of credit stress

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Executive Director of the Bank of England financial watchdog, David Bailey, has warned that the Bank of England intends to increase scrutiny on lending to landlords. Bailey said: “Our assessment of firms’ credit risk management will include a focus on traditionally higher risk areas including retail credit card portfolios

View Full Article: Bank of England orders lenders to be ready prolonged period of credit stress

Beef up anti-social behaviour powers, government urged

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Private landlords should be allowed to apply for demotion orders ending a tenancy which deem a tenant ‘capable of causing’ rather than ‘likely to cause’ a nuisance, according to the NRLA.

It has written to housing minister Felicity Buchan reiterating its calls for the government to clamp down on anti-social behaviour in the PRS and believes the orders – currently used in the social sector – would be a good start.

Private landlords need to be able to repossess a property with certainty and where possible, without exposing other tenants to potential repercussions, says the NRLA. Social housing providers have powers to demote a secure tenancy where the tenant has been engaged in behaviour capable of causing a nuisance, rather than likely to cause a nuisance. The victims do not need to be named, which can be a particular problem in HMOs.

Clearer guidance

The NRLA says the threshold of being capable of causing a nuisance is lower, allowing for clearer guidance on what constitutes anti-social or nuisance behaviour. The courts must still consider whether it would be proportionate to grant a possession order.

Chief executive Ben Beadle believes the government’s existing plans to tackle ASB do not go far enough. In the letter, he adds that the government must also require the courts to prioritise possession cases in instances of anti-social behaviour, produce statutory guidance on low-level anti-social behaviour and the circumstances in which it is reasonable to grant possession and require local authority and police action on anti-social behaviour to be recorded on the Property Portal.

Landlord Action’s Paul Shamplina says landlords don’t have faith in the Section 8 discretionary grounds. “Anything that will make landlords’ life easier in gaining possession from anti-social tenants is a must, especially with Section 21 being abolished,” he tells LandlordZONE. “There should be a mandatory ground for anti-social behaviour – the biggest problem when evicting tenants is neighbours’ and co-tenants’ fear of violence and intimidation.”

View Full Article: Beef up anti-social behaviour powers, government urged

Experts join forces to share knowledge and raise redress standards

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The Property Redress Scheme’s (PRS) advisory panel has chosen experts from across the sector to join its new member panel.

The UK’s largest lettings redress scheme, covering more than 13,250 letting agency branches, launched the panels as new, open, and transparent forums to benefit members, consumers and the scheme itself.

It asked for applications from PRS members to strengthen its governance and accountability and held its first advisory panel meeting at the House of Lords in December, when all attendees agreed with the terms of reference, which can be found on the PRS website. 

Provide feedback

Sean Hooker, head of redress at the PRS, explains that it recognises its members’ expertise and wants them to provide feedback, guidance, advice and support. “The member panel gives them that opportunity as well as enabling them to engage with other panel members to share knowledge and raise standards.”  

New chair, Eric Walker, MD South and Scotland at Martin & Co, says as a previous member of the advisory panel, he has maintained a keen interest in the growth of the scheme. “I support the excellent work they do in improving standards in the sector and supporting both agents and consumers through the complaints and mediation process,” says Walker.

Key strategy

Tim Frome, MD of HF Resolution, which owns the PRS, adds: “Our new member panel is a key part of our strategy for improving our offering to ensure we are not acting in isolation from the sector we represent. We want to know more about how redress works for our members – and how we can make it better still in the future.”

The new members are: Eric Walker, Martin & Co (chair); Nasar Hussain, Westbrooke, Rory Ballantyne, Ballantynes Scotland Ltd, Sara Morton, S.A Morton Real Estates Ltd (estate agency); Anthony Cicchirillo, Anthony Lettings Limited, Bruce Haagensen, Keystone Estate Agents Ltd, Leona Leung, Alliance Finance Consultants Ltd, Mark Lynch, Lexi Lets Ltd (lettings and property management); Lisa Williamson, No Letting Go, Simon Zutshi, Property Investors Network (property professional); Attiq Khan, NRG Consultant Group Ltd (property sourcing); Helen Macrae, Evolve Block and Estate Management (residential leasehold management).

In 2022, the PRS dealt with approximately 2,000 complaints from tenants, landlords, property buyers and sellers and awarded nearly £850,000 in compensation to consumers in early resolutions and scheme decisions.

View Full Article: Experts join forces to share knowledge and raise redress standards

Have you reserved your spot yet for the Virtual Property Exhibition?

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If you need help untangling the confusing mess of the UK economy to understand how 2023 can either help or hinder your property investment goals, the Virtual Property Exhibition is THE PLACE to be. Friday 13th January 9:30am to 5pm.

View Full Article: Have you reserved your spot yet for the Virtual Property Exhibition?

Bid to ditch stamp duty benefit for BTL investors thrown out by MPs

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MPs have voted against an amendment to prevent a tax cut from applying to buyers of second and additional homes.

During a debate on the Stamp Duty Land Tax (Reduction) Bill, Opposition Treasury Secretary Abena Oppong-Asare said that a clause which increases the threshold for people buying second and additional homes, would ensure that second home buyers, or landlords buying additional properties, received a tax cut of up to £2,500 on each transaction.

“Surely that is the part of the Bill that ministers must struggle hardest to defend,” she told the Commons. “Even if the government are determined to retain stamp duty cuts overall, surely they can see that a cut targeted at second home buyers is not the way in which public money should be used.”

Residential transactions

Financial Secretary Victoria Atkins reported that there were about 1,025,000 residential transactions in the year 2020-21, of which about 237,000 related to additional property transactions, which includes not just second homes but also buy-to-let properties.

“The Opposition amendment would remove purchases of additional property from the scope of the Bill and the temporary cut to stamp duty land tax, which we argue would have an impact on rental supply and, in turn, tenants. Through the 3% surcharge in the Bill, we are ensuring that those who purchase additional homes – in other words both landlords and those purchasing second homes – will still pay stamp duty.”

Further constraints

Atkins added that the 4.4 million households in the rental sector remained a vital part of the housing market. “We must therefore ensure that the measures we take do not imperil or endanger that market, particularly when households are struggling with the cost of living. Further constraints on rental supply will mean higher costs for tenants.”

The Bill cleared its third reading – increasing the threshold for not paying stamp duty from properties worth £125,000 to those worth £250,000, which is due to end in March 2025.

View Full Article: Bid to ditch stamp duty benefit for BTL investors thrown out by MPs

Petition calling for landlord tax relief to be reinstated hits 20,200 signatures

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A petition that was launched to reinstate tax relief allowing a landlord’s mortgage interest to be set against rental income has now reached 20,201 signatures – and has seen another well-known backer step forward.

The petition was started by landlord Simon Foster who says: “We want the Government to reinstate the ability of landlords to set the full amount of mortgage interest against rental income before tax is calculated.

View Full Article: Petition calling for landlord tax relief to be reinstated hits 20,200 signatures