Written By Em

Em

Em Morley

Birmingham is the New London for Property Investors

Published On: January 28, 2019 at 10:57 am

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Categories: Landlord News

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Birmingham is the new London for keen property investors, according to Surrenden Invest, which has been advocating the qualities of the Birmingham housing market for years.

Now, with London house prices falling for the last two years, increasing numbers of property investors are looking to Birmingham for their next investment.

The leading property investment company has assessed the latest data from Nationwide, which found that house prices in London fell by an average of 0.8% in the year to December 2018, following a 0.5% drop in 2017. 

By contrast, Nationwide’s figures show a 2.9% increase in the average property value in the West Midlands over the year.

However, it isn’t just London’s declining house prices that make Surrenden Invest such an advocate of Birmingham; the team was shouting all things Brum from the rooftops long before the capital’s property market began to wobble.

Jonathan Stephens, the Managing Director of the firm, says: “This simple fact is: Birmingham is an amazing city that has an awful lot going for it. Its business community is thriving, and there’s a palpable energy when it comes to startups and entrepreneurs in the city. 

“Birmingham’s residents demand the very best, whether that’s cultural attractions, retail outlets or the restaurant scene – and that’s precisely what the city delivers. This is a modern metropolis that is drawing in new residents by the tens of thousands, and for very good reasons.”

According to the latest Office for National Statistics population growth predictions, Birmingham’s population is expected to increase by around 166,000 people between 2018-41 – a rise of 14.5%. This is another factor driving the new wave of property investor interest in England’s so-called second city.

The rental yields on offer in Birmingham are another reason that attention is moving away from London, Surrenden Invest points out.

Then there’s the overall impact of regeneration work on the city. Grand Central’s opening in 2015 marked a step change in the way that many people thought about Birmingham. 

Now, the £500m Birmingham Smithfield master plan is taking regeneration to the next level. The Head of City Centre Development and Planning, Richard Cowell, has hailed it “an example to international cities”, with residents set to benefit not just from a new market area, but also from a museum, hotel, culture centres, leisure facilities and a 24-hour gourmet food hangout.

Stephens believes: “This is the new face of Birmingham – and it’s leaving London looking old and tired. When it comes to UK property investment, Birmingham is the place to be.”

Will you be looking to Birmingham for your next property investment? 

Renting in Retirement could Boost Finances and Social Life for Retirees

Published On: January 28, 2019 at 10:03 am

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Categories: Tenant News

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Retirees are moving increasingly into rented accommodation

As people get older, their housing needs change. A family house can suddenly seem too big, too expensive to maintain or the stairs may become too tricky to manage. For these reasons and more, downsizing can make sense. Growing numbers of retirees are now deciding to rent their new homes…

Research from the Centre for Ageing Better reported that 414,000 older people now rent from a private landlord, which is up from 254,000 in 2007. It predicts that, by 2040, a third of those aged over 60-years-old could be living in private rental housing.

Girlings Retirement Rentals has recorded a year-on-year increase in the number of enquiries from retirees wanting to downsize and rent in retirement developments.

The benefits include the fact that the apartments are designed with older people in mind, they are located in secure, purpose-built developments, there is an on-site manager, and there is a ready-made community of similar aged people, providing social opportunities.

Gillian Girling, the Chief Executive of Girlings Retirement Rentals, says: “Last year, we saw a rise in the number of reservations. One of the reasons for this growth is the fact we offer assured tenancies for tenants, which gives them security of tenure for life if they choose – essentially the same level of security as homeownership.

“Most retirement developments are in convenient places, with good transport links, and shops and doctors’ surgeries close by. Renting also gives people financial freedom. They can budget a fixed amount of rent per month and, as there are no additional maintenance and service charges to pay, there are no surprise bills.”

Dorothy decided to rent an apartment in Hedingham Place, a retirement development in Sible Hedingham, Essex five years ago to be close to her children and grandchildren.

Since moving in, Dorothy has surprised herself by making strong friendships, including with Phil, who she met in the communal sitting room. Dorothy had been talking about Enfield in north London, where she used to live. It turned out that Phil had lived there, too, and they discovered that they had both lived in Norfolk, were avid Arsenal fans and even spent their honeymoons in the same hotel on the Isle of Wight!

Dorothy and Phil have since become firm friends. They have enjoyed spending time with each other’s families – Dorothy’s family has welcomed Phil, while Dorothy has travelled with Phil to Cambridgeshire to visit his daughters. Dorothy’s son even treated the pair to a trip to Emirates Stadium as a birthday surprise, as they are both such supporters of Arsenal Football Club.

Dorothy says: “Since moving into my Girlings apartment, I’ve been lucky enough to discover this wonderful friendship I never thought I’d find again. Phil and I have led similar lives and we like the same kind of things.”

Dorothy and Phil run a weekly bingo session in the lounge on Tuesdays, and enjoy regular activities and trips, including an annual Christmas dinner, as well as weekly coffee mornings and television afternoons in the lounge.

Dorothy rents on an assured tenancy, and says that she is there for life.

She adds: “There’s a lovely atmosphere here and everyone is easy going, and we all adore the development manager, who is very helpful. The location is great, we have everything we need in the vicinity, including a Co-Op over the road, and the minister of the local church often pops in and has coffee with us. I’m very happy living here.”

The Main Features that could Devalue your Property

Published On: January 28, 2019 at 9:16 am

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Categories: Property News

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Selling a property, whether you’re a landlord or homeowner, can be a stressful time. To ensure that you don’t fall at the first hurdle – when getting the home valued – we’re looking at the main features that could devalue your property.

Homeowners, especially, can be surprised at which features may devalue their properties. 

NAEA Propertymark (the National Association of Estate Agents) members have noted some of the main features that they’ve witnessed devaluing a property…

Over-personalisation

Of course, if you’re decorating your own home, it should suit your personal tastes. However, if your taste is particularly colourful or bold, then it might be worth redecorating before you start to market your property.

As landlords will know, modestly decorated homes are the most desirable, as potential buyers can easily see how their own belongings would fit into the space and how they could make it their own.

Condition

It might sound obvious, but the condition of a property is an important factor for buyers – particularly those who want a home that’s ready to move into, without having to spend too much money doing it up.

Issues such as damp, cracks in the walls, poor roof condition, an old boiler and single-glazed windows can all have an impact on the value of your property and potential interest from buyers.

Bad presentation

If you’re looking to sell a property, make sure that it’s presented in the best way possible. Everything should be clean, clutter-free and any DIY jobs completed. 

If a home smells fresh and clean, then it has a much greater chance of selling quickly.

devalue

Swimming pools

Although they’re great fun for a weekend or two in the summer, swimming pools in the UK aren’t usually considered an attractive property feature. They’re expensive to maintain, use up a lot of space and the Great British weather means that you can’t use them very often, making them more fuss than they’re worth and a turn-off to potential buyers.

If your property has an outdoor swimming pool that is run-down, then you might want to consider filling it in. If it is in great condition, then think about selling the property in the summer, when the pool is up and running, and looking its best.

Planning permission and building regulations

If you have had any works carried out on the property, such as extensions or conversions, then make sure that you obtained appropriate planning permission and building regulations, and have access to these documents.

If you don’t have the right documentation, then you may find that you have to pay for them retrospectively before agreeing a sale.

Dark rooms

If you compare two identical homes, but one is bright and airy, while the other is dark and dingy, nine times out of ten, the brighter one will be worth more, because it’s more desirable to buyers. 

If you’ve planted lots of bushes and trees close to the windows, these may affect what buyers think. Frosted glass windows and net curtains can also sometimes have the same effect.

Japanese knotweed

The invasive Japanese knotweedis more common than you think, and can damage the foundations of a property and significantly devalue it if it’s at risk of subsidence as a result.

If you think that you can see any in the garden, then call in a professional to excavate it as soon as possible.

Mark Bentley, the President of NAEA Propertymark, says: “The house moving process is undoubtedly stressful, so it’s important to know what could add value to your home and what might detract, or even completely put off, potential buyers. 

“Sometimes, the improvements and changes you have made might make the property less attractive to buyers, so, before you start marketing your home, it’s worth taking stock and making any necessary alterations to give you the best chance of securing your asking price.”

He adds: “You can ask friends or family for their honest opinions, or your estate agents can help advise on any small changes you may want to make before placing your home on the market.”

Landlords to be Legally Required to be part of a Redress Scheme

Published On: January 25, 2019 at 11:00 am

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The Secretary of State for Housing, Communities and Local Government, James Brokenshire MP, has announced that landlords will be legally required to be part of a redress scheme, or face a £5,000 fine.

The new Housing Complaints Resolution Service will be a single housing complaints service for all residents, including private tenants and homeowners.

The Government believes that it will make it easier for people to claim compensation when it is owed. It intends to work with key stakeholders to establish this, forming a redress reform working group.

At present, landlords in the private rental sector are not obliged to register with a complaints system.

However, under the plans announced yesterday (24th January 2019), it will become a legal requirement for private landlords to join a redress scheme, or they could face a fine of up to £5,000 for failing to do so.

The Residential Landlords Association (RLA) has outlined a number of concerns about the plans.

The organisation’s Policy Director, David Smith, says that the evidence that the Government has doesn’t support the need for the changes, and it appears that little thought has been given about how all of the new legislation will fit together and be enforced.

Landlords to be Legally Required to be part of a Redress Scheme

The RLA is also worried about the cost element.

Dr. Smith says: “It will be yet another cost and yet another layer of complexity, possibly with relatively little end product.

“We also need clarification on what the situation will be for landlords who use letting agents. Agents already have to be a member of a redress scheme – so landlords using them would be paying twice.”

No clear date has been set for the introduction of the new rules.

Announcing the plans, Brokenshire said: “The proposals I have announced today will help ensure all residents are able to access help when they need it, so disputes can be resolved faster, and people can get compensation where it’s owed.”

The new measures form part of the Government’s response to the consultation Strengthening Consumer Redress in the Housing Market. In this, the Government has outlined that, in the long-term, it has the “ambition” that there should be a single code of practice on complaint handling in the housing industry.

Since 1st October 2014, it has been a requirement for all letting and property management agents in England to be a part of a redress scheme.

Paul Shamplina, the Founder of Landlord Action, gives his thoughts on the announcement: “For the first time ever, private landlords will be legally required to join a housing redress scheme. Personally, I think this is a really positive step, not only in boosting protection for millions of renters across the country, but also for recognising landlord-ing as the professional business that it should be. 

“It will encourage landlords to focus on customer service and building relationships, as well as the quality of their properties, help to professionalise the industry, and provide a level playing field for landlords and tenants.”

We will keep you up to date on further plans to implement the new rules.

What’s in Store for Landlords in 2019?

Published On: January 25, 2019 at 10:36 am

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By Marc Trup, the Founder and CEO of Arthur Online

From the effects of Stamp Duty and mortgage tax relief, to the decrease in available rental homes, landlords in the UK dealt with various economic, regulatory and tax changes in 2018.

The year certainly brought some positive outcomes for landlords, with financial information group Moneyfacts reporting a five-year record low in the cost of buy-to-let deals in the final quarter of 2018 (despite a hike to the Bank of England base rate in August).

It’s unclear as to what exactly 2019 shall bring. However, by looking at the current political environment, as well as the regulatory changes set to be introduced, 2019 appears to have a lot in store for UK landlords.

As Brexit fast approaches, the potential for house prices to fall is an important concern for landlords. While those with well-established, well-capitalised portfolios will likely remain unaffected, landlords who are much more reliant on loans could struggle. There is potential that Brexit may see those such landlords have their income suddenly decrease, which could result in landlords cutting their losses and selling off any properties. Having said that, only time will tell just how exactly Brexit will impact the UK property market.

The Tenant Fees Bill, which has recently passed through the House of Commons, is likely to become law in June 2019 (subject to Parliamentary time). This Bill was introduced after reports of excessive overcharging by landlords to tenants and is expected to save tenants on average around £250 per month, by removing letting agent charges. For landlords, the Bill could make it much more expensive to use a letting agent, leaving some landlords no choice but to self-manage. Obviously, this isn’t an option for those who have made investments in areas far from where they live, for example, those London landlords who recently made an investment in northern hotspots such as Manchester and Liverpool. 2019 could, therefore, see UK landlords choosing to make more investments close to home, to help with the process of self-managing.

What’s in Store for Landlords in 2019?

Several regulations with aims to offer increased protection for UK landlords and tenants will be introduced in 2019. From April, property managers will be obliged to register with a CMPS (Client Money Protection Scheme), protecting money if a letting or property agent goes into administration. This aims to prevent money from being stolen or misused, including money relating to deposits, maintenance or rent. Letting agents who fail to sign up will face fines of up to £30,000. The Government is also offering protection for landlords and tenants through its new rogue landlord database. Although this was launched in 2018, it’s only in 2019 that this scheme is expected to start receiving entries. This will provide information available to the UK public, including details of which landlords have been convicted of letting substandard properties or flouting their legal obligations.

Protection for tenants will also come in the form of the Homes (Fitness for Human Habitation) Bill, expected to come into force on March 20th of this year. This will impact English landlords, who will have to ensure their properties are completely fit for human habitation throughout the duration of a tenancy. Tenants will have the right to take full legal action against landlords who fail to comply with the standards set out under the Housing Health and Safety Rating System. For landlords, the introduction of the Bill could mean higher costs if their property is not in an adequate state, for example, those who need to upgrade the energy efficiency of their property this year.

With the political and economic uncertainty of 2019, alongside several new regulations on track to be introduced, UK landlords have a lot in store for 2019. To help landlords focus on making the necessary adjustments in their portfolio, there is a range of property management software out there that can really help save both time and money. Keeping track of rent payments, changeover dates, outstanding property improvements and a heavy workload during peak times becomes a breeze when you have everything in one place and online. Different access levels for relevant information are available to student renters, contractors, your accountant and anyone else necessary to ensure the smooth running of your property rental business.

With new cloud-based technology, you can manage your investments from anwhere in the world, broadening the areas you may consider for investment, and opening the best opportunities from around the world.

Systems such as Arthur Online are entirely customisable. You can use them to remain in a central managerial position, while not actually being on the ground, as things like tenant check-in/out can be handled by local agents. You can arrange viewings, sign documents and assign workorders to contractors all through dedicated apps.

This new generation of prop tech is making the property sector more connected, ultimately helping investors manage and grow their portfolios efficiently and hassle-free, and giving them access to the most profitable opportunities.

Marc Trup is the Founder and CEO of Arthur Online

After selling his business to BUPA in 1998, Marc started investing in rental properties in London. Over the next 15 years, Marc grew his portfolio to over 85 properties. While successful, self-managing his portfolio became increasingly difficult. With technological advances and greater connectivity, he assumed there was software available that would allow him to manage his business from his smartphone, while sipping espresso at the local coffee shop. Following a long search, he found that nothing quite cut the mustard. So, being an entrepreneur, he started Arthur Online to make not only his life easier, but also that of other property managers.

Arthur Online is a cloud-based platform that enables property managers to respond instantly and solve problems fast from anywhere in the world, be it with tenants, contractors, property owners or letting agents. Since launching in 2015, it has helped thousands of property managers like Marc run their portfolios in the cheapest, most efficient way possible by using the full potential of new technology and cloud computing. Start your free trial today by going to: Rental property management software

Buy-to-Let Yields have Dropped to a 3-Year Low, Reports BM Solutions

Published On: January 25, 2019 at 10:02 am

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Buy-to-let yields for landlords have dropped to a three-year low, due to the effects of recent tax changes, according to the latest quarterly landlords panel by BM Solutions, covering the fourth quarter (Q4) of 2018.

The lender found that average buy-to-let yields have fallen to 5.6% on the previous quarter.

Those with large portfolios have been worst affected, with three quarters of landlords managing between 11-19 properties reporting a decline in profitability over the past three years.

Almost a quarter of buy-to-let landlords, especially those with larger portfolios, now plan to sell up and leave the private rental sector, with the research citing tax and regulation changes as the main reasons.

Despite that, some landlords are still planning to add to their portfolios, with one in seven investors preparing to purchase more properties.

The research also found that confidence among landlords in the UK financial market in the short-term has dropped by 8% year-on-year to just 9% – the lowest level in five years.

However, despite the decrease in their confidence levels, the majority of buy-to-let yields are still healthy, with 86% of landlords saying that they still make a profit from their property portfolios.

BM Solutions found that 31% of landlords make a full-time living from their lettings businesses, while 55% use their rental income to supplement their wages.

Phil Rickards, the Head of BM Solutions, says: “The buy-to-let industry has been through many regulatory changes over the past few years, and the effects of this are clearly being felt.

“However, the landscape is not entirely bleak. The proportion of landlords making a profit from their lettings activity remains at 88%, equalling the record high seen in Q3 2018.”

He adds: “It is clear that the market is sensitive to the current legislative and macro-economic environment, and this has been reflected in the latest findings.”

Landlords, have your buy-to-let yields dropped over the past year?