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Em Morley

NLA Announces Recommendations for Government Autumn Budget

Published On: October 1, 2018 at 8:57 am

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The National Landlords Association (NLA) has responded to Chancellor Philip Hammond’s announcement about the Autumn Budget. It was recently stated that the Budget will take place on Monday 29th October.

The NLA has put forward the following recommendations:

  • The Government should immediately review the removal of finance cost relief for private landlords
  • A package of Capital Gains Tax reduction measures should be introduced, in order to encourage the sale of poorly performing investment properties, as well as properties where the proceeds of the sale will be entirely reinvested into the lettings business. It should also take into account properties that have been invested in, and utilised, for a period of more than ten years, and properties that are eligible and suitable for sale to existing tenants.
  • The Government should introduce measures in order to facilitate the tax-efficient movement of a letting portfolio into a corporate structure
  • It is also advised that it establishes and backs an investment vehicle that allows the sale of properties into a managed fund
  • Landlord’s Energy Saving Allowance (LESA) should be reinstated, and it should be established to a level sufficient enough to improve the tax efficiency of carrying out relevant works
  • The Capital Gains Tax surcharge for property sales should be removed
  • The Government should introduce Capital Gains Tax tapering, along with business asset rollover relief for let private residential properties
  • The Stamp Duty Land Tax (SDLT) levy on additional properties should be abolished

Meera Chindooroy, Policy and Public Affairs Manager at the NLA, has said: “We believe the Government needs to consider the implications of the policies they have introduced in recent years. Already we have seen landlords start to sell property, which only serves to limit the amount of choice available to renters and continue to make housing unaffordable.

“Landlords are running a business, but the Government refuses to acknowledge that and treat them appropriately. If they want landlords to continue to provide homes, and fill the gap in social housing, they need to properly incentivise landlords to remain in business.”

You can read the NLA’s full Budget submission for further details on its proposed changes.

Sheffield Landlords: Obtain a License Before it’s too Late!

Published On: October 1, 2018 at 7:59 am

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Sheffield Landlords

The deadline for a new selective licensing scheme in Sheffield, on the 1st of November, is coming round quickly.

Selective Licensing requires all landlords operating within a certain area to license any privately rented property within that area. The new areas introduced for Sheffield are on London Road, Abbeydale Road and Chesterfield Road.

Landlords will need to:

  • Apply and pay for a license for each property they let out in that area
  • Show that they (or their managing agent) are ‘Fit and Proper’ (such as appropriate management of the property, tenancy problems such as rent arrears or anti social behaviour, and repair and maintenance issues)
1st November brings around a new deadline for Sheffield Landlords

1st November brings around a new deadline for Sheffield Landlords

A spokesperson for Sheffield City Council said: “In the past three years the council has been working intensively in the London Road, Abbeydale Road and Chesterfield Road areas as a result of increased complaints and referrals.

“Landlords who the council understands own private rented property within the selective licensing area will receive a licence application form by post in August.

“If landlords who own property in the area do not receive an application form in the post, they should contact the council on 0114 273 4680.”

Councillor Jim Steinke, cabinet member for neighbourhoods and community safety, commented: “It’s our responsibility to make sure that all private sector tenants live in homes that are well-cared for and safe and that’s why this selective licensing scheme is so important – we’re asking landlords to apply for their licences as soon as they can so that things run smoothly for both landlords and tenants in the area.

“We’ve seen good progress with some landlords who have worked with us voluntarily to make significant improvements to the safety and standard of their properties.

“We want all properties out there to provide a safe environment, that people want to live in. No-one wants to be chasing their landlord every five minutes because the property they live in is not up to the mark.”

You can read about this particular licensing scheme, including a list of exemptions, in more detail on the Sheffield City Council’s website.

Labour ‘Hell-Bent’ on Dragging the UK Rental Sector Backwards

Published On: September 27, 2018 at 10:19 am

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Labour’s plans to scrap legislation permitting private landlords to evict tenants without reason has been criticised by a leading letting agency due to the adverse impact it would have on the private rental sector.

The party intends to abolish Section 21 notices, which enables a landlord to provide notice to their tenant to start the process of ending their Assured Shorthold Tenancy.

The proposal has been drawn up by John Healey, the shadow housing secretary, and would see a Jeremy Corbyn-led government change the law so that so-called ‘no-fault’ evictions come to an end.

Healey announced the policy at the party’s conference in Liverpool this week.

The shadow housing secretary also unveiled plans for a £20m fund to set up ‘renters’ unions’ to support tenants in disputes with landlords.

But the plans have been panned by Adam Male, Director of Lettings at Urban.co.uk.

He commented: “These latest initiatives seem hell-bent on dragging the UK rental sector backwards rather than forwards by following suit with the Scottish market in abolishing the Section 21 notice.

“This is yet another attempt to rebalance the scales of the rental market in favour of the tenant and a further attack on the buy-to-let sector which will be detrimental in the long run.

“The plight of UK tenants is one that needs focus, but the focus needs to be on creating a harmonious landscape that works for both tenant and landlord alike.

“The existing government already seems adamant that the issue lies with UK landlords and has made this clear through the continued implementation of restrictive legislation.

“If Mr Healey gets his way, he’ll further exacerbate the issues and ironically, won’t just be biting the hand that feeds UK tenants, but chopping it off altogether.”

Shortage of Homes Continuing to Drive up Rents in England and Wales

Published On: September 27, 2018 at 9:48 am

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The average rent across England and Wales has increased by 2.6% in the last 12 months, hitting an average of £861 per calendar month (pcm) in August, according to the latest data from Your Move.

London continued to post the greatest drop in rents in the last year, with the average rent falling 1.4% to £1,271pcm.

Two other regions, the North East and Wales, also saw rents fall during the same period.

Rent prices in the remaining seven regions rose, led by gains in the South West of England, the figures show.

“The South West of England once again saw rent growth outstrip all other regions, buoyed by the popularity of its rural areas and the attractive city of Bristol,” said Martyn Alderton, national lettings director at Your Move.

Regionally, the market remains strong, with demand in the core market of two- and three-bedroom properties remaining high, according to Alderton.

He commented: “It appears that there is less rental stock available this year compared to the same time last year. Whilst this could be the result of tenants staying in their rental properties longer or of landlords choosing to exit the market in light of recent legislative changes – it is also true that properties are letting more quickly than they were a year ago giving the impression of fewer properties available to rent.

“In our experience, demand has not slowed, and when a suitable property comes to market, it is soon let. It’s this tenant demand that invariably affects rental prices – more so in some regions than others.”

Unsurprisingly, properties in northern regions earned higher percentage returns than those located in southern areas.

The average investor in the North East enjoyed an annual yield of 5% in the year to August while in the North West this figure was 4.8%.

Landlords in London saw the smallest percentage returns, recording 3.2% during August.

Across all of England and Wales, landlords enjoyed an average yield of 4.4% in August, the same as in both June and July.

Alderton added: “Tenant finances and landlord returns have also remained steady, which suggests that landlords and tenants have reached a happy equilibrium on prices.

“Even for landlords in London, some areas of the capital city are still performing strongly.”

No Sign of ‘Mass Landlord Exodus’ From BTL Market

Published On: September 27, 2018 at 9:13 am

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Sheffield Landlords

Fears that regulatory changes will pave the way for an exodus from the buy-to-let market may be a little premature, according to Foundation Home Loans.

One year on from the introduction of tougher lending rules for portfolio landlords with four or more mortgaged buy-to-let properties, which made arranging the finances a little more arduous, many investors continue to invest in the buy-to-let sector.

Some people had anticipated a mass exodus of BTL landlords, but this seems to have been an exaggerated view of the market, according to Jeff Knight, marketing director for Foundation Home Loans.

He commented: “A year on from when the Prudential Regulation Authority’s (PRA) rules were introduced, it’s fair to say it hasn’t caused the mass exodus of landlords that some commentators widely expected.

“Naturally, there were concerns among landlords in the run up to the latest PRA rules, and landlords even said they thought it would be harder to obtain finance in the new regime. However, as with many things, it is often the fear of change than the actual change itself which is the issue.”

Recent research by Foundation Home Loans found that one in five – 19% – portfolio landlords intend to remain in the buy-to-let market indefinitely and on average, portfolio landlords expect to remain in the market for 15 years, compared to ten years for their non-portfolio counterparts.

But Knight accepts that there is still an adjustment to the new rules going on, as portfolio landlords often need to supply more information and documentation than in the past and with the full impact of PRA rules yet to be felt, which means that there is still some uncertainty.

Fire Safety Knowledge Improves but More Needs to Be Done

Published On: September 27, 2018 at 8:05 am

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According to recent research, Fire safety knowledge in the private rental sector has improved over the past 12 months but there is still significant room for improvement.

A survey by Horbury Property Services, part of the Horbury Group, to mark Fire Door Safety Week, found that 57% of respondents have not been given any fire safety information by their landlord, with just a third – 33% – having only “basic information” and 14% thinking information they were given on fire safety to be good.

Despite this lack of information, the survey found that fire safety knowledge improved – 68% of those surveyed knew that a fire door should be inspected every six months, up from 40% of respondents a year ago.

General Manager at Horbury Property Services, Richard Sutton commented: “We run this survey every year, with a number of different questions, yet we are always surprised at the results.

“This year, it was noticeable how much people actually know about fire safety and fire doors, compared with previous years. However, we are concerned how many fire doors were being used incorrectly, for example, by being propped open, which would make them ineffective in the event of a fire. This may have been due to bad habits during the warmer weather but is something that should not be done with any fire door.”

When asked what would make them feel safer to prevent fires, the top answer (45%) was tighter Building Regulations on fire safety, the second most popular answer was fire sprinklers (36%) and thirdly, more regular fire door checks (18%).

Although the survey revealed some faults with how fire doors are used, those surveyed seemed to be fairly confident about the building they work or live in is fire safe.

Many people also acknowledged the fact that fire doors play an important role in ensuring compartmentation of a building, enabling occupants to escape or be safe in the event of a fire.

Sutton added: “It was also interesting to find out people’s thoughts about what would make them feel safer in their buildings, with such high numbers mentioning Building Regulations, fire sprinklers and greater checks on fire doors.

“This was a very positive survey and showed just how much landlords, contractors and the general public do know about fire doors.”