Written By Em

Em

Em Morley

Should You Let Tenants Decorate?

Published On: August 17, 2017 at 8:12 am

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Categories: Landlord News

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The question of letting a tenant decorate their rental property can be a dilemma for landlords. On the one hand, you want them to feel at home and personalise the property in the hope they’ll stay longer and look after the condition. But, on the other hand, you don’t want to be stuck trying to re-let a property that has been decorated with questionable taste! We asked Upad landlords if they let their tenants decorate a property; this is what they had to say:

Should You Let Tenants Decorate?

Should You Let Tenants Decorate?

“I would as long as there were no material changes to the property. I think it shows commitment on the part of the tenants and that they have pride in the property.”

“We once had a tenant and when she left, we saw the bedroom ceiling painted in a mish mash of blue and white. Then we realised when you lay on the bed she had painted clouds crossing a blue sky! We allow tenants to spruce up decor but now agree colour schemes beforehand.”

“Of course! If they make it their home, they will probably stay longer and have a better relationship with you. Although, make sure they let you know what colour they are going to paint it beforehand, make sure it’s all in keeping! And make sure they are using a professional, if it’s not good their deposit will be paying to rectify it!”

“Yes, because it will make them feel more at home and they’ll probably stay longer, but put some restrictions in e.g. no black walls. And if they don’t do it to a reasonable standard, you reserve the right to get professionals in when they leave to redecorate at their expense.”

“A resounding no. I had a tenant a few years ago who pleaded to personalise the house she lived in. She assured me the colour scheme would be tasteful. When she left I could not believe it! The palisaded Victorian semi had deep purple original coving; the dado rails and skirting boards, which were previously stripped and waxed, were white glossed and had smatterings of purple emulsion on them. I was horrified, that work had taken so long to do and the man-hours involved originally outweighed any deposit, but after all said and done, I had agreed. Never again.”

“We always allow tenants to redecorate. It is their home after all and we’ve found that tenants who decorate often look after the property and are better payers than others. They also tend to stay longer and that gives us greater continuity and fewer voids. We do prefer it if tenants decorate with pastel shades and paint rather than wallpaper because it’s easier to cover up when they leave, but we don’t really mind. We always freshly paint properties in magnolia, with white woodwork, ready for new tenants to move into.”

The overwhelming majority of landlords surveyed said they do let tenants decorate a property, but protect yourself with these top tips:

  1. Agree on the type of colour paint if you want it to be in keeping with the rest of the property. If this isn’t an issue for you, ask for the walls to be painted back to the original colour, or a neutral colour, before they leave. And make it clear that if it’s not returned as such, you will need to deduct the cost from their deposit.
  2. Make sure it’s written in the tenancy agreement, particularly if you’ve agreed a certain colour or paint type. If they do return the property with a bright green living room, you need written evidence to prove this wasn’t agreed. If you’ve agreed a décor change during the tenancy, create a signed addendum to the original agreement.
  3. Make sure you have a thorough inventory before they move in, as this will document any changes when they subsequently move out and will back up anything you’ve agreed in the tenancy agreement or addendum.
  4. Make it a condition that they use a professional to do the painting. A bad paint job will be time-consuming to rectify.
  5. Wait until the tenancy has reached six months and you are confident the tenants will be staying. Again, make sure anything agreed has been written and signed by both parties.
  6. Work with your tenant, agree as long as you buy the paint and brushes to ensure it will be a quality job. Help them pick the paint colours, or offer a range that you would be comfortable with but they still have the choice.

ICA-JL-VOTE-FOR-US

What are property hunters most deterred by?

Published On: August 16, 2017 at 2:04 pm

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Categories: Property News

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Interesting new research from national estate agent, Jackson-Stops & Staff, reveals a number of features that would put people off from moving property.

The survey of 1,000 people across England and Wales suggests 69% of property hunters would be unwilling to move in should the neighbours play loud music.

Deterrents

63% would not stand for neighbours who engaged in noisy activities, such as parties or DIY, three times per week.

Financial incentives would encourage some movers however, with 29% saying that they would put up with noise if they could negotiate on price.

Younger buyers were found to be more accustomed to noise and therefore be more accepting. Just 35% of 18-24 year old say that they wouldn’t move into a property should they hear loud bass. On the other hand, 86% of over 55s said they wouldn’t move into a property such as this.

Other main deterrents were found to be living close to a pub or nightclub, with 62% of respondents saying this would certainly put them off.

Noise from trains, planes and automobiles is far more accepted by buyers of all ages, than noise from their direct-neighbours.

What are property hunters most deterred by?

What are property hunters most deterred by?

Considerations

Nick Leeming, Jackson-Stops & Staff Chairman, noted: ‘Our research shows that while many sellers are primarily focused on what their house looks like when preparing it for sale, a huge consideration to potential buyers is the surrounding noise they may encounter on viewings. Next door neighbours making a racket with music, parties, drilling and similar activities is the greatest irritant to potential buyers and for many people will be an absolute barrier to buying that home. ‘Pleasant’ noise like church bells ringing or farmyard animals are most likely to be overlooked by house hunters entirely, proving that not all noise is vexatious.’

‘Our research also shows that noise blights generated by transportation links such as passing trains, aeroplanes and road traffic are far more acceptable to buyers, especially if they are able to get a discount on a home impacted by these. With the benefits of interconnectivity more recognised than ever before, the noises generated by transportation hubs are much more acceptable to those looking to buy a home in proximity to them,’ he added.[1]

[1] http://www.propertyreporter.co.uk/property/majority-of-house-hunters-put-off-by-loud-music.html

 

 

Research suggests student landlords could achieve yields of 12%

Published On: August 16, 2017 at 10:20 am

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A league table indicating in which cities landlord can enjoy the best returns on their student rental investment has been derived by Simple Landlords Insurance.

The insurance provider claims private rental accommodation in some university locations can provide yields of up to 12% per year.

Potential

In order to collate the table, the firm looked at the major universities as listed in the Complete University Guide, examining investment potential in every location.

St Andrews came out on top, with the chance of investors earning up to 12%. This was followed by Lancaster, Loughborough and Birmingham, with these locations offering the potential to achieve yields of over 10% for student landlords.

Other regions with the potential of substantial yields were Exeter, Durham, Sussex and Nottingham, with yields in excess of 9.5% per year.

A spokesperson for Simple Landlords Insurance said: ‘Unlike other studies, ours centred in on the house prices in the streets where students at each of the universities actually choose to live. It compared the cost of buying one of these properties with the rent that is actually paid by students studying at the establishments in question.’[1]

Research suggests students landlords could achieve landlords of 12%

Research suggests students landlords could achieve landlords of 12%

Returns

On the other hand, Oxford offered the lowest value of the universities covered by the study. Properties on a popular student area, Iffley Road, normally change hands for around £720,000. As a result, landlords can enjoy a yield of 3.33% – a high outlay for less lucrative returns.

The University of East Anglia in Norwich, Cambridge, Bristol and Surrey universities also feature at the bottom of the table.

The spokesperson concluded by saying: ‘One way to mitigate the risk is to invest in an area you know for a student you know – and we’re seeing more people with children at university choosing to invest and buy a property rather than see rent going down the drain.’[1]

[1] https://www.lettingagenttoday.co.uk/breaking-news/2017/8/league-table-claims-student-accommodation-gives-up-to-12-yield

 

Property Redress Scheme Membership Up by 33%

Published On: August 16, 2017 at 9:46 am

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Property Redress Scheme Membership Up by 33%

Property Redress Scheme Membership Up by 33%

Property Redress Scheme membership rose by 33% in the year from 2015 to 2016, shows its 2016 Annual Report.

The research also highlights a 40% increase in formal complaint notifications, which may be a result of the rise in members.

At the end of 2016, a total of 5,259 agent offices (31% sales and 79% lettings) had Property Redress Scheme membership, with a further 227 property professionals – such as inventory clerks – choosing to join the scheme to promote best practice within their organisations.

Total Property Redress Scheme membership currently stands at more than 7,000, with almost 700 UK Association of Letting Agents (UKALA) members now having access to Property Redress Scheme membership, following the announcement of a formal partnership in October 2016.

As well as growth in membership, the annual report also shows that the Property Redress Scheme has seen a 40% increase in formal complaint notifications. In the report, the Head of Redress at the organisation, Sean Hooker, acknowledges that this can be partly attributed to overall growth of the scheme, but he believes it also indicates an upward trend in consumer awareness of the complaint process.

The most common causes for complaints were property management (29%), deposits (27%) and problems with rent (15%). Service and fees both resulted in 6% of complaints. Tenants made the majority of complaints (51%), while 35% were made by landlords, 8% by leaseholders, 3% by buyers and just 1% by sellers.

The Property Redress Scheme awarded a total of £152,819 in compensation, with the average amount awarded being £375.27.

Hooker comments: “Although formal complaints have risen, so too has the number of complaints resolved at the early stages of our process. Around 40% of our cases are resolved at recommendation stage and 99% are dealt with in less than 90 days from receiving the initial complaint through to a decision.

“We continuously look at improvement and initiatives to increase the effectiveness and delivery of our service. We hope that the most recent introduction of our online complaint system will further reduce the average time to complaint resolution.”

Have you considered Property Redress Scheme membership?

ICA-JL-VOTE-FOR-US

 

Mortgage Lending Up on Monthly and Quarterly Basis

Published On: August 16, 2017 at 9:26 am

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The latest UK Finance data, for June 2017, shows that mortgage lending was up on both a monthly and quarterly basis.

Monthly figures

On a non-seasonally adjusted basis, UK Finance found that mortgage lending rose in June.

First time buyers borrowed £5.9 billion – up by 26% on May and 9% on an annual basis. This equated to 36,000 loans – up by 22% month-on-month and 6% on June last year.

Home movers borrowed £7.8 billion, which was up by 26% on the previous month and 15% on June 2016. This totalled 36,500 loans – up by 24% on a monthly basis and 9% compared to a year ago.

Homeowner remortgage activity totalled £6 billion in June – a rise of 5% on May and 7% annually. The number of remortgage loans reached 34,300, which was up by 5% on a monthly basis and 6% on June last year.

Gross buy-to-let lending totalled £3 billion – up by 3% month-on-month and 3% on June 2016. This equated to 19,700 loans – up by 3% on May and 6% on the previous year.

On a seasonally adjusted basis, lending to first time buyers and home movers remained relatively unchanged month-on-month, but there were increases by volume and value on an annual basis. Buy-to-let and remortgage activity remained relatively unchanged in June from May.

The proportion of household income used to service capital and interest rates continued to sit near historic lows in June, for both first time buyers and home movers, at 17.3% and 17.5% respectively.

Mortgage Lending Up on Monthly and Quarterly Basis

Mortgage Lending Up on Monthly and Quarterly Basis

Affordability metrics for first time buyers saw the average loan size increase from £137,000 in May to £139,000 in June. The average household income rose from £40,500 to £41,000 over the month, meaning the income multiple went up from 3.58 to 3.59.

The average amount borrowed by home movers in the UK grew to £180,000 from £177,000 in June, while the average home mover household income increased from £54,900 to £55,200, taking the income multiple to 3,39, from 3.37.

Buy-to-let activity was driven by remortgaging lending in June, which accounted for over two thirds of total lending. Buy-to-let house purchase and remortgage activity remained consistent with monthly levels seen since the change in Stamp Duty on additional homes, which was introduced in April 2016.

The Head of Mortgages at UK Finance, Paul Smee, comments: “June’s figures show a busy month in the mortgage market, with home movers having their highest monthly activity levels for over a year, and an especially high number of loans for first time buyers. Buy-to-let activity remains subdued compared to its 2015 peak, but consistent month-to-month since Stamp Duty changes in April 2016.

“But there are also signs of a softening market, and we are not anticipating that this performance will be sustained in the second half of 2017. A slightly lop-sided market could well show some growth in house purchase lending but alongside reduced remortgage and buy-to-let activity.”

Quarterly data

In the second quarter (Q2) of the year, homebuyers borrowed £34.4 billion – up by 18% on Q1 and 24% on Q2 2016. They took out 183,300 loans, which marks an increase of 16% on the previous quarter and 9% on last year.

Within this, first time buyers borrowed £14.8 billion – up by 18% quarter-on-quarter and 10% on Q2 last year. This equated to 91,400 loans, which was up by 15% on Q1 and 6% annually.

Lending to home movers totalled £19.6 billion, which is up by 19% on the previous quarter and 21% year-on-year. They took out 92,200 loans – up by 17% on Q1 and 13% on Q2 2016.

Homeowner remortgage activity totalled £16.9 billion – down by 11% on Q1, but up by 1% on a year ago. The number of remortgage loans stood at 96,600, which is down by 12% on a quarterly basis and 1% on last year.

Gross buy-to-let lending hit £8.4 billion, which was down by 6% on Q1 but up by 5% annually. This equated to 55,400 loans – down by 6% on the previous quarter, but up by 5% on Q2 2016.ICA-JL-VOTE-FOR-US

 

Buy-to-let mortgage rates are falling

Published On: August 16, 2017 at 8:51 am

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Categories: Finance News

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Good news for landlords has arrived with the news that buy-to-let mortgage rates are falling, with lenders competing with each other in order to provide the cheapest rates.

Recent figures from Mortgage Brain suggest that there have been further rate and cost reductions on many mainstream products during the last three months.

Falls

Data released by the firm shows that the cost of a two-year fixed buy-to-let purchase for both 60% and 70% LTV products is now 4% than it was in May. This amounts to a saving of £342 for a 60% LTV mortgage and £306 for a 70% LTV mortgage.

In addition, 60% and 70% two-year trackers are down by 1% and 2% respectively during the last three months.

A number of longer-term deals are now cheaper, with three and five year fixes at 60% and five-year fixes at 80% LTV, having reduced by 3%.

Buy-to-let mortgage rates of falling

Buy-to-let mortgage rates of falling

Favourable

Mark Lofthouse, Chief Executive of Mortgage Brain, noted: ‘Despite the forthcoming changes to buy-to-let lending, the outlook for investors at the moment is extremely favourable with buy-to-let mortgage costs coming down yet again.’

‘With changes afoot, however, this could soon change and it will be interesting to see how the buy-to-let story unfolds over the next three months,’ he added.[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2017/8/boost-for-landlords-as-buy-to-let-mortgage-rates-fall