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Em Morley

Main bugbears of tenants revealed

Published On: April 23, 2016 at 11:48 am

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A new survey from tenant servicing firm Tenant’s Plus has revealed the main bugbears of renters.

In the questionnaire of 597 tenants conducted by Angels Media, publisher of Letting Agent Today, problems facing would be renters were highlighted.

Issues

39% of tenants questioned said they miss out on up to five properties before signing a tenancy agreement. 32% of renters admitted to prioritising cost over location when looking for a new place to live.

Problem residential landlords, including those who failed to fix repairs promptly, created issues for a worryingly high 52% of tenants. Letting agents’ fees amounted to problems for 30%.

Only 13% said that their rental payments caused them issues.

Main bugbears of tenants revealed

Main bugbears of tenants revealed

Offenders

Wayne Treveil, chief executive at Tenants Plus, noted that, ‘despite it often being presented as such, it is not the agents and landlords that are the main offenders here, whose hands are being forced by regulation, but the successive governments that do not deliver on new housing promises.’[1]

‘There is an obvious need for the government to prioritise longer, more stable tenancies and to commit to building the genuinely affordable homes that young people are desperate for, particularly in London,’ Mr Treveil added.[1]

The report from Tenant’s Plus comes on the heels of further data that indicates rental costs for new tenancies in the UK have risen by an average of 4.9% in the first quarter of 2016. However, this data excludes results from the capital., where rents continue to soar still further.

[1] https://www.lettingagenttoday.co.uk/breaking-news/2016/4/letting-agents-fees-are-major-problem-for-30-of-tenants-claims-group

 

St George Leads the Property Market in the UK

Published On: April 23, 2016 at 8:20 am

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As it’s St George’s Day, what better time to look at how the property market in England differs to the other countries of our nation?

Although united as a nation, England, Wales, Scotland and Northern Ireland all have different patron saints, and very different housing markets.

While house price growth may not be the highest in England, values are. Prices are set to reach an all-time high in England, with the current average property costing £274,101, according to online estate agent eMoov. London remains the driving force in the market, however, reports suggest the capital is running out of steam. With London’s sky-high prices and a property boom in Midlands, it is no wonder that England has the highest prices. In the past year, prices have risen by 2%.

St George Leads the Property Market in the UK

St George Leads the Property Market in the UK

In second place is Northern Ireland and its patron saint, St Patrick. Of all the four countries, Northern Ireland has recorded the greatest annual house price growth in the past year, of 4%. The average price across the Irish Sea is £183,505.

Recently, the Royal Institution of Chartered Surveyors revealed that Northern Ireland should be expecting a rise in property sales in the next three months, reflecting the strong performance seen in the first quarter of the year. Although the firm believes that a drop in house prices and sales will hit the UK, as the EU referendum approaches, it is thought that this won’t affect Northern Ireland.

However, the forecast isn’t so secure for St Andrew and St David, the patron saints of Scotland and Wales respectively. Both countries have experienced a significant decrease in house prices from 2015-2016. Scotland is still slightly ahead, with an average price of £168,683, compared with £165,077 in Wales.

Despite this, Scotland has recorded the greatest decline in prices over the last 12 months, down by 6%. Although there have been plans for major developments by European firms within Scotland, there are signs that projects are being put on hold as the UK faces the June vote.

And although Wales has seen a drop in house prices, of 1%, it is much smaller than Scotland’s sharp fall.

The CEO of eMoov, Russell Quirk, says: “Although together we stand as one British nation, it’s interesting to see how the property markets across England, Scotland, Wales and Northern Ireland differ. With London the jewel in Britain’s property crown, England is always going to come out on top, but each country has its property pros and cons.

“It’s also interesting how uncertainty in the current market, with the recent changes to Stamp Duty and the approaching EU referendum, seem to have impacted each market differently.”

He explains: “Northern Ireland has enjoyed a stronger rate of growth than England, but Scotland seems to be suffering along with Wales, although the Welsh haven’t seen a drop in values to the same extent as the Scottish.”

New application to aid Right to Rent checks

Published On: April 22, 2016 at 1:34 pm

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A new application has been launched by the Residential Landlords Association (RLA) to assist landlords in complying with their Right to Rent obligations.

The Inventory Plus app has been created in order for residential landlords to create and manage their property inventories on any device.

Checking

RLA Inventory Plus allows landlords to store inventories and tenants are able to sign reports remotely. The application also includes prompts alongside useful legal and practical advice.

In addition, the application is designed to help landlords to keep on the right side of the law in regards to Right to Rent.

As part of the Right to Rent service, the application:

  • asks compliance questions and provides a walkthrough service
  • is compliant with Home Office Immigration Act 2014
  • avoids discrimination against legitimate tenants
  • has a proof of document approval process
  • sends email reminders prompting re-checks on time-limited tenants
  • produces a PDF report that can be downloaded or emailed
  • synchronises across desktop, tablet and phones
  • comes with unlimited reporting for just £12.50 per year
New application to aid Right to Rent checks

New application to aid Right to Rent checks

Confusion

Speaking at the Landlord and Letting Show at Aintree, Richard Abbotts of Inventory Plus said it was important for landlords to have this kind of service. Abbotts noted that tenants with time-limited visas in particular, ‘cause confusion and many landlords aren’t sure when to check.’[1]

Mr Abbots when on to say that there are, ‘many services online where you can buy fake driving licenses and even a fake HMRC certificate.’[1] The application therefore is programmed to check the authenticity in conjunction with the Home Office.

The RLA Inventory Plus application is available with a free 30 day trial. Further information on the application can be sourced by visiting www.rlainventoryplus.co.uk.

[1] Richard Abbots, Landlord and Letting Show, Aintree, 20.04.16

 

The Most Expensive Cities to Rent a Home Around the World

Published On: April 22, 2016 at 11:11 am

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While we may consider London’s housing crisis as severe, a recent study will prove that it is not the most expensive city to rent a home in the world. So which is?

The Most Expensive Cities to Rent a Home Around the World

The Most Expensive Cities to Rent a Home Around the World

The Global Cities Business Alliance has analysed average rent prices in cities around the world as a proportion of residents’ average wages, to determine how expensive it is to rent in these areas.

The study found that all of the 15 cities studied are struggling to develop sufficient affordable housing for their growing populations.

In at number 15, Boston is the only city on the list to have an affordable average rent – housing costs should be no more than 30% of income. With a typical cost of £1,075 per month, renting in Boston accounts for 29.8% of the average earner’s wages.

In Sao Paulo, renting costs £335 a month – 30.2% of net earnings. However, the cost of rental accommodation in the city has risen sharply in recent years. The average monthly cost of renting has surged by 33.8% since 2009.

In Sydney, an average rent of £775 will eat up 32.1% of a worker’s wage, while renting in Singapore, at £721, will take up 33% of your income.

The proportion goes up in Chicago, where an average home is £961 per month, costing you 35.6% of your salary. Parisians must spend 36.2% of their earnings on renting, at £614 a month.

In at number nine is London – the average rent of £998 is around 50.4% of a Londoner’s monthly salary.

Countdown of the most expensive cities to rent a home

[table id=8 /]

You might expect the city with the highest overall rent per month, of £1,970, to be further up the list. However, wages in San Francisco are lower, putting housing costs at 50.5% of earnings.

Those living in Dubai face paying 55.4% of their wages on renting, which costs £893 per month.

The lowest rents on the list, £269, are found in Mexico City. However, low wages in the area mean housing takes up a huge 58% of residents’ salaries. People in the city also face the longest average commute, at 113 minutes per round trip.

While a rent price of £361 a month might look cheap, renters in Shanghai must spend 58.3% of their wages on housing.

Renting a property in New York City will cost you £1,834 per month, eating up 63.1% of your earnings. This goes up to 64% in Hong Kong, where the average rent price is £1,347.

In second place is Abu Dhabi, where the cost of renting a typical property, £1,716, accounts for 69.5% of a worker’s salary.

But the top spot goes to Beijing, where the average cost of housing is an astonishing 122.9% of net earnings, pricing many people out of the city. While the average home costs £551 a month to rent – by no means the highest amount – low wages put the cost of housing at an unaffordable level.

Rental arrears rise to 9.1% in March

Published On: April 22, 2016 at 10:56 am

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A concerning new report from Your Move and Reeds Rains suggests that numbers of tenants in rental arrears is on the rise.

Data from the investigation shows that across England and Wales, the overall level of rental arrears is currently 9.1%. This is a slight rise from the 8.8% recorded in February.

Setbacks

More worryingly, the number of tenants in arrears has risen more substantially year-on-year. In March 2015, the arrears rate stood at 7.4%.

This said, looking longer-term, levels of rental arrears are more encouraging. The figure of 9.1% recorded in March is still small in comparison to the all time high of 14.6% of rent payable in arrears. This figure was reached in February 2010.

Director of Your Move and Reeds Rains, Adrian Gill, believes that landlords need tenants with good finances. Similarly, he notes that tenants need a property that they can afford. Gill said, ‘while there is always room for healthy negotiation on rents, both landlords and tenants need each other to reach a deal. So some of the language of confrontation between landlords and tenants is not healthy or constructive.’[1]

Rental arrears rise to 9.1% in March

Rental arrears rise to 9.1% in March

Answers

Continuing, Gill said, ‘for private renting to remain an affordable option and a high-quality home for millions, the answer is more supply and more choice. That means lifting the barriers to investment in property, rather than adding fresh penalties for landlords aspiring for their own financial security.’[1]

‘Good landlords also understand that their interests and the interests of their tenants are aligned-a tenancy should be a mutually beneficial deal. That takes expertise in managing a property and it takes commitment. The growth of private renting has changed society in terms of the number of people who are tenants, but it has also raised questions for those who now find themselves as landlords, either purposefully or in some cases through a relatively unplanned course of events. Managing properties well must include regular communication with tenants, to address concerns, arrange maintenance and to avoid the possibility of rent arrears,’ Mr Gill concluded.[1]

[1] http://www.propertyreporter.co.uk/landlords/rental-arrears-hit-91-as-tenants-feel-financial-pinch.html

Homeowners Welcome Stamp Duty Surcharge for Landlords

Published On: April 22, 2016 at 9:44 am

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More than twice as many homeowners (47%) support the 3% Stamp Duty surcharge for buy-to-let landlords and second homebuyers than oppose it (18%), according to a recent survey.

The study, conducted by YouGov on behalf of HomeOwners Alliance and BLP Insurance, found that the change is seen to support first time buyers and owner-occupier properties.

Those in the South West, where there is a serious shortage of affordable homes, are most in favour of the higher tax rate, with six in ten (59%) supporting the change.

Homeowners Welcome Stamp Duty Surcharge for Landlords

Homeowners Welcome Stamp Duty Surcharge for Landlords

On 1st April, the Government introduced a 3% Stamp Duty surcharge for those purchasing buy-to-let properties and second homes. The change was initially met with opposition from many groups.

Supporters of the surcharge believe the measure will help create a level playing field between those buying homes to live in and those purchasing an investment property.

One respondent to the survey says: “The buy-to-let market is slowly destroying the overall housing market and making affordable properties less available for those wanting to own a home as their principal place of residence.”

Some have witnessed a shortage of homes available for first time buyers, and hope that the Stamp Duty change will make it harder for landlords to purchase similar properties.

Additionally, buy-to-let landlords have been blamed for pushing up house prices and pricing local residents out of the housing market.

Some also believe that those able to afford a second home or investment property should be able to afford to pay a higher rate of Stamp Duty.

Those who oppose the surcharge suggest that the measure could have unintended consequences, such as higher rent for private tenants. Landlords also feel that the Government is making another tax grab at the buy-to-let sector.

One respondent states: “I have been saving for some time (five years) to be able to afford to purchase an investment property. This change has now meant that it is not feasible for me to do so. It is unfair to penalise people who work hard and save.”

Stamp Duty reforms for all buyers, introduced in December 2014, were also well received, with one third saying the changes make buying their first home or moving up the property ladder more affordable.

Furthermore, concerns over Stamp Duty have subsided significantly. In March 2014, it was found that two-thirds of UK adults (64%) said Stamp Duty was a serious problem, while the latest survey shows that just half (52%) regard Stamp Duty as a serious issue.

The Chief Executive of HomeOwners Alliance, Paula Higgins, comments: “The British public believe that homes are for living in and not speculating with. The Stamp Duty surcharge might be bad for landlords, but it will allow more young people to realise their dream of owning the roof over their head. This is why we initially called for the tax system to differentiate between aspiring homeowners and property investors. However, we must see the money raised ploughed back into building more affordable housing.”