Written By Em

Em Morley

Investment in student housing rises

Published On: October 21, 2015 at 11:47 am

Tags: housing investment,landlords,student property

New figures suggest that investment in the British student housing market rose sharply in the first half of this year.

Data from The Mistoria Group, a leading student property investment firm, reports that investment in this sector hit £3.98bn earlier this year, well more than the £2.35bn recorded in the whole of 2014.[1]

Increases

In the first half of 2015, London saw a new record-high of £1.98bn of transactions. This was a reflection of the number of investors buying into the potential yields of a well-maintained student home, as opposed to buy-to-let or commercial property.

Investment in the student sector in the North West has risen by 66% over the last 12 months, with the South East (65%) also showing considerable improvements.

Mish Liyanage, Managing Director of the The Mistoria Group, noted, ‘in some parts of the UK, student housing is limited in numbers and of poor quality, with only student pools and tatty HMOs available.’[1]

Investment in student housing rises

Opportunity

Liyanage believes that, ‘investors have a great opportunity to invest in Universtiy towns where there is short supply of quality, affordable student property. We have seen some investors divert a significant amount of their funds from traditional buy-to-let student property. For as little as £150,000, an investor can buy a four bed HMO in the North West, in a good location for students and professionals, fully refurbished, furnished and tenanted for the coming year.’[1]

‘A key driver for the rise in demand for HMO student property is down to the huge growth in student numbers over the last few years,’ Liyanage continued. ‘According to UCAS, the number of university applicants has reached a record high, as demand for higher education courses continues to rise. Figures published earlier this month reveal that overall there has been a three per cent increase in the number of applications, compared with the same point last year, he added.[1]

Concluding, Mr Liyanage said, ‘Investing in student accommodation offers an excellent long-term investment option. Typical rents are significantly higher for student properties, than a comparable buy-to-let property in the same city and student property is highly likely to be in constant demand throughout the calendar year.’[1]

[1] http://www.propertyreporter.co.uk/landlords/student-housing-market-hits-%C3%A3%C2%A2398bn.html

Would-be homeowners in Brighton worse off than London

Published On: October 21, 2015 at 10:49 am

Author: Em Morley

Categories: Finance News

Tags: first time buyers,homeowners,London,property market

An interesting new investigation has found that would-be first-time homeowners in Brighton are worse of than those in London.

According to a report from HouseSimple, a resident in the South-Coast city would need to save for over 104 years to reach the figure needed for a deposit, based on current average salaries and property prices.

Costly

The average cost of a home in Brighton currently stands at £350,522, with the annual salary in the area £23,488. With the size of loan needed and with savers typically putting 10% of their income away for a deposit, it would take more than a century to purchase a home in the region..

Londoners do not fare much better, with the survey suggesting it would take 97 years to afford a home in the capital. Both of these calculations give a snapshot at the wider picture, with first-time buyers becoming more and more priced out of getting onto the ladder.

Wannabe-buyers in other cities are also feeling the strain. In Bristol, Cardiff and Edinburgh, it would take 55, 49 and 41 years respectively to save the required deposit.

Would-be homeowners in Brighton worse off than London

Affordability issues

HouseSimple Chief Executive, Alex Gosling, suggests that, ‘affordability remains a major problem across the UK.’ He said that, ‘everyone knows that London is unaffordable for all but the rich or fortunate, but these figures highlight the plight of the average person looking to buy an average priced property in their local town or city.’[1]

‘The average wage earner is being priced out of their local property market and without a serious influx of new properties coming onto the market, that’s likely to continue to remain the case,’ Gosling continued.[1]

Hull came out on top as the best place to buy. It takes just 6 years to save for a deposit in the city, which was the shortest period of any of the 20 major towns and cities in the UK.

[1] http://www.cityam.com/226917/uk-and-london-house-prices-how-long-does-it-take-to-save-a-deposit-for-a-property-104-years-for-people-in-brighton

Right to Rent Checks in Force From February

Published On: October 21, 2015 at 9:59 am

Author: Em Morley

Categories: Landlord News

Tags: immigration checks,landlord immigration checks,Right to Rent,right to rent checks

All private landlords in England must make right to rent checks on their tenants from 1^st February 2016. The law was created to tackle illegal immigration, as landlords must ensure their tenants have the right to live in the UK.

You must make the checks if you are a private landlord, have a lodger, sub-let a property or are a letting or management agent working on behalf of a landlord.

Making the checks

Before you rent out a property, you must ensure that an adult tenant will live in the home as their only or main residence.
You must ask all tenants for original documents that prove that they have the right to be in the UK.
When the tenant is present, check the documents are valid.
Right to Rent Checks in Force From February

Then, make and keep copies of these documents and record the date you made the checks.

If a prospective tenant has an outstanding immigration application or appeal with the Home Office, you can request a Home Office right to rent check.

Tenants

All potential tenants seeking private rental accommodation will have their immigration status checked from 1^st February 2016. Those that sub-let rooms must make the checks on other renters.

Documentation

Landlords will need to see certain documents that show their prospective tenants have the right to be in the UK.

Acceptable documents include:

UK passport
EEA passport or identity card
Permanent residence card or travel document stating indefinite leave to remain
Home Office immigration status document
Certificate of registration or naturalisation as a British citizen

Stick to the law

Landlords that do not make the checks could be fined up to £3,000 if they let a property to someone who is in the UK illegally.

These checks have been introduced as part of the Government’s reforms of the immigration system.

Find out more here: https://www.gov.uk/government/news/right-to-rent-checks-what-they-mean-for-you

Are you ready for the checks?

Reducing Buy-to-Let Investment Will Harm Tenants, Warns Report

Published On: October 20, 2015 at 3:52 pm

Author: Em Morley

Categories: Landlord News

Tags: buy to let mortgages,mortgage market,property investment

Introducing measures to reduce the amount of investment in the private rental sector will only increase rent prices and harm tenants, warns a new report from the Intermediary Mortgage Lenders Association (IMLA).

Reducing Buy-to-Let Investment Will Harm Tenants, Warns ReportLenders Association (IMLA).

The study, entitled Segmenting the UK Mortgage Market, assesses key issues facing the main sectors of the mortgage market. The market divisions are: First time buyers, moving homeowners, buy-to-let investors, lifetime borrowers, remortgagers and further advances.

Analysing the possible effect of the buy-to-let tax changes announced in the summer Budget, the IMLA says the reduction in mortgage interest tax relief will push some landlords into making losses after tax and raise the effective tax rate on their investment above 100%.

The IMLA argues that this may switch the market in favour of owner-occupiers by cutting the price that landlords are willing to pay for a property.

However, the risk of these changes, and therefore greater buy-to-let mortgage regulation, is the reduced supply of available rental homes at a time when the population is growing and low housing supply is fuelling demand in the private rental sector. The IMLA also believes that institutional investment will not make up the difference.

The IMLA research reveals that total lending across the whole mortgage market this year was below its 2014 level for January to May. Since, there has been a sharp improvement, suggesting that 2015 will end up being a reflection of 2014.

The strongest recovery was in the buy-to-let sector. However, when compared to recent years, this is unsurprising. Between 2007-09, the market saw an 81% decrease. This compares with a 60% fall in remortgaging, 56% decrease in activity by home movers and 53% drop amongst first time buyers over the same period.

Buy-to-let lending levels remained 40% below the 2007 record in 2014. The IMLA believes that the market is responding to, rather than fuelling growth, in tenant demand.

Ex-footballers give squatters extra-time

Published On: October 20, 2015 at 1:02 pm

Author: Em Morley

Categories: Property News

Tags: homeless people,Homes,Manchester,squatters

Around 30 homeless people currently squatting in an empty property owned by two former Manchester United footballers have been told that they will be able to stay during the Winter months.

Old Trafford legends Ryan Giggs and Gary Neville are currently overseeing the renovation of the former Stock Exchange building in Manchester city centre into a luxury hotel.

Staying put

Human rights activist Wesley Hall, had a telephone conversation with Neville and was informed that the inhabitants could stay until February, when the building works are scheduled to be finished.

Mr Hall said that he was speaking to a developer working on the site, when he was given permission to speak directly to the ex-England full-back.

‘He spoke to me. He said look, I’ve not got a problem with you staying here, look after the building and respect the building,’ Hall said. He went on to stay that giving the homeless somewhere to stay was a, ‘lifeline.’[1]

‘These people aren’t getting a nourishing meal, their immune systems are low and they are dying. All it needs is someone to put a roof over their head and give them a bit of support,’ he added.[1]

Ex-footballers give squatters extra-time

Security

Hall went on to say that he was determined to adhere to Mr Neville’s request that the property and it’s inhabitants were looked after, saying, ‘we are going to do everything properly. We have already drawn up rotas for cooking, cleaning and staffing the gate. Everyone will be able to have their own room and each person will be able to lock their bedroom door.’[2]

‘We were expecting that as soon as Ryan Giggs and Gary Neville found out that we had occupied the building, they would try to get us evicted and that we would have to look for another building. Having a few months during the winter to work with homeless people without the threat of eviction hanging over our heads is brilliant,’ Hall continued.[2]

Concluding, Mr Hall said, ‘we undertake not to cause any damage to anything and to leave the building in as good if not a better state than we found it in. I have ordered smoke alarms to keep the building safe. I even suggested to Gary that he might be interest in employing some of the homeless people who are living here as labourers to help with the redevelopment work on the hotel.’[2]

[1] http://www.bbc.co.uk/news/uk-england-manchester-34569111

[2] http://www.theguardian.com/society/2015/oct/18/former-manchester-united-star-occupiers-of-hotel-winter-ryan-giggs-gary-neville

New Homes Fit for Human Habitation Bill to be Discussed in New Year

Published On: October 20, 2015 at 12:45 pm

Author: Em Morley

Categories: Landlord News

Tags: landlord law,private rental housing,rogue landlords

A private member’s bill that would allow tenants to sue landlords if their home is not fit for human habitation will return to the House of Commons in the New Year.

New Homes Fit for Human Habitation Bill to be Discussed in New Year

Labour MP Karen Buck introduced the Homes (Fit for Human Habitation) Bill proposal, but moved the second reading on Friday (16^th October 2015).

The bill will raise rent caps set in a law from 1885, which gives tenants the right to a suitable home, so long as their rent is not above the limits. At present, tenants have this right if they pay annual rent of £52 or £80 in London.

Buck addressed MPs: “If any hon members can find a property where the annual rent is less than £80, I am sure that millions of people across the country would be delighted to know where it is.

“Why is a change in the law necessary after all this time? Quite simply, renting is on the rise, dramatically so, especially in the private rented sector.

“As I have said, many landlords maintain their properties well and fulfil their obligations, yet the fact remains that standards in the private rented sector are poorer than those in owner-occupation.”¹

A Conservative MP and landlord himself, Philip Davies, opposes the bill, saying that MPs wish to “impose on landlords as though they have nothing to do but wade through legislation”.

He continued: “It is unnecessary for the House to keep passing legislation that affects landlords, because there is already lots of legislation that makes it perfectly clear that homes should be fit for human habitation.

“When this House adds more and more regulations, it does not achieve anything for tenants, because there are already rules and regulations in place.

“All it does is pass on a huge burden to landlords who have to work out whether they are complying with the law today compared with what it was yesterday.”¹

The debate was adjourned, but will continue on 29^th January 2016.

Do you agree with the new bill? Or would this impose too much on landlords that already fulfil its notions?

¹http://www.propertyindustryeye.com/mp-accuses-commons-of-dreaming-up-unnecessary-legislation-for-landlords-to-wade-through/