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Em Morley

House prices rise by 5.2% in August

Published On: October 13, 2015 at 3:09 pm

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UK house prices rose by 5.2% in the year to August 2015, according to the latest House Price Index from the Office for National Statistics.

This figure was unchanged from the rate of increase seen in July.

Inflation

According to the report, annual house price inflation was 5.6% in England, 0.8% in Wales, 2.9% in Northern Ireland and -0.9% in Scotland. House price rises in England were driven by annual increases in the East of 8.8% and the South East of 7.4%.[1]

With the exception of London and the South East, UK house prices rose by 4.8% in the year to August of this year. When seasonally adjusted, average house prices increased by 0.7% between July and August.

In addition, the Index showed that first-time buyers paid 3.8% more for property than in August 2014. Existing owner-occupiers saw prices increase by 5.8% over the same period.[1]

Adrian Gill. Director of Reeds Rains and Your Move estate agents, notes, ‘the speed of house price growth across England and Wales may not be setting the world alight, but it’s certainly showing it has stamina-and continues to outdo rises in wages and consumer prices.’[1]

Rises

Paul Smith, CEO at haart estate agents, said that the data, ‘shows current occupiers have seen a near 6% annual increase in the value of their home on average. Based on the price of an average home according to our data, this amounts to about £12,700-or around half the average annual salary.’ He continued by stating, ‘while buyers may be tempted to hang onto their current property in the hope that the equity will increase further, for those upsizing the incremental increase in price on their next home will be even more substantial.’[1]

House prices rise by 5.2% in August

House prices rise by 5.2% in August

Smith also said that, ‘we are currently seeing a back-log in the supply of new homes and the mix of stock out there is not currently fulfilling the needs of the population. If people see that it may actually be disadvantageous to hold out on selling-up and moving on in the hope that house prices will increase further, we may see more home suitable for first-time buyers coming onto the market.’[1]

Healthy

Lora Roberts, portfolio manager at estate agent Ascend Properties noted that despite, ‘seemingly bleak figures on paper, both the sales and rentals markets are in good health.’[1]

‘On the surface, news that prices paid by first-time buyers are up 3.8% on the same day that inflation has been announced as turning negative again might appear bleak on paper but the reality is that we are seeing a healthy and fluid market across both sales and lettings. We are seeing signs of increased confidence across the board, with enquiries up for both segments of the market,’ Roberts concluded.[1]

[1] http://www.propertyreporter.co.uk/property/house-prices-gain-52-say-ons.html

 

Property Ombudsman offers competition law guidance

Published On: October 13, 2015 at 12:38 pm

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The Property Ombudsman scheme has provided a supplementary membership guidance note to assist letting agents in understanding their obligations under the revised Codes of Practice. This move has come to ensure compliance with the Competition Act.

Approved by the Chartered Trading Act, the revised codes came into effect on the 1st October.

Assistance

‘As part of the most recent Codes of Practice review process, we have produced further guidance in collaboration with the Competition and Markets Authority (CMA) to help support TPO members and improve standards within the industry,’ said Christopher Hamer, the Property Ombudsman. ‘This guidance note supplements section 3 of the TPO Code of Practice for Residential Estate Agents and has been drafted with the aim of ensuring agents do not compromise honesty in relation to the advertising of fees.’[1]

‘These guidelines come as a result of a well reported case that happened earlier this year where the CMA found that an association of estate agents and a newspaper publisher had entered into an illegal anti-competitive arrangement, breaking the competition. CMA imposed penalties of over £735,000,’ Hamer continued.[1]

Property Ombudsman offers competition law guidance

Property Ombudsman offers competition law guidance

Clarity

Ann Pope, CMA Senior Director of Antitrust Enforcement, added that, ’it is clear that some agents are still unclear how competition law applies to their business which is why we wanted this guidance to be disseminated widely. We wanted to assist agents and help the industry understand their responsibilities and what is seen as inappropriate practice.’[1]

‘In particular, we wanted to highlight that the ability of agents to advertise their fees or discounts freely plays an important role in stimulating price competition between competitors. If agents are prevented from advertising their fees or discounts in the media fee levels may be artificially inflated and owners are likely to find it harder to assess which agents offer the best value for money. It could also make it harder for new entrants to enter the market and compete effectively with established agents. Agents that continue to restrict their advertising of fees or discounts in this way are breaking the law and may face severe consequences,’ Pope added.[1]

[1] http://www.propertyreporter.co.uk/business/the-property-ombudsman-issues-competition-law-guidance-note-to-agents.html

 

 

Sussex Landlord Fined £4,000 for Poor State of Property

Published On: October 13, 2015 at 12:05 pm

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Sussex Landlord Fined £4,000 for Poor State of Property

Sussex Landlord Fined £4,000 for Poor State of Property

A landlord in Worthing has been fined over £4,000 for ignoring an improvement notice from the council.

Daniel Woulfe, of Rugby Road, pleaded guilty to dismissing the notice, which was served by Worthing Borough Council regarding the poor state of his rental property on Belsize Road, Worthing.

In October 2014, council officers inspected the ground floor flat, after the tenants complained. They discovered that the one-bedroom property did not have a working toilet, had penetrating damp, inadequate heating and poor fire protection.

An improvement notice was issued under the Housing Act 2004 in December 2014, however, despite continued assistance and advice being offered, Woulfe did not conduct the repair works within the specified timescale. Therefore, Worthing Borough Council prosecuted him.

On 2nd October 2015, Woulfe was fined £2,700 plus a victim surcharge of £120 and court costs of £1,194,34 at Chichester Magistrates’ Court. The charge totals £4,014.34.

Councillor Dr. Heather Mercer, Cabinet Member for Customer Services at Worthing Borough Council, says: “The shortage of private rented properties in the South East means that a minority of landlords attempt to take advantage of tenants by providing poor or substandard accommodation. Worthing Borough Council will always take action against such landlords, including prosecution as necessary.

“The fine imposed by the court shows that this is a serious issue and validates the actions taken by the private sector housing team to improve housing conditions.”1

1 https://www.landlordtoday.co.uk/breaking-news/2015/10/4-000-bill-for-sussex-landlord-who-failed-to-fix-toilet

New listings increase during September

Published On: October 13, 2015 at 10:53 am

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Would-be homeowners and buy-to-let investors have been encouraged with the news that more homes came onto the market in the UK during the last month.

Data from the report by HouseSimple indicates that across the UK, new property listings increased by 9.1% in the last month.

Increases

Between August and September, London saw a 27.1% increase, with supply in Kensington and Chelsea up by 122.2%. Camden also saw a significant rise of 95.7%.

Further north, Sunderland saw new listings increase by 46.7%, while in Cambridge, new homes on the market hit 35.5%. However, in Durham, supply dipped by 21.5%.

North of the border, Dundee recorded the highest number of new homes on the market in Scotland with a 171.1% hike in supply.[1]

After a quiet summer, where Britain faced a critically low level of housing stock, 60% of the 100 towns and cities covered saw an increase in new listings.

New listings increase during September

New listings increase during September

Scottish supply

The Scottish market saw a particular surge in new listings during September, with supply nearly tripling in Dundee. Aberdeen saw a 48.8% increase, while In Edinburgh, listings rose by 28.3%. Perth too saw a good increase, of 24.7%.[1]

London too saw a very good month, with the number of new listings almost hitting 25,000. Just two London boroughs, Croydon and Lambeth, saw a dip in supply.

Alex Gosling, Chief Executive of HouseSimple, noted that, ‘the current housing shortage in the UK has been a major contributory factor in rising property prices.’ He feels, ‘we are in the grip of a severe property shortage and if September hadn’t seen a spike in new property listings we really could have been looking at a full blown supply crisis.’[1]

‘Fortunately the September figures are far more encouraging. Almost 60% of UK towns and cities have seen stock levels rise between August and September. But it’s too early to breath a huge sigh of relief that a property crisis has been averted,’ Gosling continued.[1]

Concluding, he noted that, ‘stock reservoirs still remain dangerously low. September needs to provide the catalyst for the rest of the year. The housing market still has a long road to travel to rebalance supply and demand but these latest listings figures show that we are finally moving in the right direction.’[1]

[1] http://www.propertywire.com/news/europe/uk-new-homes-supply-2015101211079.html

Landlord Billed Over £400,000 After Renting Out Illegal Flats

Published On: October 13, 2015 at 9:34 am

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A landlord has been billed over £400,000 after illegally converting a property into flats and letting them out.

Landlord Billed Over £400,000 After Renting Out Illegal Flats

Landlord Billed Over £400,000 After Renting Out Illegal Flats

Gilbert Garrick rented the flats in West Norwood, London, despite being informed that he was breaching planning rules and breaking Lambeth’s planning policies.

He has now pleaded guilty in court and fined £30,000. He was also ordered to pay the council’s costs of £15,000 and issued with a confiscation order of £382,000 – the sum he had received in rental income from the illegal flats.

If he does not pay the charge within three months, he faces jail.

Councillor Matthew Bennett, Lambeth Council’s Cabinet Member for Housing, comments on the case: “Lambeth takes a hard line against rogue landlords who try to make a quick buck out of the housing crisis.

“This landlord will have to pay over £400,000 in fines and could face prison after ignoring the council’s early warning.

“Let this be a lesson to anyone else who thinks they can cheat their way to a profit – Lambeth will always pursue rogue landlords through the courts to protect our residents from exploitation.”1 

Garrick was originally served a notice demanding that he cease letting out the property as flats. He appealed against the notice, but after a lengthy public inquiry, the planning inspectorate dismissed the appeal.

However, the landlord continued to ignore the notice, causing council officers to seek a prosecution order for non-compliance. After several court hearings, Garrick eventually pleaded guilty and the case was referred to Croydon Crown Court for confiscation proceedings.

Once the sum is paid, around a third of the £382,000 will be given to Lambeth Council to fund further work in this area, and the rest will go to the Home Office and the courts.

1 http://www.propertyindustryeye.com/landlord-hit-with-bill-of-over-400000-after-letting-out-illegal-flats/

Right to Rent Checks Could Cause Racism Within the PRS

Published On: October 12, 2015 at 4:26 pm

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The Shadow Home Secretary, Andy Burnham, has criticised the right to rent checks that the new Immigration Bill could make law.

Under the scheme, landlords or their letting agents must check the immigration status of tenants or risk prosecution.

The bill will make it a criminal offence to let a private rental property to an illegal immigrant. It will require ongoing checks if a tenant’s right to live in the UK could change. The bill will also allow landlords to quickly evict illegal tenants.

Right to Rent Checks Could Cause Racism Within the PRS

Right to Rent Checks Could Cause Racism Within the PRS

Burnham, seemingly the first politician to address the potential problems with the scheme, which have been discussed for months within the industry, says the new measures could cause problems for “anyone with a foreign-sounding name”.

He describes the bill as “disproportionate, divisive and deceitful”.

He adds that the new document checks could become the modern-day equivalent of the ‘no dogs, no blacks, no Irish’ signs seen in windows in the 1960s.

Burnham accuses the Government of trying to legalise “everyday racism”1 in the housing market.

He calls for the Home Secretary, Theresa May, to revise the entire scheme.

Separately, the Equality and Human Rights Commission warns that the new quicker eviction process could leave families destitute and breach their human rights.

The Immigration Bill returns to the House of Commons tomorrow.

A Home Office spokesperson announces: “The Government has made clear that the right to rent scheme is about reducing illegal migrants’ access to services; it has never been targeted at people with a lawful right to be in the UK.

“Right to rent checks must be performed on a non-discriminatory basis – landlords are advised to check and record identity documents for all new tenants. Anyone who discriminates would be breaking the law.”1

Chairman of the Residential Landlords Association (RLA), Alan Ward, comments: “Landlords are rightly fearful of being caught out and also that they could be criminalised by the legislation which threatens a £3,000 fine or even prison.

“It is only natural therefore that they would choose the most readily compliant tenant, such as the one with a passport, which brings up the problem that 17% of UK residents don’t have a passport.

“The RLA has been pushing the Home Office for clarification about documentation and for councils to issue letters to benefit tenants showing their right to rent.

“This legislation is being pushed through even before the report on the West Midlands pilot scheme has appeared.”1

1 http://www.propertyindustryeye.com/right-to-rent-scheme-will-create-everyday-racism-in-housing-market-warns-andy-burnham/