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Em Morley

Retiree landlords bad news for tenants?

Published On: September 10, 2015 at 11:59 am

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The start of the new financial year saw a surge in the number of retirees investing in buy-to-let property, in a bid to gain better returns on savings.

Boom

Letting agents have reported a large level of interest from first-time landlords who tend to be of retirement age and are buy-to-let investors. A recent survey of 20,000 households has indicated a steady increase in the proportion of savers looking to use a buy-to-let investment as a means of funding their retirement years.

Data from the Office for National Statistics shows that 42% of respondents think that investing in property is the secret to secure the largest possible retirement fund. This percentage was up from 32% in 2010.[1]

However, many of these retiree landlords have either limited or no experience of dealing with tenants, thus share many characteristics of accidental landlords.

Concern

‘Many retirees are finding they can easily use equity in their residential property or money from a pension pot to fund a deposit. They can also claim tax breaks on mortgage interest and other expenses, so buy-to-let is very appealing,’ commented Peter Armistead of Armistead Property. He believes that the inexperience of retiree landlords will see many tenants getting a raw deal.

Mr Armistead said many of these landlords are, ‘inexperienced in the rental market and may be unaware of the legal, financial and duty of care responsibilities they face. There is a myriad of legislation governing tenanted properties and it is very easy for the uninitiated to fall foul of the law.’[1]

Retiree landlords bad news for tenants?

Retiree landlords bad news for tenants?

Tasks

‘For example, boiler and gas appliances checks need to be done annually for rental properties. Landlords also have a legal responsibility to minimise fire risk with the installation of fire alarms; provisions of fire proof furniture and fire extinguishers; and accessible fire escapes,’ Armistead continued.[1]

Concluding, he said that unless some retiree landlords, ‘take a professional and well informed approach to letting property, it is likely that the quality of accommodation, property maintenance, safety and communications with the tenant will be substandard and may put lives at risk.’[1]

‘Retiree landlords need to take their responsibilities seriously and get expert help to manage their properties. This will ensure they are compliant with all of the legal requirements and that their tenants are managed professionally,’ Armistead added.[1]

[1] http://www.propertyreporter.co.uk/landlords/are-retiree-landlords-bad-news-for-tenants.html

 

 

House Price Growth in All Regions, Reports RICS

Published On: September 10, 2015 at 11:33 am

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House prices are rising in every region of the country, reports the Royal Institution of Chartered Surveyors (RICS), with the trend set to continue.

The RICS monthly residential market survey also found that new buyer enquiries grew for the fifth consecutive month in August.

It adds that after a “sustained period of easing” towards the end of 2014, house price growth has now quickened consistently for the past seven months.

The strongest growth was experienced in East Anglia, Northern Ireland and Yorkshire and the Humber. However, the report adds: “The vast majority of areas are seeing a sizeable increase in values.”

House Price Growth in All Regions, Reports RICS

House Price Growth in All Regions, Reports RICS

Terry Brannen, of Brannen & Partners in Newcastle, reported to the RICS: “Strong sales figures for this time of year proves confidence is still present in the marketplace.”1

Alex McNeil, of Bramleys in Huddersfield, claimed: “Market activity has been maintained during the summer months with stock levels gradually dwindling. The sustained demand has been a recipe for capital growth.”1

The study says that once again, house price inflation is the result of the lasting trend of declining new sales instructions and increasing buyer demand. It predicts that prices will rise by 6% over the rest of the year.

Chris Beeby, of Bletsoes estate agent in Thrapston, Northamptonshire, told the RICS: “A real lack of fresh instructions still stifling the market. Looking forward to the end of the holiday season and hoping for a good autumn market.”1 

New vendor listings dropped for the seventh month in a row, although the rate of that decrease seems to be falling moderately.

This means that there has not been a marked rise in monthly new instruction levels since mid-2013, causing average stock levels to drop to record lows.

The study found that regional sales varied significantly.

The West Midlands, the North of England and the South West all reported solid growth, however, East Anglia and the North West saw a drop in sales volumes.

In the future, the RICS expects to see “significant sales growth”1 in all parts of the UK over the next 12 months, with the estimate looking particularly strong for Wales and Scotland.

In the lettings sector, the RICS found that tenant demand grew for the eighth consecutive month. As a consequence, rents are expected to increase in the near future. It adds that over the next five years, UK-wide rents are forecast to rise by 4.5% per year.

Jeremy Fisher, from The Frost Partnership in Beaconsfield, says: “Beaconsfield is seeing an upturn in both tenant and landlord activity with the quality of both very good.”1

Separately, the latest e.surv Mortgage Monitor revealed that there were 69,220 house purchase approvals in August, up by 9.3% annually.

There was also a 0.7% increase in purchases compared to July this year and 12,000 small deposit mortgages were approved – a post-recession record.

1 http://www.propertyindustryeye.com/rics-house-prices-increasing-in-all-regions/

Former East London police station was illegal hostel

Published On: September 10, 2015 at 10:42 am

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An unused police station in Barking, East London, has recently been discovered to have been turned into an illegal hostel. An anonymous tip off led to police and housing officers raiding the property, where 30 people were found to be residing.

Illegal lodging

The property on Ripple Road was raided on Friday, having been sold off as a police station in 2013. A team from Barking and Dagenham Council’s enforcement team found the large number of tenants living in five rooms, in what was an apparent ‘beds for hire’ hostel.

Inside the building were a number of mattresses and wardrobes packed with clothing. In addition, the team found a washing machine and a television. The telltale sign that the property was occupied was a notice informing residents to do their own washing up.

Zero-tolerance

‘Our war on rogue landlords will be relentless,’ said cabinet minister for crime and enforcement councillor Laila Butt. ‘We will not tolerate overcrowding in Barking and Dagenham and anyone making a mint out of others’ misery.’[1]

Former East London police station was illegal hostel

Former East London police station was illegal hostel

Both the police and the local council plan on speaking to the owners of the building following the raid on the property. Deputy Borough Commander Supt Sean Wilson commented that, ‘local neighbourhood police officers supported the London Borough of Barking and Dagenham Enforcement Officers in their closing of this venue.’[1]

‘The excellent work by the local authority has ensured that this venue can no longer be used for illicit purposes,’ he added.[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2015/9/east-london-police-station-turned-into-illegal-hostel

 

 

Calls for Harsher Penalties for Rogue Landlords and Agents

Published On: September 10, 2015 at 10:32 am

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According to the Chartered Institute of Environmental Health (CIEH), a “fundamental review” of private rental sector legislation is necessary to tackle rogue landlords and letting agents.

In a response to the Government’s technical discussion paper on tackling rogue landlords and agents in the private rental sector, the CIEH believes harsher penalties are needed to deter rogue landlords, including minimum fines of £5,000 and imprisonment terms for those that breach bans.

Calls for Harsher Penalties for Rogue Landlords and Agents

Calls for Harsher Penalties for Rogue Landlords and Agents

The CIEH states: “It is our view that a fundamental review and consolidation of the entire legislative framework is necessary to bring about comprehensive reform and rejuvenation.”

Responding to the question: ‘Do fines reflect the gravity of a (landlord’s) offence?’ the CIEH says: “No, the fines are almost always too low and do not consider the severe impact (or potential impact) on the tenants or reflect the significant capital and revenue gains to landlords.

“Courts should be required to consider the impact on the tenants and the total assets/rental streams when setting the fine. A minimum fine of, say, £5,000 would be more appropriate.

“We would support setting a minimum fine for repeat offenders, with £7,500 being our preferred level. Courts should consider the impact on and assets of landlords in setting the fine, whilst we would also support giving the courts the power to ban repeat offenders from managing or letting properties for a defined period.”

When asked if it thinks there should be a blacklist of persistent rogue landlords and agents, the CIEH replied: “We support in principle the establishment of such a blacklist on the basis it should make it easier for local authorities to carry out checks on landlords. Our concern is that landlords may not be afraid of being blacklisted.

“The database should include lettings related data, such as gas, electricity and Land Registry information, and should be accessible to tenants. All landlords should be registered to a UK-based address or provide a UK representative for service of formal notices.”

The organisation also believes it should be mandatory for offenders to be placed on the blacklist, and not left to the court’s discretion.

It says a “term of imprisonment”1 was justified for landlords that breach bans, as well as forced property sales, rent payment orders and action under the Proceeds of Crime Act.

1 http://www.propertyindustryeye.com/call-for-harsher-penalties-to-deter-rogue-agents-and-landlords/

How much would the Queen have been charged in rent?

Published On: September 10, 2015 at 9:37 am

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Yesterday saw her majesty Queen Elizabeth II become the longest serving monarch in British history. To mark the occasion, Rentify has assessed just how much each of her residences would have cost if she was renting throughout the period.

Royalties

Data from Rentify’s assessment shows that Buckingham Palace is, unsurprisingly the most expensive of her majesty’s residences, accumulating a monthly rent of a cool £303,340 per month for the 240-bedroom property.[1]

In total, the Queen’s seven properties would have accumulated a grand rental bill of £1,037,277,892 during her astonishing 23,227-day reign.

Second on her rental rich list was Windsor Castle, with the Berkshire residence setting her back roughly £129, 375 per calendar month, for its 225 rooms and 13 acres of land. This is 5,265% greater than the average rent of a four-bedroom home in the area.[1]

‘Royal properties will always command a royal price tag and these estimates show that even royalty would not be exempt from the effect of astronomic London rents,’ observed George Spencer, CEO of Rentify.

[1] https://www.landlordtoday.co.uk/breaking-news/2015/9/queen-would-have-racked-up-1bn-in-rent-during-reign

 

 

 

Britain 4th Best Place in World to Invest in Property

Published On: September 10, 2015 at 9:32 am

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Britain 4th Best Place in World to Invest in Property

Britain 4th Best Place in World to Invest in Property

Britain has been ranked the fourth best place in the world to invest in residential property, reports Savills.

A study by Savills places Britain behind the USA, the United Arab Emirates and Singapore as the most attractive places on Earth to make high returns on rent.

The Savills World Residential Investability Ranking gives countries a rating based on economic and demographic factors.

The USA was number one for investability, due to strong economic growth and market recovery potential.

However, Savills says that local factors should be taken into account, as Britain’s lack of housing supply is making the country more appealing to prospective investors.

A country’s investability is based on economic performance, development prospects and population growth.

Director of World Research at Savills, Yolande Barnes, says: “It is vital that investors understand the long-term demographic, economic and supply-side drivers of demand – and therefore sustainable value – when making investment decisions. These can be different at national and local level.

“When a growing population, growing affluence and limited housing or land supply converge, we would anticipate real house price growth.

“The absence of one or more of these variables can stall a housing market and the absence of two or more can send property values downward.”1

1 http://www.propertyindustryeye.com/savills-britain-fourth-best-place-in-world-to-invest-in-property/