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Election Poll

With a critical election fast approaching we thought it would be enlightening for us all to know the views within the property industry: landlords, agents, and property professionals.

Take a minute to vote in our poll and give us all the benefit of your preference.



Consider These Things Before You Increase Your Tenant’s Rent

1. It could force good tenants to leave.

It might only be a small amount you’ve increased the rent by, but don’t underestimate how this could offend a good tenant who pays rent on time and looks after the property. If you reward good tenants who want to stay and make your property their home for a long period of time, does it really make a difference to get a bit extra each month? And consider carefully if you’re prepared to put your property back on the market if the tenant doesn’t accept the increase…

2. Can the rental market sustain an increase?

Should your tenant decide not to accept the increase they may give you notice to leave. During a periodic term, this will be 1 month. So now you need to prepare your property for market, take photos, book in any repairs and try to arrange viewings with a potentially disgruntled tenant. Along with this, you’ll have your fees for advertising and management percentages to fork out, unless you self-manage. These fees can be reduced if you go it alone or use an online letting agent, like Upad, with prices from £100+ VAT. Once on the market, there’s no telling if it will let for the increased amount. You also need to consider seasonal variations; such as the decline over the Christmas period, and general market conditions i.e. is supply exceeding demand?

3. Can the tenant afford a rent increase?

Let’s say your tenant accepts the rent increase, can they even afford it? Affordability checks at the initial referencing stage were based on the rent price...

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Why HMOs make the best investment opportunity in 2017

With fewer owners investing in new buy-to-let properties at a time of already limited housing supply, and an ever increasing rental demand,

London’s lucrative HMO market offers great investment opportunities for landlords.

The idea of letting HMOs is appealing to a growing number of landlords who are attracted to the idea of collecting rent from a higher number of tenants and a more efficient way to run a rental portfolio.

Furthermore, HMOs are potentially superb investments: the demand for affordable, flexible housing as offered by multi-let properties has never been higher.

However, as with all things there are downsides as well. Arthur Online takes a look at the cases for and against investing in HMOs.

Many HMO and multi-let investors make fantastic rental returns on their property, compared to a typical single-let rental income. The UK market often sees gross rental yields of 12-15% achieved, with some investors hitting 20%-plus

HMO...

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UK start-up InsureStreet helps solve cash deposit crisis

Trust-based property rental solution:      

London, UK, May 2017 UK start-up, is set to solve a major issue in the rental market and potentially pump nearly £4 billion of ‘dead money’ back into the UK economy by replacing cash deposits with trust-based deposit replacement insurance - InsureStreet.

• UK start-up aims to pioneer a rental community built on mutual trust and respect

• Digital platform to benefit tenants, agents and landlords, says HISCOX insurance

• Serial entrepreneur Vin Murria among high-profile investors

The app, whose backers include serial entrepreneur Vin Murria and insurance provider HISCOX, presents ‘generation rent’ with an easy and affordable alternative to the often crippling upfront cash deposits required by landlords.

InsureStreet comes at a time when rent rises across the UK have far outpaced wage increases over the past five years – and at a time when more misery is predicted for renters with further steep rises expected over the next few years, particularly in London. However, with a shortage of affordable housing, more and more people have no choice but to rent.

How InsureStreet works:

• Typically, renters are charged a minimum of six weeks’ rent as a security deposit, plus agency fees and a month’s rent...

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What You Need to Know About Safe Property Renovation

If you’ve recently bought a property in need of some major renovations, the chances are that you will need to hire equipment to carry out the work, as well as seeking out professionals to help with the renovation. Here is everything that you need to know about safely carrying out a property renovation as a landlord.

Before You Buy

Before you purchase a home to renovate, there are a couple of things to look out for to ensure that you don’t encounter any surprises along the way. You should check if you need to get planning permission – it’s usually required if you plan to make structural changes or change the function of the building, and you will need permission from your local...

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How will the proposed ban on letting agent fees impact on buy-to-let landlords?

It is now more than six months since the Autumn Statement, where the Chancellor laid out plans for another controversial regulation change set to impact on the buy-to-let sector.

During the Statement, Mr Hammond announced that the Government was to ban letting agent fees paid by for by tenants.  Presently, these fees are required to cover costs of imperative administration tasks, such as credit and reference checks.

A consultation on this move was launched on April 7th, which will run until today (June 2nd).

Reaction to the proposals from within the sector has been mixed at best, with a number of key industry peers set against the move.

Taking this into account, just why has the Government decided to put forward the legislation? How could such a change impact on the rental market? Who could be most impacted on?

Ryan Weston, of Just Landlords Insurance Services, investigates:

Why has the proposed ban been put forwards?

“Chancellor Phillip Hammond announced the ban on letting agent fees to give both a fairer deal for millions of tenants, but also to raise competition...

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Property Master


Editorial, May 2017

As Election Day fast approaches and media reports indicate that the vote divide is narrowing, many people are getting a bit twitchy about the possible outcome.

Will it be the right result for the country at a time when we are entering critical Brexit negotiations with Europe? How will any new regime be constituted, be it Conservative, Labour or a Coalition hammered out after a hung Parliament? Will the in-out squabbles continue after the negotiations begin, will Europe and Brussels extract its “pound of flesh” helped by a divided nation?

Most importantly, how will any new regime approach the property industry: will it be the rent controls and long-term tenancy security promised by Labour, or perhaps more of the same tax penalty anti-business rhetoric from the Conservatives?

Otherwise, we are in bit of a state of limbo until after the election with all the ongoing PRS regulatory issues, and such things as the banning of tenant’s agency fees.

Our Election Poll...

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pad


Pad, committed to positive change for landlords, estate agents and tenants in the rental market

Pad are committed to positive change for landlords, estate agents and tenants in the rental market. Their ecosystem of tech, cover and slick logistics means that they are “uberizing” the rental market to save everyone time, money, conflict and hassle. You might have seen their coverage on the London tubes, evening standard and wired magazine? They are getting a lot of heat in the market right now.

As a driver of change, Pad have taken a keen interest in the election, so give their thoughts, between the lines) on what a blue or red win would mean to their mission and the happiness of their stakeholders. Let’s face it, this week is looking more like a hung parliament than ever?

CONSERVATIVES

The blue corner will look at how security for good tenants is increased and how landlords can be stimulated to offer longer tenancies as normal. The Conservative Manifesto doesn’t say much more than the Government’s previous White Paper earlier this year, however there are clues that inducements might be used to inspire landlords to offer longer term contracts.  Undoubtedly, this issue is on the Government’s radar and looms large on its ‘to-do’ list.

The February White Paper that focused on providing affordable housing, long term tenancy and supply measures has been met with mixed opinion. Some say that the White Paper continues to encourage large developers to build housing that offers large-volume rental flats for tenants. This is in response to the need for secure tenancy for families, who cannot move every six months, as per common tenancy agreements. The hope is that developers will build specifically for rental and that they will offer...

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Conditions of a Commercial Property Lease Explained

When leasing a commercial property, it’s important to know where your responsibilities as a landlord lie, and how you can protect your best interests as a landlord.

Some conditions within a lease are obvious – you would expect there to be information about rent and how it is paid.  However, there are other areas that can easily trip you up if you sign an agreement that allows a tenant to do something that you would rather they didn’t - like leaving you without any rental income two months into the lease.

Below is an overview of the types of things to be aware of.  This is by no means an exhaustive list, but should give you some pointers on the types of issues to carefully consider before signing on the dotted line when leasing out your commercial property.

Conditions in a commercial property lease

Rent

Setting a rental amount is the easy bit, but make sure that you include when the rent needs to be paid by and how regularly it needs to be paid in your lease.  For example, if you would prefer rent to be paid quarterly, you will need to stipulate this, ideally including the day of the month that the rent would need to be paid on or by.

Ways that rent can be paid are also important to outline.  If you’re not happy with a cheque, then stipulate that rent must be paid by BACS transfer or another method that you would prefer.

Deposit

This is a popular area of contention for landlords and tenants in relation...

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Elfin Kitchens


Tenant types guide

If you’re a landlord you probably want nice, reliable tenants, who have a proven, regular income, a spotless renting history - and a penchant for cleaning.

You’re not alone. A recent poll of landlords found that 64% said they wouldn’t rent to tenants on benefits, and three quarters said they wouldn’t rent a property to students.

In some ways that’s fair enough - the pitfalls of different tenant types are clear from your insurance premiums. There can be up to a 75% difference in how much it would cost to insure the same property for tenants on benefits and professional working tenants. That uplift is based on calculations assessing the risk involved, and how likely you are to make a claim.

When you throw in the potential cost of a ‘bad’ tenant - from damage to eviction proceedings - you’ve got an equation that many landlords would say simply doesn’t add up.

But with the rental market changing and coming under increasing pressures, the ‘perfect’ tenant simply may not be available to you. And sticking to this safe and sensible formula could be stopping you from diversifying your portfolio and maximising your income.

As a landlord, you could be missing out on lucrative, untapped markets. So here’s a quick guide to help you assess the risk, mitigate, and maybe start to think differently about potential tenants...

Working professionals

The plus side

Working professionals are clearly landlords’...

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National Landlord Investment Show


Expert Property Panel just announced for the Olympia Show on 15 June

National Landlord Investment Show is returning to London for its third show of the year and 45th show to date on Wednesday 15 June at Olympia.

As part of the seminar programme, the show will now offer an Expert Property Panel to discuss current issues that landlords face, including Brexit, licensing, tax, finance and immigration.

The panel will take place in the Auditorium Theatre and seat over 400 delegates. Speakers include Iain Duncan Smith, Former Secretary of State for Work and Pensions 2010 -2016 and David Smith, Award-winning Economics Editor of The Sunday Times since 1989.

Also speaking as part of the panel are Richard Bowser, Editor of Property Investor News, Marie Parris, Managing Director of George Ellis Property Services and Tony Gimple from Less Tax for Landlords.

Find out more and register for your complimentary tickets at landlordinvestmentshow.co.uk/olympia

The panel is free to attend for visitors and on a first-come, first-served basis, complementing the 20+ free seminars on all aspects of buy to let.

The exhibition also offers local landlords and property investors 100+ leading suppliers of property investment, tax, legal, insurance and mortgage services.

‘It’s going to be a very stimulating day, with many features, suppliers and seminars for property professionals, explains Tracey...

Read more...



Drop in buy-to-let valuations in April

• Buy-to-let valuations fall to just 7% of market activity in April after cut to mortgage tax relief

• Rise in buy-to-let remortgaging activity – now responsible for 11% of total valuations

• First-time buyer valuations rebound to 34% of market activity

Buy-to-let valuations dipped to 7% of market activity in April as the reduction to landlord’s mortgage tax relief begins, according to the latest research from Connells Survey & Valuation.

The proportion of buy-to-let valuations is 6 percentage points below the five year average for April. Buy-to-let valuation activity is even lower than it was in April last year – when the stamp duty surcharge was introduced.

The decline in buy-to-let valuations has likely been driven by the stamp duty surcharge and the cut to buy-to-let mortgage tax relief. As of April, landlords can only offset 75% of mortgage interest payments against rental income – down from 100% in March.

Proportion of valuation activity

John Bagshaw, corporate services director of Connells Survey & Valuation, said: “The Government’s anti-landlord policies have been hitting smaller players. Over the last year, buy-to-let valuations have made up less than 10% of market activity, representing a new low in April.

“This could suggest that smaller, private landlords, who typically use buy-to-let mortgages, have not been investing on the same scale as previously seen. Buy-to-let used to be seen as a viable way to gain additional income or to fund retirements, but the gradual removal of buy-to-let mortgage tax relief will make it much harder for the man on the street to invest.

“Having said that, buy-to-let valuations only fell 1% month-on-month and so the comparison with the five year average doesn’t always tell the whole story.”

Rise in buy-to-let remortgaging

While buy-to-let valuations have declined as a proportion of market activity, buy-to-let remortgaging is 4 percentage points higher than the five year...

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Landlords Are Making Profits But BTL Investment Is At An All Time Low

According to recent research, the majority of landlords are making a profit from their BTL portfolios despite the Government’s tax hikes, but BTL investment is at an all-time low.

The research shows that 84% of landlords are making a profit from their lettings activity of landlords and 44% rate their expectations of their own letting portfolio ‘good’, or ‘very good’ for the next three months. However, 83% of landlords have found obtaining buy to-let finance more difficult in the past six months and just 16% of landlords intend to purchase at least one more property in the next 12 months - an all-time low. (*Source: Rent Check Report, BDRC Continental and Allsop LLP).

This slow down in BTL investment in evident in the latest mortgage figures, with lenders reporting a 42% fall in loans to landlords as tax changes take their toll.  The Council of Mortgage Lenders said...

Read more...


Latest News

  • 29 May 17 - Rural Landlords Voice Concerns over MEES -

    Rural Lettings: The Minimum Energy Efficiency Standards (MEES) are due to become a legal requirement from next April, when it will be illegal to let a residential property having an Energy Performance...

  • 25 May 17 - Mayor Johnson’s London Rental Standard to close down -

    Landlord Accreditation: The London Rental Standard (LRS), which was a voluntary scheme introduced by the then Mayor of London, Boris Johnson back in 2014, is set to close down. Despite all the effort...

  • 23 May 17 - PRS still growing but more slowly… -

    Buy-to-Let Market: Following the personal taxation changes announced in 2015, coming into force this April, and buy-to-let investors seeing more clouds appear on the horizon in 2016/17, in the form...

  • 22 May 17 - The Conservative’s Plans for Rental Housing -

    Conservative Manifesto: The Conservative manifesto is really a policy overview as regards housing and renting, as in their case the nitty gritty of their housing measures have already been set out:...

  • 16 May 17 - A Rogues Gallery of Prosecuted Landlords -

    Rogue Landlords: A Bristol housing charity has topped the list of the UK’s most prosecuted landlords. The social housing charity was set up to house the homeless and is among other private landlords...

  • 12 May 17 - RLA calls for election focus on rental housing… -

    Election: With 20% of households now living in private rented accommodation, a statistic which is set to reach one-quarter (25%) in the not too distant future, all the parties in the forthcoming election...

Forum - Latest Posts


A New Approach to Buy To Let Mortgages

Buy-to-Let Mortgages:

Like building any business, establishing a successful property portfolio takes determination, knowledge and patience. Ironically, one of the challenges facing landlords is the mortgage brokering process that’s meant to serve them. It’s paper-based and often can’t keep up. As the residential mortgage sector is enjoying the benefits of online portals to streamline the process, it’s high time for landlords to receive similar benefits in the buy-to-let sector.

Buy-to-let is a dynamic and rapidly growing market that’s still served by traditional mortgage brokers. It’s a low-tech world of paper form-filling, delays, unreturned calls and a very limited market view – with the last point exacerbated by the fact that most mortgage brokers work from a limited list of lenders, with commission potentially influencing their selections.

Research shows that landlords could save over £3000* a year per property by changing the makeup of their portfolio to take advantage of the best mortgage deals.  There are even further savings as Property Master does not charge application fees for standard mortgages.

And that’s not the only challenge facing brokers like you. Government tax changes like the 3% rise...

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National Landlord Investment Show


Theresa May’s Conservative manifesto: The property review

With only 20 days to go, the Conservative party published their manifesto revealing their ambitions and plans for the next couple of years to come, including some big hopes for Britain’s property sector.

In the party’s manifesto for 2017, Theresa May dedicated two whole pages to the current issue of adequate housing for everyone in the UK.

The manifesto kicks off by explaining if the situation won’t be fixed, the promise of adequate housing for everyone can’t be kept up. The key to fixing the currently dysfunctional housing market is to build enough houses to meet the demand, so the report.

This increase in house building will then lead to a slower rise in property prices and will therefore make it easier for everyone to make it onto the property ladder. Or at least...

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The Buy-to-Let Property Show

The Buy to Let Show is a new online Rental Property TV Show, the only programme which gives you all the information you need, whether you are thinking about buy-to-let for the first time, or you are an existing investor and landlord.

Presented by Kate Faulkner and supported by Direct Line, it features advice from top experts from the property industry, including landlords, letting agents, solicitors and health and safety officers.

Accompanying the shows are six useful eBooks, which guide you through every aspect of purchasing and letting a property as well as, crucially, planning an exit strategy for the future. You can view the shows and download the eBooks here.

Episode 1 - Is Buy-to-Let a wise investment? - 7th May

Programmes 1 & 2 are already released and all of them are available here

Also, the eBooks are downloadable for these two shows and the first one includes interviews with leading buy-to-let investment experts.

Cut down versions are...

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Commercial Property Costs

For anyone coming or escaping from the residential buy-to-let market, the thought of investing in commercial property with full repairing and insuring leases, long-term leases, and upward-only rent review, must surely seem like a godsend.

On the plus side is the likelihood of less hassle, more secure income often from corporate tenants, longer leases, and status. On the overt downside there is the risk of overpaying, and/or the tenant could go bust: whatever, such risks can be reasoned away, by reading about how past performance of capital appreciation and rental growth has made up for buyer mistakes, and with wise-buys another tenant will be along in a minute.

But for all the obvious advantages and apparent disadvantages that on balance can be weighed up to sound favourable, it is not until one exchanges contracts and completes the purchase that the covert downside of commercial property investment emerges in the form of extra costs, whether recoverable or not, that can...

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LandlordZONE Documents


The great outdoors

The experts at Belvoir reveal seven simple steps to making the most of your outdoor space if you’re remarketing your rental property this summer

Providing appealing outdoor living solutions for tenants can help add a premium to your rental property. However, following the long winter months, most outside spaces will need a little extra help so give your garden an annual MOT maintenance makeover now…

1. Pest control

Weeds can infiltrate flowerbeds, pots, gravel, lawns and even patios at speed so it’s important to keep on top of the problem before it grows.

“An abundance of unsightly weeds can make even the nicest of outside spaces look uncared for and unkempt,” says owner of Belvoir Bury St Edmunds and Belvoir Norfolk Patsy Day.

“They instantly affect a property’s kerb appeal and if yours appears tatty on the outside, potential tenants will undoubtedly question what it looks like on the inside.

“There are a variety of ways you can help stop weeds in their tracks,” she continues. “Remove them by hand (including the roots),...

Read more...


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