As we begin to see tentative signs of economic recovery, particularly in the US economy, bond yields are rising and interest rates with inflation will surely follow. Whilst governments endeavour to engineer a soft landing as the financial world weans itself off quantitative easing, there are still severe risks of a further set-back in the highly indebted countries such as the Eurozone and to some extent including the UK.
The prolonged ultra low interest rate environment has encouraged risk taking in the search for income. Property is one destination for investors’ funds which generally offers a safe haven, a hedge against future inflation, the prospect of long-term capital appreciation and a good income providing you are not over extended and you can manage tenants.
However, as we warn here – see article: Beware the offer you can’t refuse – great care is needed when committing to some property investments, particularly when they are abroad and promoted by some of the more dubious property investment companies.
London has become a victim of its own success. The success of the capital relative to the rest of the UK (London’s share of Britain’s economic output is put at 22% by the ONS), and the attractiveness of London property as a safe haven for foreign investors’ money, are putting increasing pressure on housing for the middle and working classes in the capital.
London property prices are starting to rise again, despite the fact that prices have fallen or are still falling elsewhere. The cost of renting has risen to over half the average wage in two thirds of London boroughs, putting many workers under intolerable pressure.
All this is leading to calls for “rent stabilisation” or in other words rent control; that ugly phrase that will strike fear in the hearts of those landlords who remember the Rent Act era and know the full implications of such a move: rent control would be an absolute disaster for the property market in London. See our lead article: Rent Control: Is it a Real Possibility?
We include three articles here on the question of Deposit Protection and the recent appeal court judgement in Superstrike Limited v Marino Rodrigues  EWCA Civ 669. In what appears, at first sight anyway, to be a perverse twist in a continuing saga, it seems to imply that deposits need to be re-protected and a new s213 notice served whenever a tenancy moves from a fixed-term to a periodic tenancy. Hopefully, common sense will prevail in the end when further clarification from the deposit protection agencies and perhaps a superior judgement arrives.
Electrical causes have long been a common reason for fires in premises. Heat Resistance Connections (HRC) in electrical circuits are a known to cause of fires in all types of buildings. A poor electrical connection in any mains electrical circuit can potentially create a hot spot and eventually a fire, which has been a serious menace virtually since electricity first arrived. A new, essentially British invention it is claimed can eliminate this risk – see the article: Eliminate Electrical Fires in Your Premises
Finally, James Davis, Upad CEO and Founder will be taking part in the 100-mile Prudential London-Surrey bike ride to support a very personal cause. His third child Abi was born with Down’s Syndrome, a genetic disorder that affects just 1 in 1,000 new born babies in the UK. As well as seeking to raise money for two Down’s Syndrome charities, James wants to raise awareness of the condition, as is it often misunderstood. If you would like to help with a donation, click Here
Read the full June 2013 Newsletter here: https://www.landlordzone.co.uk/update/june13.html
Tom Entwistle, June 2013
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