Wednesday 29 June 2011

Rental market surges as buyers still face finance hurdles

Countrywide’s latest report reveals the rental sector is surging ahead, while potential buyers continue to be hampered by mortgage affordability and unrealistic house price expectations.

Figures from Countrywide show the number of new tenants’ registering for rental accommodation increased by a hefty 20% in May, a 28% increase compared to May 2010. Homeowners considering placing property on the rental market also showed a significant increase, up 15.5% from April to May.

Read the full story by clicking here Rental market surges as buyers still face finance hurdles

Friday 24 June 2011

Lord Freud: 'facility to pay landlords directly' to be retained in Universal Credit

Lord Freud has reiterated Government plans to keep a facility within the new Universal Credit to pay social landlords directly.

Speaking today at the Chartered Institute of Housing (CIH) conference in Harrogate, he said the Government's starting position was to pay the new credit directly to tenants but that "provision will be made to pay it directly to social landlords".

The planned Universal Credit – announced last October – will replace six income related work-based benefits with a single payment system and will be phased in from 2013.

Read the full article here Lord Freud: 'facility to pay landlords directly' to be retained in Universal Credit

NetRent Comment

Whilst this is welcome news the fact remains that the vast majority of landlords and an increasing number of tenants would rather have rents paid direct without having to go through hoops to achieve it.

More and more landlords are refusing to take tenants on benefits and the number of benefit tenants in arrears is rising rapidly. Surely it is not beyond the wit of the Government to see that the current system is not working and that an immediate return to direct payments is the only way to resolve this growing problem.

Wednesday 22 June 2011

'Tenants from hell' claim human rights over eviction

The European Court of Human Rights is to scrutinise the legality of eviction procedures used by social landlords in the UK.

Although the case specifically affects local authorities and social housing organisations, it will be watched with interest by private landlords, who fear it can only be a matter of time before private tenants start claiming ‘human rights’.

Article 8 of the European Convention on Human Rights says that people have the right to ‘respect for private and family life’.

Click here to read the whole article 'Tenants from hell' claim human rights over eviction

NetRent Comment

Perhaps the European Court of Human Rights would care to comment on the pictures we have published on our Facebook page under the title The Damage That Some Tenants Do. We suspect that the landlords and agents who supplied these photos and many more like them might consider that their Human Rights have been infringed.

Click here to visit the NetRent Facebook page

Tuesday 21 June 2011

How welfare reform will affect your buy-to-let

Tom currently receives £110 a week from Gravesham Council to pay for his one-bed flat in Gravesend, Kent. But his stipend will fall to £68 next year, as the coalition’s cuts in local housing allowance (LHA) take effect. His landlord, Marion Money, cannot afford to cover such a hefty shortfall. “The reality is he’s going to move on,” she says.

Such dramas will play out across the country over the coming year. Gravesend is in the London commuter belt, so Ms Money believes she can easily fill the flat at the previous rent from the private market. But landlords in more remote towns without strong private sectors may find it tougher. Faced with a choice between a void and a rent cut, most landlords will take the rent cut - dragging down rents even for those landlords who have no exposure to housing benefit.

Click here to read the full article How welfare reform will affect your buy-to-let

NetRent Comment

This article explains how the new rule changes will potentially affect all landlords, even those with no exposure to tenants claiming benefits, and is well worth a read.

Monday 20 June 2011

Industry discussing buy-to-let regulation

Insiders close to the Treasury said it had told mortgage trade body officials that regulation of Buy-to-let lending to consumers was “a done deal” - despite the Council of Mortgage Lenders and the Association of Mortgage Intermediaries lobbying European officials to stop this happening.

Draft regulation in the European Directive on Credit Agreements Relating to Residential Property published by the European Commission earlier this year proposes to catch buy-to-let lending to consumers.

Click here to read the full story Industry discussing buy-to-let regulation

Saturday 18 June 2011

MP calls for register of landlords because 'most are amateurs'

The Government should establish a register of private landlords to ensure they maintain their homes properly, a Labour MP says.

Phil Wilson, MP for Sedgefield, said the private rented sector needed to be "professionalised" to stop landlords letting their properties fall into disrepair and lead to problems such as antisocial behaviour.

Those who failed to meet certain standards could be struck off, while the cost of administering the register could be paid for by making landlords pay a small charge.

The register would also help local authorities determine how many private rented properties there were in a particular area.

Click here to read the full story MP calls for register of landlords because 'most are amateurs'

NetRent Comment

Calls for a national register of landlords are nothing new. Scotland has had a register for years and the rest of the UK has lagged behind. The last Government issued various promises that they would introduce a register and the Welsh Assembly Government has also said it would like to impose a landlord register.

The problem with previous discussions about a landlord register for England and Wales is that the proposals were far too complicated. The concept of a landlord register also demands that there is some degree of policing of the register otherwise it is pointless to introduce it. The proposal was that it would be local authorities who would manage and police the register in their area.

Local authorities are now facing huge budget cuts and housing support is one area many local authorities will look to make savings. This means that there will be fewer qualified people who are able to police a landlord register.

However, Phil Wilson is correct, most landlords are 'amateurs'. It is estimated that there are over 1 million landlords in the UK and the overwhelming number of these own one or two properties.

There are over 70 pieces of legislation which affect landlords and we know from our discussions with landlords that a significant number have little or no idea how these laws affect them. Consequently a large number of landlords are not renting safely or legally.

The fact is that far too many landlords ignore or are unaware of basic requirements such as tenant deposits, EPCs, gas certificates and electrical testing. Local authorities struggle to impose these regulations because they cannot identify landlords and as a result tenants are put at risk.

In our opinion this register has no chance of becoming law in the foreseeable future, but, the lettings industry has to realise that the public will continue to view suspiciously any industry which refuses to act professionally and ignores legislation. A voluntary code will not work simply because it will not include the worst culprits.

A simple, properly constituted and cheap landlord register would enable landlords to demonstrate that they comply with legislation and enable local authorities to target and deal with the minority of landlords flaunt the law. Whilst we know that many landlords will not share our view we believe that a national landlord register is long overdue and should be implemented urgently.

Friday 17 June 2011

Warnings fired over Shapps' plan to put homeless in private rented sector

Housing Minister Grant Shapps today called on councils to start forging closer links with landlords and letting agents - ahead of new powers that will see them able to place the homeless in the private rented sector - despite a backlash mounting over the plans.

The reform was subject to much criticism during the second reading of the Localism Bill, with Lord Patel of Bradford warning it could have a “devastating” impact.

Click here to read the full story Warnings fired over Shapps' plan to put homeless in private rented sector

Wednesday 15 June 2011

Private Landlords say 'no' to Tenants on Housing Benefit

Searching for suitable and affordable private housing to rent is hard enough with five tenants vying for each available property, but if you’re in receipt of housing benefit, what are your chances?

Recent studies conducted by different organisations are indicating a serious flaw in government reform and housing benefit policy pointing towards a detrimental impact on the rented housing sector. Research from BDRC Continental, RICS (Royal Institute of Chartered Surveyors), Communities & Local Government and the NLA (National Landlord Association) are all painting a pretty grey picture. And as you would expect, yup, it’s the low-income households that will feel the impact more.

Click here to read the full story Private Landlords say 'no' to Tenants on Housing Benefit

NetRent Comment

Under the current system landlords are effectively being asked to subsidise tenants who will not pay. Rent arrears have doubled in the past couple of years and quite rightly landlords are not prepared to take the risk that tenants on benefits will pay the rent owed.

Before the current legislation came in landlords were paid direct and although in many cases the rent the received may have been slightly less than the market rate landlords could be confident that they would be paid. This led to many more homes being let to tenants on benefits. If the Government returned to paying benefits direct to landlords it is likely that most landlords would seriously consider DSS tenants, simply because landlords would know that the rent would be paid.

Why is such a simple solution so difficult to implement?

Tuesday 14 June 2011

Buy to Let Mortgages – market update June 2011

The buy-to-let mortgage market continues to show signs of improvement with an increase in the number of lenders and products available to landlords. At the time of writing NetRent Mortgages had 364 buy-to-let rates available, compared with just 296 at the beginning of April (an increase of 23 per cent).

Mortgage Trust, a specialist buy-to-let lender, has returned to the market after an absence of three years, providing new options for existing landlords. Mortgage Trust re-launched with two remortgage-only products, available up to 75 per cent loan-to-value with free valuation and free legal fees.

Buckinghamshire Building Society has expanded its offering in the buy-to-let marketplace, with a highly competitive remortgage product up to 60 per cent loan-to-value. The initial rate is fixed at 4.50 per cent until 31/12/2012 with free valuation, free legals and no completion fee. Chorley Building Society is offering an excellent 80 per cent loan-to-value product which is a 4.99 per cent 2 year discount with a 2.50 per cent completion fee.

Following on from its initial buy-to-let offering, Hinckley & Rugby launched a new 60 per cent loan-to-value product for landlords with larger deposits. The initial rate is 3.15 per cent, discounted for 2 years from the lender’s standard variable rate and with a £1750 completion fee. This is available alongside its 3.99 per cent 2 year discount up to 75 per cent loan-to-value with £2499 completion fee and no early repayment charges.

At NetRent Mortgages, as well as the increase in the number of products available, we have seen an increase in average loan sizes and loan-to-values since the beginning of the year. This reflects the improving market conditions for property investors and the appetite of lenders to underwrite buy-to-let mortgage business. We should see further developments throughout the year giving landlords reason to be optimistic about their prospects in the buy-to-let sector.

At NetRent Mortgages, our most popular products in June:

• 3.99 per cent 2 year discount with Hinckley and Rugby Building Society up to 75 per cent loan-to-value with £2499 completion fee

• 4.90 per cent 2 year tracker with Paragon Mortgages up to 75 per cent loan-to-value with 2.25 per cent completion fee

• 3.99 per cent 2 year tracker with Mortgage Trust for remortgages up to 75 per cent loan-to-value with free valuation and free legals and a £999 completion (no longer available)

• 5.50 per cent 2 year fixed with Paragon Mortgages up to 70 per cent loan-to-value with a 2 per cent arrangement fee

For more information please click here NetRent Mortgages or telephone 029 2069 5466

Friday 10 June 2011

Rich to lose their 'subsidised' council homes

Ministers will target those who could afford to buy or rent a house comfortably but instead choose to live in a council house at vastly lower rents than those paid in the private sector.

For some London properties this amounts to the equivalent of someone having their rent subsidised by the taxpayer by up to £70,000 a year.

According to a Whitehall analysis prepared for ministers, there are up to 6,000 people in social housing with an income greater than £100,000.

Click here to read the full story Rich to lose their 'subsidised' council homes

Thursday 9 June 2011

Landlord responsibilities - a brief guide

Research has shown that a generation of young British adults have given up hope of ever owning their own home – a generation which the media are calling ‘Generation Rent’. But as we increasingly become a nation of renters I thought it would be helpful, for both opportunistic landlords and unwilling renters, to spell out a landlord’s legal responsibilities to his/her tenant.

Click here to read the full article Landlord responsibilities - a brief guide

NetRent Comment

This is a useful quick guide to what tenants should expect from their landlord, for a complete guide please visit the Landlord Resource Centre from NetRent.co.uk. The Landlord Resource Centre has hundreds of pages of information and links on every aspect of renting.

Please click here The Landlord Resource Centre

Tuesday 7 June 2011

Rent generation fuels buy-to-let bonanza

Rising rents, cheaper mortgage deals and positive house price forecasts are behind a huge resurgence of interest in buying property to let.

Mortgage lenders, brokers and estate agents are reporting a sharp upturn in business as investors take note of Britain's growing army of tenants.

The appeal is clear - rental returns of 10% or more are not uncommon, even before hoped-for price increases.

Read the full article here Rent generation fuels buy-to-let bonanza

Click here for details of Independent Buy to Let mortgages and re-mortgages without broker fees Mortgages through NetRent.co.uk

Monday 6 June 2011

Cut-price estate agents incur wrath of traditional firms

The estate agency establishment is up in arms over two unorthodox firms set up to encourage homeowners to sell their property, despite the long-term downturn in the market, by offering their services at bargain prices. The most controversial is Property Bay Wales (PBW), based in the Neath Port Talbot council offices and funded by council tax payers.

It aims to sell homes on the open market for a flat fee of £899 plus VAT – far less than fees, of between 1% and 2% of the sale price, typically charged by most local private agents. PBW's fee covers advertising on its own website and on portals such as Rightmove, publicising homes for sale in local newspapers, and conducting viewings for potential purchasers. The firm also handles social housing and private sector rentals.

Read the full story here Cut-price estate agents incur wrath of traditional firms

NetRent Comment

As local authorities are pressured to become more commercial and creative it is likely that more will look to copy Neath Port Talbot Council, especially if this venture proves to be a success.

One agent who commented on this venture was quoted as saying that he 'wouldn't get out of bed for £899'. It is this type of comment that convinces the general public that agents are more interested in their own pocket than their customers and will play right into the hands of the likes of Property Bay Wales.

Rather than moan about unfair playing fields and demanding to know where the start-up funds came from agents need to look at their own service and costs and question whether or not they represent value for money for the customer. If customers do not believe that agent's fees represent value for money they will vote with their feet and end up at cheaper alternatives such as Property Bay Wales.

Friday 3 June 2011

Is a Picture Really Worth a Thousand Words In Inventories?

According to The Association of Independent Inventory Clerks (AIIC), poor and inadequate photographs are being used in inventories at both check-in and check-Out, leaving landlords exposed to potentially costly disputes over wear and tear.

More often than not, the photographs submitted in inventories are little larger than thumbnails and hence make it extremely difficult to see detail. To back up a damage issue, photographs need to be a reasonable size so that the damage can be actually seen clearly.

In a recent 'a recent dispute, a landlord who had supplied his tenant with a photographic style inventory at check in. Since none of these were dated and no other written evidence was produced the tenant won his case and the landlord had to fund some expensive replacements.

Click here to read the full story Is a Picture Really Worth a Thousand Words In Inventories?

NetRent Comment

This article would appear to be self evident but the reality is that the majority of landlords fail to conduct an adequate inventory and therefore leave themselves exposed. Saving a few pounds at the start of a tenancy could cost thousands later on as our campaign The Damage That Some Tenants Do shows.

Click here for a list of Inventory providers

Click here to visit our Facebook page and pictures showing The Damage That Some Tenants Do

Thursday 2 June 2011

High Court Quashes Licensing Scheme Imposed on Lancashire Landlords

A selective licensing scheme enforced by Hyndburn District Council in Lancashire was quashed this week when 347 landlords won their case against the local authority.

The landlords claimed the council had imposed the designated scheme without consultation or good reason to enforce licensing on the 1,326 properties affected. The council, who introduced the conditional scheme, in which landlords must pay for the application of a license lost on grounds amounting to failure to consult and not following guidance, making misrepresentations to the Secretary of State. As a result, Mr. Justice McCombe held that the Council’s decision to designate an area for selective licensing and the resulting designation were both an unlawful act.

Read the full story here High Court Quashes Licensing Scheme Imposed on Lancashire Landlords

NetRent Comment

This judgement is unlikely to open the door to a wholesale review of Selective Licensing but it will hopefully make councils get their procedures right. Landlords have complained for some time that many Selective Licensing schemes are imposed without due regard or proper consultation.