Tuesday 28 February 2012

Landlord Licensing. Coming to your local authority?

Are we witnessing the birth of landlord licensing in England and Wales and at the same time looking at significant extra costs for landlords?

The London Borough of Newham has moved to its second consultation stage of their plans to licence all landlords who rent properties in the borough. Their statement says “We have listened to your views on our plans to license all private rented properties in Newham. As a result of your feedback, we have now adapted our formal proposals to introduce rented property licensing across Newham.”
Although selective licensing has been available to local authorities for some time no other council has decided to license every landlord, but councils throughout the country are watching the Newham experiment with great interest. Not least because it could be a nice ‘earner’ for the council.

Newham estimate that there are between 4000 and 5000 landlords who operate within Newham and propose that “All private landlords that let properties within the borough which will be designated as an Additional or Selective licensing designation will require a licence from Newham for each of their rented properties.”
Newham clearly believe that private renting is a major cause of anti-social behaviour. Their proposals state “Newham considers the use of borough wide licensing due to the high proportion and increasing level of privately rented accommodation in the borough and more significantly, the degree of anti social behaviour recorded and the link between anti social behaviour and poor property management and rented accommodation.”

According to the Newham proposals there are 25,339 privately rented properties in their Borough. They propose to charge landlords a sliding scale of charges starting at £150 per property for a 5 year licence. If every landlord complied immediately this would generate over £3.8 million in fees.
But if landlords fail to comply the charges get worse. Landlords who apply after the commencement date of the licensing designations will be charged £500 for a 5 year licence. At the top end Landlords who apply after the commencement date and receive two warning letters or landlords with previous management contraventions and are of concern will be charged £500 per property per year.

So the minimum Newham is looking to raise is £3.8 million, the reality could be significantly more than this. We believe this is why councils across the country are watching Newham’s proposals so closely and why if Newham moves to landlord licencing many other councils will follow their lead.
Landlords will no doubt be pleased to hear that Newham believe that “Whilst this is an additional business expense for landlords it is not seen as excessive in relation to the rental market in Newham at the present time. It is anticipated that any overall effect would possibly be offset by a higher rental premiums and cost margins through improvements in management standards and lower tenant turnover rates in the medium term when the benefits of the licensing schemes are recognised.”

Scotland has had landlord licencing since 2006 and the Welsh Government is currently engaged in its own consultation. But we believe the opportunity to raise significant sums of money will prove too tempting for local authorities, especially if, like Newham, they believe that landlords can simply pass the cost on to tenants irrespective of the backlash that will certainly come if landlords start increasing their rents.
For more information about Newham’s proposals please click here.

Monday 27 February 2012

Emergency ‘bank’ overseeing Northern Rock and Bradford & Bingley mortgages ‘treating landlord borrowers unfairly’

The emergency ‘bank’ set up by Government to oversee the mortgages originally lent by Northern Rock and Bradford & Bingley is treating landlord borrowers unfairly, it is claimed. A number of large borrowers allege that heavy-handed actions by UK Asset Resolution is leading to widespread tenant evictions, business failures and the sale of thousands of properties at depressed prices.

UKAR’s function is to wind down the £77 billion mortgages it took on in 2008 after the failure of Northern Rock and B&B, among others. Its objective is to claw back for taxpayers some of the billions used in the bailouts.

But landlords claim taxpayers are losing out, along with everyone else, as UKAR puts thousands of properties into receivership, fails to maintain them and ultimately sells them for less than their market value.

Read the full article here Emergency ‘bank’ overseeing Northern Rock and Bradford & Bingley mortgages ‘treating landlord borrowers unfairly’

Friday 24 February 2012

Property people get ready for new EPC rules

Landlords and letting agents must comply with a streamlined energy performance certificate scheme from April.

The government has given the green light to the new rules that bring EPC requirements for selling and letting residential and commercial property into line.

From April 6, all properties need a valid EPC certificate before marketing to let or for sale – and agents must be ‘satisfied’ a survey is booked before advertising the property.

Click here to read the whole story Property people get ready for new EPC rules

Thursday 23 February 2012

Tax-dodging Scottish landlords targeted

Scottish landlords who dodge tax on income from their properties are to be the focus of a special HMRC taskforce.

Landlords are just the latest group to be targeted following the government's most recent spending review to clamp down on tax evasion, avoidance and fraud from 2011 and 2012.

The move also aims to raise an additional £7bn a year by 2014-15. HMRC has planned 12 taskforces in 2011-12, with more to follow in 2012-13.

Click here to read the full article Tax-dodging Scottish landlords targeted

Friday 17 February 2012

Rising number of landlords making a loss on their buy-to-let property

The latest findings from the BDRC Continental quarterly Landlords Panel research reveals the biggest rise in the number of portfolio landlords making a loss since the Landlords Panel began in 2006.

The research shows that in the fourth quarter of 2011, the number of ‘portfolio landlords’ – those with 20 or more properties – who reported making a loss rose from just 1pc in the third quarter of 2011, to 8pc in the last quarter of the year.

Click here to read the whole article Rising number of landlords making a loss on their buy-to-let property

Wednesday 15 February 2012

It's all Landlord's fault says Shelter


Another year, another attack by Shelter on Landlords. Continuing their campaign Evict Rogue Landlords Shelter has now issued a 5 point plan they want the Government to implement.

This Shelter's 5 point plan:

Tougher sentencing for rogue landlords. Raise the maximum punishment from £5,000 to £20,000.
Make sure local councils prosecute rogue landlords by bringing in a new prosecution fund. £10m would help prosecute the very worst offenders.
Protection for tenants against retaliatory evictions. Imposing a ban on fasttrack eviction notices if a landlord has not complied with a court order would protect tenants from being thrown out of their home because they complained. Shelter knows that more than 230,000 tenants are reluctant to report complaints against a landlord because they worry about the consequences.
A national website listing all convicted rogue landlords would be a powerful deterrent for landlords and a useful warning system for potential tenants.
A minister-chaired rogue landlord summit: bring together courts, tenants, the police, local authority figures and landlords to agree an action plan to crack down on rogue landlords.

Nowhere in their recommendations does Shelter even begin to acknowledge that there might be Rogue Tenants, simply Rogue Landlords.
The reality is that there are Rogue Landlords, Rogue Agents and Rogue Tenants. All are as bad as each other and all damage the lettings industry. Simply picking out one group and making them the scapegoat for all housing ills does little to foster a vibrant lettings market in the UK.
The fact is that at this time the country needs the Private Rented Sector. The fact is that the overwhelming majority of Landlords in the UK offer decent housing. The fact is though that the majority of Landlords have experienced tenants who have caused damage, not paid their bills, left owing rent and a host of other problems that the Landlord is left to clear up.
For example, the water industry had to write off approximately £328 million in unpaid bills in 2010-11, mainly from tenants in rented properties, the Government has said. The problem is so severe that the Government is considering legislation to make Landlords liable for tenant's unpaid water bills.
It is estimated by LSL Property Services that 10.7% of all rents in the UK are either late or unpaid, totalling around £300 million.
Last year NetRent ran a Facebook campaign called The Damage That Some Tenants Do and we were inundated with pictures from Landlords of the damage and destruction that some tenants have caused. The photos were truly awful, but Shelter is oblivious to the problems tenants cause – the damage some do, the bills left owing and the rents that are unpaid.
NetRent calls on Shelter to stop polarising the lettings industry by insisting that it is only Rogue Landlords who are the problem. There are a minority of Landlords, Agents and Tenants who cause problems for the rest of the lettings industry.
The whole lettings industry needs to work together to eliminate these rogue elements, picking out one group and blaming them for all the ills will not solve the problems. That is the only way to build a fair and sustainable private rented sector in the UK.

Wednesday 8 February 2012

New EPC rules for all landlords and agents

Landlords and managing agents selling or letting property in England and Wales must comply with new rules about commissioning and disclosing Energy Performance Certificates (EPCs) certifying the energy rating for a property from April 2012.

From 6 April 2012 an owner and, for the first time, a managing agent selling or letting either a residential or commercial property will have to follow these rules.

Click here for more information New EPC rules for all landlords and agents

Monday 6 February 2012

10 tips to be a bad landlord

With the London Olympics only months away, agents are seeing a surge in enquiries from homeowners looking to rent out their property and take advantage of an expected increase in tourist numbers. For those looking to invest in a buy-to-let property, there are certain steps you should follow and many pitfalls to avoid.

To highlight the latter, click here for the top 10 tips to be a rubbish landlord: 10 tips to be a bad landlord