Helping the property market

Helping the property market

Is the UK housing market broken?

With the publication of a white paper last month, entitled “Fixing our broken housing market”, the Government clearly thinks so. But if you’re a landlord or looking to buy a property, what does that actually mean to you and what can you do about it?

The white paper itself is 106 pages long but Government policy is contained within just 60 of those pages.  Having recently been asked to give a presentation on the subject and to save you the trouble of wading through, here’s my at a glance guide and view on the report:

The Government recognises the urgent need for housing and a need to be more inventive in making housing available now and more supportive (both financially and practically) of those trying to find homes.

Looking to buy but struggling? 

tips for moving houseThe Government will continue to assist first time buyers. The help available will be in the following form:

  • ISAs to support saving for a deposit
  • Help to Buy ISAs with a 20% discount for five years, allowing you to purchase with a 5% deposit
  • Rent to Buy, meaning rent at a 20% discount to help save for a deposit
  • Shared ownership, buying a 25% or more share of a property

There will be continued efforts to crack down on empty homes and support areas most affected by second homes. And the Government has said they will look at the buying / selling process to see if it can be improved.

Are you a landlord or tenant? 

Standards in the private rented sector remain below those in the social and owner-occupied sectors, but are improving: just 28% of homes are now non-decent compared to 37% in 2010. (A property is non-decent if it fails to meet a set minimum statutory requirement. Factors to be taken into account when deciding if a property is “decent” include level of thermal comfort, the state of repair and whether the facilities are reasonably modern.)

The Government is going to encourage institutional investment in the private rented sector, helping to deliver approximately 15,000 new homes for rent. There are currently 54,000 in the pipeline.

Fairer rents 

The aim is to make renting fairer for tenants and to promote transparency. That includes the growing number of leaseholders (there are around 4 million leasehold homes in England).

Renters often face upfront costs including fees charged by letting agents to tenants and tenants often have no control over these fees because the agent is appointed by and works for the landlord.

To combat this the Government has already introduced transparency in respect of fees and are going to consult early this year, ahead of bringing forward legislation as soon as Parliamentary time allows, to ban letting agent fees to tenants. This should improve competition in the market and give renters greater clarity and control over what they pay.

Safety and standards

landlord responsibilities The Government will also continue to try to drive up safety and standards in the private rented sector and drive out rogue landlords.

In the white paper, the Government repeated its intention to implement measures introduced in the Housing and Planning Act 2016, which will introduce banning orders to remove the worst landlords or agents from operating and enable local councils to issue fines as well as prosecute. But we’re still waiting for details.

Other measures may include making electrical safety checks for rented properties and client money protection for letting agents mandatory. An announcement on this is expected soon.

Finally, the Government also plans to extend mandatory licensing of Houses in Multiple Occupation (HMOs) which will ensure greater protection for thousands of vulnerable tenants.

Family friendly private rented sector

According to a Shelter report last year, an estimated 65,000 families say that they were forced to move their child’s school the last time they moved within the private rented sector. The predominant use of 6 and 12-month contracts can mean that families who are renting need to move home before they had planned, and that’s alongside the uncertainty and costs associated with taking on a new rental property.

In light of this, it has become the Government’s intention to make the private rented sector more family-friendly by taking steps to promote longer tenancies for new build rental homes.

You’ll find the full white paper report here but I’ll keep you up to date with any developments.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/590043/Fixing_our_broken_housing_market_-_housing_white_paper.pdf

www.ewemove.com/dorkingGraham Faulkner is Branch Director of EweMove Dorking and he’s also a portfolio landlord, as well as specialising in helping other landlords. Apart from his own experience and expertise, he can also recommend the right professionals, as tried and tested by him, to advise you.

Multi award winning EweMove in Dorking is a residential property sales and lettings agency who pride themselves on being refreshingly different and standing out from the crowd. EweMove Dorking covers from Ockley to Oxshott.

Enquiries to 01306 406 506 / 01372 701 702, or via email to dorking@ewemove.com

The pros and cons of short term letting

The pros and cons of short term letting

So, you’ve got a spare room and your friends have told you to list it on one of those portals, you know the ones. It’s a great way to make easy money, they tell you. Or perhaps you’re taking off on holiday and could do with the cash or maybe, you have a second property and are attracted by the lure of high rents.

Short term letting is a booming business at the moment, as a means of providing both tourist and domestic accommodation. In London, the boom is putting untold pressure on the availability of housing as well as the hotel industry and even Airbnb agree there’s a need to monitor and regulate.

So, should you jump on the bandwagon and make your buck or is it more trouble than it’s worth?

Let’s start with what a short let is?

A short let is generally considered to be anything less than 6 months and normally the rent includes utilities, TV and internet. The premises in question is also normally fully furnished and equipped, with bed linen provided. Beyond that, there’s a great deal of diversity. Your short let might be letting your spare room, letting your house while you’re away or letting your second property / buy to let property. It might mean letting for a day, a week or 5 months.

The pros

bank-17816The main and obvious advantage is that tenants will normally pay more for short term lets. For example, lets of 3 months may earn you double the going rate of a 6-month tenancy and lets of a month or less, can earn even more. The rental transaction costs to landlords of using some of the popular portals are also usually lower than using a letting agent.

If you own your own place and are going away, a short term let in your absence can provide a great solution. Someone to water your plants, feed the cat and pay you rent while you relax and unwind. Or perhaps a lodger in your spare room a few nights a week may be enough to help make ends meet.

The cons

But don’t get carried away. For a start, don’t forget you’ll have other expenses to pay. For most short term lets, you’ll probably have to pay the council tax and water bill. If it’s a holiday let you may also have other services to cover like electricity and Wi-Fi.

Another key consideration is making sure your property is health and safety regulation compliant. That means risk assessments, gas and electricity inspections and appropriate fire precautions. In most circumstances you will need to ensure that you have a Energy Performance Certificate (EPC) and this requirement applies to holiday lets (if you let your property for more than 4 months in a year) and room rental if the room is self contained and has its own bathroom, toilet and kitchen. In short, check the regulations carefully to make sure you comply.

beer-414914_1920You also have to consider the demands of a high turnover of tenants. That’s cleaning, marketing and managing your property in between tenants. And the chances are you won’t have much opportunity to vet them. Ask anyone who has let property on short term lets and you’ll probably find they’ve had mixed experiences: some tenants leaving their property spotless, others leaving it in an absolute tip. And there’s not much you can do about that if they do.

There’s also the day to day management of the let and the state of your accommodation. Short term tenants have high expectations of your property and if something goes wrong, they usually expect it to be dealt with within the day. Not much fun, if you’re on holiday the other side of the world or caught up in your working day.

Finally, as the owner of a property with a mortgage to pay, the big problem with short term lets is that you face a very real risk of long periods when your property is empty.

Don’t forget the legalities

There are of course always the legalities you need to comply with as well. In London, you cannot let your property on a short let for more than 90 days a year. Wherever you are, you should always check with your lender if you have a mortgage, whether that’s a buy to let mortgage or not, to see what the terms are about letting. And don’t forget you’ll need appropriate insurance, then there’s the tax implications of extra income and the question of whether you’ll need an accountant.

You should also check with your local council and if you’re a leaseholder, check the terms of the lease. After all, if you fail to comply with the legal requirements, those attractive rents will be eaten up very quickly if something goes wrong.

Is short term letting for you?

Short term letting has been revolutionised by the likes of Airbnb, and although controversial, short lets are here to stay. Whether it’s right for you will remain a personal choice depending on your particular circumstances but don’t just get caught by the pull of high rents. Make sure you consider all the implications and take appropriate advice from a professional before you jump on the bandwagon.

www.ewemove.com/dorkingGraham Faulkner is Branch Director of EweMove Dorking and he’s also a portfolio landlord, as well as specialising in helping other landlords. Apart from his own experience and expertise, he can also recommend the right professionals, as tried and tested by him, to advise you.

Multi award winning EweMove in Dorking is a residential property sales and lettings agency who pride themselves on being refreshingly different and standing out from the crowd. EweMove Dorking covers from Ockley to Oxshott.

Enquiries to 01306 406 506 / 01372 701 702, or via email to dorking@ewemove.com

Avoid being gazumped

Avoid being gazumped

In the face of gloomy predictions from the Government about the state of the property market, what is clear is that the demand for property is greater than ever.  In the south-east, that means if you’re a buyer, you face fierce competition.

Recent research by Market Financial Solutions (MFS) found that on average, 5% of buyers across the UK have been gazumped. That’s a whopping 1.5 million buyers with the figures, much, much higher in London. The costs of being gazumped are also high. There’s the stress and distress of losing out on the home that you loved as well as the potential to lose thousands of pounds in unrecoverable fees.

The practice of gazumping is not illegal. Even after your offer is accepted, and until contracts are exchanged, in theory, there is nothing to stop a seller accepting a higher offer. Even if you’ve spent money on surveyors and / or on solicitor’s fees.

hand-819279As spring approaches and the property market bursts back into full swing, if you’re looking to buy, now is the time to take all possible steps to protect yourself against the possibility of the dreaded gazump!

  1. Get your finances in order

Cash buyers or buyers who have already sold their own property are always an attractive prospect to sellers. Get your current property on the market well in advance of your search and if possible, make sure you have your finance in place. If you’re getting a mortgage, try and arrange to have an offer in principle.

Funding a deposit is also often a challenge but there are various Government initiatives available including the Help to Buy ISA*. Whilst it may mean a delay in your purchase, having funds puts you in a stronger position.

  1. Insist it’s taken off the market

stamp-1726355_1280When your offer is accepted insist the property is taken off the market and monitor what happens. If the property listing remains as it is (not marked sold or at least as under offer) that could be an indication that all is not well, as is a seller who refuses to take it off the market. Forewarned is forearmed.

 

  1. Keep in touch

Once your offer has been accepted it’s important to keep the sale progressing as quickly as possible. That may mean keeping in touch and chasing your solicitor if necessary. But it is also important to build a rapport with your estate agent. You want to both keep your estate agent in the loop and be kept in the loop, and a good estate agent will not condone the practice of gazumping.

Should the worse still happen and you are gazumped, the relationship with your estate agent could stand you in good stead. Not least if the gazumper’s purchase falls through, you may still be in with a chance.

  1. Consider protection

Ask your solicitor or estate agent about the possibility of insurance against gazumping or a lock-in agreement. A lock-in agreement normally requires a payment of a deposit and prevents the seller negotiating elsewhere for a set period of time. If they do, they forfeit their deposit which might not save you heartache but should cover any wasted fees.

*If you are saving for a deposit for your first home, and are eligible for a Help to Buy ISA, the Government will boost your savings by 25%. So, for every £200 you save, you receive a government bonus of £50. The maximum government bonus you can receive is £3,000.

Multi award winning EweMove in Dorking is a residential property sales and lettings agency who pride themselves on being refreshingly different and standing out from the crowd. EweMove Dorking covers from Ockley to Oxshott.

Enquiries to 01306 406 506 / 01372 701 702, or via email to dorking@ewemove.com

Update on Right to Rent and Banning Orders

Update on Right to Rent and Banning Orders

No Right to Rent

If you’re a regular reader of this blog, you will recall back in June last year, I blogged about the new Right to Rent provisions. They include some very severe penalties (including criminal offences), for those landlords who fail to carry out Right to Rent checks. Back then, it was still unclear how quickly the authorities will act and what will be considered as “taking reasonable steps” to terminate a tenancy.

right to rentThe requirements

The Act came into force on 1st December 2016 making it a criminal offence to let to a tenant who has no Right to Rent. As a landlord, you now have to check everyone over 18, even if they are not named on the tenancy and regardless of whether you think they are a UK citizen.

You must check:

  • whether they will be using your property as their main home
  • original copies of their documents confirming their Right to Rent.

Make sure the copies are genuine, take and keep copies and make a note of the date of the check. It must be at least 28 days before the tenancy starts.

You must also do follow-up checks, either just before:

  • the end of your tenant’s permission to stay in the UK, or
  • 12 months after your previous check,

whichever is later. You don’t have to do a follow-up check if there’s no time limit on your tenant’s permission to stay in the UK. If you are in any doubt about any of the provisions, get in touch.

A slither of good news

On the bright side, a close inspection of the details of the Act reveals a slither of good news.

The Act provides that if there is no Right to Rent, the landlord can terminate the tenancy by serving a Notice to Quit in writing. That Notice to Quit can then be enforced as if it is an order of the High Court.

Without getting too technical, that makes enforcement easier and quicker with no prior court approval required. Of course, the Notice to Quit must contain the correct information so do take advice before serving. And while this may seem like a small win for us landlords, it still represents a little good news.

Banning orders update

banning orders You may also recall that The Housing and Planning Act 2016 introduces a new power to serve a banning order on certain landlords or property agents. The Act came into force in May 2016 but not the provisions in respect of banning orders which remained unclear.

To date, we know that the Act introduces measures enabling local authorities to tackle rogue landlords, including the provision of a national database of those convicted of certain offences.

We also know there will be fairly substantial penalties including fines of up to £30,000 and Rent Repayment Orders to cover illegal eviction, breach of a banning order or failure to comply with certain statutory notices.

Beyond that, there’s been very little clarity on what will constitute a rogue landlord and how the provisions will be rolled out. There is, however, currently a Government consultation which will close on the 10th February 2017. It is anticipated that some initial civil penalty provisions will come into force in April 2017 and further provisions about the database will be in force in October 2017. With luck, that means some long-awaited clarification, so watch this space.

Keep up to date 

It might be tempting to think that some of the new legislative provisions won’t affect you. After all, I don’t imagine you’re planning on becoming a rogue landlord. But however you came into your role as landlord (whether accidently or not), it’s really important to keep up to date with developments. Ignorance is normally no defence and little mistakes could cost you dear. I’ll keep you updated as we learn more.

Multi award winning EweMove in Dorking is a residential property sales and lettings agency who pride themselves on being refreshingly different and standing out from the crowd. EweMove Dorking covers from Ockley to Oxshott.

Enquiries to 01306 406 506 / 01372 701 702, or via email to dorking@ewemove.com

Some last minute landlord party advice

Some last minute landlord party advice

One last Christmas humbug

I know everyone’s in full festive swing and bursting with Ho Ho Ho. But before I sign off for the year and head for the mulled wine and mince pies, I’ve got one last humbug I need to impart and then just a small dash of Christmas cheer.

I don’t want to dampen your spirits but a word of warning to tenants and landlords alike.

beer-414914_1920Parties are of course par for the course at this time of year but before you pop the first popper or open your doors to a stranger please bear in mind the following.

1. If you’re a landlord, make contact with your tenants and remind them about what is permitted by the tenancy agreement and what is considered acceptable behaviour. You may have specific terms about parties or you just may need to “gently” remind them about noise nuisance, damage and what the consequences will be.

2. If you’re a tenant, you do not want to forfeit your deposit, face eviction in the new year or worse, so if you’re thinking of holding a party:

  • Let your neighbours know and be considerate. Think about noise levels and how long a party is going to go on for particularly if this is likely to affect those next door. When it gets to 11pm, turn the noise or the music down and make sure you’re not making a noise, night after night. Remember, section 144 of the Housing Act 1996 provides that excessive noise nuisance can be possible grounds for eviction.
  • Be very careful who you invite. Not everyone will take as much care as you do in respect of the fixtures and fittings and it’s your deposit on the line! If the worst does happen and something gets damaged, be honest about it to your landlord and tell them as soon as possible. That won’t guarantee you won’t have to pay for it but it will go a long way towards some goodwill.

On a brighter note, does your property welcome pets?

According to a recent survey, people who rent in the UK are prepared to pay £484 pet tenancy clauses more a year in rent for somewhere that accommodates their furry friend, with properties with a garden or near a park scoring particularly well! In fact, the survey reveals that 9% have paid for an extra room for their pet, with dogs being the favourite and cats in second place.

If you’re a landlord, allowing tenants to keep pets may be something that you’ve steered well away from and perhaps that’s part of the problem. We’re a nation of animal lovers and there’s not much we won’t do for our pets. 7% of those surveyed had kept a pet without the permission of their landlord and 21% had gone to the effort of agreeing a pet clause and having it included as a term of their tenancy.

Allowing pets may not be for you, but if you have a property you’re struggling to rent or could really do with that extra bit of income, it’s something that might be worth considering. It’s also far better to have an open conversation with a prospective tenant about the keeping of pets and then include a suitable pet clause in the tenancy, than to find out that they’ve being keeping a pet without permission and then lose someone who was otherwise a good tenant.

More and more people are turning to renting as the only affordable housing option and we do love our pets. They don’t necessarily have to be the nuisance or make the mess that we sometimes anticipate and are of course, often an important part of family life. Tap into that part of the tenant market and you may just find the hair of the dog is the answer to your rental headache. It’s certainly worth a thought isn’t it and I’ll be blogging about pets and tenancies in more detail in the new year.

On that note, and with a glass in my hand that’s brimming over with good cheer, may I wish you a very happy Christmas and a successful 2017. See you on the other side.

Multi award winning EweMove in Dorking  are a residential property sales and lettings agency who pride themselves on being refreshingly different and standing out from the crowd. EweMove Dorking covers from Ockley to Oxshott.

Enquiries to 01306 406 506 / 01372 701 702, or via email to dorking@ewemove.com

Is your property a threat to life?

Is your property a threat to life?
Multi award winning EweMove in Dorking  are a residential property sales and lettings agency who pride themselves on being refreshingly different and standing out from the crowd. EweMove Dorking covers from Ockley to Oxshott.

Enquiries to 01306 406 506 / 01372 701 702, or via email to dorking@ewemove.com

Is your property secure?

Is your property secure?

Is your property at risk? 

As Christmas approaches and we fill our homes with seasonal (and often expensive) gifts for loved ones, many burglars are rubbing their hands with glee. Dark nights provide easy cover and cold weather keeps people off the streets with their curtains closed. All of which makes the life of a burglar a lot easier.

In 2015 the Crime Survey for England and Wales (CSEW) found that there were almost 800,000 instances of domestic burglary in the UK, with most perpetrators preying on vulnerable properties with poor levels of security. That means approximately 1 burglary every 40 seconds, the majority of which are not planned, but are just opportunistic.

Did you accidentally leave your door unlocked?

With an estimated 64% of UK householders admitting to occasionally leaving their house unlocked when they go out, it’s not hard to see how those opportunities arise. Amazingly 73% of burglars use the door!

home security So if you want to do everything you can to make sure you’re not the next statistic, now is the time when you need to give serious and urgent consideration to your property’s security.

 

Your alarm system

According to recent research, less than half of UK adults have a burglar alarm or security system installed at home and only a quarter of those automatically contact the police.  And that’s made worse by the finding of a survey by the Halifax that only 34% of householders actually activate their alarm on a regular basis.

Make sure you have the best possible alarm and that it is functioning properly. Then make a commitment to always use it when you are out. If you let your property, remember to remind your tenants of the importance of the alarm and the need to use it.

Consider other forms of protection too, such as light timers (fewer than 25% of people in the UK use a light timer), movement sensors (only 18% of householders own movement sensors) and security cameras (only 9% of householders have these).

Locks and doors

Check the quality of your locks and the state of your windows, doors and frames. key-123554You should have a deadlock and all your locks should be of British or European standard. If you are in any doubt, call a locksmith to double check for you.

Consider using toughened glass for windows and avoid glass panels if you can. Don’t forget to check door and window frames too, as rotten wood makes easy work for a burglar. And above all else, remember to lock your windows and doors at night or when you are out.

Be neighbourhood aware

33% of householders who took part in the Halifax survey assumed another neighbour’s alarm was a false alarm! Take time to get to know your neighbours or notify them when your property is going to be empty. Join any Neighbour Watch scheme in your area and add their sticker to your window.

Be social media savvy

7% of people tag their location on Twitter and/or Instagram when they are on holiday. But tempting as it is to let your friends know on social media that you are heading off to the Caribbean for 2 weeks at Christmas, you might as well just invite the burglars to visit while you’re away.

Take advantage of new technology

The wonders of advancing technology, mean that you can now control devices in your home via your mobile phone or tablet. As long as you have wi-fi, you can monitor, view and control your home security, so if you love technology this may be the answer for you.

There is a large amount of common sense and good practice involved in keeping your property secure. Keeping the area around your home well lit, hiding keys or just leaving the lights and radio on are all a good start. Taking a little time now to assess your security and put some measures in place could go a long way to saving you from the heart ache and hassle of a break in in the coming months.

Award winning EweMove in Dorking  are a residential property sales and lettings agency who pride themselves on being refreshingly different and standing out from the crowd. EweMove Dorking covers from Ockley to Oxshott.

Enquiries to 01306 406 506 / 01372 701 702, or via email to dorking@ewemove.com