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Monday, October 20, 2014

Average rents fall by 0.3% reports Homelet


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Saturday, October 18, 2014

10 things you need to trace a tenant

On the first ever Letting Essentials Course we learnt from Simon Bennett of Springfield Associates  what the 10 essential pieces of information that a landlord needs are if a tracing agent is going to be able to find a tenant who has disappeared.  They are surprisingly straightforward, but having these bits at information at the start of the tenancy could give you up to a 75% of your tenant being traced if they abandon your property compared to the figure of only 9% success rate for debt recovery in the courts.

The information he suggest that are needed are:
  • FULL name including all middle names 
  • Correct date of birth 
  • Last known address 
  • Last permanent address 
  • Family address 
  • Partners FULL name 
  • Partners last known address and permanent address 
  • Family address 
  • Phtographic ID - driving licence, Home Office ID card, Passport 
  • National Insurance number
 How many of these do you obtain from your tenants before handing them the keys?  Tracing costs start from £75 but be warned finding a penniless tenant can be less than useless if you want your money back...unless you have a solvent tenant guarantor in place.

Worth thinking about.....

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Friday, October 17, 2014

Letting Essentials Course - NEW DATES

Letting Essentials the course to give landlords, letting agents and property professional the essential insights on how to let residential property legally has just had a number of new dates announced:

Friday 24th April 2015
Monday 6th July 2015

The two courses will take place in Sheffield and Nottingham or Derby next year.

For more details and to book a place: training@propertyhawk.co.uk

08458684070

Landlord Training - expert insights

Thursday, October 16, 2014

Miliband to ban BTL investors buying new builds

The rumour is, Labour will announce new council powers today, that will enable them to ban buy-to-let investors from purchasing in
designated new build developments.

The proposed ban is part of the the Lyons review, part of which is  looking at ways to promote opportunities for first time buyers.

The review proposes handing new powers to councils which would enable them to stop investors from buying new build property in certain areas/developments.

Ed Miliband has been reported by the FT as saying "A significant proportion of homes on those sites cannot be bought by anyone before first-time buyers from the area have been given the chance." 

The proposals are focused on relieving the property shortages in the South East, particular in certain  London boroughs where much of the new build property is being taken by foreign investors.

Alongside the block on BTL investors, the 180 page Lyons review on the future of housing puts forward Labour's aim to build 200,000 new homes by 2020.

“We propose that local authorities apply their powers, funding and incentives to take a proactive approach to land assembly and locally led development models in housing growth areas,” the report says.

Lyons also recommends giving greater planning powers to local authorities who form what are being tagged as 'Homes Corporations' similar to those held by the now defunct Urban Development Corporations.

Well, that all sounds like a bit of vote winner.

Read the full 180 page - Lyons Housing Review

Or read comment from -




RLA accuse Shelter of distorting evictions

Shelter's have been pumping money into their most recent campaign to convince the general public we are suffering from an eviction epidemic. The charitable / tax payer funded campaign group would have us all think that landlords are bludgeoning tenants out onto the street if they so much as turn their nose up at the state of a microwave.

"Please Mr Landlord, could you put a front door on my property."
"A door, whatever next? You're evicted!"

This is far from the truth. The majority of landlords want to keep tenants for as long as possible. Re-letting a property is a costly and time consuming exercise that is best avoided. 

I suppose we shouldn't be surprised to find that political campaigning is biased, warped and manipulative of the truth. It's why so many of us have lost faith in the entire political system.

Today's political furore involving Lord Freud is a classic example. Politicians seizing on a sound bite, like cheap lawyers, dissecting a phrase or sentence out from it's context, blowing it out of proportion and sensationalising it for a cheap point score.

It's embarrassing, and sadly it reveals politicians for what they are, ugly actors and PR bunnies.

In the Lord Freud case, though his wording was ill considered, the fact that he was at least debating the issue and looking for solutions should be looked on as a positive. ( I did spend five years setting up projects and schemes for adults with learning difficulties so understand some of the issues his comments were directed at.)

The cheap political point scoring only goes to underline how one word out of place can be seized upon and man-handled into some kind of dishonest truth. 

So I say it again, that's why people have lost faith in politics.

Anyway, enough of my Thursday morning rant, back to evictions.

The Residential Landlords Association has pointed out that according to figures in the most recent English Housing Survey,  2012/13, there were seven per cent of tenants who had been asked to vacate  their rental property in the last three years. This is a fall of 2% from the previous years figures, with the 2011/12 English Housing Survey recording a figure of nine per cent.

The RLA has said that the majority of evictions happen for legitimate reasons, a landlords wanting to sell, or  perform refurbishment extensive work,  or because tenants aren’t paying their rent or are committing anti-social behaviour. 

The association claims the figures expose Shelter’s campaign today as “irresponsible scaremongering which can only serve to unnecessarily frighten tenants” according to

Policy director Richard Jones, policy director for the RLA has accused Shelter of putting out "highly questionable" statistics. 

Going on to accuse the charity of “irresponsible scaremongering which can only serve to unnecessarily frighten tenants”

“The official figures show quite clearly a fall in the number of tenants having their tenancies terminated and by far most of these are for perfectly good reasons. Shelter’s campaign on so called revenge evictions is totally inaccurate and irresponsible”

“To severely restrict landlords’ right to regain possession as Shelter advocates would severely damage confidence in the sector. This would reduce supply at a time of high demand causing more people to be homeless and we thought Shelter is all about reducing the number of homeless” he says.

Sadly, Shelter have a lot more money to throw their distorted PR messages our there.

But heh, that's politics for you.

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Wednesday, October 15, 2014

Forever tenants - give up on ownership

Aviva reckons that in their recent survey 35% of renters aged between 35 and 44 believe they will never be able to buy a property. This figure rises to 50% the 45 to 50 year old tenants.

The survey found that 41% of renters had lived in a rented home for more than five years.

What this tells me, is keep your tenants happy, and they might still be with you in decades to come. 

My record tenant has been with me since I started, he's paid me seventeen years of rent and saved me a fortune in re-letting.

You've gotta love him....

Leicester landlord jailed for eight months

A landlord has been jailed for eight months for ignoring fire safety regulations at a pair of rental properties in the Highfields area of Leicester.

Haresh Rambhai Patel, had failed to act on safety warnings given to him back in 2012, when in May 2013 the adjoining rental properties caught fire, and three tenants had to be rescued by firefighters.

At Leicester Crown Court, Judge Robert Brown concluded: 

“These offences show you failed in virtually every aspect of fire safety in relation to 9-11 Evington Street. You failed to prioritise your obligations as a landlord, whilst taking the rent.”

Mr Patel pleaded guilty to seven offences under the Regulatory Reform (Fire Safety) Order 2005 during an earlier hearing at Leicester Crown Court.

This eight months sentence, is in addition to s an existing £38,000 fine, granted by the magistrates court earlier this year following a separate council prosecution, for Patel's failure to obtain the required licences on the pair of properties. 

At yesterday’s hearing, Patel was ordered to pay a further £13,704 in prosecution costs.

Mr Patel, has since spent £36,000 on fire safety measures across his rental portfolio of sixteen other properties.

A warning to all of us.

Tuesday, October 14, 2014

Life time tenancy purchasing

The Telegraph have done a piece on buying rental properties with lifetime tenancies.

At discounted values of around sixty percent, one investor has taken the opportunity to buy one for his two year old daughter.

However, I cannot help but see it as a bet on death, or would the term 'life expectancy' be a more sensitive way of putting it?

Anyway, no wheeze, no win.

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Contingency planning for BTL mortgage rate rises

Contingency planning

Andy Young, at Property Hawk Mortgages says:

It is highly likely that interest rates will start to rise during the course of the next couple of years, although I think the increases to Bank of England Base Rate will be small and in gradual increments, perhaps reaching 2.00% by the end of 2016. This of course means that the pricing of buy-to-let mortgages is likely to rise too as lenders retain their profit margins.

When considering the implications of a potential rate rise, there is no need for landlords to panic, but some contingency planning is definitely prudent. It is advisable to consider whether current rental income is sufficient to cover any increase in monthly mortgage payments and to ensure a surplus for potential void periods. Most lenders are conservative with their rent stress tests and will only approve a buy-to-let mortgage where the rental income is at least 125% at a notional interest rate of 5.00% of the loan amount. This should provide a sufficient rental income buffer for most properties.

For landlords who prefer to know exactly what their monthly payments are going to be, choosing a fixed rate mortgage may be the preferred option. At Property Hawk Mortgages, our most popular buy-to-let products are often 2 year fixed rates. However, there has also been an increase in demand for 3 year and 5 year fixed rates in recent months.

There is certainly a good argument for fixing over a longer period such as 5 years. Although 5 year money is more expensive and the monthly mortgage payment will be higher, it does provide security and peace of mind over the longer period when interest rates start to rise.

Examples of fixed rates currently available:

2 year fixed - Mortgage Trust - 2.39% fixed until 31/12/2016 up to 75% LTV with a 2.50% completion fee and a free valuation

3 year fixed – Virgin Money – 3.39% fixed until 01/01/2018 up to 60% LTV with a £995 completion fee and £500 cashback

5 year fixed – Accord Buy to Let – 3.99% fixed until 30/11/2019 up to 75% LTV with a £800 completion fee

Although Base of England Base Rate is predicted to rise, I believe that 3 years into the future the ‘new normal’ is likely to be between 3.00% and 4.00% and that rates will remain lower than historical ‘pre-credit crunch’ rates of around 5.00%.


IMPORTANT! Due to current market conditions, lenders are withdrawing and replacing products with little or no notice. Please check our website regularly to see the most up-to-date products available.


Search the whole BTL mortgage market free

Email:info@propertyhawkbtlmortgages.co.uk

Tel: 029 2069 5446


Your home may be repossessed if you do not keep up repayments on your mortgages.
The Financial Services Authority does not regulate some forms of mortgage.

Be wary of fake tenant references

Landlords need to be wary of taking references provided by a potential tenant.

References are easy to fake.

There are now even online sites that provide fake landlord references. For a fee, these fake reference companies will even answer the phone to give verbal confirmation that the tenant/ client is the epitome of high morale and trustworthiness. So glowing in fact, you might even consider inviting them to move in with you.

Here's an example of one such fake referencing site.

Once in, however, it might become clear why the tenant used a fake reference service in the first place, but by then it will be too late.

So be warned, and always take up the usual tenant checks alongside any reference provided by a potential tenants - however professional it might appear.

Get a tenant reference here

Landlords reminded of the dangers of CO

For those landlords who still resist giving proper attention to their gas appliances, this close shave involving the dangers of carbon monoxide poisoning might slap them into action.

Fortunately, this time around, the tenants recovered, but it could have all ended very differently, after a the a four month old baby was rushed to hospital for treatment.

The family had been feeling unwell for months prior to the incident, unaware that the invisible killer, CO, was leaking from faulty gas appliances at the rental property.

The landlords, Mehboob Bobat and Suraiya Bobat, were both found guilty of breaching health and safety regulations, following the Health and Safety Executive (HSE) discovery of  two faulty gas heaters, a gas fire and a gas boiler. 

Trafford Magistrates Court were told the tenants had been feeling unwell for months. 

The mother had collapsed on the kitchen floor, but had put it down to complication in pregnancy, the husband had suffered also suffered from headaches.

Finally, after feeling particularly unwell, they called for an ambulance, and after being rushed to hospital were treated for high levels of carbon monoxide poisoning.

The landlords failed to provide a copy of a valid landlord gas safety certificate to the court, and pleaded guilty to two breaches of gas safety regulations.

Each landlord was sentenced to 80 hours of community service and each were ordered to pay costs of £720.

Property forecast to go up by 30%

The crystal ball is out again. This time, Rightmove and economic forecast agency Oxford Economic are peering into the future.

They predict great fortunes, with average house price increasing by 30% over the next five years.

Regionally the south will perform best London predicted to rise by 33%, the south-east by 37%, whilst the North West sees the smallest rise of 24%.

These predictions have been described as 'the most comprehensive house price forecast of its kind ever created,' with data from both asking prices, sold prices and surveyor valuations being thrown into the mix.

Miles Shipside, Rightmove director and housing market analyst comments:

“Alongside the publication of the Rightmove monthly House Price Index which is based on new seller asking prices, we have unique access to other sources of property data from surveyors and property transaction prices at a very local level. This has enabled us to work with Oxford Economics to create a unique forecast that can be used as a guide by a number of businesses."

“Understanding the path of future house price growth is a key element of UK economic strategy and decision making, and our data driven forecasts contain insight not previously available from other commentators or the Government’s own forecasts produced by the Office for Budget Responsibility.”






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House prices to surge 30% over 5 years

The latest survey from economic forecaster Oxford Economics is talking about a rise of house prices of over 30% in parts of the south east in the next 5 years.

Top hot spots have been identified as Southampton with a suggest increase of 43% followed by Luton and Brighton at 41%. The suggestion is that the buoyant London housing market will spread out over the South East in a ripple effect. Outlying areas such as Carlisle and Manchester are only expected to see house price increases of less than 20%.

Interestingly, the survey has been commissioned by Rightmove. Have you ever seen an estate agent which effectively Rightmove is, ever calling an end to a booming housing market. Wouldn't that be like turkeys calling for Christmas?

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Monday, October 13, 2014

Most popular BTL mortgages

Max LTV Initial Rate Term Completion fee Booking fee Incentives Lender
85% 5.29% Fixed 2 Years 2.5% £130.00 No Kent Reliance Semi Exclusive
85% 5.99% Discount 2 Years 3% £130.00 No Kent Reliance Multi Let & Ltd Co. Semi Exclusive
80% 3.99% Fixed 2016-12-31 £2495 £150.00 Free valuation Mortgage Trust Exclusive
80% 4.99% Fixed 2016-12-31 0% £150.00 Free valuation Mortgage Trust Exclusive
80% 4.09% Discount 2 Years £750 £250.00 No Hanley Economic Exclusive
75% 2.39% Fixed 2016-12-31 2.5% £150.00 Free valuation Mortgage Trust Exclusive
75% 3.79% Fixed 2016-12-31 0% £150.00 Free valuation Mortgage Trust Exclusive
75% 2.5% Discount 2 Years £1995 £250.00 One free Valuation on properties valued up to £1,000,000 Hinckley & Rugby Exclusive
75% 5.39% Variable 0 Years 2.5% £0.00 No Saffron Light Refurbishment
70% 2.5% Fixed 2016-11-30 £2495 £245.00 Free valuation and free legals for remortgages (properties valued up to £500,000). Skipton Exclusive
65% 2.99% Fixed 2017-01-31 £1995 £150.00 Free valuation Mortgage Trust Exclusive
65% 3.49% Fixed 2017-01-31 0% £150.00 Free valuation Mortgage Trust Exclusive
60% 2.45% Discount 2 Years £1950 £250.00 One free Valuation on properties valued up to £1,000,000 Hinckley & Rugby Exclusive
60% 2.25% Fixed 2016-11-30 £2495 £245.00 Free valuation and free legals for remortgages (properties valued up to £500,000) Skipton Exclusive

IMPORTANT! Due to current market conditions, lenders are withdrawing and replacing products with little or no notice.  Please check our website regularly to see the most up-to-date products available. 

 
Search the whole BTL mortgage market free
 

Email:info@propertyhawkbtlmortgages.co.uk
Tel: 029 2069 5446
Your home may be repossessed if you do not keep up repayments on your mortgages.  
The Financial Services Authority does not regulate some forms of mortgage.

Saturday, October 11, 2014

Sub-letting fees from freeholder

I have owned a property for the last 12 years.  The property is leasehold apartment rather than freehold which means I have to pay a ground rent to the freeholder.  This is the law and at £37.50 per year it's not expensive.

Change of address
I have just notified the freeholder of a change of address to make sure that I didn't miss any future ground rent demands.  The result of failure to pay the ground rent would be that ultimately a landlord could be exposed to the freeholder taking action for forfeiture and possession.

Sting in the tail
In the acknowledgement from the freeholder there was a sting in the tail.  A demand for another £50 for a so called consent to let.  Further investigation of this revealed that recent case law from the Lands Tribunal indicated that for any such consent the freeholder shouldn't charge anymore than £40

What will happen
I have written to the freeholder asking for the details of the part of the lease that stipulate the landlord is able to charge for this along with an explanation of why it has not happened before given that they have been aware for a number of years that the property has been rented out.  It will be interesting to see if they give me the courtesy of a reply or whether the first thing I get from them is the bill demanding the money later this year.

What are other landlords experience of this?  It would be interesting to find out as I prepare myself for a bit of a fight.

Landlord insurance - flats - hmo - specialist requirements

Thursday, October 09, 2014

Liverpool set to decide on mandatory licence

Liverpool City Council is set to make kits final decision on whether to introduce a mandatory licensing scheme for all its 50,000 private rented properties.

The decision is due to be taken tomorrow, and if it gets passed it will start next April.

80% of agents and landlords are against the plan.

The cost of the licence is expected to be £500 per property over five years.... so roughly £2 a week added to a tenant's rent.

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House price momentum slows says RICS

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Brokers accuse FPC of mission creep

The Bank of England's Financial Policy Committee have been accused by brokers of regulatory ‘mission creep’.


The move has shocked brokers, who accuse policymakers of giving out a confused message  following the introduction of the Mortgage Market Review in April.

 Jonathan Clark, Chadney Bulgin mortgage partner says while the mortgage industry is braced for regulation of the buy-to-let -market following the Treasury’s recent consultation on the EU mortgage directive, the latest move in relation to LTVs is bordering on “regulatory creep”.

Clark says: “We know they want to regulate buy-to-let, that is on its way and the industry is aware of it. The business about LTVs is worrying because the MMR was supposed to sort all this out and get us back to responsible, sustainable lending. No sooner had it dropped, however, than we get the LTI cap.

Read more in this Money Marketing article

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Wednesday, October 08, 2014

Auction property- free listing

I'll be honest I've never sold a property at auction. I did get as far as getting Savills to value a place I owned but was advised to keep hold of it. I'm glad I did it still one of my most consistent property lets and I'm sure it's value has rebounded considerable since the 'credit crunch'. I know at the time they were asking for a listing fee of about £600 whether the property sold at auction or not.

Free listing
I've been contacted by an Auction House in Nottingham who were offering a FREE auction appraisal service. Unlike the majority of auctioneers, they do not charge any upfront entry fees and you only pay us a fee when your property is sold. I've no idea what level of service is on offer so make sure you ask lots of questions and if it does look good please let us know by posting a comment below.

For more information call  0115 950 6611, or email to auctions@heb.co.uk

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