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Thursday, April 30, 2009

Who Provides a Better Service to Landlords, Individual Landlords, Letting Agents or Institutions?

A tenant advocates renting property direct from private landlords and avoiding renting through letting agents.

It's interesting hearing that he sees the direct relationship a tenant has with a private landlord as far more positive than dealing through an agent.

As the government pushes the private rental sector away from individual landlords into the arms of institutions, it begs the question who truly provides tenants with a better service, individual private landlords, agents or institutions.

Let's face facts, this government has got a dreadful track record for managing the property market.

HIPs anyone? Property market crash! Local Housing Allowance ............

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Landlord Horror Movie - Strange Tenants Look to Cause Trouble

Trailer for the new 'Landlord' low budget horror movie from America.

The creative mind is a truly wonderful, inspiring thing.

PropertyHawk will try to get an interview with the director and the main stars of the film when they visit London for the premiere ( especially the green one and the weired masked woman, thingy ..... ...... ?

As a multi-layered reference to the current economic segregation between home and non home owners, we see it as a master piece of its genre.

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Landlords Shouldn't Trust Any Tenants Not Even the Old Ones

A tenant reference company,Letting Protection Service (LPS), reports that older tenants are equally as untrust worthy as the youngsters.

There poll of 10000 landlords apparently had 21% of landlords reporting having received fake references from prospective tenants aged 60 and over, with 43% of the landlords reporting the same fakery from prospective tenants 50 and over.

The shocking comparison, from their poll showed that 42% of landlords questioned had experienced the same experience with prospective tenants aged under 29.

What the poll seems to indicate is that landlords shouldn't trust any tenants whatever age.

Handy statistics from a company selling tenant referencing.....mmmmmmmmmmmm.

Lenin and Gordon Brown would be proud - ldls.

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Landlords Need to Take Swift Action Against Non Payment of Rent

Landlords are warned of the increased importance of acting quickly if a tenant misses a rental payment to avoid further financial losses.

Susan Prince, a property litigation specialist at Black Country law firm George Green LL has been warning Birmingham landlords of the dangers of not taking swift action against tenant who miss rental payments.

“Now more than ever before, landlords must monitor their bank account regularly to see if rent payments have been made on time. These days this can be done by using the internet or telephone banking rather then waiting for monthly bank statements to arrive. If a tenant defaults, swift action must be taken.

Read the full article in the Birmingham Post

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The Buy-to-let Barometer Shows Signs of Increase in Interest

The Daily Mail's buy-to-let barometer ( how very Alan Carr ) shows an increase in internet search activity for the term buy-to-let.

According to the 'buy-to-let barometer' the term was searched 3,191 times this March, which is an increase of 27% from the 2,472 for March 2008.

Whether this is an indication of renewed interest in the sector we will have to wait and see.

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Scottish Landlord Registration Scheme Criticised by Landlords

Shelter has called for a review of the Scottish compulsory landlord registration scheme after it reports that one in four rented properties were not registered.

A spokesman for the scheme responded to Shelters demands by saying that the scheme said the scheme was working well and would be evaluated in 2010.

Read more in the Times

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Wednesday, April 29, 2009

Landlord makes fortune out of painting

Landlords, have you ever had tenants try to pay you off with something other than good honest cash. If so I bet it was never a piece of art.

If a landlord has got a tenant that is a struggling artists, then it might be worth considering taking one of their creations as a down payment if this story of a Leeds landlord is anything to go by.

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Landlords left out in the cold by Coverheat

Landlords have been left out in the cold according to a recent report in the Guardian. The paper draws attention to the experiences of some of the users of the boiler insurance which was meant to save landlords the hassle and expense of boiler repair.

Latest reports from the same paper show that those behind the company now appear to have disappeared completely leaving the boiler insurance that many landlords had taken out to be worthless.

Boiler insurance - is it worth it?
Boiler insurance - who should I use?

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Tuesday, April 28, 2009

LHA offers landlords opportunities

Landlords who have been letting to tenants on benefits will be all too aware of recent changes in the housing benefit system which have caused considerable problems for landlords previously used to receiving rent direct from the local authority.

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Under the new Local Housing Allowance (LHA) system landlords are no longer able to claim the rent direct from local authorities but have instead to seek payment direct from the tenant. Only in exceptional circumstances will the LA pay the landlord direct, for instance if they are 8 weeks or more in arrears or if they are deemed to be 'vulnerable'.

Property Sparrow in her recent post on the LHA outlines just who and why it is so unpopular.

Meeting with Rent Service

However Property Hawk is always keen to give the other side of the argument. Following a recent meeting with a couple of senior representatives from the The Rent Service which monitors the rents paid by landlords in order to set the LHA rent levels, it was highlighted to me that there are some advantages to the new system. Some landlords are actually doing well out of the LHA by playing the system.

Some landlords doing well out of LHA

A landlord recently e-mailed Property Hawk with his experiences outlining how he is using the rule changes to his advantage.

"The local LHA for my area for a 1 bed flat or studio was set at £105 p/w, under the old rule I was only able to get the rent officer to agree £85.00 leaving the bulk of my tenants to pay a £10 top-up Many of my long term & trusted tenants were persuaded to go over to LHA by stopping their H/B for 1 week and then restarting it. Many of these tenants have issues that would be acceptable for direct payment anyway. The result is I now get £105 clear and the tenant has no top-up to worry about, and in some cases they even get a small differential payment each month. Result for me is £16k p/a extra rent and no work to chase top-up. I figure if I lose a bit to non payment of LHA by stupid tenants I am still quids in overall. The maximum they can go is 8 weeks before direct payment is resumed, 4-5 weeks of that is covered by deposit so assuming there is no damage at the end of the tenancy maximum loss exposure is only 3-4 weeks."

LHA increase business risk to landlord

Where it does seem to work is where a landlord has a trusted tenant in place who pays the rent. A landlord can then 'milk' the more generous rents being paid in some areas under the new system by getting these tenants to move from housing benefit to the LHA. The big problem is where a landlord considers taking a new tenant receiving benefit. This is because the LHA greatly increases a landlords business risk of not getting paid. Many landlords have been put off taking on new benefit tenants for exactly this reason and with unemployment rising rapidly; some estimate there will be another million unemployed by the end of the year. This will put an increasing burden on housing provision for benefit receiving tenants.

If the government does want the private rental sector to play a full part in meeting this demand then they will need to rethink urgently this element of the LHA. Given this was central to the whole idea of the LHA of paying tenants directly then this does call into question the workability of the entire scheme. It's terrible when practicalities get in the way of such a perfect theory! Doesn't life just suck?

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Monday, April 27, 2009

Grubby politician

As if property management wasn’t already glamorous enough, this story in The Telegraph has everything: red wine stains, a ‘rusty orange’ floor, a filthy kitchen sink and a minister in dispute with his landlord.

Note the minister claimed £100 MPs expenses for cleaning and £586 for repairs while he was renting this flat.

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Landlord Horror Stories - Tenants Share their Experiences

Scottish tenants report on some landlord horror stories, sponsored by Scottish Shelter.

Some landlords need to take their property management duties more seriously.

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The British Housing Market Continues to Dissapoint - like the weather

Those landlords hoping that the housing market was starting to improve alongside the fine weather may have to face the return of the drizzle, as figures released today show the number of mortgages approved for house purchases by banks fell by 7% in March.

Maybe, as ever, the anticipation of a great summer thanks to a few weeks of blue sky and sunshine might be a little premature. Here comes the rain again.

The British Bankers' Association (BBA) said its members had approved 26,097 loans for house purchases over the month, down from 28,024 in February.

Read more in this Guardian article

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More dislike the LHA

The Local Housing Allowance system in which the allowance is paid directly into tenants’ bank accounts has been in place for just over a year now. See previous posts here from the Editor about the problems that the system is causing for landlords and tenants.

Crisis, the homelessness charity, has recently done a survey on the system and their findings suggest that just about everyone involved in the LHA dislikes it. They surveyed 180 councils and voluntary organisations working in benefits advice. 82% of the councils said that tenants are falling behind with their rent and more tenancies are being terminated, voluntarily or through the courts, under the new system. It leads to wasted work for their staff at a time when the demand for prompt, efficient assessment of benefits and allowances and for homelessness advice is on the increase as unemployment rises.

This article reaffirms that landlords and tenants don’t like the LHA. It quotes a tenant, Mr Chapman, who says ‘ if I know my rent is paid, I can go and look for work and get on with my life.’

So, landlords don’t like it, tenants don’t like it, staff in councils administering it don’t like it, voluntary advisors and homelessness charities don’t like it. The Department of Work and Pensions is carrying out a review of the LHA and will report on it in the second half of 2010.

In the meantime, perhaps it’s only the banks that like it. They get their money. They have more customers: more people have opened bank accounts since April 2008 in order to get their LHA paid
to them and the Citizens Advice Bureau say they have seen cases of tenants whose allowance has been appropriated by their bank because the tenant’s bank account is overdrawn.

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Property Marketing Costs for Landlords Continue to Fall

Property marketing deflation means that landlords are finding that uploading property to Rightmove et al , is becoming better value than golf shoes on sale at Aldi.

There was a time that the likes of Discount Letting would get a landlords property on the main property portals for £59. This price has been dropping faster than the FTSE 100 over the past 12 months and Landlord Direct are now offering their tenant find service for £29.

That's half the price that landlords would of expected to have paid not that long ago.

Expectation is that these prices might continue to fall further as competition hots up, but it obviously cant continue to fall at this same rate, because that would make the service FREE, and who gives away their landlord services for FREE?

......well apart from us.

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Letting agent renewal fees

Landlords using a letting agent to manage their property will be interested to know that the long standing high court case between the OFT and Foxtons starts in the High Court today.

The outcome of which will have long standing ramifications across the letting industry as to whether letting agents can charge renewal fees.

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Saturday, April 25, 2009

Landlords owning holiday homes to be hit

According to a recent report on Moneywise holiday homes owners are going to be smarting after the budget cuts the tax benefits they had previously enjoyed.

People who own a holiday-home in the UK will lose a range of tax benefits from next April after a hidden clause in the Budget revealed the holiday lettings rules are to be scrapped.

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Under current legislation, landlords who own a holiday property in the UK enjoy several benefits under the Furnished Holiday Lettings (FHL) rules, including being able to write off any trading losses (such as loss of rental income) from their second home on their tax bill and being allowed to postpone any capital gains tax by investing in another property.

A furnished holiday letting business may also be exempt from inheritance tax where the lettings are short-term and the owner is significantly involved with the holidaymakers’ activities.

However, the 2009 Budget reveals these benefits will be abolished from April 2010. The only silver lining is that, until that happens, the FHL rules will be extended to those with qualifying homes within the EU.

For a property to qualify as a 'furnished holiday lettings’ it must be furnished, available for letting to holidaymakers for at least 140 days a year and let out for at least 70 days a year - but not occupied for more than 31 days by the same person in any seven-month period.

The property also has to be let out to holidaymakers and tourists in order to qualify.

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Friday, April 24, 2009

Buy-to-let mortgage - C and G tighten criteria who next?

The shifting sands of the buy-to-let mortgage market continue to be reshaped by the current economic climate.The latest changes are being proposed by one of the largest buy-to-let lenders Cheltenham & Gloucester (C & G ) who are part of the massive Lloyds Banking Group which includes: Halifax, Birmingham Midshires.

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Landlords had in recent years got used to being able to finance larger and larger portfolios as lenders did away with restrictions relating to portfolio size and replaced this with individual affordability tests relating to each buy-to-let property and mortgage.

This appears to be changing again as lenders attempt to restrict their exposure to the buy-to-let market and any one landlord.

Both C & G and Platform have recently announced changes to tighten up the assessment of lending to portfolio landlords.

For example the C & G now insists on landlords with more than 3 buy-to-let mortgages to be automatically referred to an underwriter for detailed affordability checks.

It has also been reported that C&G applicants can now have no more than £500,000 in mortgages across the Lloyds Banking Group, which would be a significant restriction for buy-to-let portfolio borrowers.

Borrowers can have up to £5m mortgaged across the group, but any applications above £500,000 will need to be manually assessed. Plus the borrowers will have to have an income of at least £50,000 (to borrow less than £500,000 you need an income of £35,000).

Another feature of C&G's lending criteria is that it works out affordability on a 'notional rate' basis. What this means is that it will check you can afford your repayments assuming the interest rate is 8%.

That seems a little unfair with many of the lender's products at around 5.5%, but C&G is in fact building in a buffer to ensure that when rates rise - as they surely will - its borrowers will still be able to afford their monthly repayments.

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Some lenders work in a buffer by asking for a minimum expected rental income of 125% of your monthly repayments. In other words you need to be able to get rent in over and above what you will have to pay your lender. C&G is simply using another method.

And it's sensible to do so. Rates will increase, landlords have unexpected maintenance costs and tenants do not always pay the rent. It is right to work out affordability with a good amount of leeway.

Direction of travel

It is vital to note that all the points above are C&G's lending criteria, not Lloyds Banking Group's.

So Birmingham Midshires, for example will not necessarily look at group borrowing -- for now. But the mortgage industry is fearful that the C&G criteria change is the thin end of the wedge for the buy-to-let sector, and will lead to further changes across the group, limiting borrowing from all Lloyds Banking Group lenders.

Some believe it is only a matter of time before Birmingham Midshires (the largest specialist lender in the country) restricts its buy-to-let criteria for example. And it's fair to assume that other lenders could follow such a move.

In others words, the whole sector could further tighten which would be a disaster for business levels. The only really active buyers in the sector are professional portfolio landlords who by definition have a greater number of mortgages. Further stifling them will do nothing to help the market in general.

Latest developments in the buy-to-let mortgage market are shown courtesy of Emoneyfacts:

  • Alliance & Leicester
  • END DATE on buy-to-let FIXED RATE extended to 31 July, w.e.f. 24.4.09....more
  • 24 Apr 2009
  • Newbury Mortgage Services
  • Buy-to-let FIXED RATE of 5.99% to 31.3.14 withdrawn, w.e.f. 23.4.09....more
  • 23 Apr 2009
  • Shepshed BS
  • NEW buy-to-let STANDARD VARIABLE RATE MORTGAGE of 5.54% for term, VARIABLE BASE RATE TRACKER of 5.45% for 2 years and FIXED RATE MORTGAGE of: 5.95% for 2 years launched, w.e.f. 22.4.09....more
  • 22 Apr 2009
  • Newbury Mortgage Services
  • BUY-TO-LET LENDING AREA amended to include GL, BS, BA, DT, BH, PO & BN postcodes, w.e.f. 21.4.09....more
  • 22 Apr 2009
  • Post Office®
  • FIXED RATE MORTGAGES of 6.31% & 6.51% to 31.5.12 withdrawn & replaced with new rates of 6.30% & 6.50% to 31.5.12, w.e.f. 22.4.09....more
  • 22 Apr 2009
  • RBS IP NatWest
  • Buy-to-let FIXED RATE MORTGAGE of 5.95% available via directly authorised brokers only, withdrawn w.e.f. 22.4.09....more
  • 22 Apr 2009
  • Lloyds TSB Scotland
  • MAXIMUM PORTFOLIO unchanged at 9 properties within Lloyds TSB Group, but only 3 may be self-funding i.e. using rental only calculation....more
  • 21 Apr 2009
  • Northern Rock
  • END-DATES on buy-to-let FIXED RATE MORTGAGES extended to 1 June, w.e.f. 21.4.09....more
  • 21 Apr 2009
  • Cheltenham & Gloucester
  • MAXIMUM PORTFOLIO unchanged at 9 properties within Lloyds TSB Group up to a maximum of £5m, but only 3 may be self-funding i.e. using rental only calculation....more
  • 20 Apr 2009
  • Platform
  • Buy-to-let FIXED RATE with "House Plus" criteria withdrawn, w.e.f. 17.4.09. MAX PORTFOLIO reduced to £1m and MAX PROPERTIES reduced to 3, w.e.f. 20.4.09....more
  • 20 Apr 2009
  • Royal Bk of Scot Mtges Direct
  • END DATES on buy-to-let FIXED RATES extended to 30 June, w.e.f. 18.4.09....more
  • 20 Apr 2009
  • NatWest Mortgage Services
  • END DATES on buy-to-let FIXED RATES extended to 30 June, w.e.f. 18.4.09....more
  • 20 Apr 2009
  • Woolwich
  • END DATES on buy-to-let FIXED RATE MORTGAGES extended to 2nd August, w.e.f. 17.4.09....more
  • 17 Apr 2009

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RICS - new guidance on new build valuations

Landlords looking at buying or selling new build properties should be aware that the Royal Institute of Chartered Surveyors (RICS) have drawn together and published for the first time all aspects of how they expect their members to approach the difficult task of valuing new build properties in a 'Guidance Note' to be published on 1st May 09.

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This follows on from changes to the valuation bible the Red Book which in September made it mandatory for members to ask the seller, builder or developer on site, or their selling agent, for a copy of any 'disclosure of incentives' for the new home property under consideration.

The form, prepared in accordance with guidance from the Council of Mortgage Lenders (CML), will consist of 12 questions which disclose the full details of all financial and non-financial incentives and also details of any third party interest in the transaction.

The guidance puts into context new-build valuations in the wider economic environment emphasising the relevance of the guidance to all market conditions, both in the heady days of a boom and the gloomy days of a recession.

The note stresses the need for valuers to differentiate between the new build premium, that portion of the price paid which will evaporate as soon as a newly-built property is occupied - and those value-adding factors (such as better building materials, enhanced insulation levels, or more efficient heating systems) which are intrinsic to a new property and which will remain when the home is sold.

RICS Spokesperson Barry Hall said: "All parts of the property industry are in agreement that standards must be maintained and this guidance note will provide the foundations stones for valuers working in the new build market. Developers and lenders agree that raising standards in the profession will benefit business and the consumer."

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Thursday, April 23, 2009

A thumbs down from the property industry for Budget 2009

More reflections post Budget on the impact on the property market, the Telegraph reflects the overall negative response from the property industry regarding Alistair Darling's budget.

Yolande Barnes,from Savills reflects that the budget “neither addressed the underlying structural problems of the market nor some of the new challenges it faces in future.”

Read more in the Telegraph article

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Fancy being lord of the manor?

As I am sure most of you do I get regular newsletters from Rightmove and generally I have to admit they just go straight into my SPAM box. However this particular article tickled my fancy and I just had to draw it to your attention.

The village of Linkenholt is for sale - yes the whole village! All the land, 21 houses, a manor house, 2 blacksmiths and a shop. Sadly the 12th century church of St Peters is not included in the price which is a cool £25 million.

Now I haven't run the figures to see whether this represents a good investment or not but it is certainly an unusual opportunity :)

All the best from the Happy Piggy at NSP Resources
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Budget 2009 - housing market boost?

Alistair Darling presents his plans to prevent the continued collapse of the housing market.

Read a landlords perspective on the 2009 Budget.

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Celebrity landlord - Stirling Moss talks on being a landlord.

There are a number of celebrity landlords. One who cuts quite a dash is the famous racing driver Stirling Moss. According to a recent article in the Independent Stirling discouvered buy-to-let investing at 32 after a racing crash that almost killed him. Following his retirement he looked for a new career and found it in property.

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Moss invested in property throughout London looking for run down properties that needed work doing to them. He now has 43 tenants with a central London buy-to-let portfolio running into tens of millions.

He is critical of the current law which he does not think helps good landlords.

Stirling Moss will be discussing his property portfolio on MONDAY 4TH MAY 13.00-13.45 in the Grand Seminar Theatre, sponsored by the Electrical Safety Council, at this year’s Grand Designs, Live, London -

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Wednesday, April 22, 2009

Landlords - who's talking the market up?

Landlords have seen a resurgence of confidence in the housing market as the banking crisis stabilizes.

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However, before landlords get carried away and start jumping back into the market on the back of press comment and report. This article by Patrick Collinson in the Guardian provides a useful perspective on who is 'zooming who' when it comes to the press articles that seem to rattle around the Internet about buying property.

It just shows that landlords need to be careful what they read and who lies behind the stories before acting.

All I can say is Property Hawk is independent to it's core. We are simple landlords who don't believe the hype, distrust government and company spin. The only thing we peddle is the simple honest truth, you may not agree. If so feel free to tell us.

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Landlords dilemma

Landlord will be able to identify with this. The call. The silence. Then the words.

"I'm phoning up because I want to give you my one months notice."

OK I thought. The tenant has been struggling to pay the rent and was still slightly behind despite genuine efforts of trying to catch up. We had previously agreed a payment plan and he had been sticking to it.

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Following a brief chat about paying back his deposit it turns out that he had found a cheaper flat £295 pcm and was looking to move there. My flat was currently rented to him at £375. Now my dilemma as the landlord was do I let him go, given that he was slightly behind on his rent anyway. Or do I try to keep hold of him as a tenant knowing that to do this I was going to have to take a cut in rent.

I had to make a snap decision. I quickly evaluated that to relet it was going to cost me £200 in letting fees. On top of this we could be looking at a months void. Having spoken to Shaun a few times although I'd never met him. I'd gleaned that he was a nice enough young man, setting up and budgeting on your own for the first time isn't always easy. I gambled that the hassle of moving would be worth £30 a month.

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"If I was to say to you £325 per month would you still want to move". I wasn't sure if it was he wanted to move to the new flat or just he couldn't afford the rent on my apartment.

A pause. His reply. "I don't suppose you could make it £315 pcm?"

This time my turn to pause. Voids, hassle, inventories, weird requests on Gumtree.

"OK" I said. He needed the weekend to reflect on it. But I was pretty confident that the hassle factor of moving would be overiding.

I spoke to Shaun yesterday and he wants to stay on. I remain fully let and for the time being the cashflow just keeps coming in. In these tough times landlords will increasing face these dilemmas. How we respond to them could make the difference between 'sinking and swimming."

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Tuesday, April 21, 2009

Reading landlords get shown how to be green

Reading landlords get shown how to be green at the Landlord Information Evening organised by Reading and Wokingham borough councils and The University of Reading.

Landlords can find out about the incentives on offer for energy performance in rented accommodation.

Guest speakers Jan Bartlett from the Association of Residential Letting Agents (ARLA) and National Association of Estate Agents (NAEA) will look to inform and educate on other landlord related topics.

The event at the university’s Palmer Building on the Whiteknights Campus runs from 6.30pm to 9pm.

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Landlords Budget Predictions ( should we look away now? )

Landlords, it's that time of year again. It's BUDGET time.

So what is our darling Alistair going to conjure up this time?

One prediction in the Times is slightly worrying for landlords considering the current flooded rental market.

Andrew Stanford, of Cluttons, the chartered surveyor, believes there might be an announcement of plans to finance thousands of new homes to rent. He predicts that the Chancellor might encourage pension funds and insurance companies to invest in a large-scale build-to-let programme, by offering a guaranteed 8 per cent gross yield for a fixed period.

The aim of which would be to try to revive the housebuilding industry, Mr Stanford speculates “As other government initiatives to stimulate the supply of housing have failed to produce anywhere near the number of properties needed, the Government must listen closely to those in the industry who know what it will take to attract institutional funds.”

With the current flood of rental property market keeps a downward pressure on rental amounts, this is not necessary great news for landlords in the private rental sector.

Read more predictions on the budget in the Times.
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Tips for Landlords Looking to Minimise Rent Arrears from Tenants

We have just had this set of tips sent through

Top Tips for Landlords to Minimise Rent Arrears
In the current economic climate and with more ‘accidental landlords’ than ever letting property, it’s never been more important to do all you can to avoid rent arrears.

Take these straightforward steps to reduce the risk of prospective tenants slipping into rent arrears.

Bank on It
Ask potential tenants for at least three months’ worth of bank statements so you can see their salary going into their account and have evidence that they’ve been paying their rent regularly. Bank statements will also give you an idea of how affordable they will find the rent that they will be paying you.

Work it Out
Obtain an employers reference in writing and don’t take it as read that the reference is current. Google the company for the phone number (don’t rely on being given it by the tenant) and call your prospective tenant’s employer to confirm that the company exists and, equally importantly, that they are still an employee.

Get a Reputation
Speak to your prospective tenant’s previous landlord/s to establish whether they were a reliable tenant; an invaluable way of flagging issues that could be hiding around the corner.

Vote of Confidence
Check the electoral roll to confirm that the tenant has given you an accurate previous address. This can show that they’ve not been trying to avoid being liable for council tax and also helps to confirm whether a reference from a previous landlord is current and genuine (in the event that you’re unable to speak to them directly).

Passport to a Trouble-Free Tenancy
Ask the prospective tenant for a copy of their passport and visa, if required. This not only helps confirm their identity, but also whether they can legally remain in the country for the entire period of the tenancy.

Guarantee any Doubts
If you are uncertain that the tenants will be in a position to pay their rent every month for the term of the tenancy, secure a UK-based guarantor who will then be liable to pay the rent, should the tenant default.

Ask an Expert
If all this sounds like an awful lot of work, use a reputable letting agent to arrange your tenancy and ensure that they take these steps on your behalf to carry out a rigorous suitability assessment before your tenant moves in.

Insure your Peace of Mind

As a last resort, and for added peace of mind, consider taking out an insurance policy to cover the rent in the event that the tenant doesn’t pay – but bear in mind that this can be an expensive option.

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A landlords maintenance list can be endless with some properties

I reflect on Property Sparrow's post on a landlords maintenance list that is seemingly endless, that landlords face when a managing their property portfolios.

All those hours landlords spend sprucing, cleaning, painting, fixing and bodging, those endless trips meeting with tenants, trades and various others.

These hours of unpaid, laboursome hassle that landlords find themselves doing, often during unsociable hours or at weekends and holidays.

So when landlords consider buying their next investment property maybe a prediction of the hours involved should be factored into any investment appraisal to truly calculate the perceived returns.

If landlords were to price their time at say £20 an hour, the returns of some of their investment properties start to look far from attractive.

I know from experience that some properties will be more work than others.

For example a nice family house might see a slower turnover of tenants, which saves on the time involved with re-letting, the refurbishment spruce up to attract new tenants and the viewings and paperwork.

Remember an old property usually requires endless maintenance so newer property holds an appeal for landlords who don't want to spend weekends up ladders.

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Landlords get rid of rubbish for FREE and save the planet

Landlords are increasingly aware of our responsibility to do our bit to save the planet and cut down on waste.

Landlord insurance - professional rates - discounted

One thing that many landlords particularly developer investor landlords may find useful is a website called Freecycle. This site which is effectively an e-mail group hosted by Yahoo. It allows landlords to get rid of rubbish for FREE through the 'community' of recyclers. This can be particularly useful where a landlord has finished a development and wants to get rid of the left overs which are perfectly serviceable but will just end up cluttering a landlords garage.

Another helpful site is Gumtree which allows landlords to advertise FREE STUFF.

Landlords - save on tipping costs, transport costs and save the planet into the bargain.

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Monday, April 20, 2009

Hotel investment close to administration.

Landlords who were tempted to invest in a new breed of property investment by buying a hotel room may well be regretting the day as another operator has filed for administration.

The future of buy-to-let company Owner Hotels is uncertain with reports suggesting it is just days from entering administration.

The company, which operates hotels in Hull and York, uses a model where an investor buys a hotel room on a 999-year leasehold basis with prices ranging from £70,000 to £120,000.

The investor is then entitled to stay in the hotel for up to 52 nights a year free of charge, receive 50% of the net room rate, with a guaranteed annual return.

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Headless chicken

Property Sparrow has four properties let out. Quite average some would say. Sometimes she thinks it would be good to have more, sometimes she doesn’t.

In the last two weeks it’s been one thing after another.

Flat 1 – no hot water from washbasin tap. Ground rent, insurance and half-yearly service charge due.

Flat 2 – shower not working. Ground rent, insurance and half-yearly service charge due.

Flat 3 – washing machine not spinning, clothes come out soaked and still dirty. Ground rent, insurance and half-yearly service charge due.

Flat 4 – freeholder is painting new white lines and numbers in the car park and all residents have been asked to park somewhere else Mon- Fri. Some residents have ignored this request causing delay and aggravation. Ground rent, insurance and half-yearly service charge due.

No let up at the moment.

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Buy-to-let Debate on CityWire -

CityWire writers Lorna Bourke and Tony Bonsignore go head to head over the merits of buy-to-let. Landlords might want to review the Citywire debate here.

The question is, Buy-to-Let, should we discourage it?

Over to the floor....

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