Death of BMV and NMD

What does BMV, NMD mean, is it some kind of government defence initiative. Well for the uniniated BMV is Below Market Value and NMD is No Money Down deals. Both were creations of an overheated buy-to-let mortgage market where landlords could buy property and then immediately remortgage finance at a higher value than the initial purchase price.

I've recently argued that BMV is dead because surveyors will now only value a property by taking open market value (OMV) as what ever the price the property was sold for however, much of a bargain a landlord thinks they have been able to secure.

I recently started a raging debate on this forum by suggesting that BMV was dead.

It appears that there are a lot of people who disagree. It is an interesting debate and revealing not least in the respect that those people that seem to have the most to say are also the ones that have a large interest in flogging so called BMV properties to unsuspecting landlords. Funny that!

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Landlords face growing issue of unpaid local housing allowance from tenants

This BBC article warns landlords of the perils of the Local Housing Allowance.

Reporting on the growing number of landlords who are facing unpaid rents from tenants.

Read full BBC article

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In a nutshell

Twitter, twitter, twitter everywhere about house prices and the economy.

Here’s all that Property Sparrow knows about the subject:

On 2 February 2007 she bought a three bedroom Victorian terrace house for £125,000. It was a wreck. She had central heating installed, the house rewired, a new kitchen and bathroom fitted, new carpets, roof repairs, damp proofing and the house redecorated throughout. She spent days digging the garden.

On 1 June 2007 Property Sparrow sold the house to a couple in their 30s who had a little boy aged about 7. They paid £162,500.

With realising it at the time, she sold the house at a high price and made a modest profit. A fluke. Property Sparrow’s middle name is not Sarah Beeney but she enjoyed doing this refurbishment and was delighted in seeing a house that had been empty for a year come back to life.

Imagine her distress then in June this year to see a ‘For Sale’ board outside the house, almost two years to the day since the completion of the sale.

It turns out that the couple had got further and further behind with their mortgage, moved out and one night put the keys through the estate agent’s letterbox. A formal repossession followed a few weeks later. The house has now sold, and it has sold quickly, for £130,000, a drop of 20% in the value since February 2007.

You only know what you know, wouldn't you say?

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Naming and shaming of rent dodgers

I recently came across this article about some Scottish landlords that have resulted to putting signs outside tenants houses who have failed to pay their rent.

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The move has been started by Lease2keys.

Director Elaine Stenson said: "It's quite a drastic measure and a novel approach to the problem, but it's something we had to do.

"We feel the public will be rightly concerned that their taxes, some of which is used for housing benefit, are not reaching their intended target.

"Millions of pounds are being lost across Scotland through unpaid rent because under current guidelines, no action can be taken against a tenant until they are over eight weeks in arrears."

This campaign comes of the back of the recently introduced Local Housing Allowance that requires that the rent is paid directly to the tenant.

There is growing coverage of how the system appears to be failing landlords despite the government claims that the system is working well.

Landlords who think about taking similar naming and shaming practices of bad tenants should be cautious that they don't fall fowl of the law relating to harassment contained within the Protection from Eviction Act 1977.

We think that naming and shaming is too timid anyway. What we really want is a good public flogging or beating!

Should we name and shame bad tenants?

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Property women of the year

We can announce the list of the property women of the year. Unfortunately NO Margo which means that her little black number will have to go back in the wardrobe for now. Apparently she is at home being consoled by relatives. Sorry Margo - it's back to the rubber gloves for now.

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The NLA Property Women Awards 2009 were launched in April this year, searching for women who are savvy and successful in the property investment market. Judged on their property portfolio, financial success and personal achievements in the private-rented sector, the following property savvy women are now down to the final three in their respective regions:

East of England: Karen Murray, Irene Turner and Christeen Wilson

East Midlands: Tracey Abbiss, Rachel Hutchinson and Sarah Stanier

London: Barbara Gwyer, Kate Partridge and Valerie Pierres

North East: Anne Jackson, Karen Rutter and Julie Willis

North West: Pauline Ginty, Malika Jennings and Sylvia Marrs

Scotland: Elaine Stenson, Pauline To and Gerry Whelan

South East: Susan Hainsby, Kathy Nevell and Rosemary Robertson

South West: Anne Jarrett, Caroline Lindegaard and Fiona Macaskill

Wales: Sandra Cook, Jane James and Elizabeth Paterson

West Midlands: Gillian Coleman, Glenda Houston and Joanna Phillips

Yorkshire & The Humber: Samantha Allen, Shona Davison and Sandra Widdrington

All of those who entered were also invited to enter two additional awards. For the eco-conscious landlord, the NLA Green Property Woman Award was up for grabs to honour those who have made a commitment to improving the environment. While those under the age of 30 years old, who had already made an early mark on the property market, could be eligible for the NLA Young Property Woman Award. The finalists are:

Green: Fiona Macaskill, Kathryn Nevell and Elaine Stenson

Young: Amy Dixon, Elaine Duthie and Sophie Macaskill

All of the finalists have their own remarkable stories to tell and each stands a chance of winning the biggest accolade: NLA Property Woman of the Year 2009 at a prestigious awards ceremony in Central London on Thursday 23 July 2009.

The Awards will be presented by property addict and TV presenter Melissa Porter, who has supported the Awards since their launch, commenting: “Amidst the adversity in the market place, these women have shown themselves to be in a league of their own. Their determination and savvy business approach make them a cut above the rest and I think it’s so important to celebrate the women who are not only transforming the property market, but also their lives, and in many cases the lives of their tenants.”


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Landlords to be targeted by tax authorities

As the government runs out of money the tax authorities are tightening the noose on a whole range of groups in a bid to raise additional tax sums. The latest group to be targeted are residential landlords.

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According to a recent report in the Times the governments latest plan is to give additional powers to the taxman in the form of the HMRC to triple the amount of tax it raises from Britain's 700,000 landlords.

HMRC is proposing in para 4.40 of their proposed bulk information measures to force letting agents to hand over the names and addresses of landlords that they not only manage a tenancy for a landlord as is currently the case; but also where a landlord may use the letting agent for a let only service. Currently, the HMRC do not have such powers to compel agents to disclose this information.

We think it's another case of big brother Gordon snooping into the private affairs of landlords as the Government desperately try to raise more revenue and stop themselves drowning under a sea of debt!

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