Private Landlords, Regulation and Accreditation

March 15th, 2012

Private landlords should comply with the rules or accept that worse could be yet to come says David Lawrenson of www.LettingFocus.com.

On many occasions I have said that now the private rented sector has grown so big and become so important, landlords must expect there to be no let up in the raft of legislation effecting what they do and their businesses.

Indeed, two new such changes – effecting energy performance certificates and the operation of the tenancy deposit schemes – come on board in a few weeks time – from 6th April 2012.

I’m on record as saying that I think the tenancy deposit scheme apparatus, as it exists, is ludicrous – a strange Antipodean-designed sledgehammer to crack a nut.

It might have been a better bet to have had a system that was entirely focussed on fast resolution at the time of dispute only. So, if a tenant felt that a landlord held back their deposit unfairly, they would complain to an appropriate body and the landlord would immediately have to pay over the deposit to that body, pending fast and fair resolution.

The situation we have got, where every single deposit must be protected hugely increases costs for landlords – and these are naturally passed onto the tenant as higher rents.

I’m not convinced of the value for money.

On New Rules

Landlords may baulk at all the new rules and regulations, but I take a different view.

I’m of the opinion that the business of letting property is an important one. By letting property landlords are responsible for other people having that most important of things – shelter.

So, we as a society simply cannot have a situation where landlords do not carry out their obligations under the law – whether that involves having proper gas safety checks done or protecting tenants’ deposits.

If people who are thinking of letting a property think they can just “get by” in a “Rigsbyesque” fashion, then they should be made to think again. To make them “think again” we need strong laws that more heavily penalise the type of lazy “accidental landlord” who has simply not bothered to find out what it is they should be doing.

I don’t take such a position in order to sell more copies of my book.

Rather, I take this position because I believe that unless we can show that there are high and constantly improving standards in the private rented sector, private landlords will eventually suffer a much more draconian regulatory environment of the type that is often demanded on the forum pages of “The Guardian” and “Inside Housing”.

Heavier Fines on Non Compliant “Accidental Landlords”

In a sense, we are where we are – and we are stuck with it.

And given that we have the current tenancy deposit scheme, private landlords will just have to “put up with it and deal with it.”

So, though I don’t much like the tenancy deposit schemes and I feel something could have been delivered that was better, I would still like to see far heavier fines on landlords who don’t comply with the rules that we have  – whether that is on gas safety, safe electrics or deposits.

On tenants’ deposits, landlords who don’t protect deposits will now face fines of between 1 and 3 times the deposit.

It should be much harsher than that, because knowing that there are harsh penalties, “the honest but lazy” type of landlord would have a real incentive to make sure they comply with all the rules.

A Possible Future of Heavy Bureaucracy for Landlords

If private landlords don’t comply with the rules that exist today, the calls for all landlords in England and Wales to be “licensed” or to be “accredited” will surely grow.

Naturally, it is likely that any such universal scheme would be administered by a hefty organisation, possibly run by local government.

It would probably be quite a job creation scheme and come at great cost, and like the universal landlords licensing scheme in Scotland, it would involve many civil servants busily running about ticking boxes and making sure every landlord is registered.

And while their focus and the whole attention of these administrators is on ensuring compliance of the many, the minority of really bad rogue landlords (see “Sheds with Beds” story reported here) will be totally ignored, off the radar and freer to flourish with impunity.

So, for the good of society, I would suggest that private landlords get in compliance now and ask the government for heftier fines for those among their number who don’t do the basics right.

If private landlords don’t do this, much, much worse will surely follow.

NEXT SEMINAR EVENT FOR LANDLORDS: We still have a few places left for our annual evening event – on Tuesday 20th March 2012: Landlord and Property Letting Seminar

ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of Private Rented Sector Consultancy and advice.

Services to Businesses and the Public Sector

We are advisors to a range of organisations including banks, building societies, local authorities, social housing providers, institutional investors and insurers. We help them develop and improve their services and products for private landlords.

We also write for property websites, speak at property events (send an email to david@LettingFocus.com to find out about our next event) and we are regularly quoted by the media.

Services for Private Landlords

We also help landlords and property investors by showing how to make money in the private rented sector using ways which are fair to tenants and which involve minimal risk to the investor.

AT OUR WEBSITE LETTINGFOCUS.COM:

HOME PAGE OF THIS BLOG click here: Blog

To read blog posts on related posts use the tags and categories at the bottom of each post (after the list of links), or over to the right of this page – where, you can click on “Select Categories” and use the pull down menu to read all the posts on any Category that interests you.

THE HOME PAGE OF OUR MAIN SITE

For our main home page click here:  http://www.LettingFocus.com

For general info on our CONSULTING SERVICES and also to find a small sample of links to where our comments have been featured in the National Press please click: Consultancy and Seminars

For ONE TO ONE PRIVATE CONSULTANCY FOR PRIVATE LANDLORDS click here: Property Advice

TO READ CLIENT TESTIMONIALS – from both organisations and private landlords click here: Testimonials

BUY “SUCCESSFUL PROPERTY LETTING”

Our book is the highest selling property book in the UK. Click here to Find Out More and Buy it at Amazon. If you are from an organisation and would like to bulk buy at least 50 books please ask us for special rates.

TO JOIN OUR FREE NEWSLETTER and get our latest Newsletter which goes to over 3,000 people (as at December 2011) just send an email to david@LettingFocus.com

We do not spam or sell our mailing list to advertisers, though we occasionally  mail landlords about good products from third parties. Please put us on your “white list” to ensure you receive our emails.

OFFERS ON PRODUCTS FOR LANDLORDS and TO ADVERTISE YOUR PRODUCTS to LANDLORDS click here: Landlords Resources

PERUSE LAST TEN BLOGS BY GETTING THE RSS FEED: Click Here

NEXT SEMINAR EVENT FOR LANDLORDS: Landlord and Property Letting Seminar

Copyright of Blog: David Lawrenson 2012. Please link to us here or quote us.We actively pursue copyright infringements. The blog is updated once a week.

TWITTER PAGE For my thoughts on property, personal finance, plus other random things from sport, to 80s and 90s Indy Music, to tsunamis to musings on boardroom pay, plus my (usually) centre left “take” on politics please see our Twitter page.

LINK TO THIS BLOG OR TO OUR WEBSITE

Tags: , , , , , , , , , , , , ,
Posted in Accredited Landlords, Deposit Bonds, Landlord Accreditation, Landlord Register and Licensing, Landlord Regulation, Register of Landlords, Scotland Landlords Registration, Tenants Bonds, Tenants Deposits, tenancy deposit schemes | Comments Off

The Private Rented Sector Landlords and Tax

March 7th, 2012

Private rented sector consultant David Lawrenson of www.LettingFocus.com looks at calls for reform of tax in the private rented sector.

In last weeks’ blog I looked at the housing associations, private landlords and the case for housing associations to get involved in “market renting”.

In the course of that blog I also mused on the government’s increasing willingness to get institutional investors involved in private sector lettings – and how they had already made changes to the stamp duty land tax system and to REITs to try to facilitate this – though thus far there have been few takers.

Making more publicly owned land available at a subsidy for “build to let” or part “build to let” is also on the radar.

I mentioned too that landlords associations representing the UK’s 1 million plus “individual landlords” were also asking for changes to the tax system for private landlords.

The Budget, the Private Rented Sector and Tax

All these requests are to be expected. After all there is a budget just around the corner, so it would be kind of surprising if we didn’t see lots of requests for better tax treatment making their way into the media and, of course, onto the Chancellor’s desk.

The Residential Landlords Association (RLA), quoting a report by housing expert Professor Ball, believes there is a compelling case “for change to sustain a viable and responsive PRS where landlords will continue to invest in and improve property”.

They claim that “the tax system can be used to help stimulate the PRS, without losing the total of the sum of tax taken overall”.

The RLA calls for a number of changes to the tax system including roll–over relief for capital gains when gains are re-invested and / or when a property is sold to a first time buyer and an extension to the Landlords Energy Savings Allowance (LESA).

The RLA argue that tax relief should be targeted on facilitating investment in building improvements, urban regeneration and energy saving in the here and now. They are also absolutely correct to point out that, “Capital expenditure on a dwelling can currently only be offset against capital tax liabilities at a later date which inhibits investment.”

Counter Arguments

Of course, the counter argument runs thus, “If you improve your property, sure, you may not get any tax breaks for doing so right now, but you will get higher rents, which should be more than enough to pay off the investment”.

And of course, the large active anti-private landlord lobby will also point out that landlords can already deduct from their rents, the total cost of loan arrangement fees and interest on borrowed money used for their residential letting activities.

The “anti-landlords” point out that this gives landlords a lower cost of capital and hence an unfair advantage over other house buyers.

And that is also a valid argument too.

Fair and Unfair Taxes

Of course, what one person thinks is a fair tax system is anathema to another person. Just witness the furious debate over Vince Cable’s proposed mansion tax, for example.

Whatever one thinks, the fact is that the private rented sector is now big business and as such, it will inevitably attract ever more calls to tax it differently.

Those involved in the sector must accept this fact and realise that the sector has come of age and will be scrutinized more in the future. Anyone who saw it as a safer, more reliable and flexible haven of investment than the traditional pension may begin to rest less easy in their beds.

Whatever happens, one could hope that institutional investors and the small scale landlords will be allowed to compete on an even and fair taxation basis.

But I don’t think this will happen because the former have the power to build large numbers of properties and the latter doesn’t.

ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of Private Rented Sector Consultancy and advice.

Services to Businesses and the Public Sector

We are advisors to a range of organisations including banks, building societies, local authorities, social housing providers, institutional investors and insurers. We help them develop and improve their services and products for private landlords.

We also write for property websites, speak at property events (send an email to david@LettingFocus.com to find out about our next event) and we are regularly quoted by the media.

Services for Private Landlords

We also help landlords and property investors by showing how to make money in the private rented sector using ways which are fair to tenants and which involve minimal risk to the investor.

AT OUR WEBSITE LETTINGFOCUS.COM:

HOME PAGE OF THIS BLOG click here: Blog

To read blog posts on related posts use the tags and categories at the bottom of each post (after the list of links), or over to the right of this page – where, you can click on “Select Categories” and use the pull down menu to read all the posts on any Category that interests you.

THE HOME PAGE OF OUR MAIN SITE

For our main home page click here:  http://www.LettingFocus.com

For general info on our CONSULTING SERVICES and also to find a small sample of links to where our comments have been featured in the National Press please click: Consultancy and Seminars

For ONE TO ONE PRIVATE CONSULTANCY FOR PRIVATE LANDLORDS click here: Property Advice

TO READ CLIENT TESTIMONIALS – from both organisations and private landlords click here: Testimonials

BUY “SUCCESSFUL PROPERTY LETTING”

Our book is the highest selling property book in the UK. Click here to Find Out More and Buy it at Amazon. If you are from an organisation and would like to bulk buy at least 50 books please ask us for special rates.

TO JOIN OUR FREE NEWSLETTER and get our latest Newsletter which goes to over 3,000 people (as at December 2011) just send an email to david@LettingFocus.com

We do not spam or sell our mailing list to advertisers, though we occasionally  mail landlords about good products from third parties. Please put us on your “white list” to ensure you receive our emails.

OFFERS ON PRODUCTS FOR LANDLORDS and TO ADVERTISE YOUR PRODUCTS to LANDLORDS click here: Landlords Resources

PERUSE LAST TEN BLOGS BY GETTING THE RSS FEED: Click Here

NEXT SEMINAR EVENT FOR LANDLORDS: Landlord and Property Letting Seminar

Copyright of Blog: David Lawrenson 2012. Please link to us here or quote us.We actively pursue copyright infringements. The blog is updated once a week.

TWITTER PAGE For my thoughts on property, personal finance, plus other random things from sport, to 80s and 90s Indy Music, to tsunamis to musings on boardroom pay, plus my (usually) centre left “take” on politics please see our Twitter page.

LINK TO THIS BLOG OR TO OUR WEBSITE

Tags: , , , , , ,
Posted in Build to Let, Capital Gains Tax, Housing Strategy and the PRS, Institutional Investment in the Private Rented Sector, PRSI, Private Rented Sector Initiative, Property v Pensions, Tax on Let Property | Comments Off

Housing Associations, the Private Rented Sector and Landlords

February 28th, 2012

In this blog post, David Lawrenson of www.LettingFocus.com looks at the growing clamour for housing associations and city investors to get into the private rented sector via “build to let” and thus offer a direct challenge to the UK’s army of private landlords.

In the report, “Where Next” published last year with PricewaterhouseCoopers, the housing association, L&Q explored the challenges facing the housing association sector after the end of the current spending review in 2015.

The paper proposed that housing associations could finance a move into “market renting” via their own balance sheets backed by councils using public land as equity whilst building a successful track record to attract institutional investors.

Tenants could be offered five year tenancies and hence get much greater security than they currently enjoy in the “buy to let sector” in which private landlords are usually restricted (by their lenders) to offer tenancies of no more than 12 months.

(Our own  research work has shown that there are actually few impediments to lenders in the “buy to lending  space” offering selected landlords the option to offer their tenants longer term tenancies for up to as much as 7 years. And the fact that they still don’t do so is something of an open goal to potential new entrants to come into the private rented sector from other housing sectors and using other sources of investment.)

Clearly there would seem to be something of a perfect match between the desire of the housing associations to offer well managed long term housing and tenants in the private rented sector, many of whom want just that.

Using the money from market rents the idea is that the housing associations would then be able to cross subsidise the development of “affordable homes”.

But many housing associations are still cautious and not sure how to make diversification viable, get it to fit with the rest of their business or generate high enough returns. And from a reading of the agendas at various National Housing Federations conferences, the housing associations’ leaders do not exactly have the debate at the top of their “To Do” list yet.

And there is still little sign of significant institutional investment with property companies still seemingly reluctant to take the risk to create the stock for investment by institutions.

Traditional “Buy to Let” Could Get Left at the Gate

Clearly, the housing associations and institutional investment sectors – the large scale “build to letters” – are the most obvious candidates as new entrants, providing they can make the returns stack up.

Whether they can do this or not may depend on what further tax breaks or concessions can be wheedled out of the government. In the last two years we have seen changes to the Stamp Duty Land Tax regime and changes to REITs to make large scale investment in the private rented sector more doable. We could yet see more incentives still.

Where does this leave the small scale private landlord whose success has done so much to grow the supply of property to let since 1988?

Not in a good place I would suggest, because the UK’s growing army of small scale private landlords (only a tiny fraction of whom are members of their associations) does not have the firepower or “lobbying wallop” that the British Property Federation, the city investors or the NHF have.

RLA Calls for Tax Concessions for Individual Landlords

However, small landlords associations are trying to fight back.

In an excellent paper by the Residential Landlords Association (RLA) and quoting insightful research by Professor Michael Ball, the RLA called for clever and targeted tax breaks for the small scale landlord and questioned the need for the bigger investors to enter the party.

The trouble is that many folk in politics think private landlords are lightly taxed.

My view on this is neutral but of one thing I am sure – the tax system certainly doesn’t do anywhere near enough to encourage the small scale private landlord to improve their properties, at least in the short term. Too much of the tax incentives are built around capital gains (long term) and fail to encourage private landlords to invest in the here and now.

This argument is part of the main thrust of the RLA paper. I will report more on this in a future blog post soon.

ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of Private Rented Sector Consultancy and advice.

Services to Businesses and the Public Sector

We are advisors to a range of organisations including banks, building societies, local authorities, social housing providers, institutional investors and insurers. We help them develop and improve their services and products for private landlords.

We also write for property websites, speak at property events (send an email to david@LettingFocus.com to find out about our next event) and we are regularly quoted by the media.

Services for Private Landlords

We also help landlords and property investors by showing how to make money in the private rented sector using ways which are fair to tenants and which involve minimal risk to the investor.

AT OUR WEBSITE LETTINGFOCUS.COM:

HOME PAGE OF THIS BLOG click here: Blog

To read blog posts on related posts use the tags and categories at the bottom of each post (after the list of links), or over to the right of this page – where, you can click on “Select Categories” and use the pull down menu to read all the posts on any Category that interests you.

THE HOME PAGE OF OUR MAIN SITE

For our main home page click here:  http://www.LettingFocus.com

For general info on our CONSULTING SERVICES and also to find a small sample of links to where our comments have been featured in the National Press please click: Consultancy and Seminars

For ONE TO ONE PRIVATE CONSULTANCY FOR PRIVATE LANDLORDS click here: Property Advice

TO READ CLIENT TESTIMONIALS – from both organisations and private landlords click here: Testimonials

BUY “SUCCESSFUL PROPERTY LETTING”

Our book is the highest selling property book in the UK. Click here to Find Out More and Buy it at Amazon. If you are from an organisation and would like to bulk buy at least 50 books please ask us for special rates.

TO JOIN OUR FREE NEWSLETTER and get our latest Newsletter which goes to over 3,000 people (as at December 2011) just send an email to david@LettingFocus.com

We do not spam or sell our mailing list to advertisers, though we occasionally  mail landlords about good products from third parties. Please put us on your “white list” to ensure you receive our emails.

OFFERS ON PRODUCTS FOR LANDLORDS and TO ADVERTISE YOUR PRODUCTS to LANDLORDS click here: Landlords Resources

PERUSE LAST TEN BLOGS BY GETTING THE RSS FEED: Click Here

NEXT SEMINAR EVENT FOR LANDLORDS: Landlord and Property Letting Seminar

Copyright of Blog: David Lawrenson 2012. Please link to us here or quote us.We actively pursue copyright infringements. The blog is updated once a week.

TWITTER PAGE For my thoughts on property, personal finance, plus other random things from sport, to 80s and 90s Indy Music, to tsunamis to musings on boardroom pay, plus my (usually) centre left “take” on politics please see our Twitter page.

LINK TO THIS BLOG OR TO OUR WEBSITE

Tags: , , , , , , , , ,
Posted in British Property Federation, Housing Associations, Housing Strategy and the PRS, Institutional Investment in the Private Rented Sector, National Housing Federation, PRSI, Private Rented Housing Investment Fund (PRSI), Private Rented Sector Initiative, Private Rented Sector Management, Private Renting Schemes, Residential Landlords Association | Comments Off

Private Landlords and Finding Information that is Useful

February 13th, 2012

When it comes to gathering information on the private rented sector or any sector, choose what you read with care says David Lawrenson of www.LettingFocus.com

Back when I was working for a bank I acquired a lot of bank shares. So did my partner who worked for another bank. They were worth quite a bit back in 2007.

And then, along came the credit crunch – and our shares tanked.

They are still worth maybe only 10% of what they were worth in 2008 and less than a third of the value of our own money that we put into them by way of share save options and profit share discounts.

Well, that’s life I guess – and there is a lesson in there about diversifying holdings in shares. (I also tell this story of the dangers of shares in my book, “Successful Property Letting”)

Of course, I know that one should have a balanced portfolio of shares, but I, like many others, thought that bank shares were as safe as houses.

Lack of Knowledge

Looking back on those days of 2006-7, it is pretty clear now that most people in government, probably all those in the FSA and probably quite a lot of senior executives in the banks too, did not know what was coming either. Hardly any of them understood or had a clue what the investment bank parts of the banks (what Vince Cable called the “casino sections”) were up to.

In the media, there were a few warnings in the FT, the odd insightful article, some murmurings that all might not have been quite right in the financial world, but that was about it.

So, what’s all this got to do with residential property and buying and managing property to let?

Well, actually rather a lot.

You see, very occasionally, I read all the broadsheet press to see what they are saying about the private rented sector and buy to let.

That Which Is Not Reported Matters a Lot

I always find that what they say in the mainstream press about the private rented sector is never completely wrong. True, it’s often biased and does not give a balanced point of view. But it is rarely factually wrong.

But what is interesting is what they don’t tell you.

Often journalists don’t report on some things, either because they don’t understand it or, more likely because they are too constrained by “word count” – and explaining the finer details just takes up too many words.

The fact is that they leave out quite a lot of the stuff that’s really important.

It’s for these reasons that I tell people who come to my landlord events not to read the mainstream press to find out about the private rented sector and how to make a success if it.

There are some two excellent online resources I refer them too and one great published magazine – and of course I refer them to this blog and my book.

But I don’t discount all the papers. Every Saturday morning I get the “Weekend FT.” I have got it for years.

I like it because it has lots of different views on the outlook for the economy and for shares – and even the odd good article on buy to let – sometimes, when “trade go-tos” Ray or Melanie are not contactable they will even quote me!

Seek Out the Wise Men and Women

I still buy shares. And I use the FT and the “Investors Chronicle” to give me ideas of which ones to buy – and I build a widely balanced portfolio. I have learnt my lesson! And I always avoid hyped sectors. (At the moment I think the likes of Unilever, is the classic hyped stock. Back in 2008-10 it was any mining stock.)

But I never read any article which has been written by or extensively quotes a fund manager, stock broker, government Minister or anyone who has a “vested interest” in or who is “too close to the wood.” Equally, any piece on the housing market written by a mortgage lender or estate agency chain gets ignored too.

What I look for is articles that give one a different take on what’s happening in the economy, especially those written by “practitioner-outsiders” who have an independent point of view. (One reason there are few such pieces is because the people who are really in the know are often media shy, don’t like speaking to journalists, are too modest or too  difficult or are just too busy being successful at what they do to want to be quoted by journalists. Richard Bowser and Tom Entwistle are two knowledgeable guys on the PRS who are rarely quoted in the mainstream press.)

Back in 2007, in the FT, there were few such articles warning of the coming crisis. These pieces were not abundant, but they were there. Sadly, these kinds of pieces rarely made the rest of the mainstream press’s pages. It’s the same with good stuff on the private rented sector.

So, be careful what you read.

Long Term Tenancies – Please Tell Ken and Boris!

Finally, from my Tweets this week:

Some in the London Mayor’s office and London local government keep insisting private landlords offer longer term tenancies. If they understood the PRS better they’d know that most mortgage lenders don’t allow their borrowers to offer fixed term ASTs longer than 12 months.

There will be no blog post next week.

ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of Private Rented Sector Consultancy and advice.

Services to Businesses and the Public Sector

We are advisors to a range of organisations including banks, building societies, local authorities, social housing providers, institutional investors and insurers. We help them develop and improve their services and products for private landlords.

We also write for property websites, speak at property events (send an email to david@LettingFocus.com to find out about our next event) and we are regularly quoted by the media.

Services for Private Landlords

We also help landlords and property investors by showing how to make money in the private rented sector using ways which are fair to tenants and which involve minimal risk to the investor.

AT OUR WEBSITE LETTINGFOCUS.COM:

HOME PAGE OF THIS BLOG click here: Blog

To read blog posts on related posts use the tags and categories at the bottom of each post (after the list of links), or over to the right of this page – where, you can click on “Select Categories” and use the pull down menu to read all the posts on any Category that interests you.

THE HOME PAGE OF OUR MAIN SITE

For our main home page click here:  http://www.LettingFocus.com

For general info on our CONSULTING SERVICES and also to find a small sample of links to where our comments have been featured in the National Press please click: Consultancy and Seminars

For ONE TO ONE PRIVATE CONSULTANCY FOR PRIVATE LANDLORDS click here: Property Advice

TO READ CLIENT TESTIMONIALS – from both organisations and private landlords click here: Testimonials

BUY “SUCCESSFUL PROPERTY LETTING”

Our book is the highest selling property book in the UK. Click here to Find Out More and Buy it at Amazon. If you are from an organisation and would like to bulk buy at least 50 books please ask us for special rates.

TO JOIN OUR FREE NEWSLETTER and get our latest Newsletter which goes to over 3,000 people (as at December 2011) just send an email to david@LettingFocus.com

We do not spam or sell our mailing list to advertisers, though we occasionally  mail landlords about good products from third parties. Please put us on your “white list” to ensure you receive our emails.

OFFERS ON PRODUCTS FOR LANDLORDS and TO ADVERTISE YOUR PRODUCTS to LANDLORDS click here: Landlords Resources

PERUSE LAST TEN BLOGS BY GETTING THE RSS FEED: Click Here

NEXT SEMINAR EVENT FOR LANDLORDS: Landlord and Property Letting Seminar

Copyright of Blog: David Lawrenson 2012. Please link to us here or quote us.We actively pursue copyright infringements. The blog is updated once a week.

TWITTER PAGE For my thoughts on property, personal finance, plus other random things from sport, to 80s and 90s Indy Music, to tsunamis to musings on boardroom pay, plus my (usually) centre left “take” on politics please see our Twitter page.

LINK TO THIS BLOG OR TO OUR WEBSITE

Tags: , ,
Posted in Boris Johnson, Buy to Let Mortgage Strategy, Buy to Let and Landlord Tips, FSA, Media and the Private Rented Sector | Comments Off

Longer Term Tenancies and Getting the Right Buy to Let Mortgage

February 7th, 2012

In this LettingFocus blog post, we discuss our research into the potential for buy to let mortgage lenders to allow borrowers to offer longer term assured shorthold tenancies. We also look at the questions borrowers should ask themselves to ensure they get the mortgage that’s right for them.

Currently, at LettingFocus we are doing research into the potential for buy to let mortgage lenders to allow their landlord borrowers to offer longer term assured shorthold tenancies.

This is becoming quite an issue in the media and government as many interested (and often uninformed) parties regularly criticise landlords for not offering longer term tenancies than the current standard six month or 12 month ones.

The answer is simple. Landlords who have mortgages on their properties are usually restricted by their lenders’ mortgage terms and conditions which say landlords cannot offer ASTs which have longer than a 12 month fixed term. (Some landlords have other reasons why they don’t want to offer longer term tenancy agreements too, but the “lender restriction” is a key problem.)

A lot of the work we are doing this week involves looking at the issues that concern lenders and seeing if these can be adequately addressed either within the current legal framework or by changing the mortgage terms and conditions, whilst still complying with the relevant Acts of Parliament in this area.

We may not be able to share the results of our research work beyond our corporate clients but we think that landlords, government and the media would be happy to know that this issue is now being addressed.

Getting a Mortgage – Questions You Should Ask

Speaking of mortgages, I’m in the process of re-mortgaging on some of my existing buy to lets as well as at the same time, raising more money for a residential purchase.

I have mentioned many times at the blog, my extreme irritation that the media hardly ever quotes “the follow on rates” when they discuss mortgage rates.

For example, it’s all very well knowing that the rate is 0.5% above Bank of England (BOE) base rate for 2 years, but, unless you are planning to pay it off at the end of 2 years, it is kind of important to also know that at the end of the 2 year term the rate will be 6% over base or whatever the lender’s current Standard Variable Rate (SVR) is!

Deciding which mortgage is best for you will come down to a lot of issues:

1.      How long you want the loan for and when you want to or expect to be able to pay it off, either in part or in full.

2.      How important fixing a rate is to you and if so, how long to fix it for.

3.      If you plan to remortgage in the future, what you think the outlook for Bank of England Base Rate is over the whole term of the loan (and after any initial “discounted” period). Also, whether you think the lender’s mortgage margin over the BOE base rate will be less or more in X number of years’ time than it is now. And whether  you think mortgage application fees will be lower or higher then.

4.      What the lenders’ stated “loan to value (LTV) ratio” is and whether opting for a lower LTV ratio could reduce the mortgage rate charged.

Other Issues to Consider

Also important are:

1.      What is the “starter” and what is the “follow on” interest rate. How are those rates calculated – are they pegged to the BOE or is it whatever the lender feels like setting it at?

2.      What is the set up mortgage application fee? What fees are charged for valuations (they can vary a lot)? Are there any exit penalties or early redemption penalties and, if so, how much are they? Are there any fees for making lump sum repayments and how much are these?

3.      When must the mortgage be redeemed? (On residential in particular, some lenders will not allow you to have a mortgage after the normal retirement age.)

I currently take the view that remortgaging will still be expensive in 2 to 5 years time. I expect remortgage application fees on buy to let will still be high then. For this reason, and because I plan to buy and hold properties for a long time, I currently opt for the best long term lifetime Bank of England base rate tracker.

Mortgage Broker or Direct Only?

Borrowers should also be aware that lenders are increasingly offering some products that are only available direct and not available via mortgage brokers (though this is less common on buy to let mortgage products.) So look online too.

However brokers are very knowledgeable. They know the ins-and-outs of each lenders criteria / underwriting approaches and this can save you a lot of legwork.

And don’t forget brokers receive commission from lenders on most products they sell, so you may not need to pay them at all.

ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of Private Rented Sector Consultancy and advice.

Services to Businesses and the Public Sector

We are advisors to a range of organisations including banks, building societies, local authorities, social housing providers, institutional investors and insurers. We help them develop and improve their services and products for private landlords.

We also write for property websites, speak at property events (send an email to david@LettingFocus.com to find out about our next event) and we are regularly quoted by the media.

Services for Private Landlords

We also help landlords and property investors by showing how to make money in the private rented sector using ways which are fair to tenants and which involve minimal risk to the investor.

AT OUR WEBSITE LETTINGFOCUS.COM:

HOME PAGE OF THIS BLOG click here: Blog

To read blog posts on related posts use the tags and categories at the bottom of each post (after the list of links), or over to the right of this page – where, you can click on “Select Categories” and use the pull down menu to read all the posts on any Category that interests you.

THE HOME PAGE OF OUR MAIN SITE

For our main home page click here:  http://www.LettingFocus.com

For general info on our CONSULTING SERVICES and also to find a small sample of links to where our comments have been featured in the National Press please click: Consultancy and Seminars

For ONE TO ONE PRIVATE CONSULTANCY FOR PRIVATE LANDLORDS click here: Property Advice

TO READ CLIENT TESTIMONIALS – from both organisations and private landlords click here: Testimonials

BUY “SUCCESSFUL PROPERTY LETTING”

Our book is the highest selling property book in the UK. Click here to Find Out More and Buy it at Amazon. If you are from an organisation and would like to bulk buy at least 50 books please ask us for special rates.

TO JOIN OUR FREE NEWSLETTER and get our latest Newsletter which goes to over 3,000 people (as at December 2011) just send an email to david@LettingFocus.com

We do not spam or sell our mailing list to advertisers, though we occasionally  mail landlords about good products from third parties. Please put us on your “white list” to ensure you receive our emails.

OFFERS ON PRODUCTS FOR LANDLORDS and TO ADVERTISE YOUR PRODUCTS to LANDLORDS click here: Landlords Resources

PERUSE LAST TEN BLOGS BY GETTING THE RSS FEED: Click Here

NEXT SEMINAR EVENT FOR LANDLORDS: Landlord and Property Letting Seminar

Copyright of Blog: David Lawrenson 2012. Please link to us here or quote us.We actively pursue copyright infringements. The blog is updated once a week.

TWITTER PAGE For my thoughts on property, personal finance, plus other random things from sport, to 80s and 90s Indy Music, to tsunamis to musings on boardroom pay, plus my (usually) centre left “take” on politics please see our Twitter page.

LINK TO THIS BLOG OR TO OUR WEBSITE

Tags: , , , , ,
Posted in Buy to Let Mortgage Strategy, Buy to Let Mortgage Terms and Conditions, Buy to Let Mortgages, Longer Tenancies, Longer Term Tenancies, Mortgage Brokers, Tenancy Agreement Length, What Is the Standard Variable Rate | Comments Off

Damage By Water Leaks and How Landlords Can Reduce Their Impact and Save Costs

January 31st, 2012

In this blog post by LettingFocus.com, we explain why smart and insured tenants can cut a landlords repair bills, especially repairs due to damage caused by leaks of water.

It’s that very cold time of the year when landlords are always pretty busy.

As soon as the weather gets cold, the inevitable boiler breakdown will occur and it’s then that it is imperative that you have a good local heating mechanic (or engineer as they are called in the UK) to come out and affect repairs, fast.

And if you have a dopey tenant, it’s often around this time of year that they decide to forget to tell you about that small leak that keeps making the kitchen floor wet. Their delay will cause even more damage to decorations, carpets, walls and ceilings in the rest of the building.

On top of that, the cool, wet summer of 2011 has meant that condensation problems are very bad this year. So tenants who fail to air their homes, will be seeing the characteristic spotty, black condensation-related mould appear on the inside of exterior north and east facing walls.

Get Smart Tenants

Landlords’ best bet to manage issues with damp and leaks is to ensure that they choose tenants who are clued up and practical in the first place.

This is because clued up tenants are a landlord’s first line of defence. So when they discover a leak the occupiers should always know how to turn the mains water off. (All landlords should give their tenant customers a guided tour and leave them with a laminated guide which points out where the water stop valve, gas cut off switch and the electricity control unit is.)

And, next, the tenant should be straight on the phone to you or to your people who can fix the problem permanently as soon as possible.

I try to select tenants who have some of what my grandmother used to call “gumption.” And whether they have gumption or not, often becomes apparent before you let, when you are still taking references.

The smart ones (the ones with gumption) always decide whether they like a property quickly, and they don’t delay in getting hold of the references and documents you need to see. (The really smart ones – less than one percent of all applicants – have references with them when they go out to view a place!)

These kinds of people are my tenants, though occasionally, as is the case now, I will end up with one with little gumption who has somehow slipped through my net.

Insurance Issues

At the tenancy inception, along with the House Guide, I always write to my tenants to “strongly advise them to take out contents insurance and to ensure that this also includes accidental damage cover.”

Of course, I can’t force them to take out suitable and extensive contents  insurance, but if they do so, it should mean that things like carpets are covered if, say, they drop a hot iron on it or spill wine on the carpet. And I won’t have to go to the trouble of making a deduction against their deposit, if it was their fault – which I hate doing.

If tenant negligence and delay has made damage worse than it would have been, a landlord is fully entitled to make a deduction from the deposit. The reason is that a tenant has a duty to behave in a tenant like manner, which means he should take the same reasonable precautions as any other householder would.

Right now, I unfortunately have a set of tenants whose negligence in not sorting out an obvious leak quickly (either by fixing it themselves or calling my plumber) will mean that they will have to pay the bulk of the cost to fix the decoration that’s been damaged.

Though damage to walls and ceilings is a claim on the buildings insurance, as is typical of most buildings insurance for let properties in blocks these days, the excess is a whopping £500, so I’m looking to the tenants to make up this excess cost.

Importance of a Good Inventory

Of course, I had a thorough independent inventory done at the outset of the tenancy with photos, and the tenants have already admitted negligence, so there is not likely to be a problem.

It’s just a shame that tenants who lacked “gumption” managed to slip through my net. And it’s a shame, for them, that come of the cost to fix the problem will have to come out of their deposit.

And unless they start to show some gumption and common sense, I may not offer to extend the tenancy at the end of the fixed term.

Shop Around for Buildings Insurance

Our final observation is that landlords should look carefully at the excesses on buildings insurance claims.

Many insurers now impose very high excesses for claims for damage caused by water leaks. As ever, the best advice is to shop around for the best insurance deal – and that means both premium and level of cover.

ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of Private Rented Sector Consultancy and advice.

Services to Businesses and the Public Sector

We are advisors to a range of organisations including banks, building societies, local authorities, social housing providers, institutional investors and insurers. We help them develop and improve their services and products for private landlords.

We also write for property websites, speak at property events (send an email to david@LettingFocus.com to find out about our next event) and we are regularly quoted by the media.

Services for Private Landlords

We also help landlords and property investors by showing how to make money in the private rented sector using ways which are fair to tenants and which involve minimal risk to the investor.

AT OUR WEBSITE LETTINGFOCUS.COM:

HOME PAGE OF THIS BLOG click here: Blog

To read blog posts on related posts use the tags and categories at the bottom of each post (after the list of links), or over to the right of this page – where, you can click on “Select Categories” and use the pull down menu to read all the posts on any Category that interests you.

THE HOME PAGE OF OUR MAIN SITE

Four our main home page click here:  http://www.LettingFocus.com

For general info on our CONSULTING SERVICES and also to find a small sample of links to where our comments have been featured in the National Press please click: Consultancy and Seminars

For ONE TO ONE PRIVATE CONSULTANCY FOR PRIVATE LANDLORDS click here: Property Advice

TO READ CLIENT TESTIMONIALS – from both organisations and private landlords click here: Testimonials

BUY “SUCCESSFUL PROPERTY LETTING”

Our book is the highest selling property book in the UK. Click here to Find Out More and Buy it at Amazon. If you are from an organisation and would like to bulk buy at least 50 books please ask us for special rates.

TO JOIN OUR FREE NEWSLETTER and get our latest Newsletter which goes to over 3,000 people (as at December 2011) just send an email to david@LettingFocus.com

We do not spam or sell our mailing list to advertisers, though we occasionally  mail landlords about good products from third parties. Please put us on your “white list” to ensure you receive our emails.

OFFERS ON PRODUCTS FOR LANDLORDS and TO ADVERTISE YOUR PRODUCTS to LANDLORDS click here: Landlords Resources

PERUSE LAST TEN BLOGS BY GETTING THE RSS FEED: Click Here

NEXT SEMINAR EVENT FOR LANDLORDS: Landlord and Property Letting Seminar

Copyright of Blog: David Lawrenson 2011 and 2012. Please link to us here or quote us.We actively pursue copyright infringements. The blog is updated once a week.

TWITTER PAGE For my thoughts on property, personal finance, plus other random things from sport, to 80s and 90s Indy Music, to tsunamis to musings on boardroom pay, plus my (usually) centre left “take” on politics please see our Twitter page.

LINK TO THIS BLOG OR TO OUR WEBSITE

Tags: , , , , ,
Posted in Buy to Let Insurance, Insurance for Let Property, Landlords Insurance, Property Letting Insurance | Comments Off

The Private Rented Sector and Some Key Issues for Government

January 25th, 2012

I was quoted extensively at the Guardian Housing Network blog last week and I think it is worth highlighting the key points I made.

Why the PRS is in the News

1. The private rented sector (PRS) is increasingly in the news and will remain so, partly because of its growing size and partly because of rising rent levels, which after a quiet decade have begun to soar, especially in economically advantaged areas like London.

2. This has led to some calls for rent control, but we think this would be too hard to enforce in the real world competitive marketplace and likely to lead to tenants offering other payments to secure their desired property.

3. Rising rents, like growing house prices, are simply a consequence of a lack of housing and a bulging population. In this matter, the PRS is indivisible from the rest of the housing market and the solution is the same: we simply need more homes. And to get more homes we need to ease planning restrictions.

Buy to Let Lenders Have an Impact on Length of Tenancy Agreements

4. Despite popular perceptions, our findings and those of other studies, including a recent one from the National Landlords Association, are that the majority of landlords actually want to hold on to good tenants for a long time – sometimes even if it means they have to accept less than market rent.

5. However, if there is a mortgage on the property, landlords will usually be restricted to offering tenancy agreements with fixed terms of no more than a year, because terms and conditions in their buy-to-let mortgage. Our work with some of the lenders has challenged the logic of this and I’m sure we will see longer-term assured shorthold tenancies become the norm in the future.

Why Many Landlords Fight Shy of LHA Lets

6. Compared to “non-LHA lets”, letting a property to tenants who are dependent on Local Housing Allowance (LHA) is seen as a huge extra hassle for landlords for a whole host of reasons.

- In a private, non LHA let, a landlord is paid rent in advance and usually there will also be a deposit which can be claimed against in the event of damage (providing the landlord did a thorough inventory at start and end of the tenancy.) There is usually no deposit on LHA lets and local authority bonds  – where available – can be hard to claim against.

- Tenants on LHA have to complete a lot of paperwork to set up their claim and the Housing Benefit department can often be slow to process these and start payments. LHA awards can also stop without warning simply because the tenant’s eligibility for support has changed. Delays in set up and changes in eligibility threaten the tenant’s ability to pay the rent.

- Under buy-to-let mortgage conditions some lenders still don’t allow a landlord to let to “non working” people. Insurance can also cost more too.

- LHA payments are now limited by caps and also to the 30th percentile of local market rents, setting a limit to what landlords can charge.

- Constant tinkering with the system of LHA / Housing Benefit over the years has confused landlords. Many are no longer sure how it works, and therefore avoid lets to LHA dependent tenants altogether.

Only when these some of these differences and problems are removed will significant numbers of landlords become willing to let to tenants who are dependent on LHA.

Government, Licensing, Accreditation and Landlords – the Regulatory Battleground

7. There is more that councils could do to improve the way they work with private landlords while still driving out the small rogue element. In particular, they need to sharpen up the marketing of the products and solutions they have for the LHA end of the private landlord market, stop internal wasteful competition between local authorities and housing associations and think more like private landlords  – whose main enemies are cost, time, risk and “hassle”.

8. In the short term, national and local government resources should be shifted away from universal landlord accreditation and licensing and onto uncovering the worst landlords – those who abuse tenants and let unfit properties.

- But this must be combined with much harsher penalties for “have a go” amateur landlords who do not carry out their landlord responsibilities, either through ignorance or laziness. Accidental landlords must learn that letting property is a serious business and they must take their responsibilities seriously.

9. In the medium term, accreditation may be inevitable. When it comes, the focus should be on offering simple, easy to join schemes of real value to private landlords, and thus their tenant customers -with any surplus directed to unmasking rogue landlords, not lost to administration.

Houses in Multi Occupation (HMOs)

10. There is a demand for HMOs, which simply reflects the general excess level of housing demand. Instead of clamping down on HMOs via blunt planning policies, policy should be focussed on dealing with unacceptable behaviours from tenants in the HMOs with co-operation of the owners of the properties.  If there is a problem with how HMOs are managed or antisocial issues around them, then the law should be used to deal with it.

Tax

11. The tax system around buy to let does not offer sufficient incentives to landlords to improve properties.

Build to Let

12. Succesive governments have been very keen to get institutuional investment into private letting and, at LettingFocus we see a new role for the housing associations here. However, incentives and subsidies for “big build to let” should not give them an unfair advantage over small scale private landlords. Also, a fair amount of surplus profit generated must to be ploughed back into low cost affordable housing.

ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of Private Rented Sector Consultancy and advice.

Services to Businesses and the Public Sector

We are advisors to a range of organisations including banks, building societies, local authorities, social housing providers, institutional investors and insurers. We help them develop and improve their services and products for private landlords.

We also write for property websites, speak at property events (send an email to david@LettingFocus.com to find out about our next event) and we are regularly quoted by the media.

Services for Private Landlords

We also help landlords and property investors by showing how to make money in the private rented sector using ways which are fair to tenants and which involve minimal risk to the investor.

AT OUR WEBSITE LETTINGFOCUS.COM:

HOME PAGE OF THIS BLOG click here: Blog

To read blog posts on related posts use the tags and categories at the bottom of each post (after the list of links), or over to the right of this page – where, you can click on “Select Categories” and use the pull down menu to read all the posts on any Category that interests you.

THE HOME PAGE OF OUR MAIN SITE

Four our main home page click here:  http://www.LettingFocus.com

For general info on our CONSULTING SERVICES and also to find a small sample of links to where our comments have been featured in the National Press please click: Consultancy and Seminars

For ONE TO ONE PRIVATE CONSULTANCY FOR PRIVATE LANDLORDS click here: Property Advice

TO READ CLIENT TESTIMONIALS – from both organisations and private landlords click here: Testimonials

BUY “SUCCESSFUL PROPERTY LETTING”

Our book is the highest selling property book in the UK. Click here to Find Out More and Buy it at Amazon. If you are from an organisation and would like to bulk buy at least 50 books please ask us for special rates.

TO JOIN OUR FREE NEWSLETTER and get our latest Newsletter which goes to over 3,000 people (as at December 2011) just send an email to david@LettingFocus.com

We do not spam or sell our mailing list to advertisers. Please put us on your “white list” to ensure you receive our emails.

OFFERS ON PRODUCTS FOR LANDLORDS and TO ADVERTISE YOUR PRODUCTS to LANDLORDS click here: Landlords Resources

PERUSE LAST TEN BLOGS BY GETTING THE RSS FEED: Click Here

NEXT SEMINAR EVENT FOR LANDLORDS: Landlord and Property Letting Seminar

Copyright of Blog: David Lawrenson 2011 and 2012. Please link to us here or quote us.We actively pursue copyright infringements. The blog is updated once a week, usually on a Monday or Tuesday (or more frequently when “hot” news items come up.)

TWITTER PAGE For my thoughts on property, personal finance, plus other random things from sport, to 80s and 90s Indy Music, to tsunamis to musings on boardroom pay, plus my (usually) centre left “take” on politics please see our Twitter page.

LINK TO THIS BLOG OR TO OUR WEBSITE

Tags: , , , , , , , , , , , ,
Posted in Accredited Landlords, Buy to Let Mortgage Terms and Conditions, Housing Benefit, Landlord Accreditation, Landlord Regulation, Local Housing Allowance, Tenancy Agreement Length, Tenants Deposits | Comments Off

Private Landlords, Local Authorities and Buy to Let Mortgages

January 17th, 2012

We thought it would be useful to publish the October 2011 Newsletter right here on our blog. (Our latest, January 2012, Newsletter was published on 29th December and is available free now to those who sign up to receive our newsletter. Just send us an email if you would like to join the mailing list!)

Here is the Newsletter…..

“….. The continued upward trajectory of rents in most areas means the PRS is now attracting some serious press attention.

Each month, as soon as the LSL Rental Index comes out showing further big increases in private residential rents, the press frenzy starts once again.

Questions such as: “How can people afford to pay their rents, why are people not buying houses instead, whose fault is it, aren’t landlords driving out potential first time buyers by snapping up the little housing stock that does come on the market etc?” are hurled around the media.

And in response to the rising rents, there have been an increasing number of calls from some, for controls on rents (most unlikely to happen) and / or a review of the tax regime affecting landlords (still unlikely in the short term, but more chance of happening.)

Rising Rents

Rising rents are happening at the same time as the cuts to the way housing benefit is calculated are starting to bite.

One outcome of this is that that councils are finding it even harder to find landlords who are prepared to let to tenants who are on housing benefit (or Local Housing Allowance as it’s called when landlords are involved.)

Another side consequence of housing benefit cuts is a reduction in the amount of accommodation available from private landlords to house homeless or potentially homeless people. And so, with few private landlords coming forward, councils now have to spend increasing amounts of taxpayer cash on temporary accommodation to put potentially homeless people in B&B type properties.

Years ago we predicted this would happen unless strategies for the private rented sector at the town halls were radically re-shaped and revised. But alas, back then the opportunity was missed.

Wasteful Duplication at Some Town Halls

At our blog, we have often highlighted the sometimes wasteful duplication of products and services for landlords at local authority level, the lack of targeted marketing to recruit landlords by councils, the poor administration of housing benefit payments (a particular bug bear of landlords), the lack of understanding of the PRS by councils and some of their advisors and the obsession with well meaning accreditation type schemes which can cost a lot to promote but which too often lack any features that private landlords value.

Unfortunately, with many vested interests at some of the UK’s town halls – both in terms of sunken political capital and occasionally in terms of council and housing association jobs – we think change here will not come fast.

However, a parliamentary group of MPs and peers has now been set up to look at the private rented sector. We are talking to the MPs and making our views known.

Little Evidence that HB Cuts are Driving Down Rents

Many housing experts thought that the cuts to housing benefit rates could drive average rents in the private rented sector down. But this does not seem to be happening apart from for the most basic housing stock – the type of stock which never had much appeal to the non LHA tenant anyway.

And with rents in most areas rising, the key drivers remain the same as ever – a lack of sufficient housing supply and a rising population driven primarily by increases in net inward migration. (Last year alone net inward migration increased the population of the UK by 230,000, which is roughly the population of Derby.)  With further expansion of the EU on the agenda and the widespread use of the English language I don’t see that particular trend changing any time soon.

Job insecurity is also continuing to push potential house buyers – especially first time buyers – to rent instead of taking on the risks and high entry costs that come with home buying and servicing a mortgage. Some think the tight lending criteria from lenders are not helping first time buyers either (and this may be counteracting the relative affordability that’s now emerging.)

Buy to Let Mortgage Update

However, the fruits of our consultancy work advising buy to let mortgage lenders, will mean that the days of the “one mortgage fits all landlords” model be replaced in time, by a set of lending criteria that fully takes account of a landlord’s net asset and liabilities position, their level of experience and the risk inherent in different property types / locations as well as the intended target tenant market.

We may see more innovation in the buy to let mortgage product design too.

Landlords who know their business will benefit from this but landlords who sign up to the latest “get rich quick in property scheme with no money down” may find their choice of lenders becoming more ever reduced and their mortgages ever dearer.”

ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of Private Rented Sector Consultancy and advice.

Services to Businesses and the Public Sector

We are advisors to a range of organisations including banks, building societies, local authorities, social housing providers, institutional investors and insurers. We help them develop and improve their services and products for private landlords.

We also write for property websites, speak at property events (send an email to david@LettingFocus.com to find out about our next event) and we are regularly quoted by the media.

Services for Private Landlords

We also help landlords and property investors by showing how to make money in the private rented sector using ways which are fair to tenants and which involve minimal risk to the investor.

AT OUR WEBSITE LETTINGFOCUS.COM:

HOME PAGE OF THIS BLOG click here: Blog

To read blog posts on related posts use the tags and categories at the bottom of each post (after the list of links), or over to the right of this page – where, you can click on “Select Categories” and use the pull down menu to read all the posts on any Category that interests you.

THE HOME PAGE OF OUR MAIN SITE

Four our main home page click here:  http://www.LettingFocus.com

For general info on our CONSULTING SERVICES and also to find a small sample of links to where our comments have been featured in the National Press please click: Consultancy and Seminars

For ONE TO ONE PRIVATE CONSULTANCY FOR PRIVATE LANDLORDS click here: Property Advice

TO READ CLIENT TESTIMONIALS – from both organisations and private landlords click here: Testimonials

BUY “SUCCESSFUL PROPERTY LETTING”

Our book is the highest selling property book in the UK. Click here to Find Out More and Buy it at Amazon. If you are from an organisation and would like to bulk buy at least 50 books please ask us for special rates.

TO JOIN OUR FREE NEWSLETTER and get our latest Newsletter which goes to over 3,000 people (as at December 2011) just send an email to david@LettingFocus.com

We do not spam or sell our mailing list to advertisers. Please put us on your “white list” to ensure you receive our emails.

OFFERS ON PRODUCTS FOR LANDLORDS and TO ADVERTISE YOUR PRODUCTS to LANDLORDS click here: Landlords Resources

PERUSE LAST TEN BLOGS BY GETTING THE RSS FEED: Click Here

NEXT SEMINAR EVENT FOR LANDLORDS: Landlord and Property Letting Seminar

Copyright of Blog: David Lawrenson 2011 and 2012. Please link to us here or quote us. We actively pursue copyright infringements. The blog is updated once a week, usually on a Monday or Tuesday (or more frequently when “hot” news items come up.)

TWITTER PAGE For my thoughts on property, personal finance, plus other random things from sport, to 80s and 90s Indy Music, to tsunamis to musings on why people cannot drive well if they are wearing a hat or a cap, plus my (usually) liberal “take” on politics please see our Twitter page.

LINK TO THIS BLOG OR TO OUR WEBSITE

Tags: , , ,
Posted in Old Newsletters | Comments Off

TV Programmes on the Private Rented Sector Seem to Be Setting Policy

January 9th, 2012

David Lawrenson, founder of LettingFocus.com says that TV programmes, which highlight the very worst tenants and landlords, seem to have too much influence on the policy debate on the private rented sector. It’s time for informed debate and sensible policy based on accurate research.

The facts are that if you know what you are doing, being a landlord is easy and it’s still  great fun to build a property portfolio at the same time as serving tenants and giving them a nice home that’s well looked after.

A personal touch to this week’s blog!

People often say to me, “Oh it must be hard being a landlord. I couldn’t do that – people calling you in the middle of the night all the time.”

I pondered this the other day as another really good tenant moved into one of my properties.

The previous tenant had left two days earlier. They been there three years, always paid the rent on time and had left the place in a very tidy order. Sure, there was a few things wrong – mainly a little bit of damp because they had not aired the place quite as well as they should have.

But this is easily sorted out and I’m not the sort of landlord to “sweat the small stuff” – my view is that life is just too short. So the old tenants got their deposit back in full on the day they left, no quibbles.

It took eight different evening appointments from placing my £99 advert on a specialist landlords letting portal (which uploads to Right Move, Zoopla et al) before I found my new tenant. (See our Landlords Offers pages below.) And in those eight appointments I met 14 different sets of tenants before I found someone I felt would pass my criteria and who liked the property.

No Void

As is usual for me, the period between tenancy ending and new one starting was just two days. (I don’t do empty properties!)

The new tenants are now happily settled in and love the place. They know that they can call my plumber, gas man or electrician if anything goes wrong. (I tell them there’s no point in calling me as I don’t know how to fix taps and neither do I want to learn how.)

The old tenants emailed me to ay they are also happy in their new place 9they bought a house).

Both old and new tenants got bottles of wine when they left / moved in. And I have got a higher rent. And because of local regeneration and transport improvements, the value of the property is now 10% higher than when I bought it.

I figured that everything from placing the ads on line, to doing the viewings and all the reference checks and the check-ins and check-outs and all the other admin (inventory arrangements, dealing with the tenancy deposit scheme and the rest of the paperwork that comes with being a landlord) took up about four man days in total.

Of course, I could have used an agent. That would have saved on some of the days I spent, but it would have still involved me doing at least 1 days work to check that the agent had done the tenant referencing and other stuff to my exacting standards.

All Is Right with the World

So, someone has got a nice new home, someone had a nice home for three years and has now moved on to buy their own place. All is right with the world.

Of course, like anything, letting properties in the private rented sector is only hard if people don’t know what they are doing.

So far, just over 30,000 copies of my book have been sold over the six and half years since it came out. I also know that about 28,000 people are in landlords associations.

But there are about 1.3 million landlords – a far bigger number, so that leaves a good 1.2 million men and women who don’t have my book or haven’t bothered to join a landlords association.

Presumably, they must be trusting to letting agents (whose standards vary from the brilliant to the downright awful) or they somehow muddle through on their own.

Those who muddle through or who use a duff letting agent will make a mess up of things for themselves and their tenants. These landlords will have to learn the hard way. They will either try again or quit!

Being a Landlord is Fun

These days my consulting work with organisations (and sometimes landlords) takes up about 90% of my time. It’s nice to help organisations as diverse as building societies and local authorities make a success of their products and services for the private rented sector and landlords. (Its fun and the amazing difference in culture between public and private sectors is an eternally fascinating feature of my work.)

But in the other 10% of my time, there is nothing else I’d rather be than a landlord – letting my properties and keeping my tenants happy. (But just in case, I turn my mobile off at night and sleep soundly!)

There are lots of landlords like me. The trouble is that a TV programme: “Good Landlord and Tenant Get on Well, Tenant Has a Lovely House and Gets Deposit Back in Full” does not make for exciting TV and won’t pull in viewers or advertisers.

This explains why most programmes about the PRS always focus on the worst landlords and tenants and explains why the landlord trade has such a rough image. It also explains why lots of people imagine I get calls in the middle of the night.

Clouding of Facts

It’s a shame that TV programmes are clouding the real facts, which have been revealed in every study of the private rented sector ever done: that most landlords and tenants get on fine and it is the tenant who usually moves out on their own accord, amicably at the end of the tenancy.

At the moment instead of good research like the 2008 Rugg Review driving policy in the private rented sector, we seem to have policy being driven by audience chasing TV programmes whose main aim is to show the very worst of the worst landlords and tenants.

ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of Private Rented Sector Consultancy and advice.

Services to Businesses and the Public Sector

We are advisors to a range of organisations including banks, building societies, local authorities, social housing providers, institutional investors and insurers. We help them develop and improve their services and products for private landlords.

We also write for property websites, speak at property events (send an email to david@LettingFocus.com to find out about our next event) and we are regularly quoted by the media.

Services for Private Landlords

We also help landlords and property investors by showing how to make money in the private rented sector using ways which are fair to tenants and which involve minimal risk to the investor.

AT OUR WEBSITE LETTINGFOCUS.COM:

HOME PAGE OF THIS BLOG click here: Blog

To read blog posts on related posts use the tags and categories at the bottom of each post (after the list of links), or over to the right of this page = where, you can click on “Select Categories” and use the pull down menu to read all the posts on any Category that interests you.

THE HOME PAGE OF OUR MAIN SITE

Four our main home page click here:  http://www.LettingFocus.com

For general info on our CONSULTING SERVICES and also to find a small sample of links to where our comments have been featured in the National Press please click: Consultancy and Seminars

For ONE TO ONE PRIVATE CONSULTANCY FOR PRIVATE LANDLORDS click here: Property Advice

TO READ CLIENT TESTIMONIALS – from both organisations and private landlords click here: Testimonials

BUY “SUCCESSFUL PROPERTY LETTING”

Our book is the highest selling property book in the UK. Click here to Find Out More and Buy it at Amazon. If you are from an organisation and would like to bulk buy at least 50 books please ask us for special rates.

TO JOIN OUR FREE NEWSLETTER which goes to over 3,000 people (as at December 2011) just send an email to david@LettingFocus.com – We do not spam or sell our mailing list to advertisers. Please put us on your “white list” to ensure you receive our emails.

OFFERS ON PRODUCTS FOR LANDLORDS and TO ADVERTISE YOUR PRODUCTS to LANDLORDS click here: Landlords Resources

PERUSE LAST TEN BLOGS BY GETTING THE RSS FEED: Click Here

NEXT SEMINAR EVENT FOR LANDLORDS: Landlord and Property Letting Seminar

Copyright of Blog: David Lawrenson 2011 and 2012. Please link to us here or quote us. We actively pursue copyright infringements. The blog is updated once a week, usually on a Monday or Tuesday (or more frequently when “hot” news items come up.)

TWITTER PAGE For my thoughts on property, personal finance, plus other random things from sport, to 80s and 90s Indy Music, to tsunamis to musings on why people with Ipods walk in front of cars and my (usually) liberal “take” on politics please see our Twitter page.

LINK TO THIS BLOG OR TO OUR WEBSITE

Posted in Uncategorized | Comments Off

LettingFocus Property Seminar An Opportunity to Learn the Facts About Being a Landlord and Buy to Let

December 30th, 2011

We are pleased to annouce that on Tues. 20th March, we will be running a one off networking and seminar event for landlords.

Due to the pressure of our work with organisations, we now only run one of these a year now – and always in London.

Here is the link for more info and details on how to book: Landlord and Property Letting Seminar

As it’s Christmas and New Year Week, we will not be writing a blog this week, but readers who are on our newsletter mailing list should check their inboxes for our latest newsletter, which was sent 29th December at 330pm.

If you are not on our mailing list, it’s time to get on it.

Join it by emailing me at: david@LettingFocus.com

Finally, we would like to wish all our readers a very happy New Year.

Tags: ,
Posted in Landlord Seminar Meeting, Property Clubs | Comments Off

« Older Entries
Newer Entries »