Monday, December 21, 2009
Predictions for 2010, ALL Change on Housing Benefit and the Pre Budget Report. News from LettingFocus
‘Tis the time of year to make predictions about house prices and the like.
As I have said before there are so many different micro markets in UK property market, it is more or less impossible to make a sweeping forecast about house prices which will apply in every locality.
However, my general view is that the story of increasing population / increasing number of households combined with a lack of housing supply is more important than the opposing factors constraining growth in property prices - like unemployment, debt and lack of mortgage finance.
And because of this I expect prices to increase overall in 2010.
However, there will undoubtedly be areas of the UK where local unemployment and business failures will mean house prices will fall.
Local Housing Allowance – All Change
The Conservatives have said they will reinstate direct rent payments to landlords (where housing benefit tenants choose it) if they should become the next Government.
And now the current Government has put it under review too.
Local Housing Allowance (LHA) came in for new tenancies in April 2008 when it replaced the old housing benefit system.
With the old system where rent could be paid straight to landlords in the private sector, it now goes direct to the tenants who are then responsible for passing on the rent money to their landlord. (Only in special circumstances like where the tenant is deemed vulnerable or if the payments to the landlord are over two months behind can rent be paid direct to the landlord – but even then it can take longer than two months before LHA is paid direct by some councils.)
Big Sums of Money
Faced with a big wodge of money which they are not used to having, some tenants spend the money on other things and often fail to make their rent payments - so increasing numbers of landlords are now refusing to let to tenants who are in receipt of Housing Benefit.
According to research from the National Landlords Association (NLA) of 1,000 landlords operating 13,000 LHA tenancies, the total rent arrears bill accumulated by these landlords since LHA started is a whopping £4,400 per landlord.
It is thought there are about 675,000 LHA tenancies which means that total rent arrears across the UK could be in excess of £220 million.
Temptation
It is claimed that many tenants would prefer not to be put in the way of temptation and would rather the LHA was paid direct to the landlord.
At LettingFocus.com, we have also been critical of the way the LHA is set – as it is based on very wide Broad Market Rental Areas.
This means that in some areas the rates of LHA are too high and in other areas they are too low – with knock on impacts for tenants who don’t qualify for LHA.
My old pal, Tom Entwistle of Landlord Zone has criticized the way landlords were used as guinea pigs in the current system - which does not apply to council tenants.
Check out the Government’s consultation document for more on this….…www.dwp.gov.uk/docs/hb-consultation.pdf
Pre Budget Report
No real news here.
Stamp Duty Land Tax went back to being applied for all properties over £125K
And there is so some money to replace old inefficient boilers – but not a lot – and we don’t know if it will be available for let properties yet.
Merry Christmas to all our readers.
ABOUT US
LettingFocus.com is the home of landlord information.
Hello, I’m David Lawrenson.
I have been a landlord and property investor myself for over 25 years and am author of “Successful Property Letting” – which has been the UK’s top selling property and buy to let book for the last 3 years.
We help landlords and property investors make money in property by coaching them in ways that work, which are ethical and which involve minimal risk to the investor.
We pride ourselves on giving independent unbiased buy to let advice on a one to one mentoring and coaching basis as well as through occasional group seminars.
Unfortunately, in the UK today, property advice in the UK is still largely unregulated and what counts as “good advice” is too often more about making the promoter money than giving useful information to the investor.
With no links to property firms, developers or bridging loan providers we can advise on where and what type of property to buy for investment and when to buy it.
We also show you how to manage tenants properly.
We also do consultancy for banks, local authorities and social housing providers – helping them with their landlord facing or buy to let product strategies. We also write for property websites and are regularly quoted by the media.
AT OUR WEBSITE LETTINGFOCUS.COM:
THE HOME PAGE OF THIS BLOG click here: Blog
THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
ONE TO ONE PRIVATE CONSULTANCY click here: Property Mentoring
NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors:
Next Property Investment Seminar and Networking Event
We have OFFERS on a range of services and products for landlords too; click here including landlords insurance, tenant referencing, tenancy agreements and more: Services and Products for Landlords
For general info on our SEMINARS AND CONSULTING click here: Property Seminars, Networking Evenings and Consulting
TO READ CLIENT TESTIMONIALS – both commercial and private click here: Testimonials
BUY “SUCCESSFUL PROPERTY LETTING” click here: Buy the Book at Amazon plus anything else you fancy at Amazon.co.uk
To JOIN our Free QUARTERLY NEWSLETTER simply send an email to david@LettingFocus.com - Please note we WILL NOT send spam or sell our mailing list to advertisers!
IF YOU HAVE A SITE WHY NOT LINK TO THIS BLOG OR OUR WEBSITE?
SELLING SERVICES TO LANDLORDS – YOU COULD BE A PARTNER ON OUR AFFILIATE PROGRAMME. PLEASE GET IN TOUCH!
See our Twitter page: http://twitter.com/LettingFocus
Copyright of Blog: David Lawrenson 2009. This blog is updated roughly once a week usually on a Monday or Tuesday.
TO VIEW RELATED POSTS select a “Category” at the bottom of this page.
WANT TO ADD A COMMENT OR VIEW OLD COMMENTS?
To add a comment or view other people's comments on this post, simply click on “link to this post.”
As I have said before there are so many different micro markets in UK property market, it is more or less impossible to make a sweeping forecast about house prices which will apply in every locality.
However, my general view is that the story of increasing population / increasing number of households combined with a lack of housing supply is more important than the opposing factors constraining growth in property prices - like unemployment, debt and lack of mortgage finance.
And because of this I expect prices to increase overall in 2010.
However, there will undoubtedly be areas of the UK where local unemployment and business failures will mean house prices will fall.
Local Housing Allowance – All Change
The Conservatives have said they will reinstate direct rent payments to landlords (where housing benefit tenants choose it) if they should become the next Government.
And now the current Government has put it under review too.
Local Housing Allowance (LHA) came in for new tenancies in April 2008 when it replaced the old housing benefit system.
With the old system where rent could be paid straight to landlords in the private sector, it now goes direct to the tenants who are then responsible for passing on the rent money to their landlord. (Only in special circumstances like where the tenant is deemed vulnerable or if the payments to the landlord are over two months behind can rent be paid direct to the landlord – but even then it can take longer than two months before LHA is paid direct by some councils.)
Big Sums of Money
Faced with a big wodge of money which they are not used to having, some tenants spend the money on other things and often fail to make their rent payments - so increasing numbers of landlords are now refusing to let to tenants who are in receipt of Housing Benefit.
According to research from the National Landlords Association (NLA) of 1,000 landlords operating 13,000 LHA tenancies, the total rent arrears bill accumulated by these landlords since LHA started is a whopping £4,400 per landlord.
It is thought there are about 675,000 LHA tenancies which means that total rent arrears across the UK could be in excess of £220 million.
Temptation
It is claimed that many tenants would prefer not to be put in the way of temptation and would rather the LHA was paid direct to the landlord.
At LettingFocus.com, we have also been critical of the way the LHA is set – as it is based on very wide Broad Market Rental Areas.
This means that in some areas the rates of LHA are too high and in other areas they are too low – with knock on impacts for tenants who don’t qualify for LHA.
My old pal, Tom Entwistle of Landlord Zone has criticized the way landlords were used as guinea pigs in the current system - which does not apply to council tenants.
Check out the Government’s consultation document for more on this….…www.dwp.gov.uk/docs/hb-consultation.pdf
Pre Budget Report
No real news here.
Stamp Duty Land Tax went back to being applied for all properties over £125K
And there is so some money to replace old inefficient boilers – but not a lot – and we don’t know if it will be available for let properties yet.
Merry Christmas to all our readers.
ABOUT US
LettingFocus.com is the home of landlord information.
Hello, I’m David Lawrenson.
I have been a landlord and property investor myself for over 25 years and am author of “Successful Property Letting” – which has been the UK’s top selling property and buy to let book for the last 3 years.
We help landlords and property investors make money in property by coaching them in ways that work, which are ethical and which involve minimal risk to the investor.
We pride ourselves on giving independent unbiased buy to let advice on a one to one mentoring and coaching basis as well as through occasional group seminars.
Unfortunately, in the UK today, property advice in the UK is still largely unregulated and what counts as “good advice” is too often more about making the promoter money than giving useful information to the investor.
With no links to property firms, developers or bridging loan providers we can advise on where and what type of property to buy for investment and when to buy it.
We also show you how to manage tenants properly.
We also do consultancy for banks, local authorities and social housing providers – helping them with their landlord facing or buy to let product strategies. We also write for property websites and are regularly quoted by the media.
AT OUR WEBSITE LETTINGFOCUS.COM:
THE HOME PAGE OF THIS BLOG click here: Blog
THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
ONE TO ONE PRIVATE CONSULTANCY click here: Property Mentoring
NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors:
Next Property Investment Seminar and Networking Event
We have OFFERS on a range of services and products for landlords too; click here including landlords insurance, tenant referencing, tenancy agreements and more: Services and Products for Landlords
For general info on our SEMINARS AND CONSULTING click here: Property Seminars, Networking Evenings and Consulting
TO READ CLIENT TESTIMONIALS – both commercial and private click here: Testimonials
BUY “SUCCESSFUL PROPERTY LETTING” click here: Buy the Book at Amazon plus anything else you fancy at Amazon.co.uk
To JOIN our Free QUARTERLY NEWSLETTER simply send an email to david@LettingFocus.com - Please note we WILL NOT send spam or sell our mailing list to advertisers!
IF YOU HAVE A SITE WHY NOT LINK TO THIS BLOG OR OUR WEBSITE?
SELLING SERVICES TO LANDLORDS – YOU COULD BE A PARTNER ON OUR AFFILIATE PROGRAMME. PLEASE GET IN TOUCH!
See our Twitter page: http://twitter.com/LettingFocus
Copyright of Blog: David Lawrenson 2009. This blog is updated roughly once a week usually on a Monday or Tuesday.
TO VIEW RELATED POSTS select a “Category” at the bottom of this page.
WANT TO ADD A COMMENT OR VIEW OLD COMMENTS?
To add a comment or view other people's comments on this post, simply click on “link to this post.”
Labels: BMRA, Broad Market Rental Areas, house price forecasts, housing benefit, Local Housing Allowance, Pre Budget Report, stamp duty, Stamp duty land tax
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