Tuesday, August 19, 2008
Private Leasing Schemes & Guaranteed Rent - An Evaluation by Letting Focus
As some of you who read this blog will know, I’m quite a fan of the Private Leasing Schemes.
Indeed, I was recently quoted in a recent article in the Daily Torygraph saying how good the schemes are.
In a nutshell, the Private Sector Leasing Schemes are arrangements where you let out a property to a housing association or a council for anything up to 4 years and they pay you a guaranteed rent – usually whether the property is occupied or not by their tenants.
The rent is guaranteed at the outset, usually for the full term, and often the housing association or council will also look after some basic maintenance too.
You can read more about Private Sector Leasing Schemes if you read the article I wrote about them on the main website. Click here to read it: Private leasing Schemes
OK, I know the rent is less than you would get letting through a letting agent or privately and you have no control over the tenants they put in your place, but the scheme I had with my local housing association worked well overall. There were no voids, no need to furnish at all (even white goods) and no re-letting costs or hassle – the rent just got paid every month on the dot.
Now, however, the term (which was four years) has come to an end and I can evaluate it properly.
Well, there are some downsides.
The main one is that you have no control over who they put in your property.
Having just taken back my property it was clear that whoever they put in there had some er, “problems”.
Apart from very heavy smoking (the ceiling had to get three coats of paint and I hate to think what was happening to the tenants’ lungs) there was clearly some kind of nasty incident involving harassment from a former partner.
And the last person left with loads of unpaid debts - this despite being on benefits! Ever wondered where your taxes are going!
You see, by definition the people who the council or HA sublets to are homeless or on the waiting list.
Some of them will have problems – which is why they are in the benefit system in the first place, I guess.
Once I got the property back, it did need a very thorough redecoration – and much more than would be expected under the average private let. So, there was an extra cost there – because you see whilst they fix damages for you, they don’t guarantee the state of the walls, ceilings or carpets.
The other hassle is that you might occasionally have to deal with the housing association or council at the end of the contract – and they were in turns frustrating and occasionally downright clueless.
I personally know lots of people work hard in the public sector – lots of great teachers, doctors and a chap who works for a local council - but I’m afraid that with my landlord hat on, I have not come across any who seem to do anything much than get in each others way.
For example, there was the time when their contracted British Gas service engineers told me that I needed a new boiler at a cost of £2.5K. Mmm! I got it fixed with my own guy for £60.
Alas, the service standards of this particular housing association did leave a wee bit to be desired – lack of returned phone calls and a seemingly laissez faire anything goes attitude to their landlord customers.
Hassle Free
But still, it IS a pretty hassle free way of letting – and apart from at the end of the contract I did not have to talk to the housing associations at all. And hooray for that because when I did they drove me nuts!
I’m not going to be doing it again though.
And that’s not because they clearly housed some “problem people” in my property. It is because they want to pay the same rent to be that they did four years ago.
I know, weird isn’t it?
I have told them that rents are up by about 20% in the area.
But hey, mine is not to reason the wonders of the weird logic of a public sector body funded by the taxpayer.
After all, as a self employed landlord I have to make money, get customers and look after tenants – which I think I’m OK at.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson of property investment expert lettingfocus.com.
I’m the author of “Successful Property Letting - How to Make Money in Buy to Let” which for the last 2 years has been the UK’s top selling property title - buy the UK's top selling landlord book.
It is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on buying property below market value.
I’m an expert property journalist, property speaker and a well known landlord blogger
I contribute to newspapers and a host of property websites, write a number of columns in the press and I can provide landlords coaching
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services and am a regular speaker at property shows.
You can read more of my blog & find details of my networking, advice, property mentor programme at my website.What’s unique about lettingfocus.com is that we offer you help as an independent property investors coach because unlike most people in the buy to let and property “advice” business we are not linked to a property company, a developer, an agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.
Copyright: David Lawrenson 2008. This blog is updated once a week.
WANT TO BE KEPT UPDATED WITH OUR LATEST BLOGS?
It’s easy.
Look to the right of this blog and you should see my smiling profile. Then page down a bit and you come to where it says “Site feed” - click there and away you go.
You then just copy the link that comes up into your News Reader or News Aggregator. Even a non techie like me managed to do all this.
Please note if you are thinking of reproducing material here - that’s fine but we DO require the full links shown in each blog to be included including also the links in the section “ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON” Please contact us via the Contact US button at our main site http://www.lettingfocus.com/ if you have any queries about this.
Indeed, I was recently quoted in a recent article in the Daily Torygraph saying how good the schemes are.
In a nutshell, the Private Sector Leasing Schemes are arrangements where you let out a property to a housing association or a council for anything up to 4 years and they pay you a guaranteed rent – usually whether the property is occupied or not by their tenants.
The rent is guaranteed at the outset, usually for the full term, and often the housing association or council will also look after some basic maintenance too.
You can read more about Private Sector Leasing Schemes if you read the article I wrote about them on the main website. Click here to read it: Private leasing Schemes
OK, I know the rent is less than you would get letting through a letting agent or privately and you have no control over the tenants they put in your place, but the scheme I had with my local housing association worked well overall. There were no voids, no need to furnish at all (even white goods) and no re-letting costs or hassle – the rent just got paid every month on the dot.
Now, however, the term (which was four years) has come to an end and I can evaluate it properly.
Well, there are some downsides.
The main one is that you have no control over who they put in your property.
Having just taken back my property it was clear that whoever they put in there had some er, “problems”.
Apart from very heavy smoking (the ceiling had to get three coats of paint and I hate to think what was happening to the tenants’ lungs) there was clearly some kind of nasty incident involving harassment from a former partner.
And the last person left with loads of unpaid debts - this despite being on benefits! Ever wondered where your taxes are going!
You see, by definition the people who the council or HA sublets to are homeless or on the waiting list.
Some of them will have problems – which is why they are in the benefit system in the first place, I guess.
Once I got the property back, it did need a very thorough redecoration – and much more than would be expected under the average private let. So, there was an extra cost there – because you see whilst they fix damages for you, they don’t guarantee the state of the walls, ceilings or carpets.
The other hassle is that you might occasionally have to deal with the housing association or council at the end of the contract – and they were in turns frustrating and occasionally downright clueless.
I personally know lots of people work hard in the public sector – lots of great teachers, doctors and a chap who works for a local council - but I’m afraid that with my landlord hat on, I have not come across any who seem to do anything much than get in each others way.
For example, there was the time when their contracted British Gas service engineers told me that I needed a new boiler at a cost of £2.5K. Mmm! I got it fixed with my own guy for £60.
Alas, the service standards of this particular housing association did leave a wee bit to be desired – lack of returned phone calls and a seemingly laissez faire anything goes attitude to their landlord customers.
Hassle Free
But still, it IS a pretty hassle free way of letting – and apart from at the end of the contract I did not have to talk to the housing associations at all. And hooray for that because when I did they drove me nuts!
I’m not going to be doing it again though.
And that’s not because they clearly housed some “problem people” in my property. It is because they want to pay the same rent to be that they did four years ago.
I know, weird isn’t it?
I have told them that rents are up by about 20% in the area.
But hey, mine is not to reason the wonders of the weird logic of a public sector body funded by the taxpayer.
After all, as a self employed landlord I have to make money, get customers and look after tenants – which I think I’m OK at.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson of property investment expert lettingfocus.com.
I’m the author of “Successful Property Letting - How to Make Money in Buy to Let” which for the last 2 years has been the UK’s top selling property title - buy the UK's top selling landlord book.
It is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on buying property below market value.
I’m an expert property journalist, property speaker and a well known landlord blogger
I contribute to newspapers and a host of property websites, write a number of columns in the press and I can provide landlords coaching
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services and am a regular speaker at property shows.
You can read more of my blog & find details of my networking, advice, property mentor programme at my website.What’s unique about lettingfocus.com is that we offer you help as an independent property investors coach because unlike most people in the buy to let and property “advice” business we are not linked to a property company, a developer, an agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.
Copyright: David Lawrenson 2008. This blog is updated once a week.
WANT TO BE KEPT UPDATED WITH OUR LATEST BLOGS?
It’s easy.
Look to the right of this blog and you should see my smiling profile. Then page down a bit and you come to where it says “Site feed” - click there and away you go.
You then just copy the link that comes up into your News Reader or News Aggregator. Even a non techie like me managed to do all this.
Please note if you are thinking of reproducing material here - that’s fine but we DO require the full links shown in each blog to be included including also the links in the section “ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON” Please contact us via the Contact US button at our main site http://www.lettingfocus.com/ if you have any queries about this.
Labels: housing associations, private sector leasing schemes, rent guaranteed
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