This week is SAFEagent awareness week.
Property118 has supported SAFEagent since its inception just two years ago.
The concept is very simple, a Letting Agent displaying a current SAFEagent badge has purchased client money protection and is also a member of one of the 5 best recognised professional bodies in the UK Letting Industry.
What this means is that if the agent ceases to trade, your rents and deposits are safe as they are protected by insurance. Housing Minister Mark Prisk, pictured below, said …. read on
The ratio of deposit disputes in England & Wales is just over one per cent according to official figures released by the Department for Communities and Local Government (DCLG).
The Government figures show that of the Seven million (7,052,255) deposits that have been protected since the launch of the legislation in 2007, only 91,802 have ended up requiring formal dispute adjudication – just 1.3 per cent. read on
LANDLORD NEWS – private landlord speaks out on housing benefit nightmare tonight on BBC’s The One Show
A landlord from Bracknell, Berkshire, has spoken out about her nightmare ordeal after her housing benefit tenant failed to pass on the payments. This issue has been widely reported and discussed within the buy-to-let industry but now a landlord has come out publicly to talk about it. The non-payments left Mrs Trivedy and her self-employed partner in an extremely difficult financial position. As a result of the welfare reforms and implementation of Universal Credit thousands of ordinary landlords fear that they will see more of this kind of problem. It is expected to affect the whole country and BBC1 are covering the issue on The One Show tonight, Thursday 2nd May at 7pm. They will feature Mrs Trivedy and Landlord Action, the problem tenant specialists, who she went to for help.
After meeting her current partner, Mrs Trivedy decided to sell her four bedroom house in Bracknell from a previous relationship so that they could buy somewhere together. After failing to sell the property quickly enough, she took the decision to let it out, which for three and half years provided the perfect solution. When her previous tenants moved out and an acquaintance from her daughter’s school, with five children of her own, expressed an interest in the property, it seemed like the perfect solution. The prospective tenants explained that they had fallen on tough times but that the £1,200 housing benefit they were due to start receiving would cover the rent. They agreed to set up a direct debit straight to Mrs Trivedy’s account.
From the moment the family moved in (December 2011), the payments were not consistent and with the housing benefit being paid in arrears every two weeks, there was already a shortfall of £20 per month which the tenants were supposed to make up. Four months ago, the payments stopped altogether. On communication with the tenants, Mrs Trivedy was told to liaise with the local housing allowance office, to no avail. After attempting to speak to the tenants at the property to discuss the issues and try to work out a payment schedule, the tenants called the police to file a harassment case. Mrs Trivedy has since received abusive text messages from the tenants via her mobile phone. In desperation, Mrs Trivedy called on the help of Landlord Action who have since issued a Section 8 possession notice, the process of which was filmed by The One Show.
Mrs Trivedy says “The tenants are now approximately £4,400 in arrears and that sum is mounting all the time. As a result, we are struggling to pay the mortgage on the house. My partner is self-employed so income is irregular and despite taking as much overtime at work as I can, we are living off next to nothing just to get by. What’s more, the house is a complete wreck after the tenants brought dogs into the property which subsequently had puppies. It will cost us thousands to get it back to a liveable state.”
Paul Shamplina, Founder of Landlord Action, says “The majority of social tenants do pass on housing benefit, but the cuts made in the welfare reforms are going to put many under increased financial pressure. Our experience in dealing with cases such as this is that most tenants would prefer to have their payments made directly to the landlord so that they can budget more effectively. Not enough has been done to protect landlords. Over the last few years we have seen a rise in these problems and now with the new Universal Tax Credits monthly payments, our concern is that more and more landlords will see problems and many will turn their back on the social sector.”
More advice on evicting tenants HERE
A new ebook has been released by Spare Room and is available to download as a PDF via Property118 free of charge. It’s called “Renting by the Room – A Guide to Maximising Rental Profits”.
The media has a fascination with house prices, and together with Property Investment gurus and Estate Agents, spend a lot of time talking about the money to be made from investing in property. However, they rarely mention the single biggest factor in maximizing your return on investment – renting property by the room.
The truth is that renting by the room can bring in two or even three times the income of the same property let as a single unit. So why does it feature so rarely on property programmes or investment research reports?
Perhaps there’s a belief that this type of letting is too complex for amateur landlords to handle? Maybe they want to keep the juiciest returns for themselves? Either way, it’s high time someone challenged the status quo, and revealed why savvy property investors and landlords are getting into renting by the room.
SpareRoom’s Guide to Renting by the Room reveals:
- The Origins of Generation Rent
- The Growth of Flatsharing
- The Benefits of Renting by the Room
- Where the Demand for Shared Housing is strongest, around the UK
- … as well as a Case Study of a Property Expert who only rents to sharers, and a Special Offer to get discounted advertising on SpareRoom.co.uk
To download your free copy, simply enter your name and email address below.
The Residential Landlords Associated revealed yesterday the housing benefit element of Universal Credit may well be paid directly to landlords after all. However, a lot of questions remain unanswered.
According to the RLA “automatic direct payments to landlords will now be allowed in the pathfinder areas. The policy change was tucked away on the last page of an obscure circular published by the Department of Works and Pensions (DWP) yesterday.” read on
Tenants are now staying in one property for a record duration of 20 months, according to the latest research from the Association of Residential Letting Agents (ARLA).
This figure is up year-on-year from an average of 19 months in Q1 2012, indicating that tenants are starting to take a longer-term view of renting a property. It is also the joint highest tenancy length recorded by ARLA. read on
For the first time in England and Wales, landlords and letting agents can now choose which deposit protection method they use – either custodial or insured – from the same place.
From April 2 The Deposit Protection Service (The DPS) has become the only provider to offer both services at the same time. read on
Hounslow Council is warning rogue letting agents that they could be prosecuted for advertising illegal backyard dwellings.
More than 100 letting agents in and around the borough are being contacted by the council, urging them not to market illegal developments built without planning permission or building regulation approval.
The message is being sent out to agents after the council set up a task force to deal with the blight of illegal dwellings that are built and let out as residential accommodation. read on
The biggest landlord provider of Tenancy Deposit Protection (TDP) in England & Wales, has announced it is to reduce its fees from the 1st April.
The changes, which recognise the rising value of deposits, mean that the scheme continues to provide benefits to its members regardless of the value of the deposit they take. read on
Our accountants have sent the following important tax news to all of their landlord clients. Please take heed and share this information with all other landlords you know.
The End of the Renewals Allowance from 6 April 2013
HMRC have announced that from 6 April 2013 allowances for the replacement of furnishings will no longer be available for landlords. Repair costs will continue to be fully allowable.
The current rules allow full deductibility of both repairs and replacement expenses against rental income in the year the expense is incurred. It is important to make two distinctions here:
Repairs vs. renewals/replacements:
If you replace an old item with a new one, it is quite clearly a ‘replacement’. Repairs costs are routinely incurred for maintenance, but if you spend more than 50% of the cost of an old item when repairing it then it may still count as a replacement rather than a repair.
Integral fixtures vs. furnishings:
‘Integral’ items are of the type that would not normally be removed by either tenant or owner if the property were vacated or sold (for example, baths, washbasins, toilets);
‘Furnishings’ include sofas, tables, suites, beds, cookers, washing machines, dishwashers, carpets, curtains, linen, crockery, or cutlery.
Although repair costs will continue to be fully allowable against income for both integral fixtures and furnishing, from 6 April 2013 allowances for replacements of furnishings will no longer be available.
Wear and tear allowance for fully furnished properties will continue to be available post 5 April 2013
Wear and tear allowance is calculated as 10% of the rent less council tax, water rates, and other services where the rental property is fully furnished. Until 5 April 2013 you can continue to use either the replacement/renewal allowance for furnishings or wear and tear allowance (not both).
From 6 April 2013 the only relief available to residential landlords will be the wear and tear allowance, and this can only be claimed for fully furnished properties, so landlords of unfurnished or partly furnished residential accommodation will not be able to claim any relief at all for replacing furnishings.
Allowance for cost of renewing integral fixtures will also continue
In addition to the wear and tear allowance, the cost of replacing or renewing integral fixtures may also be claimed against rental income. Where expenditure qualifies for this deduction, the following apply:
Expenditure on repair and renewal (including installation) of replacement fixtures may be treated as expenditure on repairs in addition to the 10% wear and tear allowance.
Replacement expenditure may only be claimed if you replace like with like. If a basic sink is replaced with a high end luxury sink, then HMRC will consider it an improvement not a renewal and it will need to be capitalised rather than expensed.
It is also worth noting, that in the case of house in multiple occupation, if the renewal expense is in a communal area such as corridors and hallways, then it is possible to claim capital allowances up to 100% in the year even after 5 April 2013.
Message from Mark Alexander
If you would like me to introduce you to my accountants, who specialise in tax planning for landlords, please complete the form below. Failing that, please feel free to leave a comment at the bottom of this page.
Kent Reliance has launched a series of buy-to-let products which place no restriction on the size of the landlord’s portfolio.
They are available for loans of up to £1m at 85% LTV, and at 75% TV for loans over £1m. Rates at 75% start at 4.49% for a two-year fix. A product fee is charged at 2% of the loan amount, plus an application fee of £130.
Kent Reliance only offer their products via a controlled sales distribution. Our recommended brokers have access to these products should you want to use them or just get a quote. Please complete the form below for an introduction