This Broadcast was meant to be last Wednesday but is instead being run today between 12pm-1pm.
Paul Shamplina, Founder of Landlord Action will be taking to the airwaves on BBC4’s You and Yours show, to highlight the shocking risk to landlords of the latest money making strategy to sweep the property industry, “Rent to Rent”.
It’s a simple concept: Rent a house, then sub-let the rooms to sub-tenants and make as much profit as possible. 
This is a mushrooming phenomenon which has seen hoards of “experts” writing blogs, books and seminars on how to get started and even running courses costing up to £500 on how to bring in tens of thousands of pounds with virtually no out-lay. One such “guru” includes Daniel Burton who claimed he earned £35,000 a month from the get-rich-quick scheme. Last week, The Guardian revealed he has gone missing, leaving tenants and landlords across London hundreds of pounds out of pocket.
The idea behind how it works involves a tenant (or “renter”) offering a landlord a guaranteed amount of rent for a set period, say three years. “This amount is likely to be less than its actual market value but the landlord, in theory, is happy because the property is let and he does not need to worry about lost rent, void periods or tenant issues for the foreseeable future” says Paul Shamplina. The tenant agrees to look after the property, take care of maintenance issues and in some cases even carry out a refurbishment on the property. Then, the tenant sub-lets as many rooms as possible to willing sub-tenants who are happy to rent a converted lounge or dining room and live in a house shared with six other strangers. The “renter” then creams a profit on the difference between the rent he is paying the owner/landlord and the rent coming in from the sub-tenants as a result of the multi-let.
Mr Shamplina has been asked to discuss the latest craze and how landlords might get unwittingly caught up in this scam and, what they should do if they are. He comments “I have several concerns over the legal practices of this process and how it affects the very landlords it claims to ‘support’. In my view, if it is not carried out diligently the landlord loses control of the property which is where the problems begin. I suppose I speak from being at the sharp end of dealing with evictions but I would advise any landlords entering into such an agreement to tread very carefully.”
To hear Paul’s views on rent to rent, tune in to You and Yours on Radio 4 from 12pm on Wednesday 16th October 2013.
In the pre-recorded interview Paul Shamplina mentions various tips for property owners considering Rent to Rent, one of which is not to accept Assured Shorthold Tenancy Agreement as these are not the appropriate contracts. Recently, Landlord Action announced they are now an alternative business structure regulated by The Law Society and have joined forces with The Law Department, headed by solicitor Justin Selig whose name you will recognise if you are a party to the Class Action groups fighting the West Brom Mortgage Company and Bank of Irelands decisions to increase the margins on their tracker mortgage products.
Having recognised a need for a professionally drafted commercial lease template to be readily available to Rent to Rent companies and property owners Property118 teamed up with Justin Selig to produce one.
The lease contract templates, guidance notes and notices are now available for immediate download for just £97 exclusively via Property118.com
The reason the contract templates are so competitively priced is due to economies of scale, the real cost of drafting a contract of this nature is thousands. Sufficient pre-orders of the contract template via Property118 made it viable to produce the documents and to share costs to arrive at this incredibly low figure.
If you are a property owner and you are being offered a “Guaranteed Rent” deal which allows your tenant to sub-let then this lease template is also for you as it protects your interests. If your tenant wants permission to sublet and you’re being offered a Company Letting Agreement or an Assured Shorthold Tenancy, that’s the wrong contract and should sound warning bells.
An essential read for those wanting a balanced view of the property market in the UK,
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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”.
Oven cleaning is one of the biggest issues and this article is to help Landlords present this particular item in their property in its best condition for an inventory inspection and help tenants bring an oven back to its initial clean state when leaving the accommodation.
OK, so I wrote this headline and added an image to attract your attention. I really did manage to double my money on a property deal in three seconds, however …….
A growing number of Landlords are falling for a “Guaranteed Rent” scam which enables a landlord or an agent to sublet a property.
When it comes to deciding where & how to invest, one of the most vital things a novice investor can do is to become an expert on due diligence and research … not just of potential property deals, but also of people and companies offering portfolio building services, joint ventures, mentoring and deal sourcing.