National Landlords Association

Encouraging renting


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Find out where the best Rental Yields are in London

This is a guest blog from Portico.

Portico has looked at the history of buy-to-let hotspots over the past few years, the current buy-to-let hotspots in London and an incredible amount of data, so we are able to tell you exactly which areas will give you the best return on your investment.

Property prices rise, yields fall

Over the past five years we’ve seen London house prices rise at a spectacular rate, powered by both overseas investment and record low interest rates. But with property prices at an all-time high, there are very few areas where you’ll find a great rental yield. Your investment may well be going up in value each month, but can you afford to stay in the buy-to-let business if the rent doesn’t cover your costs?

Portico has created an innovative rental yield map which can find the best rental yields in London at the click of a mouse. It enables landlords and investors to look at the granular data within each borough, to determine where the hotspots are in the borough itself.

How does it work?

Portico analyses property prices and data from several hundred estate agents in London, daily. They then combine the results with data collected over the past three months and compare it against their own internal company data, so that they have enough information to be able to make statistically reliable assessments.

This new and innovative calculator allows landlords to target their investment at postcode or street level. It’s now more important than ever that landlords do their research, and invest cleverly and with an open mind.

Portico Estate Agents have branches in Acton, Battersea, Bloomsbury, Camden, Clapham, Dulwich, Fulham, Hammersmith, Highbury, Islington and West Hampstead.

Find out more here.

 


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Time to Check Compliance

Russell Brittain, Electrical & Lighting Buyer at Toolstation, the trade and DIY supplier, discusses the Smoke and Carbon Monoxide Alarm Legislation

From 1 October 2015, private sector landlords have been required to install a smoke alarm on every storey of their properties and a carbon monoxide (CO) alarm in any room that contains a solid fuel burning appliance, such as a coal fire or a wood burning stove.  The government also issued guidance notes to encourage landlords to install CO alarms in rooms where there are gas appliances as an additional precaution.

With landlords now legally required to install CO and smoke alarms, there remains confusion among the general public about their use. A recent study conducted by Toolstation on the attitudes towards CO and smoke alarms has revealed that 25% of homeowners in Britain are unsure about whether they should fit CO alarms and worryingly 17% don’t think they are necessary at all.

So, almost six months on, it’s worth looking again at some of the ‘ins and outs’ of the legislation and checking you are fully compliant, especially when it comes to any new tenancies you may be securing this year.

For every new tenancy landlords must check that all the required alarms are in working order on the first day of the tenancy – this can be done and recorded as part of the inventory. The guidance from the government says that tenants should be advised to test alarms on a monthly basis for their own safety and get in touch with their landlord if there are any problems.

If you are replacing or installing alarms for new tenancies there are a huge range of smoke and carbon monoxide alarms available, both battery and mains powered. The government leaves it up to landlords to make an informed decision, choosing the best products for their properties and tenants.

Like many products, these alarms have become much more sophisticated over the last few years with all those stocked by Toolstation performing to the required standards. Whilst some also feature smart technology such as thermally enhanced optical technology, LED displays showing both CO levels and room temperature and even wireless interlink technology that can remotely locate, test or silence alarms. Also many of our CO alarms feature self-diagnostic fault and end of life alarms, so landlords and tenants alike can feel secure.

Both smoke and CO alarms have British Standards which are marked at Toolstation with the British Standard logo and all alarms come complete with the manufacturers’ comprehensive installation instructions. Generally, smoke alarms should be fixed to a ceiling in a circulation space like a hall or a landing and carbon monoxide alarms should be positioned at head height on a wall or a shelf, no more than three metres away from the potential source.

One thing to remember – heat detectors are not a substitute for smoke alarms – the Regulations are quite clear on this point, specifying smoke alarms. However, for ultimate peace of mind, landlords can install heat alarms in addition to CO and smoke detectors. The heat sensors react to large flames and so are particularly useful in the kitchen, where over 50% of accidental house fires start.

Toolstation offers a wide range of smoke and CO alarms at very competitive prices. For further information and to see the latest range of smoke and CO alarms, visit your local Toolstation branch or www.toolstation.com

 


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Are you ready for Right to Rent?

Are you ready for Right to Rent?

From the first of February, all private landlords in England will have to carry out ‘right to rent’ checks on tenants for all new tenancies they grant. These checks will serve as part of the Government’s plan to crack down on those who are living in the country illegally, and landlords are warned that they could face a fine of £3000 if they are found to be letting property to people without the right to reside in England.

How will right to rent checks affect landlords?

In order to escape any possible penalties, landlords must ensure that the property being rented is the main home of their tenant/s, and must also obtain and make copies of documents such as UK or EEA passports, identity cards, travel documents or Home Office immigration status documents. A full list of acceptable documents can be found here.

For landlords in the West Midlands – where Right to Rent checks have been piloted since  1st December 2014 – the rules don’t apply to tenancy agreements in place before then, or renewals of those tenancies after this date, as long as it involves the same people and there’s no break in the tenancy.

Where to go for more information

Landlords are advised to be ready for Right to Rent and to understand what the new rules will mean for letting property in 2016.

The National Landlords Association offer immigration courses for both full NLA/UKALA members and non-members, which will cover everything a landlord or agent will need to know about carrying out the checks. Find out more here.

For advice and guidance on how to make a right to rent check, see the video below, or you can see the Home Office’s guidance on all aspects of the new requirements here.

 


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Have you registered your appliances?

By Douglas Herbison, Chief Executive, the Association of Manufacturers of Domestic Appliances (AMDEA).

This year, the appliance industry aims to ensure that landlords across the UK take the sensible safety measure of registering their tenant’s appliances at www.registermyappliance.co.uk.

This is a vitally important home safety measure. In fact, by failing to register landlords could be putting their tenants at risk as they may miss out on important safety notices concerning the appliances in their property.

Worryingly, even though there are over 100 million large appliances in use in homes across the UK, that are kept running a very long time, less than half (47%) of consumers registered the last product they bought.  Unlike cars, this leaves the vast majority untraceable if a safety action becomes necessary.

In fact, the appliance industry, who are investing thousands to keep the public in the loop about product safety, deem registration such a crucial issue that they are holding a Register My Appliance Day. On the 21st January millions of citizens will receive a safety message from their favourite brands, reminding them to register fridges, freezers and washing machines.

The industry want conscientious landlords to be aware that by registering they are safeguarding their tenants against any appliance safety recall issues. It’s never been easier to register and landlords can complete this quick admin job, at no cost, in one fell swoop.

The Registermyappliance.co.uk portal provides quick access to the registration pages of 62 leading brands and, once registered, owners can be contacted immediately in the rare instance a free safety repair or modification becomes necessary. All that is needed is the product’s serial number, found on appliance data plate (at front of ovens, at the entrance to the drum of washing machines and sometimes on the underside or back of smaller appliances).

Landlords should be particularly mindful if they are have unregistered older appliances. These trusty, older machines, which are in constant use, could suffer some unforeseen and potentially dangerous wear and tear.  Usefully the online safety initiative allows them to register many products that are up to 12 years old.

Ever since its launch in 2015, this important public safety campaign has garnered support that includes the Department for Business, Innovation & Skills (BIS) as well as the Royal Society for the Prevention of Accidents (RoSPA), Age UK, Citizens Advice, Electrical Safety First (ESF) and local Fire and Rescue Services.

The Minister for Product Safety, Anna Soubry MP also recently expressed her support for Register my Appliance, encouraging everyone to invest a little time to register their products. In the interests of a tenant’s safety and a landlord’s peace of mind those few minutes online are time well spent.

 

 


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Safeguard your rental income and get your Rent on Time

One of the biggest concerns for landlords today is arrears, and the potential income lost due to missed or late rent payments. The business of letting your property relies upon a working relationship between both landlord and tenant, particularly when income is so dependent on others.

Arrears on the rise

Cases of rental arrears are on the rise in the UK’s private rented sector (PRS). According to our research, 37% of landlords experienced rental arrears in 2015, and with a 4% increase in the incidence of arrears towards the end of the year.

In addition, as a recent article published by Property Wire points out, there are now 84,200 tenants who are more than two months behind on their rent. This means that, in 2015, the number of households facing financial difficulties rose by 10,200.

Naturally, the failure of tenants to keep up with rent payments can cause huge problems for them and for your ability as a landlord to operate a successful, profitable business, not to mention the wellbeing and future development of the PRS as a whole.

Secure your rental income with the UKs leading landlord association

To help landlords secure their rental income in the event of arrears, the National Landlords Association has launched a new service, Rent on Time.

When landlords register with Rent on Time, the NLA will manage the rent collection process, collecting rent directly from your tenants and paying it into your account on agreed-upon dates, even if the tenant fails to pay. In the event of arrears the NLA will work with your tenants to resolve any issues and, if necessary, will seek property repossession at no additional fee. Given the possible costs incurred from arrears and legal fees, Rent on Time could save you a potential £3664 a year.

With discounted rates for NLA members, Rent on Time offers a fully automated online ordering system, a dedicated telephone support line, and is available for both new and existing tenants.

Find out more here or just call 0203 819 8900 to discover how Rent on Time can protect your rental income and help your business thrive.

 

Reinventing Renting


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Get the most out of your lettings business with Reinventing Renting

Your ability to earn on an investment has a huge impact on your efficacy as a landlord. A worrying 17% of landlords experience difficulties in recovering their costs and, in some of the worst cases, suffer losses. In light of these findings, how can you ensure that your business is successful, profitable, and above all rewarding for both you and your tenants?

At the NLA, we believe in educating, informing and equipping landlords with the very best in tools, advice and expertise to enable your business to grow and flourish. We are proud to support and represent the rights and needs of landlords across the United Kingdom, and all our members enjoy exclusive access to a wide range of services.

By becoming an NLA member you can expect to gain the edge over your competitors, make substantial savings, and gain a complete and thoroughgoing understanding of your rights and responsibilities as a landlord in order to be at the top of your game.

To demonstrate our commitment to helping you achieve success in lettings, we have recently launched our Reinventing Renting campaign. Over the coming months, we will be addressing the key concerns and issues facing landlords today, and will be providing a wealth of materials, guides and presentations to allow you to overcome them.

You will learn how to choose the right investments, improve your financial planning, expand your portfolio, reduce your exposure to risks, manage an effective and mutually beneficial relationship with your tenants and maximise your financial gains to truly get the most out of your business.

Right now we have a number of guides to download and presentations to view, all from topics such as growing your portfolio, meeting financial commitments, how to equip your buy-to-let property, the issue of rising interest rates, preventing loss from arrears, and also key advice and guidance on entering the private rental sector and making an investment that’s right for you.

Find out how we can help you transform your business at:  http://www.landlords.org.uk/reinventingrenting


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Did the Shadow Chancellor have a point?

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Blood letting seems the only king of private let the Chancellor approves of

Maybe that would be taking it too far, but in his response to George Osborne’s Autumn Statement the Shadow Chancellor, John McDonnell, took inspiration from Chairman Mao.

He even went so far as to throw a copy of the infamous Little Red Book his way for advice.

Little could he have imagined that the Chancellor of the Exchequer had stolen a (long?) march on his opposite number by embracing an ancient and very nasty Chinese custom.

It would seem that Mr Osborne is a committed student of  Chinese history and has managed to master and apply the ancient custom of ‘Lingchi’ – used for over a millennia in China until it was banned in 1905 – and otherwise known as the ‘death by a thousand cuts’.

Accordingly, one hundred and 10 years after falling out of favour the Chancellor and his colleagues have decided to resurrect the lingering death as a way of dealing with small landlords.

The lacerations started in the summer with the Chancellor’s Budget:

  • Finance costs – tax relief gone
  • Mortgage Interest – tax relief gone
  • Wear and Tear – reforms to come

These led to other consequences:

  • Landlords on low incomes forced into higher tax brackets
  • Effective Income Tax rates above 100 per cent
  • Moderate income households forced to sacrifice child benefit
  • Owners of larger portfolios losing personal allowances.

The Home Office joined in:

  • Immigration checks
  • Increased sanctions & criminal offences

Next up Communities and Local Government:

  • Restrictions on the use of s21
  • Seemingly endless proposals for ‘prescribed information’
  • Increased licensing of HMOs

And then back to the Treasury in time for the Autumn Statement where this week the Chancellor introduced what he described as “a tax on buy-to-lets and second homes”.

From next April, assuming the Government get their own way, landlords will be forced to pay Stamp Duty Land Tax (SDLT) at a rate 3 per cent higher than other purchasers.

In reality this means that an investment property bought today (November 2015) for £200,000 will incur an SDLT charge of £1,500. An effective rate of 0.8 per cent.

From April this will increase to a whopping £7,500, or in this case an effective rate of 3.75 per cent.

Even ignoring the efforts of the other departments of Government, which may be rationalised by other objectives, the Chancellor’s efforts will irrevocably alter the private rented sector.

For more information about the Autumn Statement see our briefing

Faced with the prospect of significant SDLT bills new acquisitions by small landlords will drop.

As a result of the Budget changes to finance relief existing portfolios held by individuals will become untenable – or drive accelerated rent inflation.

See our projections here.

So what’s next?

That is unclear. It is questionable that this is the end of the slicing. The Bank of England has been vocal about its concerns for the housing market and could yet make BTL lending more expensive and less available.

This Government has at least five more Budget Statements and four Autumn Statements before the 2020 election and there is still some revenue not yet re-classified as ‘profit’ for tax purposes.

What has been made clear is that the Government do not see small landlords playing a significant role in providing new housing. The target is larger commercial landlords and build-to-rent developments so far as renting is concerned – but ultimately home ownership is the prize for Osborne.

The mystery that remains is where these aspiring home owners of the future are supposed to live while Mr Osborne plans for 2020.

Perhaps that’s why he decided to increase funding to tackle homelessness…..

 

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