National Landlords Association

Encouraging renting

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‘Student-proof’ your property by registering its appliances

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

September’s coming and so are the hordes of students looking for digs.  Each academic year, the half a million or so young people needing rented accommodation represent a real opportunity for landlords across the country. The private rental sector accounts for a substantial proportion of student housing, with 30 per cent of this population going down the lettings route.

A good student landlord needs to bear in mind that for many youngsters this will be the first time that they have lived independently.  They need to find ways of making the property as safe as possible for this particular type of tenant who may not have enough time to worry about anything beyond their dissertation deadline.

One essential but easy way to prepare a student property is to register all its appliances on AMDEA

Whilst safety recalls on appliances are rare (between 6 -10 recalls a year), if a problem arises it is very important that owners of the affected models can be contacted quickly, especially if the tenant has not got their eye on the ball.

Unlike cars, manufacturers of appliances hold few records for the majority of owners. The user-friendly website, whose growing number of supporters includes the Government’s Fire Kills campaign, aims to change this and provides quick access to the registration pages of over 60 leading brands of domestic appliances.

The web portal also offers tips on appliance care and home safety, along with a current product recall listing.

Once registered, in the rare instance that there is a safety action, a qualified engineer would visit the student residence to perform a quick fix, rendering the product safe for the rest of its working life. It is one of the simplest ways to prevent avoidable fires and ensure a tenant’s safety.

This simple and quick piece of administration should be on the to-do list of every responsible landlord as well as the vitally important task of installing working smoke and carbon monoxide alarms

Allow anxious parents worrying about their offspring coping in their first rental property to sleep easy: at least the student digs are safe.

AMDEA’s Top tips for ‘student-proofing’ your property:

For more about AMDEA visit  

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Withdrawal of Green Deal

money_handoverThe Government announced the effective end of the Green Deal Scheme on Thursday 23 July when it confirmed that that no further funding would be provided to the Green Deal Finance Company, which makes and administers the Green Deal loans, or to the Green Deal Home Improvement Fund (GDHIF), which provide additional subsidy to install specific energy saving measures.

The decision will not make any difference to anyone who already has a Green Deal loan or a GDHIF voucher.  The Government has confirmed that these will be honoured.  The Green Deal Finance Company expects to be able to process the applications it has already received for Green Deal loans, but will not accept any further applications, at least for the time being.  It is possible that it will seek private finance to enable it to continue to operate.

The Government says that it remains committed to improving the energy efficiency of 1 million homes during the course of this Parliament, but concluded that, in order to ensure the money spent was giving proper value to the taxpayer, it should call a pause on the current arrangements and look at how to ensure that the funding was provided in a more coherent way for the future.  Amber Rudd, the new Secretary of State for Energy and Climate Change, is conducting a wider review of energy policies and funding of energy efficiency improvements will form part of this.

The Green Deal was a good idea in theory, but that was never matched in practice.  Its implementation in the private rented sector was held up for more than a year when it was discovered late on that it was not compatible with the Consumer Credit Act.  By the time this was resolved, the Chancellor had changed the rules by restructuring the ECO subsidy.  The stop-start nature of the GDHIF funding further undermined confidence.

The NLA has had its own difficulties.  We worked closely with the Coalition Government to develop the Green Deal, and thought it had a real opportunity to succeed where other energy efficiency promotion schemes had failed, because it focused on the building rather than the occupier.  We developed a service to support landlords through the whole process, but the funding problems meant that we struggled to deliver what we intended and had to face the entirely reasonable frustration, anger and disappointment of members who applied in good faith and did not get what they thought they had paid for.

That being said, the re-launched NLA Property Services is helping a growing number of landlords improve their properties, so that their tenants are warmer and happier in their homes.  The expertise built up through the past three years means that we are aware of all the potential sources of funding and work with the landlord to put together the package that works best for them.  Our partners have already confirmed that they were drawing increasingly on sources of funding other than the Green Deal and GDHIF even before last week’s announcement.

Whatever our immediate frustrations over this decision, the Government now has an opportunity to construct a more certain and sustainable means of supporting landlords to improve the energy efficiency of their properties. But it will have to move quickly, as the deadline of April 2018 for the introduction of minimum energy efficiency standards in the PRS remains unchanged.  The exemption which will be granted to any property which cannot be brought up to an EPC E rating without upfront cost to the landlord also remains in place, and without the Green Deal or an alternative, the amount of funding available for that is very limited.

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Don’t take the risk, call our experts

advice line 2

Staff photos

Of the many services provided by the National Landlords Association (NLA), perhaps the most useful and unique benefit is the help and assistance offered by the Advice Line. In an increasingly complex regulatory environment, it is a great comfort for NLA members to know that on the other end of a telephone line is the sympathetic ear of a trained adviser able to offer practical aid and pragmatic advice on any and all issues to do with running a lettings business.

The NLA receives over 38,000 calls a year covering a wide variety of issues from landlords who need some advice. We are here to give professional and practical assistance to all our members, whether small, one property landlords or larger portfolio landlords and agents. Alan Jakeway, Head of NLA Advice Line, gives you the low down on the NLA Advice Line.

Who are the advisers?

Our Advice Line consists of 18 professional members of staff all with extensive experience of the lettings business. The advisers come from various backgrounds: some are legally trained to a high level, others are housing law practitioners, and many have been trained in the gentle art of negotiation. All advisers receive regular training and professional development, so that they are all fully aware of current legislative requirements.

In most cases, the NLA member will find they are also talking to a fellow landlord, who will empathise with the issue they are discussing. The advice team all work part-time, on average two days a week; for the rest of the time they will be running their own businesses. It is not uncommon to hear an adviser say to a member: ‘Yes, the same thing happened to me only last week.’

What does the Advice Line do?

As a UK-wide organisation, we deal with queries from landlords based in England, Scotland, Wales and Northern Ireland and the role of an adviser is not just to give advice, but also to listen.

Call times can vary between five minutes to thirty minutes or more if the matter is more complex, such as assisting in the filling out of court forms. In some cases, landlords are very distressed and need time to relate the full issue and it’s vital that we tease out all the necessary information after which we can get to work on briefing them and offering advice on the most appropriate course of action.  There are times when more than one possible course of action is available; in such instances the member will be presented with the various options available to them and the likely outcome of each one.

There is always a minimum of five advisers working at any one time, with six on what we class as peak days (Mondays and Fridays). Calls are received from the moment the lines are opened at 9am and continue non-stop until 5pm when the lines close. Members who cannot get through immediately are able to leave a message and all calls are returned, usually within the hour. On a typical day, the advice line receives on average 160 calls.

What issues does the Advice Line commonly deal with?

A high percentage of calls will be concerning possession proceedings. It is an unfortunate fact that landlords will occasionally have to go to court to secure possession of a rented property. Most of the advisers have had experience of court possession procedures and assistance can be given with what to expect in court, how to instigate the process and how to correctly fill out the court forms. While there can be no guarantees, the NLA can confidently assert that if the correct procedures are followed a successful result will almost certainly be achieved. This has been our experience even with difficult and defended claims.

But there are a whole host of other issues we advise members on, and each poses a slightly different scenario. The most common subjects landlords raise with the Advice Line include:

  • Possession
  • Rent arrears
  • Dealing with letting agents
  • Contract law matters
  • Court procedures
  • Local Housing Allowance and Housing Benefit regulations
  • Council Tax liability obligations
  • How to go about serving a Section 21 and Section 8 Notices
  • Deposit protection
  • Tenancy contract issues
  • Queries relating to houses of multiple occupation (HMOs)
  • Joint Tenancies/Deed of Assignment
  • Housing Benefit regulations

Don’t take a gamble, get the right advice

If you can relate to any of these problems, or are currently grappling with an issue you’re unsure about, why turn to the internet when you’re not guaranteed a correct answer? As one of our experienced advisers has said: ‘I can look at any so-called legal advice website for landlords and within 5 minutes find a legal error.’ You could always call a solicitor, but that might prove more expensive in the long run.

Full NLA members have free access to the Advice Line as part of their membership. If you are not an NLA Full Member, then we also offer a more flexible solution in Call Credits, which gives you the opportunity to try out the Advice Line without committing to NLA membership. When you purchase Call Credits for the first time we’ll enrol you as an NLA Landlord Associate which gives you FREE access to our approved tenancy agreements, forms and letters which cover England, Wales and Scotland. We’ll also deduct the cost of previously purchased Call Credits from your membership fee if you later decide to join as a Full Member within 90 days.

Join the NLA and find out exactly how we can help support you to make a profitable success of your letting business.

NLA Full members can access the Advice Line on 020 7840 8939


Taxing Times Ahead

budget2015This was billed as a ‘big’ Budget, and frankly the best opportunity George Osborne would have to drive through the difficult financial policies which he may deem necessary to meet the Government’s objectives.

However, it has also proved a significant – if not outright damaging – budget for private landlords in the UK where Mr Osborne seemingly borrowed policies from Labour and the Green Party.

The Chancellor made two major announcements under the headline of ‘landlords’ reproduced below as they appear in the ‘Red Book’: 

1.191 The government will restrict the relief on finance costs that landlords of residential property can get to the basic rate of income tax. The restriction will be phased in over 4 years, starting from April 2017. This will reduce the distorting effect the tax treatment of property has on investment and mean individual landlords are not treated differently based on the rate of income tax that they pay. It will also shift the balance between landlords and homeowners. 

This is a major blow, and one the NLA feared based on speculation in the weeks leading up to Mr Osborne’s statement. In fact we wrote to the Chancellor directly ahead of the statement seeking assurances that the rumours were unfounded.

Contrary to common sense, loan interest is no longer to be considered a straightforward revenue expense, as the available relief will only be available at the basic rate of income tax.

It seems frankly ridiculous that the Treasury can announce such a cutting proposal, likely to increase operating costs and inevitably rents at a time when the private-rented sector is under such pressure to house a growing share of the country’s population.  Based on a typical rental property, valued at around £160,000, this move will hit a landlord’s margin to the effect of more than £800 per year; potentially forcing rents up by £70 per month.

This is apparently based on a belief that the ability to deduct interest payments from taxable income puts landlords at an unfair advantage over owner-occupiers – completely ignoring the fact that landlords are providing a service by way of business, while households are buying a home for their personal use.

It suggests a complete misunderstanding of landlords’ businesses and a lack of recognition for the work undertaken for largely unremarkable yields.

I suspect many landlords will be crunching their respective numbers to see if private renting remains viable post-2017 from when these measures will be phased in.

1.192 The government will also reform how landlords of residential property can account for the costs they incur in improving and maintaining rental property. Currently, landlords of furnished properties can deduct 10% of their rent from their profit to account for wear and tear, irrespective of their expenditure. This means landlords can reduce their tax liability even when they have not improved the property. From April 2016, the government will replace this allowance with a new system that enables all landlords of residential property to only deduct costs they actually incur

This point requires a little more consideration. It is difficult to understand exactly what the implications of replacing the ‘wear and tear allowance’ will be, and may result in a positive outcome for many (despite appearances).

It could be a response to the concerns raised by many in the NLA since HMRC removed the option to make ‘like-for-like’ deductions based a short while ago.

It could be that those who claim the 10 per cent allowance, without necessarily facing significant costs in that tax year will lose-out. Although this may be balanced by offering a solution for those landlords of unfurnished, or part-furnished property who are currently unable to recover any of the cost of replacing white goods, curtains or carpets etc.

The NLA will be seeking an urgent meeting with the Treasury and HMRC to discuss these issues, and the wider implications for landlords’ tax status and will update readers soon.

All in all private landlords have some hard decisions to make about where they invest, what return is possible and whether letting remains a worthwhile activity in the future – 2017 could well be make or break for many in the PRS.

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European Court of Justice VAT ruling could cost UK landlords so act now

Gary Rowson, One EGary Rowson, OneE, urges landlords considering energy efficiency improvements to take action.

A recent EU ruling on the application of the UK’s reduced rate of VAT for energy saving equipment and materials is likely to increase costs for landlords with domestic properties and individuals who are either building or refurbishing their homes (who are not able to recover VAT incurred on their construction works).

Under current UK legislation, a reduced VAT rate of 5% is applied to the installation of energy-saving materials to make dwellings ‘greener’ – such as solar panels, insulation or micro-combi boilers.

However, the European Court of Justice has now decided that this interpretation is not in line with the relevant VAT Directive, which only allows the reduced VAT rate to be applied where there is a ‘social aspect’ to the works.

The judgement means that UK VAT legislation will have to be amended and the scope of the relief is likely to be significantly restricted.  While there’s no clear timeframe for when this will be implemented, landlords would be wise to seriously consider bringing forward any energy efficiency improvements in order to take advantage of the current situation.

If you have any questions about how this might affect your rental property business, please call OneE Group on 0207 8701234 or send an email to

And to find out more about how the NLA can help you to make energy efficiency improvements, visit NLA Property Services.

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Is the grass always greener on the other side?

Matt Oliver, NLA Public Affairs Officer, on more evidence to suggest rent controls simply aren't the answer.

Matt Oliver, NLA Public Affairs Officer, on more evidence to suggest rent controls simply aren’t the answer.

Today’s publication of the interim report from LSE, commissioned by the NLA  debunks the myth that rent control is a golden bullet, easy to implement and guaranteed to work in the UK.

The launch comes on the day that the four Labour candidates aspiring to be leader (and potentially our next Prime Minster) go head-to-head in a live TV debate.  The Private Rented Sector (PRS) and housing is going to be top of the agenda, especially as Labour’s London Mayoral candidates are all advocating some form of rent control in the Capital as they pitch for votes in their separate election primary.  This is all despite the fact the Mayor has no such powers to implement such a scheme.

Rent controls are non-transferable policies

When it comes to the PRS, LSE’s report shows the grass definitely isn’t always greener. For example, the model cited for the policies advocated by Labour during the election was Ireland but, as the report concludes, the controls introduced in the last few years have had very limited effect.  In fact the country is experiencing a housing crisis, with rapidly rising rents and a near-standstill in new housing production.

Ah, but what about Germany?

Yes of course, Germany. This is often cited as the best example of a country with a stable PRS, yet LSE’s report found that the system of indefinite security and in-tenancy rent stabilisation has in the past been cushioned by low house prices and demand, something we don’t have here, whilst initial rents can be well above current market levels in high-demand areas. Meanwhile in San Francisco and New York it looks like the main beneficiaries of interventionist policies are older middle class households, with the young hardly getting a look in.

What’s the moral of the story?

Well, in a nutshell: rent controls sound great on the surface but the evidence points to the contrary. The NLA is a strictly neutral political organisation.  However, as Labour members listen to these proposals for the PRS and contemplate choosing their third leader in eight years, much like some do with Tony Blair (the only Labour leader to win three successive General Elections), they will remember that you often don’t know what you’ve got till it’s gone.

*LSE’s final report, due to be published later this year, will examine London in more detail to see specifically how renters in the Capital would be affected by various proposals for change.

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How to get started with buy to let financing

BTL RB blog

NLA London Rep Richard Blanco unpacks buy to let financing…  

I’m always keen to encourage people to research their own buy to let (BTL) mortgages, but there’s no doubt it can be very daunting.  There are a few key concepts you need to understand and I’m going to outline them here for you.

What mortgage do I need?

Most investors choose to take out interest only loans, because the interest can be set against your rental income, making this a relatively tax efficient transaction.  The lender will look at your credit file, and most expect borrowers to have their own home mortgaged or owned outright and have a minimum income of around £25,000 – although this varies depending on the lender.  Some major lenders like Birmingham Midshires and The Mortgageworks don’t require earned income, but their credit score is consequently more onerous, especially at higher loan-to-value ratios (LTVs).

How will my credit score and income be calculated?

Credit scoring plays a key part and having a high credit limit on a card can increase your credit score. However, using the credit facility regularly can reduce it quite dramatically and your credit score will be spared from impairment if your balance is below 50% of your total credit limit. Lenders can be fussy about what they include when calculating your income, and most disregard the forecasted rental income that the property will command.  They also tend to favour employed income from a payroll, and things like bonuses and earnings from zero-hours contracts may be overlooked.

What about lending criteria?

Rental income must cover 125% of the mortgage but almost all lenders now calculate prospective payments at a higher notional rate of 5%, rather than the agreed mortgage interested rate. This makes it harder to obtain finance and is aimed at acclimatising borrowers to the likelihood of interest rate rises in the short to medium term.  Lending policy also tends to favour landlords with smaller portfolios and most lenders place a cap on how many properties you can own, regardless of who the loan is with – usually between 3 and 10 or if not, a cap on how much you can borrow overall.

And what interest rates should I expect?

In 2009, typical buy to let interest rates were around 5.25% with often an arrangement fee of around 2.5% of the loan applied, but thankfully rates and fees have fallen considerably, and at 75% LTV you are now looking at an interest rate 2.5% to 3.5% with fixed fees of less than £2,000. If you have a bigger deposit and can stretch to a 65% LTV, rates can be as low as 2%.  New entrants like Virgin Money, The Mortgage Trust, Precise and Aldermore – though not always the cheapest – have helped to increase competition.

How long will the process take?

The whole application process can be very slow and pedantic – with an average completion of 8 weeks –and the big three BTL lenders have about two thirds of market share partly because of their speed and efficiency: TMW, BM and Godiva. 

Should I use a broker?

Around two thirds of landlords choose to use a broker but be aware they may steer you towards specialist lenders who are not necessarily the best value.  Often building societies who mostly deal direct with customers can have some of the best deals, so try carrying out your own research by looking at interest rates for example on the NLA Mortgages search engine, or Moneyfacts before deciding either way.

Is it ready to let?

Mainstream lenders will require the property to be habitable and ready to let in order to proceed, which means a working kitchen and bathroom and no damp or subsidence.  Many won’t lend to flats over four storeys high, flats over commercial outlets or to freehold buildings containing flats. For situations where the property requires works, you could try commercial lenders like Lloyds, Shawbrook, Bank of Cyprus, private or other high street banks, but expect to pay an arrangement fee of at least 1% and interest rates of around 4% on loans of up to 70% of the value of the property.  Interest-only loans are harder to come by in this sector and your repayment term will be shorter – say, 15 years instead of 25 – but there won’t be any caps on the number of properties you own. 

Is bridging finance for me?

Bridging financers are the funders of last resort, usually lend on a non status basis at 65% LTV, and involve much higher costs of generally around 1% per month with no arrangement fee. It’s a bit like buying on a credit card. The advantage is the property can be in any condition – within reason, but be warned: never obtain bridging finance without a clear exit strategy and be aware that you will be stuck on it for six months before you can apply for a remortgage.

Growing a portfolio

I hope this has all been useful. Remember, once you have a mortgage, and if the property increases in value, you can think about growing your portfolio by releasing equity and applying for a further advance.  People often release funds from their own homes in this way to buy an investment property. It’s called capital raising, and most lenders will allow it for the purposes of buying property, though they may insist you own the property for 6 or sometimes 12 months, and apply a lower LTV.

For more information about growing your portfolio, see our guide here – available to NLA Associate Members and above. Not a member? Sign up for free here


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