The Guaranteed
Rent Specialists

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Year: 2020

  • Landlords Confidence Crumbles As Regulation Hits Hard

    Landlords Confidence Crumbles As Regulation Hits Hard

    Landlords confidence took a hammering in the second quarter of the year, as they were hit by the evictions ban, Government regulations and the Covid downturn.

    The National Residential Landlords Association’s (NRLA) confidence index reveals that those with portfolios in London and Wales are feeling least confident about their future compared to 12 months ago, with those in the North East and North West most bullish.

    But nearly all the regions improved their score from the first quarter – just as lockdown was starting. The only significant drop was seen in the South West, which the NRLA believes could just be seeing a slight lag; its previous fall wasn’t as great as many others, and it’s also where rents have seen the largest rise.

    Good tenants
    A fear of losing good tenants, along with local market conditions and the general state of the economy have all impacted on their decision-making, with a slight fall in the number either buying (10%) or selling (15%) in the last 12 months.

    It also makes landlords believe they can’t raise rents; only 18% have done so in the last 12 months while 72% have frozen them.

    But they’re certainly not suffering from a drop in demand as the survey finds that more than 60% of vacant properties are taken up within a four-week period.

    Looking to the future, fewer landlords want to sell and only slightly more are planning to buy properties.

    The NRLA says the gap between the two has fallen markedly since last summer and explains: “This could purely be a Covid-effect. It could also indicate that the pain inflicted by tax changes and new regulations, plus future changes in the pipeline, are now more fully baked into landlords’ plans.”

    Blog Post from Landlord Zone

    See details of our Guaranteed Rent Scheme here

  • BREAKING: Second disabled tenant wins ‘No DSS’ discrimination court case

    BREAKING: Second disabled tenant wins ‘No DSS’ discrimination court case

    Another house-hunting tenant has won a discrimination case after being refused viewings by a lettings agency on the basis that he was in receipt of housing benefit.

    Supported by Shelter, disabled Stephen Tyler, 29, yesterday won his legal battle at Birmingham County Court (pictured) after successfully proving ‘No DSS’ discrimination in his case.

    The legal action was triggered when Tyler and his family were told by Birmingham lettings agency Paul Carr that it is was ‘company policy’ to refuse to rent to people on housing benefit, despite Tyler having a spotless renting record.

    He and his legal team argued that the firm was in breach of the Equality Act after preventing him from viewing three properties advertised to let via this ‘blanket’ policy.

    As in Shelter’s previous case in July at York Crown Court, the discrimination faced by Tyler was deemed in breach of the Equality Act because it disproportionally affects disabled people, who are more likely to need some support with paying their rent.

    The ruling does not therefore cover the wider practice of putting ‘No DSS’ requirements in property advertising.

    Disability

    Nevertheless, it affects a lot of people – 45 per cent of private renters who claim disability benefits like Disability Living Allowance or Serious Disability Allowance also claim housing benefit.

    During the most recent case in Birmingham, the judge Her Honour Judge Mary Stacey ruled that: “There is no doubt that there was a blanket policy that no one in receipt of housing benefit would be considered for the three properties.

    “It put the claimant and other disabled people at a particular disadvantage when compared to others.”

    Tyler and his family were evicted from their original home in February 2018 after asking their landlord if they could complete disability adaptions to the property, and then subsequently struggled to find a new home.

    Polly Neate, chief executive of Shelter, says: “This win proves yet again that blanket bans against people on housing benefit are unlawful because they overwhelmingly bar women and disabled people like Stephen, who are more likely to need help with their rent, from finding a safe home.”

    Blog Post from Landlord Zone 

    See details of our Guaranteed Rent Scheme here

  • Eviction Ban: ‘Expected from Labour, not Tories’ says party member

    Eviction Ban: ‘Expected from Labour, not Tories’ says party member

    A Tory member has used the Conservative Home website to tell his party that it should introduce interest-free loans to help tenants pay off their arrears.

    Chris Town – a party member and former vice-chair of the Residential Landlords Association – says the Conservative government’s eviction ban has produced victims in the shape of landlords being unable to take action against tenants committing anti-social behaviour or those involved in domestic violence or those with arrears accumulated before the pandemic.

    “It is six months in which landlords have been unable to reclaim possession of their own home where they have rented it out whilst working elsewhere such as those in the military or diplomatic service” he adds.

    Town believes some landlords could lose as much as £20,000 when arrears and the length of time to go through the court process are added together.

    “It is completely unacceptable to expect landlords to undertake the responsibility of the state to subsidise those who are struggling to pay their rent. I might expect Labour to have no sympathy for landlords, but I would hope that a Conservative government would show some understanding that most landlords are not wealthy, and cannot afford to forgo rent for long periods of time” he writes on the website.

    He insists that the best protection for renters with genuine Covid-related arrears, and for landlords, is to enable the tenants to pay off their rent arrears.

    “This should be done through interest-free, government-guaranteed hardship loans for tenants in England to cover Covid-related arrears. The money would be paid directly to the landlord, and the immediate future of their tenancy secured” Town advocates.

    He says that such a scheme would then allow the government to give a cast-iron guarantee that the eviction ban wouldn’t be extended again beyond its current expiry date of September 20.

    “This would be a good incentive to ensure that they had done all they could to work with the tenant to find a solution, which is what the large majority of landlords have been doing. They deserve some recognition for this and some support where it is needed” concludes Town.

    Perhaps surprisingly for a Conservative website, at the time of writing this article over half the comments beneath Town’s piece appear to be critical of landlords.

    Blog Post from Letting Agent Today

    See details of our Guaranteed Rent Scheme here

  • Right to Rent is burdening landlords and pushing genuine tenants into destitution

    Right to Rent is burdening landlords and pushing genuine tenants into destitution

    Radical reform of immigration policies is needed to tackle the injustice of a ‘hostile environment’ that burdens landlords with unnecessary responsibilities, says a new report.

    Research Access Denied: The Human Impact of the Hostile Environment believes this environment has forced many people into destitution, has helped to foster racism and discrimination, and badly affected those with the legal right to live and work in the UK.

    It points to the Right to Rent scheme as one of the Government’s “systematic flaws” in its approach to immigration enforcement.

    Authors at The Institute for Public Policy (IPPR) write: “Inherent in the design of the hostile environment is the targeting of individuals on the basis of their lack of documentation, the deterring of people from accessing public services, and the transfer of responsibilities away from immigration officials and towards untrained professionals such as landlords.”

    Earlier this summer, MPs voted not to exempt landlords from doing Right to Rent checks on EU nationals as the Immigration and Social Security Co-ordination Bill passed its third reading in the Commons.

    Supreme Court
    The Joint Council for the Welfare of Immigrants plans to challenge a Court of Appeal ruling which found that the scheme was ‘proportionate’ in meeting its objectives by taking a further appeal to the Supreme Court.

    The report says this has introduced new forms of discrimination into the private rental sector and adds that restrictions on access to benefits can force people without immigration status into destitution.

    It says: “There is evidence of malnutrition, cramped and substandard accommodation, and mental ill-health among undocumented migrant families unable to access public funds.”

    IPPR believes the current situation doesn’t appear to be working for anyone and points to its study of 133 people without immigration status that found that, in spite of the increasingly harsh conditions associated with the hostile environment, nearly 40% planned to stay permanently and less than 10% intended to leave within the year.

    Blog Post Landlord Zone

    See details of our Guaranteed Rent Scheme here

  • Enfield presses on with selective licensing despite overwhelming landlord opposition

    Enfield presses on with selective licensing despite overwhelming landlord opposition

    The London borough of Enfield has gone ahead with its unpopular additional licensing scheme and is determined to bring in selective licensing as soon as it can.

    Despite landlords’ overwhelming negative response to its consultation, with 73% against selective licensing and 56% opposed to additional HMO licensing, Enfield believes it’s the best way to crack down on the private rented sector.

    Earlier this year, it approved the introduction of a selective licensing scheme to cover single family private rented homes in a whopping 14 wards across the borough.

    It now needs the Secretary of State’s permission and although it estimated that the scheme would be introduced in September, Covid looks to have put paid to its plans and it will have to wait a bit longer.

    The new additional licensing scheme introduced this week increases licensing across the borough to include all properties occupied by three or four people living in two or more households who share amenities.

    £900 for five years
    It will cost about 8,000 HMO landlords £900 for up to five years. The council has also increased its mandatory HMO licence application fees from £697 to £1,100, an increase of 58%.

    Enfield Council’s cabinet member for licensing & regulatory services, councillor George Savva, says: “We believe the scheme will improve the reputation of private landlords, as well as Enfield’s reputation for providing quality housing. The scheme is a major step forward in improving living standards for many Enfield residents.”

    Just over a third of Enfield’s properties are rented – over 43,500 properties; it believes up to 59% of HMOs have serious hazards that need addressing and says that on average 23% of HMOs have been associated with anti-social behaviour in the last three years.

    In 2014 Enfield famously failed in its first bid to introduce licensing in the borough.

    Blog Post from Landlord Zone

    See details of our Guaranteed Rent Scheme here

  • LATEST research: How a CGT tax increase would hit landlords hard

    LATEST research: How a CGT tax increase would hit landlords hard

    The changes to capital gains tax (CGT) predicted in July are becoming more likely to kick in this autumn as the Chancellor looks to fill the trillion-pound hold in the UK’s finances.

    But new research shows how it would hit landlords hardest in those parts of the country that have seen the biggest historic property price rises.

    London and the South East are also the areas where rental yields are lowest, and where landlords are likely to have focused on capital growth rather than annual income, according to new research from Hamptons International.

    It says the average higher rate taxpayer landlord in London could see their bill rise by nearly £27,000 to almost £90,000 as a result of the proposed changes.

    The Treasury proposes increasing the CGT rate from 28% to 40% for higher-rate taxpayers and from 18% to 20% for a basic taxpayer.

    For a higher rate taxpayer, the proposals would see the capital gains tax bill (excluding allowable expenses) go up from £15,880 to £22,680 – assuming the landlord can make use of their £12,300 CGT allowance.

    Landlords around the country would be affected differently; at least 89% of landlords in London pay capital gains when they sell their property, compared to 31% in the North East, where the average profit on the sale of an investment property is just £5,000, well within the allowance.

    The estate agent’s research found that the average landlord who sold their buy-to-let property in England and Wales this year made a £69,000 gross gain, having owned it for almost ten years.

    In London, investors sold their buy-to-let for £236,000 more than they originally paid for it, having owned for 11.1 years. It also finds landlords see less capital growth than the average seller – £88,000 – usually because they buy homes that cost less than the local average and because they prioritise yield.

    Blog Post from Landlord Zone

    See details of our Guaranteed Rent Scheme here

  • Illegal Evictions And Violence Against Tenants

    Illegal Evictions And Violence Against Tenants

    A group of leading campaigning and regulatory figures have joined forces to recommend key measures for local and national government to adopt if the burgeoning problem of the ‘shadow’ private rented sector is to be tackled.

    Their report, launched today at a virtual meeting attended by key figures from parliament, local authorities, enforcement bodies and campaigning groups, is seeking to combat the rising tide of illegal evictions, harassment, and abusive and threatening behaviour carried out by a growing criminal minority within the PRS.

    “The current regulatory framework fails to deal with the kind of landlords who have no intention of complying with the law,” says one of its co-authors Julie Rugg (right).

    “Too often we call these landlords ‘rogue’ but this doesn’t describe their activities adequately – they are criminals for whom this is a business model.”

    Rugg says these landlords and often letting agents can be pigeonholed into several categories.

    These include those ripping off tenants through rent-to-rent scams and illegal sub-letting; corporate corner-cutters; organised criminals who knowingly operate dangerous and over-crowded properties; lettings connected to sex trafficking and cannabis farms; and landlords who employ violence and intimidation.

    Ben Reeve-Lewis, also a co-author of the report, says the nature of criminal landlords is changing rapidly as technology enables organised criminal landlords to become more difficult to identify and track.

    “It’s not a few rotten apples as it used to be – it’s systematic organised illegal activity,” he says.

    The report’s recommendations include:

    • Make online renting portals that landlords are able to directly upload to without filtering more culpable for the property listings they publish and introduce property MOTs and unique identification numbers to help achieve this.
    • Put a duty on police to stop illegal evictions.
    • Create a fund to help authorities recruit more enforcement teams with the relevant skills – austerity has severely reduced this.
    • Force authorities to adopt a multi-agency approach – too many criminal landlords take advantage of councils whose different enforcement arms don’t work together effectively.
    • Amend housing legislation to introduce joint and several liability for housing offences to include the property owner and/or letting agent.
    • Introduce a right to expert statutory advocacy for private renters faced with criminal behaviour by landlords.
    • Ban Section 21 evictions.

    During the launch Chris Norris of the NRLA, a lone representative of landlords at the event, said that local authorities must be given more money to tackle the shadow PRS and that relying entirely on the fees from licensing schemes was unfair on compliant landlords.

    The Journeys in the Shadow Private Rented Sector report is jointly published by the University of York and Cambridge House Research and funded by Trust for London. It is backed by, among others, the Mayor of London, Generation Rent, Karen Buck MP, James Murray MP and the NRLA.

    Blog Post from Landlord Zone

    See details of our Guaranteed Rent Scheme here

  • Listings Of Rental Property Documents Ignored

    Listings Of Rental Property Documents Ignored

    Letting agents have been in touch with LandlordZONE to allege that Rightmove is turning a blind eye to listings of rental property that feature fake or inaccurate EPC documents, part of a larger problem of sometimes weak compliance among agents, landlords and portals.

    As we reported on Wednesday, the lax way listings of rental property are regulated in the UK means fraudsters and criminal landlords are using gaps in EPC and other regulatory systems to make their properties look legitimate online when they are not.

    Rightmove told LandlordZONE: “All agents advertising on Rightmove must adhere to all relevant legislation.” It has also undertaken to look into any examples of fake or inaccurate EPCs within its listings.

    Providing an EPC has been a legal requirement since 2013 and a landlord must commission an EPC for a property or provide a valid existing EPC. It also stipulates that their letting agent – if they use one – has to be ‘satisfied that an EPC has been commissioned for the building before it is put on the market’.

    Landlords then have seven days to provide a valid EPC and a further 21 days is allowed in exceptional circumstances.

    But the regulation and oversight of the EPC system is weak. The policing of EPCs is a low priority for most local authorities and/or Trading Standards, both of whom are under pressure to cut costs – while portals struggle to police their correct use within listings given the huge volumes involved.

    Agents have contacted LandlordZONE to highlight OpenRent, the largest lettings firm in the UK by volume of listings, popular because it’s inexpensive to use. Many other traditional and online agencies are part of the problem, nevertheless.

    They claim landlords on OpenRent can create their own listings and, instead of providing physical EPCs, are asked to declare what band of EPC they hold via a menu ‘drop-down’.

    Open Rent denies this vigorously. “We manually check EPCs against the online register and strictly enforce rules around the grace period where they are still being obtained. OpenRent has done a lot of work to ensure we are industry-leading in our compliance in this area”, the company says.

    “There’s a much bigger issue here which is poor enforcement of EPCs being in place at the time of advertising – i.e. landlords telling their agent it’s being obtained, and agents not then following up on this. We follow up on this automatically because we’ve built that into our system, meaning we’re industry leading on this issue.”

    SW16 postcode
    An example shown to LandlordZONE was a listing in London’s SW16 postcode which revealed an A-rating EPC for an apartment even though none of the EPCs on the public register for the building show any A-ratings.

    OpenRent checked this example and agreed the ‘A’ rating supplied by the landlord should have been a ‘B’ but said it still believed such examples were ‘rare’ and the “tenant was provided with an accurate copy of the EPC on move-in, so the impact of the mistake was quite limited”.

    “EPC ratings are something we take very seriously. There’s no legal requirement to provide physical proof of EPCs at the point of advertising – and so we don’t supply a copy to the portals in all cases,” the company says.

    “Agents who are ‘irate because they have to track down the EPCs for their properties’ should already be aware of this. The legal requirement is for landlords to supply a copy to tenants at viewing/enquiry stage or before they move in.

    “Indeed, a quick look on Rightmove reveals a bunch of high street agents who don’t mention the EPC at all in their advertising for example this one: https://www.rightmove.co.uk/property-to-rent/property-96897290.html.

    “In terms of compliance, there are fines for not having EPCs. Eviction notices can also be invalidated if an EPC is not in place. If this isn’t working that’s a matter for MHCLG to comment on however we aren’t aware of any particular issue among OpenRent landlords.”

    Blog Post from Landlord Zone

    See details of our Guaranteed Rent Scheme here

  • Agents urged by ARLA to lobby MPs over cash help to tenants

    Agents urged by ARLA to lobby MPs over cash help to tenants

    The Association of Residential Letting Agents is urging its members to write to their MPs over the provision of cash help for tenants during the pandemic.

    Propertymark is part of a cross-sector group calling on the government to deliver a package of emergency measures to support tenants in England who have built up arrears specifically through COVID-19 related issues.

    The package includes ring-fenced funding administered through local authorities, using a mechanism like the Discretionary Housing Payment; an additional cash injection into local welfare assistance schemes; and government-backed, interest-free loans for tenants not eligible for the above support.

    Last week the Scottish Government launched a new £10m fund, along with a further increase in the Discretionary Housing Payment funds, so that no one will be unable to afford their rent.

    Here is the template letter it wants agents to write to their Members of Parliament:

    Dear (insert name of MP),

    As a professional local letting agent working in your constituency, I am writing to you to urge you to raise the issue of support for tenants who have built up rent arrears as a result of the pandemic. 

    Government action like the furlough scheme and the increase in Local Housing Allowance has supported many tenants to continue their rent payments, however it remains the case that there are many instances where support is still insufficient. With the courts reopening on 20 September for possession hearings for the first time since the crisis began, further measures are needed to help sustain tenancies.

    As a business we wish to do everything we can to support tenants, however the non-payment of rent has become untenable for both landlords and tenants. This is why we are supporting the campaign from ARLA Propertymark and other leading sector organisations including NRLA, Shelter, Generation Rent, Crisis and Citizens Advice, calling on the Government to deliver a package of emergency measures to support tenants who have built up arrears specifically through COVID related issues. 

    There is no ‘one size fits all’ in approach, and I support these organisations in calling for the following: 

    – For those tenants in receipt of benefits, or who would otherwise be eligible for benefits but have no recourse to public funds, support should take the form of a dedicated grant. This could be administered by local authorities, using a mechanism like the Discretionary Housing Payment, but it must be designed so that it gets to those that need emergency funding now to pay off their arrears.

    – Further funds could be made available through an additional cash injection into local welfare assistance schemes, building on the £63 million the Government committed in June 2020.

    – For other tenants, such as those who have been furloughed and are struggling to pay their rent now but will be able to pay in the future, support should take the form of a Government-backed, interest-free loan. This could be administered by a third party such as a credit union or a bank or building society.

    The COVID health pandemic is an unexpected crisis, and therefore requires a one-off intervention to address specifically Covid-related arrears. This will enable both tenants and landlords to continue the tenancy and support tenants to remain in their homes. If such assistance is not given, we could be faced with a homeless crisis when the eviction ban ends as well as a generation of tenants saddled with crippling rent arrears. 

    Furthermore, the stay on evictions means that landlords are under increased pressure to support tenants who cannot afford the rent, without any compensation, while also continuing to pay mortgages and bills. As much as decent landlords and agents like myself wish to continue to help tenants, this situation is unsustainable. 

    Please raise this issue in Parliament and with the Government to ensure that tenants get the support they need and tenancies are maintained. 

    Yours sincerely,

    (name)

    Blog Post from Letting Agent Today

    See details of our Guaranteed Rent Scheme here

  • Tenants must get interest-free loans to clear Covid arrears – agent

    Tenants must get interest-free loans to clear Covid arrears – agent

    A scheme providing interest-free loans to tenants with Covid-related arrears should be offered across the UK.

    That’s the view of David Alexander of property management firm Apropos, who says such a scheme – currently operated in Scotland – should be spread across the rest of the UK.

    “This scheme is welcome as it will support tenants in paying their rent during this difficult period. The Westminster government should offer a similar scheme in the rest of the UK to ensure that tenants facing financial difficulties due to the pandemic are supported in paying their rent” he insists.

    “This in turn will help landlords who are badly in need of financial support to maintain their properties at a time when regular rental incomes have sometimes become more erratic” he continues.

    “However, it is vital that tenants who receive these funds must use them to pay their rent. If the private rental sector is to survive the pandemic – and it needs to as it is the second largest provider of homes in the UK – then governments need to support tenants and landlords through these difficult days.”

    Scottish housing minister Kevin Stewart has said that the loan scheme, which has a £10m pool of public cash, should mean that no one should be left in a position where they cannot access support to pay their rent. The scheme opens north of the border in November.

    Alexander continues: “Although this will be an additional financial burden for government at a time when national debt is soaring there would be a much greater human cost if tenants cannot pay their rent.

    “The loss of rental income experienced by landlords could result in many being unable to keep their properties and beginning to exit the market. A substantial loss of homes would be catastrophic for many thousands of people and highlights the need to back everyone involved in the private rental sector at this time.

    “The Tenant Loan Scheme is one way of keeping people in their homes, and landlords in the market, and the UK government must establish a similar scheme immediately to help support the sector through a potentially difficult autumn.”

    Blog Post from Letting Agent Today

    See details of our Guaranteed Rent Scheme here