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UK landlords are societies new favourite target for criticism

UK landlords are societies new favourite target for criticism

Everyone Appears To Be Taking A Pop At Landlords

I don’t think I am becoming paranoid but have you noticed that public attitude towards landlords has changed over the last couple of years?
I know opinion can be like the property cycle and generally rolls around, but have you spotted a few subtle and not so subtle digs being aimed at our profession?

Targeting the private rental sector and the landlords who provide tenants with much needed housing used to be the reserve of newspapers such as the Daily Mail, but now the derision is much more widespread.

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New Row Over Letting Agent's Evil Fees

New Row Over Letting Agent’s Evil Fees

Homeless Charity Wants All
Letting Agent Fees To Be Met By Landlords

The homelessness charity, Shelter have started to campaign to get all letting agent fees currently charged to tenants banned throughout England, and they want landlords to foot the bill for it, a point which has angered the Residential Landlords Association (RLA) and caused consternation with the Association of Residential Letting Agents (ARLA) and the UK Association of Letting Agents (UKALA).

Shelter have launched a new report, “Letting Agencies: the Price you Pay”, claiming that charging landlords is a fairer way of doing business and the charity also claim that tenants are having to go without food or heating to meet increasing housing costs because letting agents’ fees are out of control.

Shelter were instrumental in getting letting agent fees banned in Scotland and now want the practice outlawed by MPs in England and are calling for politicians to take action.

The homelessness charity seem to think that all letting agents are the devil in disguise and recently questioned 58 separate letting agents throughout England, anonymously, asking them about what fees each charged in order to set up a tenancy for a tenant and discovered the average administration fee charged by agents was £350 (GBP) plus upfront rent and tenancy deposits. Less than a third of letting agents questioned charged fees totalling more than £400 and seven charged in excess of £700.

The Shelter research claims that in the last three years,

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New EPC Rules In Force From 9th January 2013

New EPC Rules In Force From 9th January 2013

The Energy Performance Certificate (EPC) shows the energy efficiency of a property, including any recommendations for improving the energy standards of the property, and it is a legal requirement in the UK that all properties for sale or to let have this certification. 

When letting or selling a property the EPC must be commissioned before any marketing can begin and a physical copy should be obtained within 7 days of the property first being advertised. That gives landlords just a week to instruct an agent, arrange an EPC and begin marketing the property for sale or to let. 

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A commercial radio advert which suggested that people would be better off putting their money into property rather than keeping it in the bank has sparked a furore and landed an estate agent in trouble with the authorities.

The radio advert, approved by the Commercial Radio Companies Association prior to broadcast, was pulled following complaints.

Three complaints to the Advertising Standards Authority, (ASA), claimed that the advert was misleading because it did not make it clear that there were risks associated with investments. Two of the complainants believed the advert misleadingly presented buy-to-let as a low-risk investment.

Two of the complainants also challenged whether the advertiser was regulated by the Financial Services Authority (FSA) and, if not, whether the ad was suitable to be broadcast on radio.

The company responsible for the advert, Aldermartin Baines & Cuthbert (ABC), told the ASA that they offered many properties that reflected yields of between 7% and 12% but had been guided to suggest a 5% yield, which was very conservative and definitely deliverable. They claimed that they had also been very careful to ensure the ad spoke in very general terms and did not guarantee any return or yield. ABC also said that accountants and financial advisers had contacted them and commended them on the advert.

The company did not accept that the ad misleadingly presented Buy-To-Let as a low risk investment. They said that whilst the radio ad did not mention ‘low risk’, it focused on the issues of inflation eroding the value of money, either on deposit or as the debt of a mortgage, and that if a deal was considered risky, banks would not lend on it particularly in the current economic climate.

The Commercial Radio Companies Association said they were happy with the content of the advert as, in their view, it had been carefully worded so as not to misleadingly imply that investing in a buy-to-let property was low risk or risk-free.

They said the advert was for buy-to-let property promoted as a buy-to-let ‘investment’. They understood that buy-to-let property was outside the FSA’s remit because it was an ‘investment’ not felt to be in need of FSA regulation. They did not feel that banning such adverts from radio would be fair or proportionate.

The ASA considered the advert misleadingly presented buy-to-let investment as low risk and did not make clear the potential risks associated with such an investment. It stated that the risks involved were not limited to tenants not paying their rent and felt that the overall impression was that the advert presented buy-to-let investment as an alternative, or a preferable option, to saving.

The ASA noted that buy-to-let property was not regulated by the FSA and considered the advert to be promoting an investment and despite the CRCA’s comments, it upheld the public’s complaints and subsequently banned the broadcast of the radio advert .

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