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Government Issue Response To Tax Relief Petition

Government Issue Response To Tax Relief Petition

Government Issue Muted Response To Tax Relief Petition

The Government has published a response to the online petition that opposes the proposals to change the amount of tax relief on buy to let mortgages announced by the Chancellor, George Osborne, in the post election summer budget.

From April 2017 onwards landlords will only be able to claim the basic rate tax relief rather than the higher rate tax relief on buy to let mortgage payments. It is widely feared that the move will severely affect the profitability of the private rented sector (PRS).

The online petition to reverse the planned tax restrictions on individual landlords has attracted more than 23,600 signatures since being posted.

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Will The Housing Crisis Win The Election?

Will The Housing Crisis Win The Election?

The Politics Of Housing

It is still generally acknowledged by all political parties that there is a housing shortage in the UK, and each political party wants to offer the public alternative methods of tackling the problem in an attempt to win electoral favour.

Most political parties see the housing crisis in the UK as a possible election winning issue and each party’s election manifesto promises the general public many things, including further private rented sector (PRS) reforms and the introduction of additional legislation. There isn’t much offered by any political party for landlords, except for the promise to put an end to the private rental sector.

A recent survey by Ipsos MORI research published in January 2015 discovered a confusing conundrum, in that:

  • 75% of the public agree that there is a housing crisis in the UK
  • 48% of the public disagree there is a housing crisis in their locality

The publication of each political party’s election manifesto is intended to give the public a clearer indication of the housing priorities of the UK’s next parliament.

However, despite claims of a housing shortage nationally there are still some UK regions that have large proportions of derelict and abandoned properties, many still in a habitable condition.

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Survey Finds 30% of Tenants Quit Rental Properties Due To Poor Standards

Survey Finds 30% of Tenants Quit Rental Properties Due To Poor Standards

Landlords Need To Take Note Of Survey Findings
To Attract And Keep Good Tenants

One in three current PRS tenants have quit properties and ended tenancies within the UK private rental sector due to lack of repairs by landlords and the overall poor condition of rental properties in general.

These shocking tenant revelations are from a survey carried out on behalf of the National Landlords Association (NLA) by shower manufacturer Methven, last month.

The survey of PRS tenants discovered that poor quality fixtures and fittings in rental properties are a major cause of grievances and less than 10% of tenants who took part in the survey were completely happy with the condition of the property they were currently renting.

Over 60% of private rented sector tenants who took part in the survey said the standard of bathroom fixtures in rental properties is below average with 16% reporting that standards were poor. A further 53% claimed a good shower is an essential feature of a good rental property, which is good news for the shower manufacturers conducting the survey.

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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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Landlords need to be aware of the energy efficiency of their rental properties

Landlords need to be aware of the energy efficiency of their rental properties

UK PRS landlords are being urged to check the energy efficiency of their rental properties that they want to let out before tenants commit to rent them, as it could save their tenants a substantial amount of money in the long term.

Landlords have stated that their tenants are becoming increasingly concerned with the extortionate cost of utility charges and many tenants have even used the information displayed on EPC’s to make the decision to go ahead with the let of more energy efficient rental properties.

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Tenants prevented from switching utilities illegally according to new research.

  • 10% of UK tenants have been illegally stopped by their landlords or property management agents from changing energy suppliers.
  • 3% of private rented sector tenants cannot switch utility companies because of restrictive clauses in their tenancy agreement.
  • 7% were informed verbally by their landlord that they were not allowed to change energy supplier.

    Switching Utilities Causes Landlords Problems

    Switching Utilities Causes Landlords Problems

The assured shorthold tenancy agreement (AST) or rental contract is allowed to contain restrictive clauses that stipulate tenant’s require permission from the landlord before switching energy supplier, however, permission cannot be reasonably refused.

The same is also true if tenants require payment meters installed for their gas and electricity supply. This is where the bone of contention lies for many landlords, as once a property is fitted with prepayment meters, there is a charge to the property owner (landlord) if they wish the property to be changed back to a normal meter and quarterly billing.

Landlords have been able to offer preferential rates to tenants using Utilities Warehouse offering competitively priced energy, telephone and other cost saving services to tenants as part of an attractive rental package. The services taken up provide the landlord with a small commission, and changing supplier could mean the difference between the landlord operating a profitable business and making a loss. So tenant’s switching utility suppliers is not always in the landlords best interests, despite cutting the tenant’s fuel bills.

Data from uSwitch, showed

  • 38% of private tenants had switched utilities in order to find a cheaper energy supplier
  • 33%of private tenants were unaware of their right to change energy providers
  • 33% of private tenants could see no point in switching suppliers as they would not be living there long-term.

Despite the potential annual savings of up to £420 according to uSwitch.

Tenants concerned about high energy bills should consider approaching their landlord about switching utility companies and seek permission to do so, however according to uSwitch, 22% of PRS tenants claim that their landlords don’t want to be bothered by tenants over energy suppliers.

An attitude that seems to also cover energy efficiency, with 26% of tenants saying that they wouldn’t talk to their landlord about energy efficiency because they didn’t think their landlord would be interested, and 10% of private rented sector tenants wouldn’t feel comfortable raising it with their landlord.

Over 40% of PRS tenants say that the rental property they are currently living in has little or no energy efficiency measures installed.

uSwitch Director of Consumer Policy, Ann Robinson, said: “With more and more people renting, it’s vital that people don’t feel that being a tenant means relinquishing the right to control their household bills. The fact is that if your name is on the bill you have the right to shop around for a better energy deal. If your rental contract says otherwise, then talk to your landlord or letting agent, it is in all parties interests for rented property to be on a cost-effective tariff and as energy-efficient as possible. Now is also a good time for private landlords to look at energy efficiency. Energy suppliers have a pot of money to spend on making their customers’ homes energy efficient and only have until the end of this year to spend it in order to hit government targets. As a result, there are now a huge number of offers for insulation, ranging from the free to the heavily subsidised. Taking advantage of these now would benefit both landlords and tenants, as a minimum outlay will see lower energy bills and a more attractive, rentable home.”

Current energy efficiency schemes available in the UK include:

Warm Front
: Available across England only, Warm Front installs insulation and heating measures for people receiving certain income-related or disability benefits. The scheme is available for people who rent privately or own their own home.

Carbon Emissions Reduction Target (CERT) : 
The main energy suppliers (British Gas, E.ON, EDF Energy, RWE npower, Scottish Power and Scottish and Southern Energy) are providing free or low-cost energy efficiency measures, commonly loft and cavity wall insulation. All properties in the UK are potentially eligible for help under CERT, although the most vulnerable people (for example the elderly or people on low incomes) are given priority. Both tenants and home owners can apply, although tenants must have the landlords’ approval for work to begin.

Community Energy Saving Programme (CESP) : The main energy suppliers (British Gas, E.ON, EDF Energy, RWE nPower, Scottish Power and Scottish and Southern Energy) are providing free or low-cost energy efficiency measures, such as solid wall insulation, to properties in areas of low income.

Find out if your area is eligible by visiting


Its Not Too Late To Get FREE Property Insulation

Its Not Too Late For Landlords and Tenants To Get FREE Property Insulation

The UK Government’s Green Deal is set for launch in October 2012, replacing current schemes for property insulation, with new funding aiming to provide energy efficiency works for those on a very low income and additionally for premises where the cost of improving the energy efficiency will be cost prohibitive.

The new funding criteria means the end of the current subsidies for cavity wall and loft insulation, which have been available for years.

There are some incredible offers for property insulation as the energy companies become more desperate to meet the targets set by the government before the end of this year, although the allowances are not going to be as generous as they are now.

Most energy suppliers provide free property insulation, whilst some are even giving cash bonuses of up to £100 (GBP), or a finder’s fee of up to £50 (GBP), along with the free insulation.

The offers are only available for owner occupiers, tenants and landlords in the UK.

If properties don’t have adequate loft or cavity wall insulation, property owners, landlords and PRS tenants should act now before the offers come to an end.

Contact the Energy Saving Trust on 0300 123 1234

UK landlords are urged to get properties insulated now whilst it’s free, and avoid the forthcoming paperwork which will be associated with Green Deal funding, before the enforcement of energy efficiency standards are introduced.

Timely repairs can increase buy to let rental yields

Timely repairs can increase buy to let rental yields

Reducing repair and maintenance costs for a Buy-To-Let landlord can make the difference between a property producing a healthy yield or being a lemon with a high void rate and a poor return.

With this in mind, property repairs and maintenance can be a crucial focal point for landlords when analysing the potential rental yields from any buy to let property.

Ensuring that all windows are energy efficient and watertight is just one area for landlords to improve the energy efficiency of their rental property. It only takes a missing piece of silicone or a small hole in the grouting for water to seep in and pool under tiles or floor boards. If left, the minute leak can become an expensive disaster.

Landlords should always make sure that all areas exposed to the elements remain water tight whatever the weather before a tenant moves in as putting it right when tenanted can cause a great deal of time lost and damage to the professional relationship between landlord and tenant.

When a rental property becomes vacant at the end of a tenancy, landlords or their agents should ascertain the overall condition of the property and identify any potential work that may need doing to get it ready for re-habitation, and that work should be carried out by qualified and trusted tradesmen.

The overall condition of a private rental sector (PRS) property can often attract a similar quality of tenant. If the rental property is in need of a number of repairs or overall improvement and landlords fail to carry out the necessary works, more often than not, the type of tenant attracted will be of a lower standard and they may not be bothered with maintaining the upkeep of the property, causing further financial headaches for the landlord.

Improving the look and quality of a rental property can often be achieved through quick and inexpensive jobs being done such as repainting walls and gloss work and thorough deep cleaning of high use areas such as kitchens and bathrooms.

Landlords should include clauses within the tenancy agreement (AST) to make the tenants responsible for some of the upkeep of the property and these points should be highlighted to new tenants when they are preparing to sign the AST.

Such things as regular cleaning and cutting the grass can be included and it should also be clearly indicated in the tenancy agreement that any changes to the property must be put in writing to the landlord or letting agent.

UK PRS Landlords Are Still Worried About EPC Compliance

UK PRS Landlords Still Worried About EPC Compliance

More than 17% (1 in 6) of UK PRS landlords reckon that some or all of the properties in their rental portfolio’s fall into the lowest Energy Performance Certificate categories, with an F or G rating, meaning that they could end up being banned from the rental market.

From 2018 under the Government’s Green Deal proposals, properties with F and G EPC ratings will not be allowed to be let.

The latest poll of 1,500 landlords by the Association of Residential Letting Agents, (ARLA) also discovered that over 35% of landlords do not even know the energy rating of their properties with regard to EPCs.

ARLA have called for the Government to help landlords to achieve minimum energy efficiency standards, asking for the Landlords Energy Savings Allowance to be extended.

The call has been echoed by Alan Ward, Chairman of the Residential Landlords Association (RLA), who called for the annual energy savings tax allowance to be raised from £1,500 to £14,000.

The allowance is due to be scrapped altogether in April 2015

ARLA Operations Manager Ian Potter, said: “The clock is ticking for the private rented sector to improve its environmental performance but the investment just isn’t there to ensure that this change takes place in the Government’s timeframe. ARLA have campaigned for the Government to incentivise, through tax relief, the improvement of rental properties. Otherwise it is going to be exceedingly difficult for the majority of landlords to find the funds to improve stock.”

While the Green Deal will offer landlords upfront access to funds, it is tenants, as users of the properties, who will have to repay the loan.

Landlords who comprehensively tenant reference applicants can ensure regular income with Rent Guarantee Insurance, easing the financial burden and worry for tenants as loans are repaid.

The UK government have submitted new proposals that recommend Buy To Let landlords and home owners who apply for permission to make repairs and improvements to their properties are encouraged to make additional improvements at the same time as other ongoing works in a bid to make properties greener.

However the proposals fail to fully account for where the UK PRS landlords are expected to find the money for such extra improvements or even if such improvements will prove to be beneficial to tenants.

Conservative MP Tim Yeo said “The new proposals will effectively force landlords to complete non-essential improvements aimed at improving energy efficiency at the same time as they make minor repairs or improvements to their rental properties. If they refuse they could be denied permission to make essential repairs by their local council.”

It is also widely thought that the UK coalition government want to introduce a scheme that means all property repairs, such as the installation of a new boiler or central heating system, are logged with the council.
The council will then ‘recommend’ additional improvements, such as new double glazing or loft insulation that will also need to be carried out in order to get permission for the boiler installation.

The proposed costs of the ‘recommended’ improvements could be offset using the new government Green Deal scheme due to be launched in October 2012.

Mr Yeo commented on the proposals saying; “You’ve got to find ways of making the public more enthusiastic about energy efficiency and I think compelling people who have applied for planning consent to make some alteration to their home isn’t necessarily going to help.”

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