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Landlord Possession Orders And Tenant Evictions Increase

Tenant Eviction Figures Increase Again

Tenant Eviction Figures Increase Again

There has been a dramatic increase in the number of PRS landlords seeking to evict bad tenants and the volume of possession orders doesn’t look like abating any time soon according to data released by the UK Government.

Government figures show that there were 103,329 landlord claims for tenant eviction and orders for possession made last year, the highest recorded rate over the last five years and continues to represent an upward trend.

It is estimated that between 67% and 80% of claims led to a possession order being granted by the courts.

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To Let - Legal Obligations Apply

To Let – Legal Obligations Apply

 

There are numerous rules and regulations which you must abide by when letting your house. It is the landlord’s responsibility to ensure that the property which is being let out is fully compliant with all relevant safety regulations. As well as safety regulations, landlords must also be certain that they carry out any duties which are outlined on the tenancy agreement, if the landlord did not draft this agreement themselves, all clauses and responsibilities must be read and fully understood. It is always recommended to have a proper tenancy agreement in place at the start of each tenancy as this can act as protection should any disagreements between landlord and tenant arise.

A tenancy agreement can also outline the tenant’s responsibilities during the tenancy period and what they are required to do, this is mostly common sense but having this in writing with signatures from both the tenant and the landlord means each party have read the agreement and understands what is required of them.

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New landlords are using rental income to provide for their retirement

New landlords are using rental income to provide for their retirement

A high proportion of struggling residential property owners are copying the practices of successful portfolio landlords and choosing to offer their properties for rental purposes in the UK private rental sector (PRS) in order to provide adequate finances for their retirement.

Of the struggling property owners choosing to offer property to rent for the first time and existing portfolio landlords who responded to the BM Solutions/ BDRC Continental survey:

  • 84% view their rental property as a supplementary income to their pension
  • 60%of landlords actively plan to live off the rental income either before or at retirement.
  • 40% agree that their property is their pension and intend to make a decision dependent on the state of the property market once they reach retirement age.
  • Very few landlords plan to sell all properties in their portfolio when they reach retirement

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Fall in the number of tenants in severe rent arrears

Fall in the number of tenants in severe rent arrears

The number of tenants in severe rent arrears declined by 15.6% during the final quarter of 2012, according to data released by Templeton LPA, part of the LSL Property Services group.

The data indicates that in the last quarter of 2012, almost 16,000 fewer tenants faced severe rent arrears of more than 8 weeks rental costs, compared with the previous quarter of 2012.

The number of tenants in this situation has dropped for the first time in over a year and could in part be due to the development and availability of Rent Guarantee Insurance products.

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Reluctant Landlords have been avoiding insurance obligations

Reluctant Landlords have been avoiding insurance obligations

When the banking crisis struck back in 2008, mortgage lending in the UK virtually ceased as lenders became wary of the toxicity of sub-prime mortgage loans and raised their lending criteria (and lowered their Loan To Value ratios) to unprecedented and highly restrictive levels, virtually killing the property market.

This meant that properties became financial millstones for many people who were unable to sell, resulting in an upsurge of reluctant or “accidental” landlords who were able to take advantage of a booming rental market caused by the fact that potential property buyers were forced to hand over substantial deposits in order to be allowed a mortgage or were unable to obtain mortgages due to the tightening of the lending criteria and were subsequently forced to rent!

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Tax Year Deadline is 31st January 2013

Tax Return Deadline Looms For LandlordsDespite all the awareness campaigns and TV advertising, Her Majesties Revenue & Customs (HMRC) repeatedly attempt to tell us that completing a self assessment tax return doesn’t have to be taxing!

However, as anyone who has ever completed a self assessment tax return will tell you, the evaluation of personal income for the tax year and the amount of time needed to complete a self-assessment form, either on paper or online can be very considerable.

When managing a single property or declaring a growing rental property portfolio, it can be hard work to set aside the time needed to tick all the right boxes.

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Landlords Lose Out Due To Unexpected Costs

Landlords Lose Out Due To Unexpected Costs

If You Fail To Plan Then You Are Planning To Fail

A recent survey by a national lettings agency has highlighted financial losses incurred by UK landlords due to failing to adequately plan for unexpected costs.

 Landlords pay on average around £1500 (GBP) per year of their rental income covering tenant rent arrears, maintenance, repair bills and void periods; a figure that equates to over £2 Billion (GBP) per year nationally, according to the survey by Northwood.

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Property Owners In Flood Risk Areas Fear Worst

Property Owners In Flood Risk Areas Fear Worst

With flood alerts and warnings still in place in some parts of the UK, the Association Of British Insurers (ABI) has warned that up to 250,000 residential homes and commercial properties could be left without flood insurance.

The ABI has claimed that it had already reached a crisis point in its talks with the government over replacing an agreement which would ensure that all households in area at high-risk of flooding could still secure some degree of flood insurance. However that was before last week’s heavy rain.

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Avoid Tenant's from Hell

Avoid Tenant’s from Hell

As thousands of people struggle to sell their properties in the current financial climate, many are turning to renting them out in order to move on with their lives. However this comes with its own problems and responsibilities that many people are not really prepared for.

Being a landlord means you have legal responsibilities towards the housing of others. In order to stay on the right side of the law, provide a place where people want to live and avoid tenants from hell, it is recommended that landlords should seek to use recognised and trusted professional services to help them operate their rental property business and educate themselves before it’s too late.

The most common concerns faced by new landlords regarding offering a new tenancy are:

  • Background of tenants
  • The rent / rent arrears
  • Property maintenance
  • Insurance
  • Legal compliance

Tenant Referencing

Every landlord wants to avoid the tenant from hell, someone who doesn’t respect where they live, the neighbours or the landlord and who doesn’t pay the rent. Tenant referencing can help landlords avoid bad tenants and professional referencing should include:

  • Credit Check
  • Employers / Accountants Reference
  • Landlords / Managing Agent’s Reference
  • Financial Review
  • Bankruptcy Search
  • Anti Fraud Check

Rent Guarantee

With the current financial unrest still being felt by many people, employment uncertainties and austerity measures still emerging, it can be a worry for landlords and their tenants about being able to pay the rent on time.

The rent can be guaranteed providing that the conditions of the rent guarantee insurance are met, usually meaning that the applying tenant must be credit checked and properly referenced prior to the start of the tenancy.

Property Maintenance

Landlords may need to provide repairs or conduct regular maintenance on their rental property in order to maintain their income producing asset. They may know a bloke from the pub that can do the job but it is recommended to use recognised tradesmen to do any work on the property. Repairs will be done to the correct standard and tradesmen should be professionally registered with their respective federations to ensure quality. Any repairs involving gas can only be conducted by a GasSafe registered engineer.

Insurance

Landlords need to ensure they have adequate insurance for the protection of their rental property, many mortgage providers demand proof of insurance. There are a multitude of different insurance products on the market but it is recommended that landlords protect the landlord’s contents within a property as well as the fabric of the building. This means fixtures and fittings such as the kitchen and bathroom suite are insured. Find out more here

Legal Compliance

Self managing landlords need to ensure they are compliant with over 70 separate pieces of government legislation and a raft of local authority regulations. There are a number of useful governement resouces that can be found on the web, however, it is recommended that landlords seek professional property management agents to ensure that all the correct legal requirements are met.

Things That Go Bump In The Night

Tales from beyond the tenancy....

A Halloween tale from Legal 4 Landlords

In a House of Multiple Occupation (HMO) in Gravesend, on a dark stormy Halloween evening, the residents gathered in the communal lounge drinking and discussing ghost stories…

One young male tenant claimed that an old man who used to own the large house they lived in was buried a few months earlier in the graveyard down the street, he claimed that the old landlord had been buried alive and that if you listened carefully it was possible to hear him still scratching at the lid of his coffin, he also claimed that the old man was a notorious serial killer who was responsible for the disappearance of dozens of unsuspecting HMO tenants and his victims were still being discovered.

The evening wore on and after several more drinks and a great deal of teasing, a young female tenant agreed to go down to the graveyard to find out if the stories about the old landlord were true. No-one else dared to accompany her, so she decided to go alone and she said she would drive a stake into the ground next to the grave to prove that she had in fact been there.

The young woman put on her waterproof jacket, picked up a torch and took a large stake from off one of the tall shrubs in the back garden and set off into the night followed by laughs and jeers from the other HMO tenants.

The following morning it became clear that their housemate had not returned, at first they thought that she was playing a joke back on them they dismissed it and carried on with their daily routines. At around 5pm when the young woman had still not returned they began to feel guilty for teasing her, the rest of the tenants decided to head down to the graveyard to see if their friend had really been there.

As they neared the grave they were horrified to find their friend at the old landlord’s grave, she was lay face down at the graveside…dead!

She had accidentally staked the bottom of her waterproof coat to the ground and when she tried to run from the grave, she couldn’t… she had died of fright!

Don't get spooked by lack of insurance

Don’t get spooked by lack of insurance

 

 

It may be Halloween but spooky goings on don’t just happen on a single night of the year and landlords are reminded to ensure that they have adequate landlord insurance on their rental properties 

 

 …and tenants are reminded to make sure they have proper life insurance.

 

Read more posts by Legal 4 Landlords here

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