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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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New Proposals Could Critically Damage The Private Rented Sector In Wales

New Proposals Could Critically Damage The Private Rented Sector In Wales

New Proposals Could Be Costly For
Landlords With Properties In Wales

There Residential Landlords Association (RLA) have released alarming news that will cause major concern for landlords who own rental properties in Wales

Cardiff city council released two new consultations before Easter 2014,

  • Considerable change in planning guidance
  • The extension of additional licensing to Plasnewydd

Rent controls appear to be quite a crucial political issue and with another general election looming the RLA feel that it is imperative that the facts are understood by landlords with rental properties in Wales.

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3 Compulsory Redress Schemes To Investigate Lettings Complaints

3 Compulsory Redress Schemes To Investigate Lettings Complaints

3 Compulsory Redress Schemes
To Investigate Lettings Complaints

The Government have approved three compulsory redress schemes to offer landlords and tenants in the UK private rented sector independent investigation into complaints in the property management and lettings industry, bringing them in line with redress schemes already in operation for residential property sales.

The 3 lettings industry redress schemes are:

  • The Property Ombudsman
  • Ombudsman Services Property
    • The Property Redress Scheme 

The new schemes will consider all complaints made by tenants and landlords including non-disclosed fees and poor service delivery, and as with residential property sales where a complaint is upheld, tenants, landlords and leaseholders could receive compensation.

Two of the three redress schemes have been around for a while and The Property Ombudsman (TPO) is probably the most recognised of the two pre-existing schemes but little is known about the new Property Redress Scheme.

Most letting agents in the UK are already registered with at least one redress scheme, however 40% of the entire lettings industry, estimated to be around 3,000 agents, are to be encouraged to join up before membership is made mandatory later this year.

Housing Minister Kris Hopkins said that he hoped the new rules would strike the right balance between protecting tenants in the UK private rented sector and not harming the UK lettings industry with excessive red tape. The new redress schemes were just one part of the government’s efforts to secure a better deal for tenants in the PRS, stating: “All tenants and leaseholders have a right to fair and transparent treatment from their letting agent. Most tenants are happy with the service they receive, but a small minority of agents are ripping people off, and giving the whole industry a bad name. That’s why we will require all agents to belong to one of the official redress schemes. They will ensure tenants and landlords have a straightforward route to take action if they get a poor deal, while avoiding excessive red tape that would push up rents and reduce choice for tenants.”

The Property Ombudsman, Christopher Hamer said: “TPO experienced a 34.2% increase in consumer enquiries relating to unregistered letting agents during 2013, which really underlines the importance of mandatory redress. Whilst my role as Ombudsman means that I am not a regulator and I can only review complaints after a dispute has occurred, making redress a legal requirement for lettings is a positive move. Clearly it would be better if complaints did not arise in the first place and robust legislation to enforce controls was in place.”

There are thousands of decent letting agents in the UK but there are also a fair proportion of rogue agents who operate under the radar, that lack the much needed transparency on fees and who are fleecing both tenants and landlords alike.

Landlords should ensure their appointed property managing or letting agent is registered with the Association of Residential Letting Agents (ARLA) or the UK Association of Letting Agents (UKALA).

Most UK tenants are unaware that they could be leaving themselves open to exploitation if the agent is not a member of at least one of the regulatory associations.

NLA Want HMO License Fee Refunds For Landlords

NLA Want HMO License Fee Refunds For Landlords

HMO landlords Wrongly Charged Licensing Fees By Local Authorities

The National Landlords Association (NLA) has demanded that landlords affected by the outcomes from three specific judgments involving English local authorities and HMO landlords.

The NLA have written to all local authorities in England asking them to contact any affected HMO landlords, informing them of their right to the appropriate refunds and providing details of how they may make a claim, after recent court judgements clarified some issues surrounding the mandatory licensing of Houses in Multiple Occupation (HMOs) and how local authorities determine HMO licensing fees.

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More Red Tape For LandlordsRed Tape Increases For Private Sector Landlords
Despite Government Promises

Despite numerous promises to reduce the amount of red tape property professionals had to deal with, there are now even more legal requirements to let and manage rental properties.

The coalition Government started an initiative called the Red Tape Challenge, aiming to reduce the time and associated financial costs incurred by businesses and consumers in complying with unnecessary legislation.

However, recent Government announcements will increase the amount of red tape and infuriating processes that landlords and letting agents have to deal with

The Residential Landlords Association (RLA) say there are currently over 100 national regulations governing the letting of a rental property in the private rental sector.

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Yet another local authority has set its sights on compulsory landlord licensing for every privately owned rental property within its boundaries. 

Liverpool City Council Want Landlord Licensing To Become Mandatory

Liverpool City Council Want Landlord Licensing To Become Mandatory

Liverpool City Council is the second local authority in the UK to launch a consultation for the introduction of a citywide landlord licensing scheme affecting over 50,000 properties.

The controversial move towards mandatory licensing of all private landlords follows that of Newham, in London, which became the first council in England to introduce mandatory licensing of all private rental properties on January 1st.

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30 Day Tenant Deposit Registration Deadline

New Rules Mean All UK Tenant Deposits Must be Registered Within 30 Days Of Reciept

New Deposit Protection rules are now in force and the deadline for landlords and letting agents for the registration of a tenant’s

deposit, for every single tenancy, must be completed within 30 days of 6th April 2012, therefore, the deadline will be the 5th May 2012

This Affects All PRS Landlords If They Have Never Previously Taken Action To Protect Tenant’s Deposits

Following the introduction of the Localism Bill on the 6th April 2012, the over-complicated Deposit Protection rules have changed.

These changes will impact heavily on all UK landlords, property management and letting agents, however, many landlords are still unaware that rule changes regarding mandatory tenant deposit protection have occurred.

The new rule changes could result in landlords being left with sitting tenants in their rental properties, that they are unable to gain possession from or they could face being liable to pay THREE times the amount of the original deposit back to the tenant, regardless of any damage to the landlords rental property!

Legal 4 Landlords are aware that the new rules regarding mandatory deposit protection could prove to be a big surprise for unaware landlords and have listed the main changes that came into effect on 6th April 2012 below:-

  1. 1. Deadline for Registration

Under the current rules landlords/agents must register a deposit within 14 days from the commencement date of the tenancy.

THE NEW LAW The Localism Bill has proposed that this time limit be amended to 30 days giving the landlord or property managing agents more time to fulfil the registration requirements.

However, it means that Landlords can’t claim an administrative oversight for any delay in registering the deposit for protection.

Prescribed Information

THE NEW LAW Landlords or their appointed property managing agents must complete and supply to the tenant(s) a Prescribed Information Form within 30 days of receipt of the deposit.

This may require tenant signature and asks for contact information and details of the Landlord and the amount of deposit paid.

  1. 2. Late Registration

If a Landlord or their managing agent does not register the deposit within the prescribed 30 day deadline, then the loophole supplied in Universal Estates v Tiensia will no longer be available. The Landlord/Agent will not therefore be able to register the deposit after the 30 day deadline.

THE NEW LAWThis change has serious implications for landlords and property managing agents:-

a) The tenant will be able to bring a claim against the Landlord and /or their managing agent for failure to register the deposit and under the new rules the court may fine a landlord/agent up to three times the amount of the deposit.

b) Without the deposit being registered a valid Section 21 notice for possession cannot be issued on a tenant and a landlord cannot therefore take back possession of their property.
This basically leaves a Landlord with a sitting tenant and with very limited circumstances in which they can get them out.

The rule changes therefore affect any new tenancy in the UK private rented sector and also any current tenancy where the deposit has not previously been registered (such as tenancies which started before the introduction of the 3 Government backed Tenancy Deposit Schemes) and will mean that the deposit will need to be registered for every single tenancy within 30 days of 6th April 2012

There are still some landlords who have forgotten to register the tenant’s deposit or thought they could register the deposit only if requested to do so by the tenant.

These landlords will be massively affected by the change in law and could end up severely financially penalised. Ignorance is no defence.

Failure To Act Will Cost Landlords Money And Cause Problems Getting Tenants Out!

#deposit protection

Two Executives have been suspended at the UK’s largest tenant referencing firm, HomeLet, while an investigation into the selling of tenants’ insurance policies is under way.

The investigation follows a crackdown by the Financial Services Authority on the selling of contents insurance policies by HomeLet, which is one of the brands owned by insurance giant Barbon, (the company formed from the former insurance wing of the collapsed property services firm Erinaceous).

The probe revolves around a clause in lettings agents contracts, making it a mandatory requirement for tenants to take out tenants’ content insurance.

It is understood that the clause – which was apparently a long-standing one and not objected to by the FSA during earlier inspections – was originally inserted by agents on the advice of HomeLet.

HomeLet sells its policies to landlords and tenants through letting agents, and claims to sell one in five of all tenants’ references. It has a network of 3,000 lettings agents, all of whom have apparently been contacted and told to remove the clause.

It is understood that the FSA, which requires HomeLet to make sure the agents do not breach the regulator’s rules, has been concerned on two fronts: first, the possibility that making purchase of insurance a condition of tenancy could be an unfair term; and secondly, because the clause breached FSA and OFT guidelines which state that a tenant cannot be asked to buy their own contents insurance – although, confusingly, a tenant can be asked to buy insurance that covers their landlord’s possessions.

The HomeLet spokesperson said: “HomeLet is involved in a review process which may lead to policyholders with tenants contents policies being contacted about how such contracts were purchased. This is a thorough process to ensure it meets the company’s required standards. HomeLet continues to provide insurance products and services to existing and new customers. HomeLet is committed to best practice in the service it offers to landlords and tenants via agents.”

The next step in the investigation will be for HomeLet to contact tenants who were sold the HomeLet contents insurance. HomeLet says the tenants will be contacted ‘shortly’.

It is thought the FSA could have other lettings insurance firms in its sights.

Source: Estate Agent Today

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