Currently viewing the tag: "renting"

UK PRS Expanded By 1 Million Households In 5 Years

UK PRS Expanded By 1 Million Households In 5 Years

One Million More Rented Households In UK
Since 2009 With More To Come

It has been well documented over recent years that there has been a cultural and generational shift towards renting in the UK with “Generation Rent” emerging as the dominant force in the UK property market.

The shift towards the continental style of living in rented property has been largely influenced by the difficulty for people to raise the necessary deposit and finance for property ownership.

CBRE believe that significant activity by UK Buy-to-Let property investors and foreign nationals acquiring property in major towns and cities within the UK has also contributed significantly, and the influence of these interested parties is still growing.

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Local Authorities Urged To Build More Private Rental Sector Properties

Local Authorities Urged To Build More Private Rental Sector Properties

Local Authorities Urged To Promote Institutional Investment In Private Rented Sector Over Home Ownership

According to the report “Making Renting Viable“ commissioned by the British Property Foundation (BPF) and conducted by a leading London law firm; more UK local authorities should focus on building new residential properties for the private rented sector to encourage institutional investment instead of promoting local homeownership.

The British Property Foundation and Addleshaw Goddard who conducted the survey, reckon that UK local authorities should earmark land within their council boundaries for private rented sector (PRS) properties and set housing development targets to encourage pension funds and other institutions to invest more in the private rented sector.

Partner at Addleshaw Goddard, Marnix Elsenaar, said: “It’s vital councils recognise both the need for an institutional private rented sector that’s not the same as buy-to-let, while ministers should update planning guidance to make building for rent economically viable. Residential property was seen as more difficult than renting out a commercial office block, but the landscape has changed. Institutions want reliable, long-term returns and they should see a good degree of income growth in the private rented sector.

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Renting Property Can Be More Profitable Than Buying!

Renting Property Can Be More Profitable Than Buying!

How Next Generation
Landlords Earn Living

It can be infuriating when you’re shown an investment strategy that is so simple, and obvious, that you can’t understand just how you missed it?

So now an easy to follow, step-by-step guide is being made available to property investors (and first-time buyers) just in time… even if the next generation of young landlords are already familiar with it, and using it to fantastic effect.

UK property prices are finally getting back to record highs, and the newspapers are again telling us how property investment and controlling bricks and mortar is a very reliable way of multiplying monthly income.

Forget ‘buying’ a starter-house with your families hard earned savings as a deposit, because there is a much easier way…

Rent A House And Make Up To £1,000 (GBP) A Month Income From It!

Whether that is a house advertised in a local newspaper or one that you have seen in the estate agent’s window… it doesn’t matter.

Right now the UK’s biggest property education company is explaining how to use this simple strategy to great effect:

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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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Tenants Charter Proposals For Longer Tenancies Breach Mortgage Lenders Current Buy-To-Let Mortgage Terms

Tenants Charter Proposals For Longer Tenancies Breach Mortgage Lenders Current Buy-To-Let Mortgage Terms

Industry welcome to weak tenants’ charter that could see UK PRS landlords at odds with

Buy-To-Let Mortgage Lenders

The new tenants’ charter was announced by the Secretary of State for Communities and Local Government (CLG), Eric Pickles, last Wednesday, allowing tenants to ask for longer tenancies and better transparency of letting agents’ fees.

The new tenants’ charter will also aim to force all lettings and property managing agents controlling PRS rental properties to join a compulsory redress scheme.

The Tenants’ Charter, published for consultation, outlines what tenants should be looking out for at every stage when renting a property in the UK’s private rented sector, including lettings agents having to inform customers what all their fees are upfront, before they have committed to anything, including visiting a property.

However, the introduction of these terms under the banner of the tenants’ charter could threaten the business future of large numbers of landlords who would technically be in breach of the strict buy-to-let mortgage terms imposed by many mortgage lenders, which generally stipulate that tenancy agreements are to be for a period of no more than one year.

Secretary Of State For Communities & Local Government, Eric Pickles

Secretary Of State For Communities & Local Government, Eric Pickles

Mr Pickles stated that the Government intend to publish a code of practice setting standards for the management of property in the private rental sector (PRS) along with guidance setting out the role of public bodies in protecting tenants from illegal eviction.

Mr Pickles said: “This government is on the side of hardworking people and the last thing we want to do is hurt tenants and kill (property) investment by increasing costs and strangling the sector with red tape. But tenants deserve better value for money, and dodgy landlords should be under no illusion they can provide a shoddy service with impunity. These proposals will raise the quality and choice of rental accommodation, root out the cowboys and rogue operators in the sector, and give tenants the confidence to request longer fixed-term, family-friendly tenancies that meet their needs”

Mr Pickles also said that the Government will develop a model tenancy agreement which will clearly set out the rights and responsibilities of tenants and landlords, and ensure families can benefit from longer tenancies, without changing the existing legal framework for the rental market. He said “Longer tenancies will give families greater certainty and security, especially for those with children at school, and reduce costs for both tenants and landlords who will not have to pay letting agents to arrange frequent contract renewals.”

Clive Betts MP, Chair of the Communities and Local Government Committee said: “I am pleased that the Government has embraced many of the recommendations in our private rented sector report. The proposals for a tenants’ charter and model tenancy agreements reflect our calls for greater awareness of rights and responsibilities. Far too often the security needed by families is not being provided by the private rented sector. I am pleased, therefore, that the Government has listened to what the Committee said about the need for more family friendly tenancies. It is also welcome that the Government is taking forward our proposal to allow rent and housing benefit to be clawed back when landlords have been convicted of letting out dangerous property. The Committee will be watching closely to ensure that they are translated into action. We will also press to ensure that the Government’s gathering of information on selective licensing leads to action to raise standards. Much remains to be done if renting is to become an attractive alternative to owner occupation. It is disappointing; therefore, that the Government does not see fit to crack down on cowboy letting agents and their rip off fees and charges. It is also regrettable that the Government has declined to give local authorities the powers and freedom they need to improve housing in their areas.”

Tenants Charter Proposals For Longer Tenancies Breach Mortgage Lenders Current
Buy-To-Let Mortgage Terms

Property professionals generally agree with the introduction of the new tenants’ charter but many think that the Government have sidestepped the opportunity to enforce much tighter regulation of landlords in the private rental sector and lettings and property managing agents in particular and many feel that the new measures fall short of what is really needed.

It will be interesting to see if the Government put pressure on the banks and mainstream mortgage lenders to abolish or ignore such limiting clauses, allowing them to deliver on the real aim of the tenants’ charter.

Caroline Kenny, an executive of the UK Association of Letting Agents (UKALA) wants the Government to build on the experience and expertise of those industry bodies which already require higher standards of their members. Commenting “Responsible agents who choose to belong to professional bodies which require client money protection insurance, impartial redress and an adherence to a strict Code of Practice are forced to compete with those who show little regard to professional standards or the needs of their clients. UKLA believe that this package of proposals represents a missed opportunity for the Government to make mandatory the kind of comprehensive protection offered by the UK Association of Letting Agents and other industry regulatory bodies, which are called UKALA & NLAfor by those working in the property industry and needed by hardworking consumers who are unable to differentiate between good and bad letting agents.”

Richard Lambert, Chief Executive of the National Landlords Association (NLA), said: “The NLA has long argued that private renting can be far more flexible than commonly perceived, and we need to tap into this potential to meet the changing needs and expectations of those who rent. We look forward to working with government to make a success of these proposals. However, we believe that the Government has missed an opportunity to require greater professionalism of letting agents. While the requirement to belong to an approved redress scheme is a step in the right direction, it does little to protect the financial interest of landlords and tenants working with unregulated agents.”

Residential Landlords Association

Join The Residential Landlords Association

Alan Ward, Chairman of the Residential Landlords Association (RLA) welcomed the Government action to improve tenants’ understanding of their rights and responsibilities saying: “Tenants take more trouble buying a second-hand car than renting a house” Ensuring that tenants and landlords each understand clearly their rights and obligations to one another ensures a balanced relationship and enables them to hold each other to account based on the large number of laws already in existence. It will also play a vital role in rooting out those willfully criminal landlords who reap misery on tenants. We look forward to working with Ministers on the Charter as well as on how to best get this information to tenants.”

RICSPeter Bolton King, RICS global residential director, said “The long overdue announcement was definitely a step in the right direction. The lettings sector has for far too long been the Wild West of the property industry, with many tenants having absolutely nowhere to go should they wish to complain about shoddy service. The introduction of a code of practice specifically covering those managing rented property should certainly improve standards.”

Chief Executive of the Housing & Homelessness charity Shelter, Campbell Robb said “This announcement is recognition that current private renting arrangements are not fit for families with children, who need greater long-term stability. This is a welcome step in the right direction, and ministers now need to consider how to make longer tenancies a real choice for the families desperate for a more stable place to live.”

The announcement of the new Tenants’ Charter was good news for consumer champions, Which? Who have been campaigning since 2007 when they first called for an amendment to the Consumers, Estate Agents and Redress Act 2007 requiring letting agents to join an approved complaints scheme, just as property sales agents are. The consumer groups investigations also discovered earlier this year that major letting agents are acting unlawfully by not being upfront about the fees charged to clients.

The Enterprise and Regulatory Reform Act 2013, looks set to be implemented in Spring 2014, giving all landlords and tenants access to a complaints scheme. This will mean that 40% of agents who currently aren’t signed up to a redress scheme will have to become members

Which? Executive Director, Richard Lloyd, said: “Renting is now the only housing option for millions so we’re pleased to see the Government taking steps to address problems in the lettings market. Making charges clear upfront will enable people to shop around more easily, and longer tenancies could mark the end of unnecessary renewal fees. The new legislation giving landlords and tenants access to a complaints scheme now needs to be brought in as soon as possible and there must be strong action taken against any agent in breach of the scheme.”

  • Do you think the proposals go far enough?

Take our Poll on the Tenants Charter or leave a comment below!

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More Home Owners Move To Private Rental Sector

More Home Owners Move To Private Rental Sector

Many new tenants in the private rental sector are former home-owners who have opted to become tenants due to the increasing financial pressures associated with home ownership.

In fact more people are quitting home ownership to become private tenants, than are leaving the private rental sector to become home-owners.

The “Generation Rent” trend was identified by the English Housing Survey, which estimated that there were 22 Million households in England in 2011/12.

The trend underlines the fact that home ownership levels in the UK have continued to fall over recent years as the number of households in private rental sector accommodation has increased.

  • 65% of property in the UK is owned by the occupiers
  • 17% are private rental sector properties
  • 17% are social housing

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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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Good news for landlords

Good news for landlords

There is a lot of Good News For Landlords Around As PRS rents Increase, Tenancies Last Longer And Demand Remains Strong

Good news for landlords as monthly PRS rents have increased by 1.1% year on year to average £845 (GBP) per calendar month (pcm). Scotland has witnessed the greatest rental price increase at 6.7% compared with the first quarter of 2013.

There has also been an increase in the number of older private rented sector tenants according to the latest quarterly index published by Countrywide lettings agency, who noted a 6% annual growth in the number of tenants over the age of 50 renting property in the UK private rented sector (PRS). The lettings agency also report that there has been a 7% annual decline in the number of tenants aged under 25 in the second quarter of 2013.

Buy-To-Let yields are strengthening across the UK, with the average yields being recorded in 3 regions:

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Cost Of Renting Property More Expensive Than Purchasing Property

Cost Of Renting Property More Expensive Than Purchasing Property

The cost of renting property in the UK private rented sector (PRS) is more expensive than actually buying property, according to Zoopla.

Renting works out at 13% more expensive than paying off a mortgage, although the gap between the two lifestyle choices has narrowed in recent months due to the rise in residential property values.

Zoopla say the main cause of the narrowing gap is that residential property prices have increased at a faster rate than rents during the past year.

The cost of renting a two-bedroom property in the UK Private Rented Sector is up by an average of £84 (GBP) per month compared to the cost of servicing an interest-only mortgage on the same property, which has risen by just £120 per year.

The average rental payment on a typical two-bedroom property is around £8,006 (GBP) per year, compared with £7,045 (GBP) per year to service a 5% mortgage.

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Rental Property Seen As Safe Investment

Rental Property Seen As Safe Investment

Landlords Increasing Rental
Property Portfolios

There has been a rise in the number of landlords expanding their rental property portfolios over the last three months, according to fresh research by the Association of Residential Letting Agents (ARLA).

ARLA questioned its members to find out if landlords are currently increasing their investment in rental properties in the private rental sector (PRS) and they discovered that the number of landlords buying properties has risen from 30% to 39% over the last three months.

ARLA have taken the responses from their members to indicate greater confidence in the UK private rented sector and that rental property is still perceived as a safe investment amidst ongoing global and national financial instability by landlords with existing rental property portfolios.

ARLA research also revealed that fewer landlords are quitting the UK private rental sector and selling their rental properties too, with numbers incrementally down on the previous quarter, from 15% to 14%.

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