Right to Rent start date announced

The Government has announced that from 1 February 2016 all private landlords in England will have to check new tenants have the right to be in the UK before renting out their property.

Under the new rules, landlords who fail to check a potential tenant’s ‘Right to Rent’ will face penalties of up to £3,000 per tenant.

The new law will mean that private landlords, including those who sublet or take in lodgers, must check the right of prospective tenants to be in the country to avoid being hit with a penalty.

Right to Rent was introduced in the Immigration Act 2014 as part of the Government’s reforms to build a fairer and more effective immigration system. The first phase was launched in parts of the West Midlands, and the most recent announcement is the next stage of the scheme’s national roll out. 

Immigration minister James Brokenshire said: “Right to Rent checks are quick and simple, and many responsible landlords already do them as a matter of routine. We are providing landlords in England with all the advice and support they need before the checks go live on 1 February 2016.

“The new rules are part of the Immigration Act 2014 which introduced measures to reform the immigration system. Right to Rent is about deterring those who are illegally resident from remaining in the UK. Those with a legitimate right to be here will be able to prove this easily and will not be adversely affected.”

But despite Brokenshire’s assurances, Right to Rent has received widespread criticism with landlord groups claiming landlords are being forced to actas border control, and suggestions that anyone with a foreign-sounding name could be turned down for a rental property.

Under Right to Rent, landlords should check identity documents for all new tenants and take copies. The Government claims scheme has been designed to make it straightforward for people to evidence their right to rent and a range of commonly available documents can be used, including:

• a UK passport
• a European Economic Area passport or identity card
• a permanent residence card or travel document showing indefinite leave to remain
• a Home Office immigration status document
• a certificate of registration or naturalisation as a British citizen

The checks should be carried out on all new tenants and are backed up by codes of practice – including guidance on avoiding unlawful discrimination – which was drawn up with the assistance of the Human Rights Commission.

There are four steps involved in making a Right to Rent check:

• Check which adult tenants will live in the property as their only or main home.
• Ask tenants for the original documents that show they have the right to be in the UK.
• Check the documents are valid with the tenant present.
• Make and keep copies of the documents and record the date you made the check.

If a potential tenant has an outstanding immigration application or appeal with the Home Office, landlords can conduct a check on that person’s ‘right to rent’ via the Landlords’ Checking Service.

Guidance to help both landlords and tenants understand the new rules is available on GOV.UK.

Article courtesy of Landlord Today

Exeter Students

Love them or hate them, students are an integral and important part of the property market in Exeter.  From purpose built apartment blocks to privately owned multi bedroom houses, there is a wide choice of accommodation for students to choose from.

Exeter University is now ranked 93^rd in the Times Higher Education World University Rankings, placing it among the very best institutions across the globe and it is this together with a number of other factors which is providing yet another boost to the Exeter property market with more students wanting to study in the city and more private landlords looking to invest.

I have many potential landlords contacting me to discuss investing in a student property. They hear  of the high annual income that can be achieved but sometimes underestimate the work involved in managing a student property and keeping up to date with the changing legal requirements.

Potential and existing landlords should consider what may happen if the property is not let or if additional licencing comes into place preventing the ability to renew HMO licences in certain parts of the city.  Although there is no sign of the market cooling soon, it is worth having a contingency plan, just in case. It is true that in the majority of cases there are excellent annual returns to be made, last year we found all our properties let extremely quickly and demand outstripped supply, meaning landlords were also able to select the best tenants for their properties. I can see no reason why the same won’t be true this year.

I have sold many student properties over the last few years all generally achieving high gross annual yields; however it is worth factoring in to financial calculations potential expenditures, such as replacing furniture, redecorating and dealing with tenancy matters.  With changes to tax allowances coming into place and the potential abolition of the 10% furnished property allowance, it is worth talking to a financial adviser to look at your personal circumstances before you make the purchase.

Students nowadays look for properties that are well equipped, well maintained, clean and tidy.  They ask questions about the landlord and if the property is managed by an agent or the landlord, they are also knowledgeable about the requirements for Energy Performance Certificates, fire detection and licences. In other words, if a property has been neglected, the likelihood is that it will not be let.

If you are looking for information on the requirements for an HMO licence contact us or follow this link to Exeter City Councils’ website: http://www.exeter.gov.uk/index.aspx?articleid=11223.

Generally in the current market student properties do make good investments, however it is worth looking at the pricing and location very carefully. There are few properties on the market and they are currently so popular that the prices are starting to increase quickly.  If you are looking at buying or selling a student property with or without tenants in situ, please call me on 01392 254488 to discuss the current market. I am always happy to talk to potential and existing landlords.

Rental price growth slows

Rent price rises have slowed to match the pace of house price growth in the UK after nine months of sustained faster growth, according to HomeLet.

The HomeLet Rental Index shows that rent prices have slowed below double figures to an average annual increase of 8.5% across the UK.

For the three months to September 2015, every region of the UK with the exception of the East Midlands has seen annual rent price rises slow down or move into negative growth.

Nine out of 12 UK regions are still seeing rent prices rise on an annual basis, with the largest increases seen in Scotland at 8.4%, the East Midlands at 7.7% and Greater London at 6.6%. The figures also show three regions in negative annual price movement, with prices in the North West 4.6% lower than a year ago, 2.2% lower in East Anglia and 1.4% lower in Northern Ireland.

Comparing September figures to the previous month, the index reveals that only three regions have seen rent prices rise since August. In the three months to September 2015 only Scotland, the East Midlands and West Midlands have seen prices rise – by 1.2%, 1.4% and 1.4% respectively.

Every other region of the UK has seen rent prices fall modestly in the three months to September 2015, with the largest price reductions seen in the South West, the North East and North West at -2.4%, -2.3% and -2.2% respectively. 

Martin Totty, Barbon Insurance Group’s chief executive officer, said: "The UK economy has dipped into 'negative inflation' which is a boost to consumers' spending power and, ultimately, their real income. Affordability is an important factor in determining rents. Depending on what happens with inflation and real incomes over the coming months, could have a bearing on future rental price trends especially where, in certain areas of the country, the supply of rental properties is not keeping pace with demand from those wishing to be private sector renters.”

Article courtesy of Landlord Today

Winter Is Coming… Prepare Your Garden In Ten Steps.

For your garden to survive winter, it is essential that you take a few steps in autumn to prepare. Not only does this make things easier for you in spring, but it also prolongs the life of plants, outdoor furniture and toys.

If you rent your property, there’s a high chance that it is written in your tenancy agreement that you are to look after your gardens. Therefore these ten simple tips could ensure you keep your deposit safe.

1. Remove Greenhouse Shading

Days are shorter in winter so your plants need all of the sunlight they can get. By giving your greenhouse a little scrub with some warm soapy water and some elbow grease, you can provide optimum amount of daylight to your plants inside. Now is the ideal opportunity to check your greenhouse for any wear and tear and replace any broken glass.

2. Spruce Up Your Lawn

Remove moss with a rake, and then continue to remove old grass clippings. Make deep holes with garden fork prongs in areas of high wear (such as walkways). These holes allow better drainage and aeration in the often over-compacted areas. Laying new turf now provides enough time for it to establish before the spring.

3. Clear Out Your Compost

Last season’s compost should be at the perfect level to use on your plant beds right now. If not, why not turn the compost to encourage a faster degradation? Plus, with the newly trimmed bushes and hedges, you will accumulate a lot of new compost material so get trimming.

4. Tidy Away Toys

Toys that are left out will wear faster when exposed to the elements. If you don’t have – or have no room in – a garage or shed, or if your property is rented, why not try an outdoor storage trunk.

5. Plant Evergreens

This is the perfect time to plant evergreens. Evergreen plants provide a visually appealing and fragrant winter backdrop. They usually require minimal attention and are extremelydurable once established.

6. Think Of The Wildlife

While you’re cosying up to a Netflix marathon in your fluffiest onesie with a toasty hot chocolate, spare a thought to the birds and squirrels. Why not hang a seed dispenser – or even make your own– to brighten up your garden and provide some much-needed food for your local wildlife. Allow the variety of wildlife to create a focal point of your back garden whilst your summer flowers lie dormant.

7. Pack Away Any Summer Accessories

Clean and cover BBQs, undress and fold away swing covers and pack away your seat cushions. Summer is over, so the chances of you needing these items are slim. Storing such items effectively over winter means they won’t weather in winter, saving you money in the spring.

8. Maintain Your Garden Equipment

Even the trustiest of rakes could – and probably will – dishevel in a particularly harsh winter. Pack away in a shed or garage. Sharpen shears, service lawn mowers if required and generally make sure everything is in good working order, and stored in a neat and organised manner – Next year ‘you’ will thank you.

9. ‘Leaf Litter’ Is Good… Unless You Have A Pond!

Leaving leaves on top of soil provides a kind of ‘blanket’ to protect the delicate plant roots from frost and other winter nasties.  The leaves degrade into organic matter over the course of the season, turning into nutritious sustenance for the surrounding plants. This is one of the few times being messy is encouraged!

10. Channel Your Inner Jamie Oliver

This is a great time of year to grow bulbs such as garlic and shallots for next summer’s salads. They’re also some of the more hardy plants, so provide a great ‘first attempt’ for the less-than-green-fingered among us.

For more topical news and tips for homeowners, please visit our news section on the Martin & Co Today blog.

View all articles by Gina Narramore

Government rules out any re-think on restricting buy to let tax breaks

The government is ruling out any re-think on its proposals to reduce buy to let tax breaks from next year.

The Financial Secretary to the Treasury, David Gauke, has written to the Residential Landlords' Association to emphasise the determination of the government to plough ahead with the changes, first announced in July by Chancellor George Osborne.

Gauke's letter is uncompromising, saying the Osborne proposals are essential to establish "a fair tax system".

Gauke's letter says: "By restricting cost relief to the basic rate of income tax, all finance costs incurred by individual landlords will be treated the same by the tax system."

The RLA, in an earlier letter to Gauke, had made the point that the private rental sector should be treated like any other business for tax purposes. 

Gauke's response to this point includes this key statement: "Landlords will continue to get full income tax relief on the costs incurred in letting out a property, such as letting agency fees and replacing furniture, as others do on the costs they incur in carrying out a trade. Finance costs are different as having a mortgage on a property also allows the landlord to purchase a more expensive property and incur larger gains on the investment than they would without the mortgage. The government wants to rebalance relief for these finance costs and ensure that all individual landlords get finance cost relief at the same rate."

Gauke insists that the phased reduction on tax relief for landlords will not lead to a rise in rents "due to the small overall proportion of the housing market affected." 

The minister insists only one in five landlords will pay more tax as a result of the change, which will be phased in over four years.

Article courtesy of Letting Agent Today 

Is it cheaper to rent or buy?

An excellent article by Money Advice Service posted on the On The Market blog -

If you can’t afford to buy, renting is cheaper. Right? Well the latest figures show that might not be the case with average mortgage payments LESS than average rent payments. But does that mean buying a home costs less than renting.....

https://www.onthemarket.com/content/is-it-cheaper-to-rent-or-buy-3/