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Government urged to consider changes to NPPF or risk missing housebuilding target

Government urged to consider changes to NPPF or risk missing housebuilding target

Proposed reforms to the National Policy Planning Framework and other changes to the planning system in response to a Ministry of Housing, Communities and Local Government consultation on this issue has gained support from Propertymark. 

The professional body backs implementing changes to the planning system and is keen to see a system which represents the needs of residents and supports the building of necessary houses to keep pace with demand.  

Propertymark believes it is vital the ministry initiate changes which will assist the UK government with their aim of constructing near 2 million new homes during this parliamentary term.  

Lat month, Propertymark led a roundtable with members of their sales division to hear opinions about what is working with the planning system and what needs improving.  

Responses highlighted a lack of local knowledge and consistency among local council planning officers and stated that planning requirements should be tailored to each area. Properties, therefore, need to be built for the specific needs of local neighbourhoods, as one area may need more housing for older residents than others, for example.  

Members stressed that construction remains expensive, so councils would either have to build more affordable homes themselves or subsidise developers to meet precise demand.  

To make matters more difficult, members said that there is a lack of incentives for landowners to sell to develop.  

They also warned that without a long-term housing strategy from successive governments, there can be no way for politicians to ensure that there are housing options across all tenures to meet the needs of local communities on an individual basis.  

There was also strong feeling that new homes should also be built on brownfield sites first, be more energy efficient, and not compromise any natural landscapes. 

Commenting on members’ feedback, Rose Forman, policy and campaigns officer at Propertymark, said: “Focusing on planning reform is an important step for the UK government to deliver the magnitude of new homes it has promised. Propertymark consulted with our members who said there is a greater need for planning requirements to be more area specific, and for greater local knowledge and consistency in the decisions made by local authority planning officers. 

“Our members want to see homes built for the demographics who will need them and in the precise locations for which there is demand. The type and cost of construction must be taken into consideration and the UK Government must have a long-term strategy which future-proofs our towns, villages and cities for generations to come. New homes must be energy efficient and built around robust supporting infrastructure, such as upgrades to road and public transport setups, as well as wide ranging health and education provision.”  

See below: Knight Frank graph from recent Telegraph story questioning Labour’s 1.5m housing target shows 0% believe they will and 2% of respondents believed they will exceed the target.

Knight Frank graph from recent Telegraph story questioning Labour’s 1.5m housing target shows 0% believe they will and 2% of respondents believed they will exceed the target.
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10 Tips for a Successful Rental Home Search in London

How Much Can I Borrow for a Home Loan 2

Finding a rental property in London can feel like a daunting task, especially if you’re new to the city or unfamiliar with the process. London’s vibrant rental market offers a variety of homes, ranging from modern apartments to traditional houses, all set against the backdrop of one of the world’s most dynamic cities. However, to secure the ideal rental property that suits both your budget and lifestyle, it’s essential to have a strategy in place.

In this guide, we’ll share essential tips to help you streamline your rental home search in London. Whether you’re a first-time renter or a seasoned tenant, these tips will help you navigate London’s rental market with confidence.

1. Start Your Search Early

The London rental market moves quickly, with desirable properties often being snapped up in a matter of days. Starting your rental home search early gives you more time to explore different neighbourhoods, compare prices, and arrange viewings. Aim to begin your search at least 6-8 weeks before your intended move-in date. This allows you to get a good sense of what’s available within your budget and avoid the pressure of making hasty decisions.

Ready to start your home search? Browse through Homesearch Properties today to explore current listings in London and book a viewing.

2. Determine Your Budget

Before diving into your search, it’s crucial to have a clear understanding of your budget. London is known for its high living costs, and rental prices vary significantly depending on the neighbourhood and type of property. Take into account not just the rent itself, but also other monthly expenses such as utility bills, council tax, internet, and transportation costs.

When setting your budget, consider setting aside at least 10% of your income for unexpected costs, like repairs or increases in rent. In general, it’s advised not to spend more than 30-40% of your monthly income on rent to ensure you have enough for other living expenses.

Need help finding a property within your budget? Use our advanced search filters on the Homesearch Properties  website to customise your search.

3. Choose the Right Neighbourhood

London is a vast city with a variety of neighbourhoods, each offering its own unique character, amenities, and pricing. Choosing the right area is just as important as choosing the right property. Consider factors like proximity to work, public transport links, schools (if you have children), and local amenities such as supermarkets, parks, and cafes.

Some popular areas for renting in London include:

  • East London: Trendy and increasingly popular with young professionals, areas like Shoreditch and Hackney offer a mix of vibrant nightlife, markets, and art galleries.
  • South London: Areas like Clapham and Brixton offer a diverse and lively atmosphere with great transport links into the city.
  • West London: Known for its more affluent vibe, neighbourhoods like Notting Hill and Kensington are ideal if you’re looking for picturesque streets and high-end boutiques.
  • North London: Camden and Islington offer a mixture of culture, nightlife, and excellent schools, making them popular with both young professionals and families.

Not sure which neighbourhood suits you best? Explore our detailed area guides on the Homesearch Properties London website to find the perfect location for your next rental home.

4. Know What to Look for During Viewings

When viewing properties, it’s important to keep an eye out for key details that could affect your living experience. While it’s easy to get caught up in the excitement of a new home, make sure to thoroughly inspect the following:

  • General Condition: Look for any signs of damp, mould, or structural issues. Check windows for drafts and make sure all appliances (such as ovens, fridges, and washing machines) are in working order.
  • Security: Check that all doors and windows have secure locks. If you’re viewing a flat, ask about the building’s security measures, such as a secure entry system or CCTV.
  • Heating and Water Systems: Make sure the heating system is in good condition and that there’s adequate insulation to keep the property warm during colder months. Additionally, check that the water pressure and heating work well, especially in older properties.
  • Noise Levels: London can be a busy city, so pay attention to noise levels both inside and outside the property. Ask the landlord or agent about any known noise issues, such as construction work or noisy neighbours.

Call to Action: Find your ideal rental home in London with peace of mind. Browse verified listings on Homesearch Properties  to schedule a viewing today.

5. Understand Your Legal Rights as a Tenant

Renting in London comes with certain legal protections. As a tenant, you have rights under the law, and it’s important to be aware of these when signing a tenancy agreement. Here are a few key points to keep in mind:

  • Tenancy Agreement: This contract outlines the terms of your rental, including rent amount, deposit, and length of tenancy. Make sure you read it carefully and understand all clauses before signing.
  • Deposit Protection: Your landlord is legally required to place your deposit in a government-backed tenancy deposit protection scheme. This ensures that your deposit is returned at the end of your tenancy, provided no damages or unpaid rent are due.
  • Repairs and Maintenance: Your landlord is responsible for maintaining the property in a habitable condition. If any essential repairs are needed (such as plumbing or electrical issues), it’s their responsibility to fix them.
  • Eviction Notice: Your landlord must give you proper notice if they wish to terminate your tenancy, typically two months for most assured shorthold tenancies.

Need more advice on renting? Visit our Homesearch Properties  blog for tenant resources and expert guidance.

6. Be Ready to Act Fast

As mentioned earlier, London’s rental market moves quickly. Once you find a property you like, it’s crucial to act fast. Have all necessary documents ready to submit to the landlord or letting agent, such as proof of income, references from previous landlords, and a copy of your passport or visa.

Some landlords or letting agencies may request a holding deposit to take the property off the market while your application is processed. This is typically equivalent to one week’s rent, and it’s refundable or deducted from your first month’s rent if your tenancy is finalised.

Get ahead of the competition! Register on Homesearch Properties London to receive instant alerts on new listings that match your preferences.

7. Use a Reputable Letting Agent

Navigating the London rental market can be overwhelming, especially if you’re unsure where to start. A reputable letting agent can simplify the process and provide you with access to properties that might not be listed on the open market. Agents also have experience dealing with landlords and can help you negotiate terms, making the rental process smoother for you.

When choosing a letting agent, ensure they are registered with a recognised professional body, such as ARLA Propertymark or the National Approved Letting Scheme (NALS). This provides peace of mind that the agent is adhering to high standards of professionalism.

Looking for trusted letting agents in London? Contact the team at Homesearch Properties today to get expert help with your rental home search.

8. Understand the Costs Involved

In addition to monthly rent, there are several upfront costs associated with renting a home in London that you need to budget for:

  • Holding Deposit: As mentioned earlier, this is usually equivalent to one week’s rent and is held while your tenancy agreement is being processed.
  • Security Deposit: This is usually capped at five weeks’ rent for most properties.
  • First Month’s Rent: Many landlords require the first month’s rent to be paid upfront.
  • Moving Costs: Factor in the costs of moving services, transportation, and any new furniture or appliances you might need.

Be sure to factor in these costs so you’re financially prepared to secure your new home.

Ready to take the next step? Explore available properties at Homesearch Properties and find your new rental home today.

9. Consider Short-Term vs Long-Term Tenancies

London’s rental market offers a range of tenancy options, and it’s worth considering what’s best for your situation. Short-term tenancies are great if you’re only staying in the city for a few months, whereas long-term tenancies offer more stability. Make sure the tenancy length works for you, and don’t be afraid to negotiate if you prefer a longer or shorter contract.

Whether you’re looking for a short-term or long-term rental, Homesearch Properties  has a range of flexible options to suit your needs.

10. Stay Organised

Finally, staying organised throughout the home search process is key. Keep track of properties you’ve viewed, the pros and cons of each, and any important deadlines for securing your new home. This will help you stay on top of your rental home search and ensure that you don’t miss out on your ideal property.

Simplify your rental home search in London with Homesearch Properties. Save your favourite listings, set up alerts, and get expert advice to make your next move stress-free.

Renting in London doesn’t have to be overwhelming. By following these tips and working with a trusted letting agent, you can make your rental home search as smooth as possible. Whether you’re looking for a modern flat in the heart of the city or a cosy home in a quiet suburb, your ideal property is out there waiting for you. Start your journey with Homesearch Properties and find the perfect home today.

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Capital gains tax speculation leads to ‘significant increase in market appraisal’

Rachel Reeves

There are growing that potential tax changes in the Autumn Budget next month may curb demand and increase downwards pressure on prices in higher-value markets

Rachel Reeves has not yet delivered her Budget but it is already having repercussions in the property market.

The government has said private schools will be charged VAT from January, but other announcements on 30 October may focus on capital gains tax (CGT), non doms, pension tax relief and inheritance tax.

By Tom Bill, head of UK residential research at Knight Frank, commented: “While there was a 34% increase in the number of sales in London in July and August compared to the five-year average, there was a 16% decline above £2 million, Knight Frank data shows.

“When you consider that £2 million-plus sales accounted for 22% of the £11.7 billion raised in stamp duty last year, it highlights the risk of tax rises having unintended consequences.

“The other way in which the Budget is impacting the property market relates to CGT and speculation that it may increase from its current level of 24%.

“Supply looks set to rise this autumn, which will be driven in part by owners attempting to sell before any changes are introduced.”

In an indication that more sellers are planning to list their property, the number of market valuation appraisals in August was 25% above the five-year average in London, Knight Frank data shows. Any future rise in supply would increase downwards pressure on prices.

“We are seeing a significant increase in market appraisals and listings from clients who have residential lettings portfolios,” said Andrew Groocock, chief operating officer of Knight Frank’s estate agency business.

“There is a feeling among many owners that they are better off bringing their properties to the market now and perhaps accepting a price that is 5%-10% lower, rather than running the risk of a CGT increase after the Budget.”

Average prices in prime central London (PCL) continued to edge down on a monthly basis in August. A fall of 0.2% took the annual change to -2.3%, which was the 16th month in a row the annual change was negative.

In fact, annual price growth in PCL has not been above 3% since March 2015 and prices remain 18% down on their last peak in August 2015.

Prices in prime outer London were flat in the 12 months to August as lower-value, needs-driven property markets perform more strongly. By comparison, prices in POL are 8% below their last peak in July 2016.

As far as lettings is concerned, rental value growth continued its return to earth in August as supply climbed and demand fell. Overall, rents rose 2.1% in prime central London (PCL) and 2.2% in prime outer London (POL).

In both cases, it was the lowest figure since the summer of 2021 when the long-let market was flooded with short-let properties during the pandemic. Supply subsequently fell sharply, in part thanks to landlords selling up during a stamp duty holiday, which meant rents were growing by more than 20% in the early months of 2022 as demand far exceeded supply.

The chart below shows how the market has rebalanced and put downwards pressure on rents.

The number of new listings in August was 8% below the five-year average, Rightmove data shows. That compares to much steeper declines in recent years.

Meanwhile, the number of new prospective tenants was 11% below the five-year average in August, partly due to a decline in overseas students applying to study in the UK.

The number of students accepted from China, which accounted for the largest proportion of overseas students in 2021/22, dropped 6% to 10,950 this year, according to UCAS data.

UK universities may have reached “peak China”, according to comments last year from the head of the Universities and Colleges Admissions Service, for reasons that include visa and tax changes as well as the fact rents have risen in recent years.

“International students coming to the UK are tending to focus on London more closely than other cities” said John Humphris, head of Relocation & Corporate services at Knight Frank. “With fluctuations in applications from China, but notable increases from Turkey and Canada, London remains an evergreen destination in spite of competition from other global education hubs, notably Australia”

Average rents in PCL are 34% higher than they were before the pandemic in February 2020, while the equivalent rise in POL is 29%.

While rents are normalising, there is a risk that upwards price pressure may intensify as more landlords sell due to possible legislative changes.

First, there is speculation that capital gains tax may increase from its current level of 24% in next month’s Budget.

In an indication that more sellers are planning to list their property ahead of possible changes, the number of market valuation appraisals for sale in August was 25% above the five-year average in London, Knight Frank data shows. Conversely, any future rise in supply would increase downwards pressure on prices.

“We are seeing a significant increase in market appraisals and listings from clients who have residential lettings portfolios,” said Andrew Groocock, Chief Operating Officer of Knight Frank’s estate agency business.

“There is a feeling among many owners that they are better off bringing their properties to the market now and perhaps accepting a price that is 5%-10% lower, rather than running the risk of a CGT increase after the Budget.”

Second, there is uncertainty over the revived Renter’s Reform Bill, as previously explored. Measures could include making it harder to evict tenants and tighter rules around the green credentials of lettings properties, according to recent press reports.

Original Post from https://propertyindustryeye.com

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New housing policies: Angela Rayner’s speech at Labour Party Conference

Angela Rayner

Angela Rayner set out measures to protect renters from fire safety defects, damp and mould in her speech at the Labour Party conference yesterday.

The deputy prime minister and housing secretary, committed to “building homes fit for the future”, while also pledging to bring forward a Remediation Acceleration Plan this autumn to speed up the removal of unsafe cladding on high-rise buildings.

Other measures Rayner announced on Sunday included consulting on a new “decent homes standard” for the social and private rented sectors, and a new law to make landlords respond to complaints about disrepair within legally binding timescales.

Here is part of Rayner’s speech relating to housing at the Labour Party Conference yesterday:

“14 years of Tory chaos has not just left its mark on people’s jobs, but on homes too.

Not enough are being built. The Tories failed to meet their targets year, after year, after year.

Michael Gove handed back nearly £2 billion to the Treasury in unspent housing funds. Mortgages have soared. Leaseholders are left at the mercy of eye-watering charges. Renters face crippling rent hikes in damp and mouldy homes. Homelessness is all around us.

The simple aspiration of a safe, secure and affordable home is further out of reach than ever and we can’t go on like this. So change must begin at home.

We are tackling the Tories’ housing emergency.

We will get Britain building and building decent homes for working people.

A new planning framework will unlock the door to affordable homes and provide the biggest boost to social and affordable housing in a generation.

And Conference, our renters’ bill will rebalance the relationship between tenant and landlord and end no fault evictions – for good.

Our long-term plan will free leaseholders from the tyranny of a mediaeval system.

And a cross-government taskforce will put Britain back on track to ending homelessness.

Whether you’re a leaseholder, a tenant, a home-buyer or without somewhere to live – this government is on your side.

But my mission is not just to build houses, it is to build homes.

Because we cannot build at any cost. These new homes must be warm, secure and most importantly safe.

We will give families the security they need to have the best start in life.

I know first-hand the difference a decent home can make.

When I was growing up we didn’t have a lot. But we had a safe and secure home. Today, not everyone does.

Working with the Prime Minister on the Grenfell Inquiry was the most sobering moment of my career: 72 lives lost, 18 children, all avoidable. A fatal failure of market and state. A tragedy that must never happen again.

It is completely unacceptable that we have thousands of buildings still wrapped in unsafe cladding seven years after Grenfell.

And that’s why we will bring forward a new remediation action plan this Autumn to speed up the process and we’ll pursue those responsible – without fear or favour.

This must lead to new, safer social housing for the future.

Under the Tories, new social housing plummeted.

We will reverse that tide – with an ambition to be build more social homes than we lose, within the first financial year of this Labour Government.

In my first weeks in office, I set out how we will start this council housing revolution.

But Conference, with Government support must come more responsibility.

This is why today I want to give you my promise that this Labour Government will take action to ensure all homes are decent and safe, and residents are treated with the respect they deserve.

And Conference, of course, many Housing Associations, councils and landlords do good by their tenants and I know how hard they’ve had it after 14 years under the Tories.

Which is why I will work in partnership with the sector to deliver the change.

I will clamp down on damp and mouldy homes by bringing in Awaab’s Law in the social rented sector this autumn and we’ll extend it to the private rented sector too.

We will consult and implement a new Decent Homes Standard for social and privately rented homes, to end the scandal of homes being unfit to live in.

We will also ensure social housing staff have the right skills and experience. And I will ensure 2.5 million housing association tenants in this country can hold their landlord to account for their high quality services and homes. So that repairs and complaints are handled faster, but more importantly, so social housing tenants are treated fairly.

I am under no illusion about the mountain we have to climb.

We all saw that this summer: violent extremists preyed on our communities and local councils were left picking up the pieces.

Local leadership is the foundation of strong communities.

That’s why I have put local government back where it belongs, at the heart of my department’s name and mission.”

Original Post from propertyindustryeye.com

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Estate agency touting yields limited success as over 90% of homes sold with first agent

Uk homes statistics

Some estate agents believe that more than 50% of homes sell with a second agent, but this is simply not the case, according to property data and analytics company TwentyCi.

This stat regarding more than half of homes being sold with a second agent has been floating around the market for a number of years, points out Christopher Watkin, a regular contributor to EYE.

This statistic has often been quoted by industry leaders and PropTech suppliers, and typically goes unchallenged, but fresh findings suggest something very different.

“Historically for the last decade, it was believed that only 40 to 50% of properties sold with the first estate agent,” Watkin said. “This [new data] dispels the myth that a second agent is more successful.”

The data reveals that more than 18 out 20 UK homes sell with the first estate agency listed to market the property.

Of 1,776,709 UK homes sold sold subject to contract with an estate agency since 1st January 2023, under a sole agency agreement, 1,655,754 of those UK homes (93.2%) sold stc with the initil estate agent marketing the property.
Only 120,955 UK sold stc with the second UK estate agent marketing the home (6.8%).
Watkin cautions that the success achieved by those initially instructed to market a property “is not a charter for estate agents to overvalue to secure the listing”.

He continued: “It must noted that while 1.77m properties have sold STC since the 1st January 2023, over 2.9m UK homes have been listed since January 2023, meaning only around 60% of properties listed have had a sale agreed on them. Once you take into account sale fall throughs, that drops to only 53% of listings exchanging and completing (when the agent is paid).”

“The key challenge for estate agents is not just securing the listing first time but ensuring the property is priced correctly from the outset to guarantee a successful sale. This data should serve as a wake-up call for UK agents and homeowners alike – overvaluing might massage your ego in the short term with your listing’s market share, in the long-term, you are setting yourself up and the homeowners you serve to failure, wasted time, lost homes they want to buy, and ultimately, financial loss for everyone.”

Homes Sold
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Agent reveals massive corruption and forgery by tenants on industrial scale

fraud

An agent claims he and his peers in other agencies face massive struggles with forged IDs, digitally-altered supporting documents and undeclared financial issues.

In the last month Benham and Reeves, a London firm, detected eight forged passports or IDs; 40 digitally-altered bank statements, utility bills, payslips or proof of address; 50 forged employment references; and 30 undeclared county court judgements (CCJs) and  individual voluntary arrangements (IVAs).

Agency director Marc von Grundherr says: “The lettings market has become a key target for fraudsters due to the illicit profits they can generate quickly and over a short period of time and nowhere more so than in London, where demand is high and rental values are at their highest.

“Landlords themselves must be on guard but even more so, it’s down to letting agents to provide that vital line of defence which simply can’t be upheld through technology alone.

“The reality is that some agents simply don’t do an adequate job. Unfortunately, every agent does things differently and so landlords really need to be sure their agent is going the extra mile.

“For us that means strict digital ID verification but it also includes a manual check of all documentation, rigorous checks of employment references including domain names, registration details and IP addresses cross referenced with payslips and bank statements, an online search of the applicant including a review of their social media profiles, open-source tools and search engines, information sharing with the police and more.

“So whilst it’s inevitable that some crooks will slip through the net, this threat can be drastically reduced by taking a proactive approach to tenant verification and not leaving it technology alone.”

He says that while digital and AI technology has evolved rapidly and can process vast amounts of data in a timely fashion, rogue tenants have also evolved with it, becoming increasingly more inventive in how they trick the system.

von Grundherr also cites four real world examples of how a more thorough human-and-tech approach has helped prevent huge financial loss:

• High net worth fraud: A supposed art dealer with an undisclosed CCJ of £12,151 provided altered bank statements and was found to be in arrears at an undisclosed tenancy while claiming Universal Credit. Without careful cross-referencing, this fraudster could have easily slipped through the cracks.

• Organised crime network: Several applications from different tenants shared suspicious similarities, such as identical email formats and switched referees. All references were found to be fraudulent, leading to police involvement. This case highlighted the importance of scrutinising not just individual applications but patterns across multiple ones.

• Cloned company scam: Multiple applications were made by employees of a fake media company. Altered bank statements, fake payslips, and undisclosed addresses linked these applicants to a newly formed lettings business likely involved in illegal activities. The discovery of these links prevented a potentially large-scale fraud.

• Fraudulent barrister: A barrister applied with what appeared to be legitimate documents. However, closer inspection revealed altered bank statements and a gambling addiction. The applicant had also provided fake landlord details to hide arrears at their current tenancy. This case underscores the importance of not taking professional status at face value and digging deeper.

Original Post from lettingagenttoday.co.uk

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Record number of former rentals up for sale

New figures out today show the rental housing crisis is worsening – with the number of former rental homes up for sale hitting record highs

New figures out today show the rental housing crisis is worsening – with the number of former rental homes up for sale hitting record highs

The NRLA said the data, from property portal Rightmove, is bad news for all tenants looking for a home, with a bold new approach needed if the Government is to tackle the massive imbalance between supply and demand.

It says pro-growth taxation measures are vital to stem the tide, with NRLA Policy Director Chris Norris saying October’s Budget offers the perfect opportunity to introduce changes.

He said: “Today’s data will be a serious concern for all those renters struggling to find somewhere to call home.  With demand already massively outstripping supply, Rightmove suggests the situation is set to get worse.

“Every rental home that is sold simply exacerbates the imbalance between supply and demand. Whilst some of these properties will inevitably end up on the owner-occupied market, that will be of little comfort to those households struggling to access quality housing.

“What we need is a housing strategy that recognises the need for more of every type of property, including high quality homes for private rent. That’s why the Budget needs to announce pro-growth tax plans to meet the needs of renters across the country.”

Rightmove says the proportion of former rental properties moving into the sales market is at its highest on record, which indicates; “more landlords are selling up, some potentially driven by the mooted increase in Capital Gains Tax in the Autumn Statement on 30th October.”

What does the data say?

The findings show that:

  • 18% of properties now for sale were previously on the rental market, compared with 8% in 2010.
  • The hotspot is London, where nearly a third (29%) of homes for sale were previously for rent, followed by Scotland (19%) and the North East (19%)
  • The previous five-year average for homes moving from the rental to sales market in Great Britain is 14%, suggesting that this isn’t a sudden mass exodus of landlords
  • The number of new properties coming to the market for sale is now 14% ahead of last year.

More information

Original Post from https://www.nrla.org.uk

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Landlords ‘forced to sell up’ over Government’s energy upgrade plans

Rock and a hard place: Many landlords may struggle to achieve an EPC rating of C or above, and may decide to sell up rather than face potentially expensive upfront renovation costs
  • New rules mean warmer homes for tenants, but upgrades may be expensive

Landlords may choose to sell their properties due to the cost of meeting Government energy efficiency targets for rented homes, experts believe.

The Government confirmed this week that all rented properties in England must have an Energy Performance Certificate (EPC) of ‘C’ or above by 2030.

The requirement was part of the Government’s election manifesto, and was repeated by energy security secretary Ed Miliband at this week’s Labour Party conference. The plan will be consulted on later this year.

Experts say many landlords may be forced to sell properties rather than meet the new EPC rules, unless the Government offers extra support.

 

Rock and a hard place: Many landlords may struggle to achieve an EPC rating of C or above, and may decide to sell up rather than face potentially expensive upfront renovation costs
Rock and a hard place: Many landlords may struggle to achieve an EPC rating of C or above, and may decide to sell up rather than face potentially expensive upfront renovation costs

 

A spokesperson for the National Residential Landlords Association (NRLA) said: ‘Some landlords may find that they are unable to finance the improvements needed, particularly in areas with lower property values.

‘However our past research has shown that over 80 per cent of landlords had either made or planned to make energy efficiency improvements, with most using or planning to use their own savings or rental profits to fund the upgrades.’

A spokesperson for the British Landlords Association said: ‘Yes, some landlords are already selling.’

The cost of upgrading rented properties to an EPC rating of C and above can cost thousands of pounds.

In theory this should also improve the value of the property, but it does mean landlords having to shoulder an upfront cost. For some properties, especially older ones, the cost rises substantially.

NRLA figures show that solid wall insulation can cost more than £20,000, especially in homes built without cavity walls.

Landlords with more modern properties will typically pay £9,000 to meet the new EPC standards, Government figures show.

However, an NRLA spokesperson added: ‘The costs of these changes vary greatly depending on the type of property.

‘It is also important to take into consideration how landlords are impacted by the region their properties are based in. Our research in 2021 found that in some local authority areas of the North and Midlands, the estimated costs of improving home energy are around 25 per cent of property values.

‘By contrast, in affluent parts of London and the South East the cost of retrofitting with heat pumps represents less than 2 per cent of overall property value.’

It may not be possible for landlords to meet the 2030 deadline, either.

The NRLA spokesperson said: ‘If there is clarity at an early stage on what’s required, sufficient tradespeople, and a financial package that means landlords can plan upgrades, 2030 may be possible.

‘But equally, if the expectation is to retrofit every rental property not currently EPC C or above by 2030 there is an enormous amount of work to do in a very limited period of time.

‘Otherwise, landlords may struggle to afford the high cost of home improvements, and may miss the 2030 target altogether, reducing the number of rental homes available and pushing up rents.’

Asked if landlords would meet the deadline, the BLA spokesperson simply said: ‘No.’

 

Counting the cost: Some of the upgrades required to make properties more energy efficient can be expensive, such as replacing the boiler or installing a heat pump
Counting the cost: Some of the upgrades required to make properties more energy efficient can be expensive, such as replacing the boiler or installing a heat pump

 

There is also a chance that rents might have to rise to cover the cost of energy upgrade work.

The NRLA said: ‘Upgrading to an EPC C will require a higher level of investment – and the ability of landlords to fund this themselves will vary, particularly given the regional variability in their options to leverage finance from their property values.

‘Some landlords may have to increase rents to match increased maintenance costs, but this will depend largely on the landlord’s individual circumstances and the type of property.’

The BLA said that rents would not rise for EPC reasons, but only as they are rising already due to many landlords already leaving the letting sector.

Finding up-to-date figures on the number of rented properties in England that are below EPC band C is tricky.

There are around 4.5 million rented homes at EPC ratings of D or below in the UK, according to data analysts Outra in 2023 – not just England, where the 2030 rule applies.

The last Government figures show that 8 million properties in England were below band C – or 31 per cent of the total 25.2million properties – but this dates back to the 2021 census and is for all homes, not just rented ones.

Original Post from https://www.thisismoney.co.uk/

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WARNING: Eviction reforms will make landlords ‘choosier’ about tenants

Paul Shamplina, Founder of Landlord Action

Landlord Action’s Paul Shamplina (main image) has predicted a rise in landlords using rent guarantee insurance as well as tougher referencing to protect themselves against the fall-out of eviction reforms.

A perfect storm of tighter grounds for possession and the end of Section 21, along with a lack of investment in the courts and a chronic shortage of bailiffs – as well as higher landlord costs and higher rents creating a greater risk of arrears – means landlords will want to be more stringent with referencing, he tells LandlordZONE.

Once the Renters’ Rights Bill is passed, landlords must instead use a Section 8 and the government’s new Guide to the Renters’ Rights Bill helpfully explains how the legislation will ensure landlords “enjoy robust grounds for possession”.

It will provide protections for tenants who temporarily fall into rent arrears, “supporting both parties by preventing tenancies which are otherwise viable from ending”. This means an increase in the mandatory threshold for eviction from two to three months’ arrears and an increase in the notice period from two weeks to four.

“This will allow tenants more time to repay arrears and remain in their homes, while ensuring landlords do not face unsustainable costs. Landlords can also continue to use the discretionary rent arrears grounds, for example if rent is repeatedly late,” says the guide.

Worry

Shamplina believes that for landlords, it means starting the process – if they have to go to court – with an extra months’ rent arrears added. “The worry for landlords unfortunately is court delays, getting court orders and having them enforced,” he says. “The process is taking longer which adds to the landlord’s costs.”

Landlord Action is getting more instructions from landlords to enforce money orders against tenants which can be very challenging to collect as many tenants have to be tracked down and don’t have much money.

“Post-Covid, rent arrears are getting bigger and landlords feel that some tenants try and get away with it so will pay to try and get it enforced – and this will show up as a county court order,” he adds.

The ultimate guide to handling the eviction process

Original Post from landlordzone.co.uk

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Airbnb boss reveals plans to go into longer-term property rentals

CEO of Airbnb Brian Chesky

Landlords may soon be able to rent their homes out via Airbnb to more than just holiday makers, its co-founder has revealed.

The CEO of Airbnb Brian Chesky (main image) yesterday told a conference in the US that he considers ‘longer term rentals’ of more than 28-days duration to be the next big growth area for his renting platform.

He said that longer-term rental now account for up to a fifth of all bookings on Airbnb, a trend spurred on by the pandemic, and that he wants to focus the business on rentals of up to three months.

Offering significant more things is the future of this company,” he said, going on to say that he was “100%” looking at residential lettings of more than 30-days as a new market. “This is going to be a huge opportunity,” he added.

This would put him in direct competition with the many letting agencies all over the world who offer ‘corporate lets’ and is clearly a landlord market that he wants to dive into, namely rentals of between 30 and 90 days.

Crackdowns

But Chesky’s comments are also an attempt to dodge the crackdowns many city and holiday hotspot councils have introduced as many landlords have switched to the much-more profitable holiday lets market, which offers revenues of up to five times normal ‘long-term’ lettings, albeit with more work and costs attached too.

Labour recently announced that it intends to bring in a national registration scheme for holiday lets as well as the requirement for all new holiday lets to gain planning permission before they can be marketed via platforms such as Airbnb and Booking.com.

Watch the interview in full.

Original Post from landlordzone.co.uk