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Lettings Group 2

4 reasons why landlords should accommodate electric vehicles

Electric vehicles are kinder to the environment and currently kinder on the wallet, with the added bonus of being unaffected when it comes to environmental protests and oil refinery blockades. Therefore it’s no surprise that tenants are looking for properties where they can park up and plug in. Here are four reasons why landlords need to accommodate the ‘leccy car. 

1. Landlords are eligible for a 75% charging point discount

Although the Electric Vehicle Homecharge Scheme has come to an end, the Government has introduced a replacement in the form of the ChargePoint grant – a new initiative designed specifically for landlords. On offer is a 75% discount on the cost of purchasing and installing an electric vehicle charging point to a residential buy-to-let property. 

There are a number of limitations to be mindful of. The discount is up to the value of £350, the landlord must own the parking area, and they should be VAT registered or registered at Companies House to qualify.

2. Tenants will prioritise your properties….and pay more

When E.ON recently questioned Gen Z (aged between 16-27) and Millennials (aged between 28-41) about their property search habits, 80% of Gen Z and 78% of Millennials said they would discount properties that didn’t meet the minimum energy efficiency rating. In addition, four in five people (81%) aged between 16-41 would pay a higher price for a property if it had an electric vehicle charger, a heat pump or solar panels.

3. Your tenants are increasingly likely to own electric vehicles

Drivers are already working ahead of an outright ban on the sale of new petrol and diesel vehicles. Sales of electric vehicles increased by 186% in 2020, report Heycar, while 20% of cars sold in the UK this year have been electric models, according to data from the Society of Motor Manufacturers and Traders. Electric vehicle sales are projected to rise by the end of 2022, with electric cars likely to outsell diesel and mild hybrid diesel models, says Heycar. 

4. Tenants want the option of filling a tank with electricity

Tenants will increasingly turn to electric cars as a way of saving money as well as the environment. Even with energy price caps doubling in April, figures published by ThisisMoney suggest the cost of charging an electric vehicle will likely remain cheaper than a tank of petrol or diesel. Monthly charging costs of around £50 are achievable, especially as many utility suppliers offer dedicated electric vehicle charging tariffs.

Support tenants who want to make their own application

Landlords who are not VAT registered or registered with Companies House can still benefit from a discounted electric vehicle charging point via their tenant. The ChargePoint grant runs a concurrent scheme aimed at tenants in flats and single-use accommodation, with renters able to enjoy 75% off the purchase and installation of an electric vehicle charging point. Landlords who want to encourage their tenants to apply can point them in the direction of this dedicated Government webpage but it’s worth noting that renters must own, lease or have ordered a qualifying electric vehicle and have access to dedicated off-street parking at their rental property.

The Government’s website carries full details of how landlords and tenants can apply for a ChargePoint grant and for any other advice regarding lettings, please contact the team today.

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Lettings Group 2

7 reasons to consider newly built for your next BtL

Old versus new? When it comes to investing in property, many landlords will be weighing up period properties versus 20th century homes but what doesn’t always get a look in are homes built in the last 10 years.

While brand new and nearly new may carry a premium at the purchase point, landlords shouldn’t write off a modern property. Here we look at seven sensible reasons why a newly built home can help balance the books and appeal to tenants. 

  1.     Renters are ready to pay a premium: new data analysis from Unlatch found tenants will pay an average 23% premium for a newly built property, when compared to an older one. This figure can rise to a 41% premium in some parts of the country.
  2.     Maintenance costs are negligible when it’s newer: new and recently built homes can be less troublesome than period properties. The all-new aspect of the structure, fixtures, fittings and appliances – facets covered by warranties and guarantees within the first few years – reduces a landlord’s maintenance spend.
  1.     Stay ahead of changing energy requirements: landlords buying newer homes will gain a degree of future-proofing when it comes to meeting green targets. Thanks to a sustainable build and fit out, most newer homes have an EPC rating higher than the current, legally-required E. In addition, many will already have achieved the C rating that the Government wants to make compulsory for all lets by 2028.
  1.     Appeal to energy-conscious tenants: in 2021, a survey found over half of renters questioned would pay more for a green home and a newer property ticks more than one eco box. As well as improved insulation, efficient central heating, and smart features that lower energy usage and reduce utility bills, new homes built with off-road parking from this year will have to include an electric vehicle charging point as standard.
  1.     Secure the best buy-to-let mortgage: mortgage lenders are incentivising purchasers to buy green homes in return for lower interest rates, larger loans and cash back deals. A newer home with a good EPC will automatically qualify for special ‘green’ mortgage products being offered by some banks, potentially saving landlords hundreds of pounds every year in repayment costs.
  1.     Avoid the void: whether a few years old or a first release, a new home is less likely to need a major upgrade or improvement works before it is let on the open market. This avoids any loss of rental income between sales completion and a tenant move-in date, while the good state of repair will minimise empty spells between future tenancies.
  1.     Sniff out housebuilder incentives: those deciding to buy really new – as in before it’s built – can take advantage of picking the most desirable plot and also potentially benefit from value uplift while construction is underway (although prices can change in either direction). Even when completed units are marketed for sale, housebuilders are known to offer property investors incentives, such as paying their second home stamp duty bill, contributing towards the deposit or paying the buyer’s conveyancing costs.

If you are looking to expand your buy-to-let portfolio or are interested in becoming a first-time landlord, get in touch. We can advise on matters of rent, local tenant demand, yield and returns on rental properties of all ages.

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Lettings Group 2

FOMO is behind the gazumping trend in lettings

The post-lockdown lettings market is super-buoyant and the fear of missing out (FOMO) is bringing a new competitive edge to renting. While making an offer £50 or £100  below the asking rent was acceptable – and often accepted by the landlord – in the past, today’s sought-after rentals can end up the subject of biddings wars, with gazumping a tactic back on the table.

If rental gazumping is a new concept to you and you’d like to avoid being pipped to the post at the very last minute, here’s our guide. 

What is gazumping?

Gazumping is when a tenant makes a last-minute offer on a rental property. Their offer will be higher than the one accepted by the landlord and it will come very late in the marketing process – perhaps after the referencing process has started or just before the tenancy agreement is signed. 

Why is gazumping starting to happen in lettings?

Gazumping is common when there is a supply and demand imbalance. In terms of today’s rental market, demand among tenants is increasing and the number of properties available to rent is falling. 

In fact, recent analysis by Zoopla revealed the number of tenants searching for rental properties at the start of 2022 was 76% higher than when compared to the same period between 2018 and 2021. The portal also found there were 39% fewer homes available to rent in January 2022 when compared to the same month in other years.

Is gazumping illegal?

Gazumping to secure a rental property is not illegal but it is widely viewed as slightly unethical. The legal aspect of lettings relates to a written tenancy agreement. This becomes a legally binding contract as soon as both the tenant and landlord have signed it. Until this point, there is nothing stopping multiple ascending offers being made on a property.

Will the highest offer always be chosen?

Not always, especially in lettings. A satisfactory referencing process is equally as important as the highest offer. Landlords will be looking for tenants who have a secure job, a good credit history, impeccable past landlord and employment references, and a track record that shows they pay the rent on time every month. Aspects such as how quickly the tenant can move in and whether they have any special conditions will also be weighed up against the offer made. 

How can gazumping be avoided?

Of course, matching (or exceeding) the asking rent will always turn the head of a landlord but there’s more to it than money. For tenants, speed is of the essence and it’s often too late to make a winning offer by the time a property is listed online. Registering directly with a letting agent ensures tenants hear about a property before the masses. Those who can view, offer and sign a tenancy agreement without delay – perhaps even within a 24 hour period – will be in pole position. Offering to pay six months’ rent upfront is another gesture that is finding favour, especially if there is any question mark over a renter’s financial health.

We are working to match the very best tenants with available properties, balancing offers, personal circumstances and the ability to be a reliable renter. Talk to us about properties to let and our landlord services.

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Lettings Group 2 Sales Group 2

Inheriting a property: your questions answered

Whether expected or not, finding yourself the owner of a property after someone’s death is a sensitive subject. Here we answer the most frequently asked questions by someone who has inherited a home.

Q. I’m named in the will so is probate necessary?
A. Unless a property is passed on to a joint tenant, probate is almost always required. Although the will sets out who inherits what, the probate grants the legal right to an executor to deal with someone’s property, as well as their money and possessions, after they die.

Q. More than one person has inherited the property, what happens next?
A. It’s very common for siblings to jointly inherit their parent’s property, with multiple new owners responsible for the future plan. All the owners need to consent for it to happen. One way to gain sole ownership is to buy the co-owners out.

Q. Can I move into a property I’ve inherited?
A. If you are the sole owner and the property is empty, there is nothing stopping you from using the inherited property as your place of residence. If you have inherited a buy-to-let with tenants in situ, you’ll need to wait for their tenancy to end before you move in, or give them the pre-set notice period if there are valid reasons to ask them to leave.

Q. Is there anything stopping me from selling the property?
A. If you don’t want to move into the inherited property or rent it out, you can sell it. It’s a straightforward process if you’re the sole owner but everyone needs to agree to a sale if the property is jointly owned.

Q. Are there any tax implications attached to an inherited property?
A. Tax is a big consideration, especially if the deceased was in debt or faces a large inheritance tax bill. Sometimes the only way for beneficiaries to balance the books is by selling the property asset. It’s also worth remembering that when an inherited property is sold, there may be income tax to pay upon completion or a mortgage to settle.

Q. What happens about stamp duty when I own more than one home?
A. This is another tax consideration. If you retain an inherited property and rent it out, but go on to buy another house to live in, you will be classed by the Government as an owner of additional properties. All homes bought in addition to the inherited property will incur an extra 3% levy on top of basic stamp duty rates.

Q. Can I rent out an inherited property?
A. If you don’t want to sell a property you’ve inherited, you could become a landlord and advertise the property to tenants. You’ll be able to keep the property in the family and always have somewhere to move into in the future but being a landlord also comes with its own tax implications. As well as income tax to pay, any profit made when selling the inherited property in the future may be subject to capital gains tax.

Q. I’ve inherited a buy-to-let with tenants, can I evict them?
A. Inheriting a tenanted dwelling is slightly different as you’re gaining residents as well as a property. Depending on the tenancy agreement in place, the landlord has to give an average of two months’ notice to regain their property, or they have to wait until the fixed-term tenancy ends.

Q. Could I take over the buy-to-let?
A. If you like the idea of an inherited property with tenants in place, there’s nothing stopping you from taking over as the landlord. You’ll need advice from a letting agent and a tax specialist but renting out can be a rewarding way of keeping ownership of an inherited property.

Q. I’ve never bought a property but I’ve just inherited one – how will I be affected?
A. Your first-time buyer status will likely be scuppered if you inherit a property as you’ll automatically be considered a homeowner – even though you’ve never been through the buying process. Your access to discounted stamp duty rates, benefits attached to a LISA (lifetime ISA) and ability to use Help to Buy may all be compromised, even if you never live in the inherited property and sell it on immediately.

Q. So can I refuse an inherited property?
A. You can refuse to inherit a property and the technical term for this is ‘disclaiming’ it. We do recommend taking legal advice before you disclaim any inherited asset, especially if you have never owned a property before.

We are here to sensitively advise families and individuals who are going through the probate process, so please get in touch to discuss your options.

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Lettings Group 2

Taxing matters for landlords in 2022

‘Tax doesn’t have to be taxing’ is a favourite slogan of HM Revenue & Customs and it’s true! For many people, paying tax and working out VAT is an aspect of our daily lives that someone else works out on our behalf.

If you’re a landlord or property developer, however, you are classified as a business owner who is responsible for their own tax bill and possibly VAT too. While a good accountant is vital when it comes to filing returns and reducing bills, understanding the relationship between tax, VAT and property before you invest and during a tenancy is key to healthy yields and profits.

This year will see landlords settle into a new tax and VAT pattern, and while we can’t predict what the Chancellor may introduce later in 2022, here are 6 things we do know:

Mortgage interest tax relief changes are in full effect
The tapering of mortgage interest tax relief is complete and from now on, landlords filling in their self-assessment tax return will only be able to offset 20% of their mortgage interest payments against their tax bill.

There’s more time to report & pay CGT
When a landlord sells a buy-to-let property, there is usually CGT (Capital Gains Tax) to pay. This year has already heralded a positive change to how landlords report profits gained from selling additional properties and how long they have to pay the CGT bill. The timeframe has been extended to 60 days, up from the previous 30.

The tax liability notification period may shorten
The Government is keen to boost its coffers and it is consulting on an Income Tax Self-Assessment reform, which would prompt landlords to pay taxes due more quickly. At present, landlords have six months to notify HMRC of a tax liability if they’re making money from additional properties but this timeframe may be reduced to something much shorter, possibly one month.

Stamp duty may rise for mixed-tenure purchases
Property investors with one eye on the High Street should plan for a possible SDLT (Stamp Duty Land Tax) hike. The Government wants to change how mixed-tenure purchases – such as a ground floor retail unit with a residential flat above, sold as one transaction – are taxed. Currently, purchasers pay lower commercial rates of SDLT on the entire purchase but the proposed change would see the residential part taxed at the higher residential rate.

5% VAT for developer landlords is available
Landlords who engage in development and conversion work before they let out a property still have access to more flattering rates of VAT. Building work to change a commercial premises into a residential buy-to-let home may attract 5% VAT, while developing student accommodation could see VAT reduced to zero in some cases.

Reduced VAT rates for providers of holiday accommodation ends soon
One of the Government’s pandemic rescue packages saw suppliers of holiday accommodation – including short Airbnb lets – pay a reduced rate of VAT but this benefit ends on 31st March 2022. As of 1st April 2022, the VAT rate will rise from 12.5% to the pre-pandemic standard rate of 20%.

Still find tax taxing?
As buy-to-let and property specialists, we can advise on all matters of lettings, including tax and VAT. Get in touch and we can help you find financial efficiencies and run profitable property investment portfolios.

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Lettings Group 2 Sales Group 2

A guide to council tax & property bands

The way we buy and sell homes is forever changing but some things stay the same. The property ‘bands’ that were set more than 30 years ago in 1991 are still used when calculating today’s council tax charges. Expressed as a letter, with A being the least valuable property and H being the most expensive, these bands dictate how much council tax a household should pay.

If you are curious about your property’s band, want to know if it can be changed or whether the bands will alter in the future, read on for our guide to council tax and property bands.

Today’s bands
Let’s start with a little background. Each local authority is free to set their own council tax but they do, in fact, all work to the same set of property bands, as follows:-

A: up to £40,000
B: £40,001 to £52,000
C: £52,001 to £68,000
D: £68,001 to £88,000
E: £88,001 to £120,000
F: £120,001 to £160,000
G: £160,001 to £320,000
H: more than £320,000

When you move into a property, whether owned or rented, it usually falls to the occupant to pay the council tax bill. The money collected by the local authority pays for vital services, such as refuse and rubbish collection, street lighting, emergency services and community assets, such as libraries.

You could be in the wrong band
The job of valuing properties before the council tax’s launch in 1991 was very rushed. In some cases, those responsible for providing the figures simply drove past rows of houses, assigning each property the same band without detailed examination.

The financial commentator, Martin Lewis, estimates that thousands of homes were incorrectly banded and it is possible for occupiers to challenge the band they were given. This process is managed by the Government’s Valuation Office Agency and it can present a successful way of re-banding your property and reducing your council tax bill.

If you are thinking of asking for a band reassessment, be aware of the pitfalls. Quite simply, the Valuation Office Agency may think you aren’t paying enough council tax and your new banding may make your council tax bill more expensive. Alternatively, your band may remain the same.

A new garden room may have an impact
If the recent ‘race for space’ and a greater appreciation of your garden prompted you to add an annexe or a fully habitable outdoor room, this may be taken into account when a band is recalculated.

If the Valuation Office Agency deem your outdoor room to have been ‘constructed or adapted for use as separate living accommodation,’ they are obliged to give it its own property band and, therefore, its own annual bill. It’s worth noting that the use of an annexe or garden room is not taken into account. Instead, an assessor will look at its physical features, such as provisions for cooking, sleeping and washing.

The good news is the ‘Granny Annexe Tax’ was abolished in 2014. This spelt the end for two full-price separate council tax bills – one for the main residence and one for the annexe. Now, at the discretion of the local authority, it’s more likely that a 50% reduction in council tax is applied to the annexe.

There’s no plan to reassess every property
With bands that were generated three decades ago – and a property market where values have soared in that time – there has been speculation that the Government would force a mass reassessment of property bands.

As of January 2022, there is no evidence to suggest such a move is scheduled. With an estimated 23 million domestic dwellings in England, any plan to revalue and re-band properties would take years in the planning and would require huge resources. For now, the current bands look set to stay, unless challenged by the property owner.

If you would like more detailed information on property bands and whether you qualify for a council tax discount, visit the Government’s dedicated webpage. If you would like to know the band and council tax bill for a property we are marketing, please get in touch.

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Lettings Group 2

Levelling up for landlords: your questions answered

Levelling Up the United Kingdom is a new White Paper released by the Government. It’s aim is to bring better opportunities to all, no matter where people live in the UK, and one of the areas it wants to reform is housing.

The White Paper will have an effect on how lettings operates and the standard of rented homes available, so landlords do need to pay attention. In this blog, we answer the most commonly asked questions about Levelling up The UK.

Q. Is the Levelling Up White Paper the same as the Renters’ Reform Bill?
Despite there being some crossover in content, these are two separate entities. The Levelling Up the United Kingdom White Paper does mention many aspects that pertain to lettings but the text also refers to a ‘landmark’ White Paper to be published in spring 2022. This is another document that acts as a prelude to the Renters’ Reform Bill, and it may contain additional changes specifically related to lettings.

Q. What’s happening about evictions?
Talk of banning Section 21 ‘no fault’ evictions has been swirling around the lettings industry for almost two years and the Levelling Up White Paper confirms that this is still the Government’s intention. It is hoped a brand new Section notice will be introduced or an amendment will be made to the existing Section 8 notice in order to protect landlords looking to regain their properties.

Q. Will I have to make improvements to my buy-to-let property?
The Government has announced that it is to consult on a new legally binding Decent Homes Standard in the PRS (private rented sector). Although there are no details of what constitutes ‘decent’, there is already a Government document called A Decent Home for social landlords. Any new Decent Homes Standards for the PRS could be influenced by this. Landlords should expect, by law, to make the upgrades and improvements required to bring their properties up to a new minimum standard for habitation.

Q. What’s being done to stop rogue landlords?
The Government would like to drive bad landlords out of the sector and one way of doing this is to introduce a National Landlord Register. Although there is already a database of rogue landlords, it is only available for use by local authority enforcement professionals. It is thought a National Landlord Register would be open to the public, allowing tenants to identify landlords to avoid.

Q. Will it become easier to buy and sell rented properties?
The Levelling Up White Paper acknowledges that the buying process could be improved. It wants to ensure ‘critical information buyers need to know is available digitally wherever possible from trusted and authenticated sources’. This may pave the way for less paperwork and more online communication, as well as improved central sources of digital information and pre-prepared property details.

Q. When are all the changes coming into effect?
As of 3rd February 2022, no fixed dates for these changes were given. As an illustration, the Renters’ Reform Bill was put forward in 2019 but nothing has been adopted by law or ratified yet. It may take months – years even – to see the full effect of the proposals and in the case of the National Landlord Register, this is a reform that the Government is merely consulting on. We will update landlords after the spring White Paper has been published.

Although it isn’t exactly light reading, you can read the full Levelling Up the United Kingdom White Paper on the Government’s website (there’s also an executive summary for those short on time).

If you think any of the proposed changes will affect your buy-to-let or investment portfolio, get in touch for advice and guidance.

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Lettings Group 2

Your damp & mould questions answered

Damp and mould are not glamorous topics but some of our most frequently asked questions involve humidity, condensation and unsightly black patches. As landlord responsibilities are bound in legislation and compliance, including the Homes (Fitness for Human Habitation) Act 2018 and the Housing Health and Safety Rating System (HHSRS), it is imperative those involved in lettings understand how damp and mould issues are tackled. 

Here are the answers to the most common damp and mould questions:

What is damp?

Damp is a broad term for the presence of water, moisture and condensation within a property. There are three main types of damp. Rising damp is when moisture is drawn from the ground up through a property’s bricks and mortar, while penetrating damp is a result of a structural defect – such as a cracked chimney stack or broken gutter. Ambient damp is usually attributed to condensation and is a by-product of everyday lifestyles inside. 

What produces condensation?

Condensation is when warm air full of water vapour comes into contact with cool surfaces. In the home, this can be the steam from a hot shower settling on a cold mirror, or a kitchen window fogging up when boiling a pan of water. Having a conversation, breathing in our sleep, houseplants and wet washing drying inside also create condensation.

What is mould?

Mould is a microscopic fungus that grows best in damp and poorly ventilated areas – it’s what you see if there’s a black-green, mottled stain on a wall or window sill. As well as being unsightly and damaging to surfaces, the presence of mould and its spores can create or worsen respiratory health issues.

Who is responsible for preventing & treating damp in rented properties?

Prevention is definitely a shared responsibility but it is usually the responsibility of the landlord to provide the cure. In the case of rising and penetrating damp, a structural fault is usually to blame. It falls to the landlord to solve the issue and make repairs under Section 11 of the Landlord and Tenant Act 1985.

It is wise, however, for tenants to let landlords or their property manager know if they see the first tell-tale signs of damp or mould, such as peeling wallpaper, bubbling paint, black speckles or water droplets – especially if these are on the interior surfaces of outside walls. In fact, a tenancy agreement may stipulate that it’s a tenant’s responsibility to flag up issues early.

Ambient damp needs a team effort. A tenant should take measures to reduce the amount of condensation they produce in their property by making lifestyle changes, while landlords should create an environment where warm, humid air can easily escape.

Are there any condensation, damp & mould prevention tricks?

For tenants, this could be: line drying washing outside or using a condensing tumble dryer; ensuring the inside temperature in winter is kept steady throughout the property at around 18°; ventilating the property by opening windows whenever safe to do so, and keeping steam confined to one room by shutting the bathroom or kitchen door.

A landlord can also play their part by ensuring there are extractor fans in all high humidity areas; using specialist anti-mould and condensation products in kitchens and bathrooms; ensuring replacement windows have trickle vents installed, and making sure windows have locking safety latches so they can be left securely ajar for ventilation. 

Nip small issues in the bud

Professional inventories and scheduled inspections commissioned by a letting agent are two other ways of ensuring instances of damp and mould are recorded, tracked and attributed. Often small lifestyle changes or the installation of extractor fans are enough to reduce condensation to acceptable levels. If you’d like more advice on the matter, get in touch with our team.

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Lettings Group 2

The pros and cons of longer tenancy lengths

Results of the latest English Housing Survey (EHS) have brought the issue of long-length tenancies back into the spotlight. While the idea of making 3-year tenancies mandatory was abandoned by the Government in 2019, following an extensive consultation, the survey results have highlighted how renters are choosing to stay in the same rental property for extended periods.

The EHS found the new average stay in a privately rented property is now 4.3 years – surpassing the three-year benchmark that was widely rejected as a mandatory term. It’s a trend that has been building for a number of years, with the average tenancy length rising from 3.9 years in 2016/17 and 4.1 years in 2017/18.

The findings may prompt more landlords to consider offering longer-term tenancies but there are pros and cons to weigh up when it comes to offering rental agreements of more than 12 months. Here’s our quick-read considerations guide but for tailored advice, please contact our lettings team.

Pros:

  • Void periods are reduced: any void is a drain on finances so reducing the number of times you have to find new tenants – a process that may potentially leave a let empty for a week or two – is a good thing. A long-term tenant also ensures rent is always hitting your bank account every month.
  • You’ll generate a ‘hands off’ investment: long-term tenants are a great option for landlords who like as little involvement in their buy-to-let as possible. There’s less worry about renewing tenancies, finding new renters, check ins, inventories and check out, plus landlords who opt for a fully managed package can really sit back and enjoy the rewards.
  • Tenants will reward you with respect: tenants who feel secure in their rental generally feel more positive about the experience. They will be keen to create a home they can settle in, and anecdotal evidence suggests they look after the property better and forge good relationships with the landlord or property manager.

Cons: 

  • Regaining possession may be harder: currently, landlords can serve a Section 21 ‘no fault’ eviction notice after a fixed term tenancy ends. If the agreement is only for 6 or 12 months, regaining possession doesn’t pose too much of a problem. If the agreement length is two or three years, landlords may have to wait an untenable amount of time. One workaround is to insert a break clause into long-term agreements – something we can organise on behalf of landlords.  
  • You’ll have to trust your tenants: when the same people live in your let for 2 or 3 years, you’ll have to trust that they’ll take care of the property and pay the rent on time, especially if the eviction process will favour the tenants more in the near future. Referencing carried out by a letting agent is the best line of defence. It will uncover an applicant’s past renting behaviour and reveal their financial situation, allowing the most trustworthy tenants to be chosen.
  • Rent reviews will need careful planning: it’s a wide-held but unwritten rule that landlords reward long-term tenants with fair rents that aren’t hiked up overnight. If you’re used to raising the rent every time new tenants sign up – perhaps as often as every 6 months – you’ll need to plan a rent rise strategy before you move in long-term tenants. Always consult with a letting agent and consider writing any plans into the tenancy agreement. 

Speak to us about setting the right tenancy agreement length for your property, your target tenant and the current lettings market. We will create the perfect tenancy agreement that factors in break clauses, rent rises and notice periods.

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Lettings Group 2

New carbon monoxide alarm regulation

Landlords of private rental properties need to be aware of a change in regulation relating to gas safety. All buy-to-lets with fixed gas appliances, such as a gas boiler or a gas fire, now need to have a working carbon monoxide alarm after changes were brought forward through the Smoke and Carbon Monoxide Alarm (England) Regulations 2015 and the statutory guidance (Approved Document J) supporting Part J of the Building Regulations.

Additionally, the regulations state that a carbon monoxide alarm needs to be supplied when the first gas appliance is fitted in a rental property. This could be when electric storage heaters are replaced with gas central heating, for instance.

This is different to the old regulation, which previously stated that carbon monoxide alarms were only a mandatory requirement in any room containing a solid fuel burning appliance, such as a coal fire or a wood burning stove.

It has been reiterated that it is the landlord’s responsibility – or that of a managing agent working on their behalf – to ensure a defective carbon monoxide alarm is replaced once they are told it is faulty. They should also ensure the carbon monoxide alarm is tested for working efficiency at the start of every new tenancy. 

A refresher on smoke alarm regulations

There is no change to the regulations regarding smoke alarms in rental properties but a refresher on the compliance aspect is always useful. Private sector landlords should have at least one smoke alarm installed on every storey of their rental property which is used as living accommodation. As with carbon monoxide alarms, they must make sure the alarms are in working order at the start of each new tenancy.

Failure to comply with any of the carbon monoxide or smoke alarm regulations can result in a fine of up to £5,000, with the requirements enforced by the local authority in charge. 

Testing…testing

One of the biggest grey areas with regards to both smoke and carbon monoxide alarms is testing the alarm during the tenancy period. This excerpt is taken from the Government’s Smoke & Carbon Monoxide Alarm Q&A Booklet, and should be widely distributed to new and existing tenants: 

“After the landlord’s test on the first day of the tenancy, tenants should take responsibility for their own safety and test all alarms regularly to make sure they are in working order. Testing monthly is generally considered an appropriate frequency for smoke alarms. If tenants find that their alarm(s) are not in working order during the tenancy, they are advised to arrange the replacement of the batteries or the alarm itself with the relevant landlord.

 A note on alarm placement

As well as ensuring that smoke and carbon monoxide alarms are in good working order, landlords can ensure their location increases their chance of effectiveness. Smoke alarms should be fitted to the ceiling in circulation spaces, such as hallways, stairwells and landings. Carbon monoxide alarms should be placed at head height between 1 and 3 metres away from a gas or solid fuel appliance.

Please contact us if you have any questions about gas safety and compliance in rental properties.

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Lettings Group 2

The ‘grey pound’: why older tenants should be a target

Landlords, who is your target tenant? While traditional focus has always been on Generation Z, Millennials and young families, there is growing evidence that those over the age of 55 are increasingly turning to rented property in their later years.

In 2020, AgeUK reported that 750,000 people over 60 live in private rented housing in England, with the number of households inhabited by older renters doubling in the last 15 years.

That figure isn’t static either – an aspect landlords shouldn’t ignore. A report published in the same year revealed that renters of retirement age and those in the upper-middle age category are the fastest growing tenant groups. 

Privately rented properties where the tenants were aged between 55 and 64 years old had risen 118% between 2010 and 2020, while rented properties where the tenants were aged over 65 had grown by 93% over the same period.

While you may assume older tenants have been forced into renting due to unfavourable circumstances, the New Generation Rent article published by Property Reporter suggests that comfortable baby boomers are actively choosing tenant status, earning their spending power the nickname of ‘the grey pound’.  

With both the Halifax and the Nationwide’s November house price indexes showing that average property values are at record highs, many over 55s are selling now to free capital to fund their retirement, and are choosing to move into rented accommodation in order to watch what the market does next.

Among this age group is hope that house prices will decline, making their next purchase cheaper, while other older renters like the advantage renting gives them in being chain-free when it comes to buying again. 

The article also suggests that many mature tenants will stick with private renting for the rest of their lives, whether it’s for the flexibility, the lower maintenance aspect or as part of  an estate planning exercise.

Older tenants often prove to be very reliable tenants, so landlords should go the extra mile to appeal to this group. Over 55s are likely to be asset rich and less likely to default on rental payments, for low or zero arrears. In addition, they’re unlikely to be involved in anti-social behaviour, can deal with running repairs and basic maintenance without troubling the landlord, and will want tenure security for consistent occupancy.

If you’d like to chase the ‘grey pound’ and appeal to more mature tenants, there are a number of considerations that may improve your chances of success:-

  • Opt for access-friendly flats and houses: consider ground floor apartments, those on upper floors that are serviced by a lift and houses without steps to the front door
  •  Choose locations carefully: town centre living where everything is within walking distance is ideal, as is a property close to a bus stop
  • Offer long-term tenancies: foster a sense of security with tenancy agreements of at least 12 months 
  • Buy new build: brand new properties will present lower running and maintenance costs for both landlord and tenant
  • Consider added extra: on-site facilities, such as a concierge, video entry or gym
  • Think reduced responsibility: developments where communal gardens are tended to and maintenance is taken care of will rent out quickly

Talk to us today about letting a property you own or purchasing a buy-to-let.

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Lettings Group 2

Gas boiler ban: 6-step action plan for Landlords

The flame on conventional gas boilers is set to be snuffed out after the Prime Minister fleshed out his Net Zero agenda ahead of the COP26 climate change conference. His address reiterated two deadlines that the rental sector needs to keep an eye on.

In 2025, house builders and property developers will be banned from installing conventional gas boilers in the new properties they build. In 2035, the sale of conventional gas boilers will also be banned. 

The new rulings will prompt more landlords to explore alternative heating options in their buy-to-let properties. Although existing gas boilers can stay in rented houses and flats, a like-for-like gas boiler will not be a viable replacement should the model be condemned or fail beyond repair.

While 2035 may feel too far in the future for it to be an immediate concern, landlords may need to make heating changes sooner than this, as the Government is on course to further improve energy efficiency in rented properties. By 2028, the Prime Minister wants all new, renewing and extending lets where the EPC is below a C to be made illegal, with this standard rising to a B rating from 2030. 

Currently all let properties need an EPC rating of at least an E to be legally compliant, so a steep jump in minimum energy efficiency standards may be ahead. Improving the energy efficiency of a buy-to-let with greener heating systems will go a long way to achieving a higher EPC rating, so what should landlords do next? Here’s our recommended plan of action:-

  1. Check your buy-to-let’s current EPC rating: if your rating is an E, you’re in the danger zone and risk slipping into unlawful territory. An EPC is valid for 10 years so if yours is close to expiring, be aware that your let may be reclassified when a new EPC is issued.
  2. Get a boiler health check: a landlord’s gas safety responsibility involves an annual gas safety check and required maintenance, so why not book a boiler health check at the same time? You’ll find out the predicted lifespan of your boiler, and where you stand in terms of parts and performance.
  3. Think about heating alternatives: the Government would like gas boilers replaced with air, ground or water heat pumps. They are currently more expensive to purchase and fit than most gas boilers – around £10,000 – but this cost is set to reduce as more people switch. Other options open to landlords include all-electric heating – such as storage heaters and hardwired underfloor heating.
  4. Apply for a heat pump grant: to help finance a quick switch to heat pump systems, the Government is making £450 million available to property owners – including landlords. The Clean Heat Grant launches in April 2022 and successful applicants will receive up to £5,000 to put towards the cost of a heat pump installation. There are limited funds available, however, so those considering the switch should apply as soon as the grant launches.
  5. Keep your current boiler serviced: there is no indication that existing gas boilers in good working condition need to be removed now or in the future. If your EPC is already above an E and you’d like to avoid installing a heat pump system for now, look after the existing  gas boiler in your buy-to-let with annual servicing.
  6. Replace any old gas boilers soon: there’s a window of opportunity to replace ageing gas boiler models before the ban on public sales comes into effect in 2035. New gas boilers offer greater energy efficiency, will reduce the fuel bills of tenants and, if serviced, may keep heating your let beyond 2035.

If you’d like to discuss your buy-to-let’s current EPC rating or are considering energy saving improvements, get in touch with our team.

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Lettings Group 2

Rent controls? Not on the radar

The UK’s property market can be hard to keep up with. As well as a new minister for housing, communities and local government (step forward Michael Gove), the industry is awaiting the Government’s publication of a Rental Sector White Paper. There is a gentle murmur that rent controls could be on the cards but is it time to panic?

It’s a firm no. The letting industry’s gut reaction is that rent controls are not part of the Government’s immediate plan, especially as the post pandemic recovery is still underway and the leading letting agents’ professional  body – ARLA Propertymark – is not supportive of such an introduction.

History shows us that rent controls have rarely had the desired effect those in charge want, so despite a few rumbles in the press about a possible introduction, landlords should read with passing interest but it’s definitely not time to worry.

A brief history of rent control

The idea that a limit is put on how much rent can be charged – or by how much rents can rise – is not a new one, nor is it a concept consigned to ancient history. Modern-day rent controls were introduced during World War I, when approximately 90% of UK households rented privately. 

As rent caps existed to prevent profiteering during troubled times, it was no surprise that rents were also limited during World War II. Local rent caps, rent tribunals and revised rent Acts prevailed in some form right up until 1989, when the Housing Act 1988 deregulated rents on new private sector lettings and legal limits on rents were lifted.

Will Scotland set the precedent?

Rent control discussions are already happening in Scotland, where a new power sharing agreement between the Scottish National Party and the Scottish Greens has allowed rent caps to make it onto the agenda. The Green Party manifesto outwardly supports rent regulation, favouring ‘a points-based system’ of rent controls, although it remains to be seen if this notion wins cross-party backing. The mood is definitely that controls won’t make the final cut. 

Tenants in Scotland don’t, however, have to wait for a coalition Government to enshrine new ideas to curtail soaring rents. Local Scottish authorities have recently been given the power to introduce ‘Rent Pressure Zones’ – a way of capping rent increases where rents are rising to unaffordable levels. This initiative has staved off widespread rent controls but it remains to be seen whether it’s an effective or sustainable housing model.

Has London already provided the blueprint?

London’s Mayor, Sadiq Khan, has been extremely vocal in his support of rent controls but he actually has zero power to introduce them and there’s actually no need for them.

The capital already has an active way of controlling rents in the shape of the ‘London Living Rent’ – a below-market rent held at one-third of median local household incomes in a localised area. It’s an initiative that doesn’t affect many private landlords, however, as London Living Rent properties are generally only available at dedicated Build to Rent schemes. 

How would other rent caps work?

As nationwide rent caps are theoretical at this stage, how they would be implemented is merely speculation, serving as a discussion topic and nothing more. The Scottish Green Party’s points-based system would work on the basis that housing costs should not equate to more that 25% of a household’s income, while others – including the Labour Party – suggest that rent rises could be limited by linking them to the RPI (Retail Price Index) – which is a measure of inflation. Previous rent caps were linked to the age, condition and location of a property. 

If the mechanics of the lettings sector are something you’d like to know more about – in your position as a tenant or a landlord – get in touch today.

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Lettings Group 2

Rental guarantors: the new normal in lettings?

If we were to draw positives from the pandemic, one would be that workers have been presented with the opportunity to change their career path. Whether they’ve started a cottage industry from their kitchen table during furlough or have gone it alone after being made redundant by an employer, one thing is for sure – self-employment is on the rise.

In fact, the number of those working for themselves broke through the 5 million barrier for the first time at the end of 2019, while the Institute for Fiscal Studies forecasts a record rise in solo self-employment in 2021. So why does this have a bearing on the lettings industry?

Financial security and employment prospects form a critical part of the referencing process when vetting potential tenants. Those looked upon most favourably are those with job security – workers with a stable income and for the same employer for a number of years.

With the last 18 months seeing a dramatic shift towards freelancing and self-employed status, many tenants renting in the near future will have a largely unsubstantiated income. When it comes to referencing, a few months as an untried and untested self-employed worker may not be enough to satisfy landlords. This is why rental guarantors may be the most important aspect of lettings moving forward – and not just the preserve of student renters. 

What is a rental guarantor?

A guarantor is someone who agrees to step in and pay the rent if or when the tenant can’t. Becoming a rental guarantor isn’t a trivial matter – it carries legal obligations and the agreement has to be made in writing. As well as covering any payments, a rental guarantor also acts as a second point of contact, should the landlord be unable to reach the named tenant, and they will be called upon to pay for any damage to the property if the tenant can’t. 

A landlord will also want to know that the nominated guarantor has the financial means to pay the rent and to cover damage. As a result, they too may also need to clear credit checks before they are accepted, proving they have an income or savings of their own as part of the process. 

Who can be a rental guarantor?

Usually a rental guarantor takes the form of the tenant’s parents or an immediate relative, although it’s also possible for a close friend to become a guarantor. It’s worth noting that some trustworthy people will be declined as a guarantor, such as those who are retired, those who don’t own a property and those who are themselves self-employed.

There are also businesses who will act as a guarantor – useful for when a landlord wants 6 or 12 months’ rent upfront or when the tenant can’t provide a UK-based guarantor. The renter pays a one-off or a monthly fee in return for the company guaranteeing to pay the rent if the tenant can’t.

An option if you can’t get a rental guarantor

If you’re newly self-employed and your earnings are still on the ascendancy, a guarantor is a great option when renting a property. If you’re not in the position to secure a guarantor, you can offer to pay the rent six months in advance, as a clear indication to the landlord that you have the funds to meet the monthly rent. When the six months is up, you may be able to prove your earnings and switch to conventional monthly rent payments.

Landlords and tenants looking for further information about the referencing process and the option of a rental guarantor should contact our team for friendly advice.

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Lettings Group 2

7 realistic rental tips if you’re moving for a school place

Whether you think it is ethical or not, many families choose a rental property and time their move to put them in a favourable position when applying for schools. 

The admissions process for both primary and secondary places is based around a set criteria and although the distance from your home to the school gates isn’t at the top, it often counts when a school is oversubscribed. 

There is, therefore, much manoeuvring and jostling ahead of the application deadlines, with parents desperate to secure the right address before they fill out the form. For many, buying a property within the catchment of the best schools can be impossible in terms of cost and timings.  

Property sales can take up to four months to reach completion once an offer has been made (and longer in more complex circumstances), which leaves parents at risk of missing the application deadline. Plus, properties closest to the best schools often carry a price premium.

An alternative is to move into rented accommodation, as the set-up costs are a fraction of the costs involved in buying and the entire moving process, from a viewing to collecting the keys, can be concluded in a matter of days, if the tenancy is straightforward.

There are, however, a number of serious points to consider if you are thinking of renting a property with the specific aim of applying for a school place. Here is our list of top 7 tips and hints:-

  1.     Check a school’s catchment area before you start your property search: sometimes the catchment will be an irregular shape and not a circle, so the house right next door to the school may still be out of catchment. Some schools only take from certain parishes or postcodes, while others adjust their catchment every year, based on the volume of applications.
  2.     Establish the application closing dates: the Government’s official school application website states the primary school application process opens in September and closes on 15 January. When it comes to places at secondary schools, the deadline for applying is 31 October.
  3.     Rent a property well in advance: local councils do have rules about families whose moving timings are suspicious. They may want proof that you have lived in a rental property for a minimum period before you apply for a school place, so ensure you are moved in well before the closing date.
  4.     Don’t assume a buy-to-let address counts: there have been cases where families have used the address of a buy-to-let property they own that falls within a school’s catchment on the application form. A local council will want an owner-occupier address on the form and could send an officer to the property to check the status of the person living there.
  5.     Be mindful of a short let: the most popular of schools are hot when it comes to parents who take out a short let agreement just to have an address within their catchment. They may not accept applications where the tenancy length is six months or less, unless the family can prove all ties with their previous property have been cut.
  6.     Be prepared to evidence your move: if you have started renting a property quite close to the school application deadline, be prepared to provide your local authority’s admissions department. You’ll need a solicitor’s letter confirming you have sold a prior residence or proof that you have given notice on your current rented property, plus a signed copy of the new tenancy agreement, together with the start date.
  7.     Stick to the rules: if there is a suspicion that a local council’s application rules have been broken and no validation or proof of a legitimate address is provided, the school application could be declared void.

Our local knowledge will help you choose the right rental with a favoured school in mind. Talk to us about timings and availability today.

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Lettings Group 2

Tips for tenants: creating a portable garden

We don’t need to reiterate how important outside space is and searches for properties to rent with gardens or balconies continue to grow. Having somewhere to sit outside, entertain and even grow your own produce is the end goal for many but getting to that point involves an investment of both time and money.

If you’re living in a rented property, it can be galling to think all your hard work digging, planting, pruning and perfecting has to be left behind when you move to a new property but that doesn’t have to be the case. It is possible to create a totally portable garden that can give you just as much pleasure in your next property.

Here’s our guide to creating a garden that’s good to go:-

Pots and planters: flowerbeds are the backbone of many gardens but they don’t pack up and fit on the back of a removal van. Pots, however, can be moved from property to property and will last for years. Opt for lightweight plastic or faux stone planters and half fill with recycled polystyrene to keep the weight down further, making them easier to move. 

Pick plants wisely: specimen shrubs and mature plants are investment purchases, and there is no guarantee that they will survive or thrive if dug up and replanted in your next garden. Be prudent when choosing plants for your rented property’s garden. If you use markers, bulbs can be dug up, dried out and replanted, or choose plants that set to seed, as these can be collected, stored in a labelled envelope and grown again elsewhere.

Freestanding cooking: while the current trend is for outdoor kitchens, going to the effort of building somewhere to cook in the garden isn’t wise in a rented property – especially as it may break a clause in your tenancy agreement if it is a permanent alteration. Opt for freestanding BBQs and table top pizza ovens that can be enjoyed in any garden.

Lights and lanterns: fairy lights and festoon bulbs add instant atmosphere to any garden but avoid anything that is hard wired or runs off mains electricity. Battery operated and solar powered lights are inexpensive and moveable, or choose lanterns and candles that easily fit in a packing-up box.

Soft furnishings: garden rooms are all over social media and if you’ve joined the trend with waterproof cushions, throws and outdoor rugs, you’ll need a smart way to transport them or risk your soft furnishings taking over the removal van. One solution is to use vacuum storage bags that will reduce the biggest pile of cushions to a more manageable, airtight stack.

Garden furniture: who doesn’t love swinging in an egg chair or lounging on an outdoor sofa but how easy are these items to move? Bulky furniture may ramp up your removal costs, so look out for folding alternatives. Old fashioned collapsible deckchairs and sun loungers are in vogue, while folding bistro sets are both small and lightweight. 

If your next move is motivated by outside space – or if you have a property to rent out that has an amazing garden – get in touch today.

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Lettings Group 2

Top 5 ‘no-viewing’ tips for tenants

Would you sign a tenancy agreement without a physical visit to the property in question? According to behaviour analysis by Twentyci – a data agency specialising in home moving activity – an increasing number of renters are agreeing to let a new home without going on a viewing. 

Twentyci concentrated on rental properties that were being marketed with virtual viewings, and found that two thirds of prospective tenants who had seen a property exclusively using a virtual tour would sign a tenancy agreement without making an in-person visit.

Reasons for signing up without seeing

There are natural peaks in the property market when the supply of homes to rent doesn’t always keep up with demand. During these periods, houses and flats can be let within a matter of days – even hours. Tenants who have missed out previously may find they stand the best chance of success by signing up to a property based on the online listing alone – especially if they are signing a short let agreement.

Tenants relocating from out-of-area and those moving from overseas are also more likely to sign on the dotted line without seeing a property in the flesh, as the distance to travel and speed at which decisions need to be made are not always compatible.

More recently, tenants are exercising caution in the wake of the Covid pandemic when deciding to visit properties. Thankfully, the quality and quantity of visuals aids now available for tenants to review can be enough to come to a decision, especially in a fast moving market. 

How to reserve a rental without a viewing

Competition for rental properties can be fierce and the latest ARLA Propertymark report showed that a record number of new tenants registered with letting agency branches in April 2021. In fact, an average of 82 prospective renters joined the waiting list of every office, which is 10 more hopeful tenants per branch than in April 2020.

If you’re worried about missing out – or perhaps you haven’t got time to view a property in person as quickly as required – you can still make an offer on a rental. Here are our top 5 tips for making a decision without a physical viewing:

  1. Review the photos and/or virtual tour: take time to study the pictures that have been taken. Try to look at the photos/footage on a laptop or bigger screen and not just on your mobile ‘phone.
  2. Look at the floorplan: the floorplan will show you the flow of space and arrangement of rooms in a way photos can’t. Elements often missed – doorways, storage cupboards and windows – should be marked.
  3. Examine the measurements: use the measurements provided and compare these to the room sizes where you live now – it’s the best way to truly understand the space that’s on offer without standing in the property.
  4. Use Google Street View to explore: Google’s Street View function is a great way to check out the immediate area without visiting the neighbourhood.
  5. Ask if there’s a video: it may be possible for an agent to take a video of the property for you to view or sometimes, they can FaceTime call you from the property to create a ‘live’ viewing scenario.

If you are looking for a new rental property and need advice about making a successful offer before someone else beats you to it, get in touch with our lettings team today.

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Lettings Group 2

7 ways to improve your chances of renting with a pet

Whether you have bought a puppy to keep you company now you’re working from home or you have a fondness for rescue cats, there is no doubt that a pet can be the most wonderful companion.

What isn’t always compatible is the need to rent a property and take your pets with you. Attitudes to lets with pets are, however, changing and tenants now stand a greater chance of renting somewhere that welcomes Fido or Felix.

What has changed already

In January 2021, the Government’s Model Tenancy Agreement – a blueprint document that some, but not all, landlords and letting agents use – was changed. Previous wording suggested a blanket ban on pets in lets has been removed and now landlords must provide a good reason why not to let pets stay in a property they rent out.

Landlords warming to the idea of pets in lets

Business insurers Direct Line surveyed current landlords on the matter of lets with pets soon after the Government amended its Model Tenancy Agreement. Nearly half welcomed the revised document, suggesting that there is a softening of attitudes around tenants moving in together with their domestic animals. 

Future pet-friendly changes planned

Although still not fully passed, the Dogs and Domestic Animals (Accommodation and Protection) Bill would force letting agents and landlords to remove ‘no pet’ clauses from their in-house tenancy agreements, meaning that all tenancy agreements created could not contain an outright ban on pets.

The new Bill would be a step forward but it’s also worth noting that tenants would have to meet a new set of conditions before moving a pet in. These include: passing a test of responsible ownership, with certification from a vet; proof of an up-to-date vaccination and flea treatment schedule and in the case of dogs, proof of micro chipping and a demonstration that the pet responds to basic training commands. 

7 ways to improve your chances of renting with a pet

If you’re searching for a rental property but can’t bear to be parted from your pet, or your current landlord needs convincing on the matter of moving an animal in, you might like to try the following:-

  1. Compile a pet CV: this should detail your pet’s breed, age and veterinary practice, along with the animal’s vaccination record and details of any training it has completed.
  2. Obtain pet references: a short statement from your vet, dog sitter/boarder or trainer may help convince your landlord that you own a well behaved pet. Even better is a reference from a past landlord if they let you have a pet.
  3. Invite a future landlord to meet your pet: if a landlord can see how your pet is cared for, its temperament and in what home environment it’s kept, it may help your cause.
  4. Offer to pay a rent premium: as tenancy deposits are now capped, taking extra money to hold against pet damage is now banned but as a renter, you may want to offer a small amount extra on top of the advertised rent as a substitute.
  5. Commit to professional cleaning: if a landlord is worried about the condition of the property after it has housed a pet, you could offer to pay for a professional deep clean to be conducted at the end of the tenancy – a condition that can be written into the tenancy agreement. 
  6. Opt for lets that have been vacant for some time: every landlord dreads an empty property, so the most open-minded may be those who have endured long void periods.
  7. Take out insurance that covers pet damage: landlords will feel more comfortable with pets in their property if you can prove your insurance covers damage caused by chewing, scratching, tearing or fouling. There will be extra bonus points if your policy also includes accidental damage, such as if your dog knocks over the TV, but read the small print as not all pet-friendly policies will cover the same aspects. 

Contact us if you’d like your next rental property to be pet friendly or if you’re thinking of moving a pet into where you currently live.

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Lettings Group 2

Landlords: how to spot signs of subletting

Subletting is when a tenant turns landlord themselves. Instead of living in the property they have signed the tenancy agreement for, they rent out the property to others – either on an entire house basis, room-by-room or even as an Airbnb. Subletting is a way for tenants to make money, as they charge other tenants more than they are paying the landlord to make a profit.

The intention to sublet often goes under the radar as the legitimate tenant will move in friends, use word-of-mouth to attract people or advertise the property/rooms on social media platforms and places such as Gumtree – all of which are hard to track.

Is subletting illegal?

The answer is sometimes. The act of subletting is usually prohibited, as set out in the tenancy agreement, and the landlord’s mortgage may also forbid subletting. Therefore, the landlord is within their rights to take legal action against tenants who sublet. 

There’s also a note of caution when it comes to tenants who turn a property into a HMO (a house in multiple occupation, when rooms are rented out to different individuals with shared communal facilities). A recent case saw the original tenant of a four-bedroom house fined over £9,000 and receive a criminal record for subletting, while the property owner/landlord was also fined. Both parties were guilty of breaching housing laws and not obtaining the correct HMO licence. 

The property owner who fell foul of subletting was reported to have visited the property ‘occasionally’ in their role of landlord but missed clues that eight people – instead of the sole tenant who signed the agreement – were living in their property. So would you miss the signs of subletting? 

Subletting signs you need to recognise

If you are a landlord who suspects subletting in a property you rent out, you need to keep a vigilant eye on the following: –

  • Living areas that have been turned into bedrooms, such as dining rooms and lounges
  • More toothbrushes and towels than required for the number of tenants on the original agreement
  • Makeshift sleeping arrangements and bundles of bed linen on sofas and possibly in outbuildings
  • More domestic waste and recycling than you would expect for the number of tenants on the original agreement
  • If the property is rented as ‘bills included’, heavier use of utilities than during previous lets
  • Signs of increased wear and tear around the property
  • Reports of extra noise, unexplained comings and goings, or anti-social behaviour from neighbours
  • The original tenant refusing access to the property for an inspection
  • Different people frequently arriving with suitcases

Lodgers & holiday lets

Tenants should know that although the Government’s Rent a Room Scheme is perfectly legal, most tenancy agreements will prohibit tenants taking in a lodger, whether for financial gain or not. Holiday lets are another area of concern, especially with the popularity of staycations. An estimated 120,000 properties in the UK are illegally sublet through sites such as Airbnb. Landlords should also note that subletting for illegal activities is just as popular as offering properties to holidaymakers.  

Why is subletting an issue for landlords?

Subletting means tenants move into a property without undergoing reference checks – there’s no official record of their past behaviour, their status to rightly reside in the UK or their ability to pay the rent. Even a tenant allowing a friend to sleep on the sofa could be classed as subletting, and can be detrimental to the condition and value of the property, not to mention jeopardise legal compliance.

Professional property lettings: the advantages

Choosing to work with a professional lettings agency is the best way to avoid subletting. A good property manager will ensure any tenancy agreement has a clear no-subletting clause and they will undertake thorough tenant referencing to detect previous bad tenant behaviour. 

A lettings agency will make tenants aware of regular planned property inspections – which can act as a subletting deterrent – and if there is any hint of subletting, they can diarise more frequent visits. Don’t forget, a lettings professional will spot the more subtle signs of subletting and may also spot if your buy-to-let appears as ‘to let’ on property portals. If you’re worried about subletting, speak to us today.

 

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Lettings Group 2

Tenants: your guide to rental guarantors

You’ve got a part-time job, you’ve got the deposit and you’ve got a pretty good credit history, so is there any need to worry when it comes to renting a property? Perhaps.

Every tenant has unique circumstances and every private landlord takes a different attitude to risk, which could lead to some renters being asked to supply a guarantor.

What is a guarantor?

A guarantor is someone who agrees to pay the rent on your behalf if you can’t pay it yourself. Usually a guarantor will be a family member – a parent or older relative – and they will need to demonstrate they have the financial means to step in and pay any debts owed to the landlord. In some cases, a landlord may accept a company or employer as a guarantor. 

Who may be asked to provide a guarantor?

Not every tenant will be asked to provide a guarantor but there are some characteristics that make it more likely. These include:

  • tenants who have a poor or no credit history in the UK 
  • students or tenants renting for the first time
  • renters who are unemployed, have a low income or are working the gig/freelance economy
  • tenants who have moved to the UK from overseas

Finding the right guarantor

Many landlords will need guarantors to meet a few minimum requirements, so this should influence who you choose to ask. Commonly favoured characteristics include:

  • they should live in the UK
  • they should be in employment and not be retired
  • they should own their own property
  • they should be able to pass credit reference checks

It’s a legal responsibility

Becoming a guarantor is more than doing a family member or friend a favour. There is a legal obligation for a guarantee agreement to be set out in writing, outlining what is expected of the guarantor. This may extend to covering repair/replacement costs if the property is damaged, so you should both read the small print. It’s also worth noting that if your guarantor can’t pay your rent, your landlord can take them – as well as you – to court.

Student services

Undergraduates are commonly requested to provide a guarantor but in the case of international students, they may not have anyone suitable to ask. It is possible to pay a fee to a company, who will become your professional guarantor. It’s a growing trend, with service provider Housing Hand seeing a 12% rise in the number of domestic students using its services between November 2019 and November 2020. It’s also good to know that rental guarantor services can also be used by professionals, and not just students.

If you’d like further details about rental guarantors, Citizens Advice provide some useful information, and you can contact us for support during your rental property application process.