iHowz recently published their paper outlining proposals on the PRS in response to the Queen’s speech. With Michael Gove due to make an announcement on the government’s white paper, we wanted...
Prime central London property prices have barely risen since 2015 due to a combination of factors including BREXIT (visas), the great pandemic move to the country, WFH, slow return of Chinese and sanctions on Russians to name the obvious ones.
This lack of capital growth and the dip in rents during the pandemic, along with rising taxes, interest rates and licencing schemes has driven the recent rent rises.
As the Government seek to push through the Renters Rights Bill, while threatening to raise taxes such as CGT, it would be surprising if landlords - central London and beyond - do not vote with their feet and decide to sell all but their best performing properties and invest the proceeds for better returns in more liquid assets.... Read More
Why can Shelter only celebrate the negative?
Housing standards and energy efficiency have steady improved over the years.
Higher interest costs, and repeated tax raids have reduced landlord's profitability. This reduces the funds that landlords have available for maintenance and proactive improvements, never mind the disincentive to invest further funds into the sector.
All stick, no carrot = landlords selling up
Economics 101, less supply + growing demand = higher prices for a scarce resource.
Never mind, they can keep dreaming that the build to rent sector can magic up replacement homes and will be willing to rent them to those with less than perfect references.... Read More
The Prime Minister says he wants to tread gently to deliver a government guided by policy, pragmatism and ‘service’, rather than ideology.
Let's hope he will remind Mathew Pennycock this is the guiding policy and ask him to remove his bover boots to avoid stomping on those ordinary working people helping address the housing crisis.... Read More
You cannot be serious. (Sorry, couldn't resist - Wimbledon)
Unless you have a full inventory and made it clear in the tenancy that the property must be returned in the same condition (subject to fair W&T) a deposit scheme would reject the claim.
If this is the worst that you encountered at the end of a tenancy and rent was paid in full, where is the value in creating admin when patience and some towels will do most of the work.
The time saved would be better used to update your procedures and tenant documentation.... Read More
Just because you want to finish your project to address years of poor management and bring the services up to date, it does not alter the rights of the leaseholder, or their tenant.
You say the council are giving you a hard time over the heating system and there are several fire safety issues. If this is so, the council, the block insurers and fire risk assessor should be directed to ask the lessee to arrange with their tenant for access to carry out the relevant inspections and associated works.
If access is not forthcoming, then you will either have to wait for the tenant to move out or invest in further legal advice.... Read More
In a recent announcement, it has been proposed that we no longer call ourselves landlords.
https://www.landlordzone.co.uk/news/nrla-to-drop-landlord-in-bid-to-change-public-perception-of-sector
Today, iHowz were at the London National Landlord Investment show on the panel answering landlords burning questions as we await the election.
iHowz will be lobbying the new government for:
- urgent action on court delays
- retention of the ability to serve notice without need for court approval
- retention of a standard 6 month initial term, with the option of both parties to agree a longer fixed term... Read More
Before rushing to deliver legislation on reforms such as abolition of S21, it is time for a proper conversation between regulators, landlord and tenant groups to AGREE a long term workable agenda.
This must take a more holistic and balanced view which will ensure sufficient supply of rental housing (both social and private sector) is provided by landlords who will meet the required standards. At the same time, local authorities and others who are responsible for compliance need to be held to account, reporting their activities.
While this is being agreed, there is nothing stopping the government from pushing forward on the promised improvements in the courts. Nor is there any reason why the Property Portal and an Ombudsman cannot go live, with participation on a voluntary basis, followed by legislation to mandate participation once they have a proven model.... Read More
Don't worry, the Chancellor won't forget you when you have had enough and decide to sell.
If you sell a business asset for a profit you will pay capital gains tax. Because residential property is somehow a special asset class, you will get to pay a higher rate, and you must file a return and pay up within 60 days. No need to wait until the end of the tax year like everyone else.
But wait, it gets better, unlike other businesses there is no reduced rate if I use the proceeds to reinvest the proceeds investing in another rental property.
And, if I invest my rental income in a pension, no tax relief can be claimed as I haven't earned it.... Read More
George Osborne promised to fix the roof while the sun was shining. This was certainly not the case for the PRS where he not only stripped the lead but came back for the chimney pots and aerial.
As a result of the constant fiscal and regulatory attacks on the PRS, it's little wonder that so many landlords have already sold properties, resulting in the shortage of stock which forces prices up.
Labour need to focus on getting the courts working and delivering the details of what they propose for EPCs, the Property Portal and Ombudsman before they think about setting a date for ending S21.... Read More
Too little too late.
Why not simply remove the CGT surcharge?
As Mark implies, this is a cynical measure, no doubt based on the maximum potential uptake, when very few tenants would have the financial resources or the desire to buy their current rental property.
Not only that, how does this help HMO landlords?
No full expensing of business finance costs
No retirement relief
No pension relief on rental income
No more FHL relief
No wonder landlords are heading for the exit.
Many landlords feel let down as they struggle to help provide homes while politicians fail to address the housing crisis.
We need fully thought through housing policy covering all tenures which factor in the energy transition, an ageing population and fiscal policy to support it.
iHowz will be publishing their manifesto for the PRS later this week.... Read More
Chris is right, this is a positive step. Many lenders, including BMS, still specify a maximum of 12 month tenancy.
Before the RRB got washed out (just like Rishi) one of the points made in the Lords 2nd reading was to question why fixed terms were being abolished when
- it wasn't in the original bill
- it restricted the parties right to set contract terms
- it risked higher rents as landlords need to factor in costs of re-letting.
iHowz had drafted two amendments
- one for a new S8 ground for no fault eviction
- the other giving the option of tenant and landlord creating a fixed term.
This helps establish that tenants want the ability to have longer term fixed tenancies - nothing stopping both parties agreeing a 6 month trial period then locking in a longer period 2-3 months in, once they were both reassured that they could commit to it.
The RRB will be resurrected by whoever comes to power. iHowz will be lobbying to ensure that the new version is more balanced, to avoid the risk of more landlords heading for the exit.... Read More
Just to add, even if this fails, you are unlikely to have to wait 2 years to reapply, as that requirement is being removed in the Leasehold Reform Bill
https://ihowz.uk/leasehold-and-freehold-reform-bill/... Read More
I had a similar issue trying to remortgage after completion of a lease extension, where the new lease was not showing on the register several months later.
Apparently, delays in registering changes to title are very common at Land Registry.
You, or your solicitor, can write to LR asking them to expedite the registration, explaining your situation.... Read More
The article mentions Home REIT. I am one of the unfortunate shareholders who bought the story of housing the homeless, not realising that their advisors were simply buying poor quality properties to rent to poor quality corporate tenants, while trousering their fees.
Right now, the new managers are still trying to understand the condition of the properties and the tenants. With only 9% of rent collected, several hundred properties auctioned well below cost and the FCA involved, this should be a cautionary tale for Hackney or any other council planning to go down this route.
The risks should be slightly lower for the councils as they are effectively giving tenants the money, so it can be paid back to them as rent.... Read More
Landlords operating through a corporate structure have jumped through the government's hoops and should expect the same respect from the government that they showed in the covid reliefs to those running compliant businesses.
How can they announce the withdrawal of a tax treatment less than a month from the new tax year when operators with seasonal businesses will already have a significant level of bookings from hard working families looking forward to a post pandemic break. Many others will be international tourists as we do our bit to promote Britain and balance the trade deficit with our goods and services export.
Politicians are happy to reminisce about their UK holidays - should we cancel their booking before we sell up?... Read More
A budget almost exclusively of stick, rather than carrot for landlords
Those who have properties in their own name who had pivoted part of their portfolio to serviced accommodation / furnished holiday lets to counter S24 will be penalised from this April for running their businesses efficiently - something the chancellor is spending billions in the public sector to achieve.
The SDLT relief on multiple property purchase transactions has been removed, making it harder for landlords to sell a portfolio as a going concern.
The encouragement landlords got was to head for the exit with the top rate of CGT on residential property dropping from 28% to 24% - still a 4% premium on gains on any other asset, and presumably leaving an 8% premium payable for those on basic rate who are paying 18%
Clearly revoking S24 - which would have expanded investment in long term rental supply didn't cross his mind
The lost tax would have been recovered by increased supply forcing rents down, reducing housing benefit and emergency accommodation costs
That's got to be better than bailing out Birmingham, Nottingham and other failed councils who have forced up rents with indiscriminate licensing schemes.
Instead of giving us an extra £5,000 ISA for British Investments, he could have made residential property a qualifying asset in SIPPS, giving landlords some tax relief for their pension investment.
If landlords could register as a cultural or ethnic group, we'd be off the courts protesting discrimination.
Unless landlords join an association, so their voice can be heard, government will continue to ignore smaller operators in the PRS and focus solely on their plans for it to be run like the social sector with large corporate owners.
Take a look at what iHowz can do for you - at least you subscription is fully tax deductible.
https://ihowz.uk/... Read More
The Private Rented Sector (PRS) houses over 20% of the population. Government and Social Landlords seeming to be unwilling/unable to step up and fulfil their obligations. It is a shame that, once again, the government has missed the opportunity to reinvigorate housing, especially the PRS.
Most landlords rent property to earn their living.
If landlords are unable to operate profitably, they will be forced to find another way to earn a living, with a consequential impact on housing.
Government don’t seem to be able to understand this simple conundrum.
Today's cut in National insurance does nothing to encourage landlords to provide more homes at lower rents.
Instead of the desperate tax grab against holiday lets – which has been forced on landlords by the onerous tax regime – iHowz has consistently called for a mix of reforms to stimulate the industry:
Allow Registered Landlords to reclaim Supplemental 3% SDLT on rental properties
Remove the requirement to pay Supplemental 3% SDLT on lease extensions
Index the Supplemental 3% SDLT threshold or link it to the standard SDLT threshold
Rescind Section 24 of the 2015 Finance Act
Allow rental profits to qualify for pension contribution tax relief, the same as other business profits
Extend the period for filing CGT return to 6 months
Make residential letting property a qualifying asset for CGT roll-over relief
Remove 8% CGT surcharge for rental properties, or some sort of retirement relief
Zero VAT rating should apply to Conversion, Refurbishment and Retrofit Works to match new build.
Energy Efficiency costs:
100% write down of costs in year of spend.
Grants with a long-term scheme which recognises a realistic approach (fabric first + achievable measures)
Poorly insulated homes lead to damp and mould, costing tenants more to heat. Funding for energy efficiency makes homes more efficient, provides many new jobs and helps the UK meet it legal commitment on emissions.
The current lack of housing has helped drive some local authorities to bankruptcy as emergency housing and other related support take a rising proportion of their budgets. And a lack of funding to support the courts to get their backlog under control has led some landlords to see the time for cases to be heard double and even triple. If landlords are not able to recover their property in a timely manner, they will sell up and invest elsewhere.
When will Government treat the industry with the respect it deserves? Landlords house people using their own funding, at minimal risk for the Government; you would imagine they would be more supportive of the housing sector which offers the most diverse selection of housing. Instead, the PRS is used as a political football to satisfy opportunists, who have no answer of their own.... Read More
15:14 PM, 26th September 2024, About a month ago
Reply to the comment left by havens havens at 26/09/2024 - 11:58
Prime central London property prices have barely risen since 2015 due to a combination of factors including BREXIT (visas), the great pandemic move to the country, WFH, slow return of Chinese and sanctions on Russians to name the obvious ones.
This lack of capital growth and the dip in rents during the pandemic, along with rising taxes, interest rates and licencing schemes has driven the recent rent rises.
As the Government seek to push through the Renters Rights Bill, while threatening to raise taxes such as CGT, it would be surprising if landlords - central London and beyond - do not vote with their feet and decide to sell all but their best performing properties and invest the proceeds for better returns in more liquid assets.... Read More
11:35 AM, 20th September 2024, About 2 months ago
Hmm, what a stunt.
Why can Shelter only celebrate the negative?
Housing standards and energy efficiency have steady improved over the years.
Higher interest costs, and repeated tax raids have reduced landlord's profitability. This reduces the funds that landlords have available for maintenance and proactive improvements, never mind the disincentive to invest further funds into the sector.
All stick, no carrot = landlords selling up
Economics 101, less supply + growing demand = higher prices for a scarce resource.
Never mind, they can keep dreaming that the build to rent sector can magic up replacement homes and will be willing to rent them to those with less than perfect references.... Read More
10:39 AM, 10th July 2024, About 4 months ago
As Judith highlights, a S21 notice does not give landlords the power to end the tenancy, only the courts or your tenant can do that.
If you are looking for a fixed cost service for processing your eviction, iHowz partner SCS offer a discount to members.
Your question regarding belongings left at the end of a tenancy will depend on what is specified in your tenancy agreement.
The friendly team at iHowz would be happy to give you more specific advice.
https://ihowz.uk/... Read More
14:11 PM, 8th July 2024, About 4 months ago
The Prime Minister says he wants to tread gently to deliver a government guided by policy, pragmatism and ‘service’, rather than ideology.
Let's hope he will remind Mathew Pennycock this is the guiding policy and ask him to remove his bover boots to avoid stomping on those ordinary working people helping address the housing crisis.... Read More
10:14 AM, 7th July 2024, About 4 months ago
You cannot be serious. (Sorry, couldn't resist - Wimbledon)
Unless you have a full inventory and made it clear in the tenancy that the property must be returned in the same condition (subject to fair W&T) a deposit scheme would reject the claim.
If this is the worst that you encountered at the end of a tenancy and rent was paid in full, where is the value in creating admin when patience and some towels will do most of the work.
The time saved would be better used to update your procedures and tenant documentation.... Read More
18:35 PM, 4th July 2024, About 4 months ago
Just because you want to finish your project to address years of poor management and bring the services up to date, it does not alter the rights of the leaseholder, or their tenant.
You say the council are giving you a hard time over the heating system and there are several fire safety issues. If this is so, the council, the block insurers and fire risk assessor should be directed to ask the lessee to arrange with their tenant for access to carry out the relevant inspections and associated works.
If access is not forthcoming, then you will either have to wait for the tenant to move out or invest in further legal advice.... Read More
15:09 PM, 3rd July 2024, About 4 months ago
In a recent announcement, it has been proposed that we no longer call ourselves landlords.
https://www.landlordzone.co.uk/news/nrla-to-drop-landlord-in-bid-to-change-public-perception-of-sector
Today, iHowz were at the London National Landlord Investment show on the panel answering landlords burning questions as we await the election.
iHowz will be lobbying the new government for:
- urgent action on court delays
- retention of the ability to serve notice without need for court approval
- retention of a standard 6 month initial term, with the option of both parties to agree a longer fixed term... Read More
15:00 PM, 2nd July 2024, About 4 months ago
Before rushing to deliver legislation on reforms such as abolition of S21, it is time for a proper conversation between regulators, landlord and tenant groups to AGREE a long term workable agenda.
This must take a more holistic and balanced view which will ensure sufficient supply of rental housing (both social and private sector) is provided by landlords who will meet the required standards. At the same time, local authorities and others who are responsible for compliance need to be held to account, reporting their activities.
While this is being agreed, there is nothing stopping the government from pushing forward on the promised improvements in the courts. Nor is there any reason why the Property Portal and an Ombudsman cannot go live, with participation on a voluntary basis, followed by legislation to mandate participation once they have a proven model.... Read More
10:52 AM, 2nd July 2024, About 4 months ago
Reply to the comment left by Katy Ann at 02/07/2024 - 09:56
Don't worry, the Chancellor won't forget you when you have had enough and decide to sell.
If you sell a business asset for a profit you will pay capital gains tax. Because residential property is somehow a special asset class, you will get to pay a higher rate, and you must file a return and pay up within 60 days. No need to wait until the end of the tax year like everyone else.
But wait, it gets better, unlike other businesses there is no reduced rate if I use the proceeds to reinvest the proceeds investing in another rental property.
And, if I invest my rental income in a pension, no tax relief can be claimed as I haven't earned it.... Read More
10:49 AM, 1st July 2024, About 4 months ago
George Osborne promised to fix the roof while the sun was shining. This was certainly not the case for the PRS where he not only stripped the lead but came back for the chimney pots and aerial.
As a result of the constant fiscal and regulatory attacks on the PRS, it's little wonder that so many landlords have already sold properties, resulting in the shortage of stock which forces prices up.
Labour need to focus on getting the courts working and delivering the details of what they propose for EPCs, the Property Portal and Ombudsman before they think about setting a date for ending S21.... Read More
10:29 AM, 11th June 2024, About 5 months ago
Too little too late.
Why not simply remove the CGT surcharge?
As Mark implies, this is a cynical measure, no doubt based on the maximum potential uptake, when very few tenants would have the financial resources or the desire to buy their current rental property.
Not only that, how does this help HMO landlords?
No full expensing of business finance costs
No retirement relief
No pension relief on rental income
No more FHL relief
No wonder landlords are heading for the exit.
Many landlords feel let down as they struggle to help provide homes while politicians fail to address the housing crisis.
We need fully thought through housing policy covering all tenures which factor in the energy transition, an ageing population and fiscal policy to support it.
iHowz will be publishing their manifesto for the PRS later this week.... Read More
17:44 PM, 1st June 2024, About 5 months ago
Reply to the comment left by Mick Roberts at 29/05/2024 - 05:38
Well said, Mick.
Chris is right, this is a positive step. Many lenders, including BMS, still specify a maximum of 12 month tenancy.
Before the RRB got washed out (just like Rishi) one of the points made in the Lords 2nd reading was to question why fixed terms were being abolished when
- it wasn't in the original bill
- it restricted the parties right to set contract terms
- it risked higher rents as landlords need to factor in costs of re-letting.
iHowz had drafted two amendments
- one for a new S8 ground for no fault eviction
- the other giving the option of tenant and landlord creating a fixed term.
This helps establish that tenants want the ability to have longer term fixed tenancies - nothing stopping both parties agreeing a 6 month trial period then locking in a longer period 2-3 months in, once they were both reassured that they could commit to it.
The RRB will be resurrected by whoever comes to power. iHowz will be lobbying to ensure that the new version is more balanced, to avoid the risk of more landlords heading for the exit.... Read More
15:24 PM, 4th April 2024, About 7 months ago
Just to add, even if this fails, you are unlikely to have to wait 2 years to reapply, as that requirement is being removed in the Leasehold Reform Bill
https://ihowz.uk/leasehold-and-freehold-reform-bill/... Read More
15:16 PM, 4th April 2024, About 7 months ago
I had a similar issue trying to remortgage after completion of a lease extension, where the new lease was not showing on the register several months later.
Apparently, delays in registering changes to title are very common at Land Registry.
You, or your solicitor, can write to LR asking them to expedite the registration, explaining your situation.... Read More
13:20 PM, 11th March 2024, About 8 months ago
The article mentions Home REIT. I am one of the unfortunate shareholders who bought the story of housing the homeless, not realising that their advisors were simply buying poor quality properties to rent to poor quality corporate tenants, while trousering their fees.
Right now, the new managers are still trying to understand the condition of the properties and the tenants. With only 9% of rent collected, several hundred properties auctioned well below cost and the FCA involved, this should be a cautionary tale for Hackney or any other council planning to go down this route.
The risks should be slightly lower for the councils as they are effectively giving tenants the money, so it can be paid back to them as rent.... Read More
18:31 PM, 7th March 2024, About 8 months ago
Not clear whether FHL income will still qualify for pension contributions tax relief.... Read More
14:55 PM, 6th March 2024, About 8 months ago
Reply to the comment left by JohnCaversham at 06/03/2024 - 14:27
Well said.
Landlords operating through a corporate structure have jumped through the government's hoops and should expect the same respect from the government that they showed in the covid reliefs to those running compliant businesses.
How can they announce the withdrawal of a tax treatment less than a month from the new tax year when operators with seasonal businesses will already have a significant level of bookings from hard working families looking forward to a post pandemic break. Many others will be international tourists as we do our bit to promote Britain and balance the trade deficit with our goods and services export.
Politicians are happy to reminisce about their UK holidays - should we cancel their booking before we sell up?... Read More
14:39 PM, 6th March 2024, About 8 months ago
I would add
A budget almost exclusively of stick, rather than carrot for landlords
Those who have properties in their own name who had pivoted part of their portfolio to serviced accommodation / furnished holiday lets to counter S24 will be penalised from this April for running their businesses efficiently - something the chancellor is spending billions in the public sector to achieve.
The SDLT relief on multiple property purchase transactions has been removed, making it harder for landlords to sell a portfolio as a going concern.
The encouragement landlords got was to head for the exit with the top rate of CGT on residential property dropping from 28% to 24% - still a 4% premium on gains on any other asset, and presumably leaving an 8% premium payable for those on basic rate who are paying 18%
Clearly revoking S24 - which would have expanded investment in long term rental supply didn't cross his mind
The lost tax would have been recovered by increased supply forcing rents down, reducing housing benefit and emergency accommodation costs
That's got to be better than bailing out Birmingham, Nottingham and other failed councils who have forced up rents with indiscriminate licensing schemes.
Instead of giving us an extra £5,000 ISA for British Investments, he could have made residential property a qualifying asset in SIPPS, giving landlords some tax relief for their pension investment.
If landlords could register as a cultural or ethnic group, we'd be off the courts protesting discrimination.
Unless landlords join an association, so their voice can be heard, government will continue to ignore smaller operators in the PRS and focus solely on their plans for it to be run like the social sector with large corporate owners.
Take a look at what iHowz can do for you - at least you subscription is fully tax deductible.
https://ihowz.uk/... Read More
14:32 PM, 6th March 2024, About 8 months ago
iHowz have published this comment:
The Private Rented Sector (PRS) houses over 20% of the population. Government and Social Landlords seeming to be unwilling/unable to step up and fulfil their obligations. It is a shame that, once again, the government has missed the opportunity to reinvigorate housing, especially the PRS.
Most landlords rent property to earn their living.
If landlords are unable to operate profitably, they will be forced to find another way to earn a living, with a consequential impact on housing.
Government don’t seem to be able to understand this simple conundrum.
Today's cut in National insurance does nothing to encourage landlords to provide more homes at lower rents.
Instead of the desperate tax grab against holiday lets – which has been forced on landlords by the onerous tax regime – iHowz has consistently called for a mix of reforms to stimulate the industry:
Allow Registered Landlords to reclaim Supplemental 3% SDLT on rental properties
Remove the requirement to pay Supplemental 3% SDLT on lease extensions
Index the Supplemental 3% SDLT threshold or link it to the standard SDLT threshold
Rescind Section 24 of the 2015 Finance Act
Allow rental profits to qualify for pension contribution tax relief, the same as other business profits
Extend the period for filing CGT return to 6 months
Make residential letting property a qualifying asset for CGT roll-over relief
Remove 8% CGT surcharge for rental properties, or some sort of retirement relief
Zero VAT rating should apply to Conversion, Refurbishment and Retrofit Works to match new build.
Energy Efficiency costs:
100% write down of costs in year of spend.
Grants with a long-term scheme which recognises a realistic approach (fabric first + achievable measures)
Poorly insulated homes lead to damp and mould, costing tenants more to heat. Funding for energy efficiency makes homes more efficient, provides many new jobs and helps the UK meet it legal commitment on emissions.
The current lack of housing has helped drive some local authorities to bankruptcy as emergency housing and other related support take a rising proportion of their budgets. And a lack of funding to support the courts to get their backlog under control has led some landlords to see the time for cases to be heard double and even triple. If landlords are not able to recover their property in a timely manner, they will sell up and invest elsewhere.
When will Government treat the industry with the respect it deserves? Landlords house people using their own funding, at minimal risk for the Government; you would imagine they would be more supportive of the housing sector which offers the most diverse selection of housing. Instead, the PRS is used as a political football to satisfy opportunists, who have no answer of their own.... Read More
12:03 PM, 6th January 2024, About 10 months ago
Reply to the comment left by Andrew Rudge at 06/01/2024 - 11:53
... Read More