Landlord & Agent Course – Face to face

Please join us on Saturday 19th November at 9am for the next face to face Landlord & Agent course. Our dedicated course tutor will be on hand to provide up to date information and guidance ensuring that you are supported fully.

Our address is:

138 Walter Road, Swansea, SA1 5RQ

To book your place, please call 01792 539987 and speak to a member of the Landlord Training Wales team. Opportunities are limited, so please book early to avoid disappointment.

*** Please remember that the deadline for completion of Landlord or Agent courses is Wednesday 23rd November 2016 ***

Residential sales in UK up by almost 5%

Residential sales recorded in the UK increased by almost 5% between May and June 2016, according to the latest estimated figures to be published.

The residential transaction count was 94,550 and while this is up 4.9% month on month, it is 10.2% lower compared with the same month last year.

The large increase in transactions for March 2016 followed by the substantial reduction in April is likely to be associated with the introduction of the higher rates on additional properties in April 2016, according to HMRC which publishes the figures.

However, whilst April and May 2016 are lower than the corresponding months in 2015, it should be noted that the total for March to May 2016 is still substantially higher than the corresponding period last year, it pointed out.

The additional property rates were announced in the Autumn Statement 2015 for England, Wales and Northern Ireland, and in the Scottish Government’s draft 2016/2017 budget for Scotland.

Non-tax factors may have played a role as well, for example the Bank of England’s plans to curb buy to let mortgages resulting in a rush to purchase before April 2016, and the European Union referendum affecting transactions in recent months.

The residential count includes properties paying the main and additional rates. For June 2016 the number of non-adjusted residential transactions was about 21.2% higher compared with May 2016. The number of non-adjusted residential transactions was 11.1% lower than in June 2015.

According to Doug Crawford, chief executive officer of My Home Move, June’s figures show a market returning to health after a very quiet April and May which was due to investors doing business earlier in the year to avoid the stamp duty changes.

“While the number of property transactions remain below the levels seen a year earlier, a 4.9% increase between May and June is very encouraging. My Home Move’s own data suggests that the number of completions in June 2016 was actually 2.7% higher than in June 2015,” he said.

“The June increase shows that the property market mostly shook off the uncertainty from the Brexit referendum at the end of the month. This reflects our experience as most purchases went ahead without any issues. The big question now is what the impact will be for the rest of the year,” he explained.

“While this is less clear, our view is that the fundamentals of the property market are strong enough that there will not be a significant impact. There have been anecdotal reports of a slight slowdown in July from the estate agents we work with, but it is impossible to tell how much of this is actually Brexit related and how much is down to a normal summer slowdown. The picture will only start to be clearer in September after the holiday season,” he said.

Source: Property Wire

To read more, see Property Wire.

Rate of house price growth in UK starts to plateau

Latest index data suggests that the rate of house price growth in key cities in the UK is starting to plateau after a strong first half of the year. London in particular is likely to see slower growth ahead.

Month on month the Hometrack Cities Index recorded growth of 6.9% in June and year on year growth is running at 10.2%, the same level as the previous month.

Market attractions

The index report suggests that double digit year on year growth has been sustained by the surge of investor demand ahead of the stamp duty change in April. Low mortgage rates and improving economic conditions have continued to attract households into the market against a backdrop of dwindling supply with the net result being continued upward pressure on prices.

In June, Bristol remained the fastest growing city with year on year price growth of 14.7% taking the average price to £253,400. London followed close behind with annual growth of 13.7% to £476,800 and then Cambridge up 11.5% to £411,800.

The report points out that any impact from the decision by the UK to leave the European Union will not be reflected in the index for two to three months.

“That said, we have reported signs of slowing growth in some cities, particularly in southern England where affordability levels are close to record highs. The slowdown might have been more apparent by now had the stamp duty change not been introduced,” it says.

Supply and demand

A new analysis looking at listings also shows that for selected cities new supply has grown faster in the last three months than the average increase in supply seen over the last 12 months. For all cities in England and Wales excluding London new supply has grown 10% faster than the 12 month average, this rises to over 15% in London.

“This analysis shows how recent sales momentum in regional cities, and higher house price growth, appears to have held up over the referendum period. In contrast, the headwinds facing the London market ahead of the vote have resulted in more supply and relatively fewer sales pointing to slower house price growth in the months ahead,” the report says.

Hometrack explains that this is something that is clearly evident at a more granular level across London’s localised markets where the highest value markets in central London are registering low single digit growth. In lower value, outer areas of London growth is still 15% to 20% per annum although showing clear signs of losing momentum.

“While this listings analysis provides a snapshot of the last quarter, the reality is that it is still very early days to assess the true impact of the EU referendum vote on activity and house prices. Our view remains that sales volumes are likely to slow and price growth will moderate over the second half of the year,” the report adds.

“The severity of a slowdown will depend upon the response of consumers and businesses to the uncertainty created by the decision to leave the EU and the impact this has on the economy. The early market activity data confirms our view that London will bear the brunt of any slowdown,” it concludes.

Source: Property Wire

Read more here.

A step by step guide to becoming a successful landlord

A step by step guide to becoming a successful landlord

Whether you’re a property mogul with a to-die-for portfolio of houses, or you’re just renting out your wife’s old flat – you’ll need to get your head around the simple steps of being a landlord.

Getting into buy to let can be a great way to boost your income. And if you play your cards right, you may even be able to make a career of it.

Of course, there’s more to it than just buying a property and finding some tenants to pay the rent – you have legal responsibilities to make sure the home is safe and suitable for the tenant.

This handy visual guide from specialist mortgage providers, Commercial Trust, will help point you in the right direction.

guide-to-being-a-landlord-for-web

Commercial Trust guide to being a landlord

 

Turkey – an attractive overseas property investment hotspot

Turkey’s omission from the European Union together with its bullish economy and buoyant property market should make it an attractive destination to foreign investors both, said Spot Blue International Property in June, adding that Istanbul remains the country’s key investment hub.

“Whatever the outcome of the referendum, foreign buyers in Turkey know their asset or ownership rights won’t be directly affected to the extent that owners of property in the EU could be,” said Julian Walker, director at Spot Blue International Property. “Being outside the EU means the country has escaped much of the financial volatility caused by the media storm around the Referendum, seen in the UK and Europe.”

Here are four key reasons why investors should consider Istanbul in 2016:

Strong GDP

Turkey’s economy is out-pacing most countries in the European Union and Members of the OECD. According to the Turkish Statistical Institute, the country’s GDP soared at a rate of 4.8 per cent in the first quarter of 2016 compared with the same period in 2015. A forecast in May by international ratings agency Fitch predicted the Turkish economy would grow at a rate of 3.5 per cent this year and 3.6 per cent next year. Of all G20 countries, only China and India recorded higher GDP growth than Turkey during 2015.

Currency advantage

Volatility in the £/€ exchange rate and how it will react after the Referendum are bringing uncertainty to UK investors buying in the EU right now. Property in Turkey is sold in Turkish lira, euros, dollars and sometimes Sterling, giving an international buyer flexibility and presenting opportunities to minimise exposure to currency rates. Turkey not being in the EU means the Sterling/Turkish lira rate will be less affected by whatever the outcome of the Referendum.

Property sales underpinned by non-EU market

The largest groups of property investors in Istanbul and wider Turkey are from the Gulf States, in particular Saudi Arabia, the United Arab Emirates and Kuwait. They will remain interested in Turkish property, continuing to drive the market and bring foreign money into the country, whatever the outcome of the Referendum.

More benefits for foreign workers, businesses and homeowners

Turkey is making serious efforts to entice more overseas workers, firms and residents in 2016, in particular to Istanbul. This in turn should have positive effects on demand for residential and commercial real estate. In June Deputy Prime Minister Canikli revealed draft laws to improve investment conditions, which included reduced tax rates for foreign firms setting up and purchasing real estate. Canikli also announced plans for a series of regulations that would improve employment conditions and opportunities for foreigners. Elsewhere, in the same month Economy Minister Nihat Zeybekci said that the Turkish Cabinet was set to offer citizenship to foreigners who buy a number of properties in Turkey.

Spot Blue International Property sells a range of property in Istanbul, including one, two, three and four-bedroom apartments at a residential development in the popular district of Halkali, with prices from £118,000.

Which? magazine calls for an end to tenant’s fees

Consumer magazine Which? has called for a ban on tenant admin fees. The magazine included the charges in its round-up of ‘sneaky fees that should be banned’, which also included BT Broadband exit fees and mortgage exit fees.

The call comes a year after tenant fees were banned in Scotland in June 2015, and calls for a standard practice across the UK and better regulation in the private sector.

The well-known consumer magazine said that letting agents charge fees to both the tenants and landlords, and that it was hard not to assume some fees and charges were exploitative.

“Admin fees are charged by a majority of agents, which covers things such as drawing up a tenancy, inventories and checking tenant references,” said Which?

“This can cost up to £500 for an individual every time they move. Landlords usually pay admin fees too, and with the cost of checking credit ratings relatively low, it’s hard not to assume that some agents are simply exploiting these fees and charges.

“Better regulation is needed in the private sector. Scotland banned letting agents from charging tenants four years ago – Which? thinks this should mirrored in the rest of the UK.”

Post-Brexit ripples could be both positive and negative for UK property market

Confidence in the UK’s commercial real estate markets is likely to fall due to the Brexit uncertainty, with a ripple effect set to spread beyond London, according to recent analysis.

It is likely that decisions will be pushed back in the period of heightened economic and political uncertainty that no one can define or quantify and it will most likely take several years for people to fully understand the implications of the decision to leave the European Union, says the report from Fidelity International.

But there are likely to be positive as well as negative effects due to the referendum decision. ‘The question is whether resultant pricing volatility is a fair reflection of inherent risks or a potential mispricing opportunity,’ said Adrian Benedict, the firm’s real estate director.

He pointed out that before the referendum, transaction volumes were already down 50% in the year to date compared with the same period in 2015. ‘We anticipate volumes to remain modest for the rest of 2016 as investors assess the implications,’ he added.

‘As we saw in the aftermath of the 2008 financial crisis, we can expect real estate investors to seek refuge in the relative safe harbour markets like London West End or long leased assets. However, unlike then, values are already 10% to 20% above long term levels,’ Benedict explained.

He believes that many investors will be turning their attention to the occupier market, in particular evaluating the impact on financial and business services companies; anyone with those type of tenants are going to be more circumspect but the impact won’t just be confined to London.

‘We can expect to see a ripple effect across the country. Bournemouth for example has a high proportion of people employed by financial service companies and it would be naïve of us to think the impact will be contained to the capital,’ Benedict said.

‘So long as occupiers remain cash generative, we’re unlikely to face a material pricing correction arising from weak fundamentals. Supply of new space remains very constrained and vacancy rates in the key cities across the UK have largely recovered,’ he added.

He also pointed out that having short leased assets doesn’t necessarily mean occupiers will move out. ‘Fidelity’s experience suggests less than 25% of occupiers chose to exercise their option to terminate leases or move at expiry. Rather than selling or buying real estate ‘markets’ a greater emphasis will need to be placed on underwriting the occupiers and the certainty of their cash flows,’ he said.

‘As with most clouds, there is a silver lining. Over the last 12 months international buyers accounted for 40 percent of commercial property deals in the UK, a near doubling within 10 years. The relative attractiveness of the UK market is explained by a strong economy but also a relatively weak currency. In US$ terms, the UK real estate market is now back to pre-2004 pricing levels. The question is whether international investors will view this as an attractive entry point or defer making a decision,’ he concluded.

Patrick Scanlon, a commercial research partner at Knight Frank believes that the referendum result creates both threats and opportunities for the central London office market. ‘Economic uncertainty is rarely a positive  for any market, and in the short term we should expect some occupiers to delay committing to new office moves as they take stock of what the new landscape means for their businesses,’ he said.

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Three in 10 property purchases fall through

New research from Which? Mortgage Advisers reveals that three in ten (28%) homebuyers have had a house purchase fall through after their offer was accepted, and on average homebuyers were left nearly £3,000 out of pocket as a result.

The survey of 2,000 homebuyers – who bought their home in the previous two years – found that it takes over 4.5 months on average, from starting a property search to having an offer accepted. However, 28% of purchases fell through after that point.

The main reasons for a property purchase falling through were:

  •     The seller decided not to sell their home after all (27%)
  •     The buyer pulled out, as their own property sale had fallen through (21%)
  •     The buyer found somewhere else to buy (21%)
  •     The buyer was ‘gazumped’ (21%)

Of those who had lost money and knew how much they were out of pocket, the average loss was £2,899. This included conveyancing, survey, mortgage valuation or brokerage fees paid and not recovered.

Many homebuyers experience failed transactions due to problems in the ‘property chain’ – the line of buyers and sellers linked together because each is selling and buying a property from another.

For more advice on managing a property chain and keeping things moving, visit Which

Tenant evictions on the rise in England and Wales

The number of households evicted from rental accommodation in England and Wales rose by 5% in the first three months of the year, while the repossession rate for home owners fell to a record low.
Seasonally adjusted figures from the Ministry of Justice show there were 10,732 repossessions of rented homes by bailiffs between January and March 2016, up from 10,253 in the final three months of 2015.
The number of tenants evicted from their homes by bailiffs reached a record high in 2015, according to official figures for England and Wales, which shows that 42,728 households in rented accommodation were forcibly removed.
Housing campaigners blamed welfare cuts and the shortage of affordable homes for the rise in repossessions over the year and more than half the evictions are thought to have been by private landlords.
These figures are echoed by a new report from online letting agent PropertyLetByUs which shows that a quarter of landlords have served an eviction notice to tenants over the last 12 months and 5% have pursued an eviction through the courts. Furthermore, almost half of landlords have also experienced rent arrears over the last 12 months.
‘Landlords are increasingly facing rent arrears, as rent escalation continues to outstrip gross income. They are also facing a financial squeeze due to restrictions on their tax breaks and some may be raising rents to supplement their income. Pushing up rent rises further will put huge pressure on those tenants who are already struggling to pay their rent. We may well see evictions continuing to rise over the next few months,’ said Jane Morris, managing director of PropertyLetByUs.
She pointed out that the statistics highlight the need for landlords to protect their rental income and ensure they carry out thorough references with all new tenants. ‘Times are very tough for many tenants and demand for rental accommodation is soaring in many parts of the UK. Landlords need to extra vigilant when they take on a new tenant. But a few simple checks will help identify if a tenant is in a good financial position or not,’ she added.

Meanwhile, changes to the process of accelerated possession through applying to use High Court Enforcement Officers (HCEOs) to evict a tenant has brought an end the so called seven day eviction which were misleading for landlords as well as increased costs, according to legal experts, Landlord Action.

Source: Property Wire

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Millennials most likely to fall victim to rogue landlords

As the popularity of renting continues to rise, a professional property buying company based in the UK has taken a survey to determine the public’s opinion on rental landlords and the current state of renting in 2016.

Since 2011, nearly 3,000 landlords have faced prosecution under the Housing Act 2004. In London alone, the data reveals 2,006 individuals and companies in the UK were fined a total of £3m for housing offences.

Openpropertygroup.com found that it is the millennial generation that have suffered the most from criminal landlords. Over half (62%) of the age group in ‘generation rent’ have had trouble retrieving their deposit back at the end of their tenancy.

In November 2015, The Guardian suggested millennials should ignore advice and stick to renting, however new survey results suggest they should think again. Shockingly, the majority (51%) of people aged 25-34 surveyed had to take legal action against their landlords or admitted to living in unsatisfactory living conditions.

Figures provided by the Ministry of Justice show that the number of evictions is increasing year on year, rising by 53% since 2010. This is reflected in Open Property Group’s own findings, where over half (54%) of millennials surveyed felt that they had been unfairly evicted with another half had in fact had their rented properties sold by their landlord without notice.

Jason Harris-Cohen, director of Open Property Group, says “thanks to Shelter Housing, there is a renewed focus on landlord prosecution with an additional 5 million GBP to be shared out amongst councils to take action against landlords. Here at Open Property Group, we have teamed up with experts to create an advice guide for those who are renting and in danger of falling victim to seemingly common landlord scams. The graphic, which can be found on our site, is filled with advice from London the City of London Police, Leeds City Council and Advice 4 Renters to help struggling renters.”

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Advice guide for renters