Weekly landlord news digest: 08/02/19
As a landlord, it can be challenging to stay up-to-date with the latest news, reports and changes in legislation. That’s why, each week, we round up the latest stories from the last seven days to keep you abreast of the latest developments.
This week, read more about how you can make your property stand out from the rest, what the future holds for buy to let and where you can find the cheapest investment property.
We have also had important news of our own, with Hamilton Fraser taking full ownership of mydeposits, one of the three government-approved tenancy deposit protection schemes.
A third of letting agents refuse to rent to those on benefits
New research from the Ministry of Housing, Communities and Local Government reveals that a number of letting agencies refuse to rent properties to certain groups of individuals. More than a third of those surveyed will not let to those on housing benefit or receiving Universal Credit, with delays in payment, unpaid rent and the risk of benefits failing to cover rent payments being the primary reasons.
In addition, 10 per cent of those surveyed will not rent to prospective tenants without a UK passport, and 6 per cent will not rent to families because of a perceived risk of increased damage.
The research also shows that while tenants would prefer longer tenancy agreements, around 40 per cent of both agents and landlords will not consider letting a property for a fixed period of longer than 12 months.
Want to make your property stand out? Ensure it’s affordable
A survey from Intus Lettings of 2,000 UK renters reveals that the most important factor in choosing a rental property is affordability – and this is true of all age groups. Nearly two-thirds cited it as the most important element in their decision – well ahead of the number prioritising local amenities or public transport.
When it comes to the features of a property, outdoor space was the most important element to 46 per cent, who cited the presence of a garden, balcony or terrace as their most desired feature. More than 40 per cent, meanwhile, would be deterred if a property had no parking space, while 24 per cent stated that dated interiors would put them off.
Intus Lettings say, “We’re seeing a clear trend towards a generation of practical renters – those looking for a convenient, modern-feeling home, rather than exciting but potentially costly surroundings”.
What the future holds for buy to let
The future of buy to let lies with build to rent landlords willing to splash out billions on rental homes to cash in on growing demand from tenants who cannot afford to buy a home of their own.
Estate agent Knight Frank predicts investors have £36 billion earmarked for smart, professionally run rental properties, many of which will include on-site gyms and communal lounges.
The firm expects the private rental sector to swell by 560,000 households by 2023, and believes that £39 billion has already been spent on 110,000 rental homes to meet this demand which are already under construction or planned.
More than half the money is swallowed by developments in London, where buying a home is more expensive and the demand for renting is higher.
Nick Pleydell-Bouverie, head of residential investment agency at Knight Frank, said buy-to-let tax changes are deterring buy to let landlords from the market.
In the UK Tenant Survey 2019, the firm argues the buy to let market is starting to move from individuals to large-scale investors in London and that the trend will ripple out from the capital over the next decade.
Where to find the cheapest investment property
Buy to let investors need to look north for the country’s most affordable city homes.
The most southerly city in the top 20 ranking was Hereford, while Londonderry, Northern Ireland and Stirling, Scotland, were tied for first place.
An average home costs 4.4 times the average wage of £34,366 or £151,000.
The most affordable English cities are Bradford and Lancaster, says the survey by Lloyds Bank. Swansea is the highest placed city in Wales.
At the other end of the table, Oxford in the least affordable city with an average home costing £460,000, which is 12.6 times the average wage.
Review green lights tenant fee ban
An independent review of the tenant fee ban has greenlighted the law.
The government runs legislation passed the Regulatory Policy Committee, an independent body sponsored by the Department for Business, Energy and Industrial Strategy, to iron out any last minute issues and to assess how the law will impact business.
The committee agreed the ban should stop letting agents charging sky-high fees for simple tasks and argued letting agents make excessive profits from the charges which are difficult to assess when deciding to rent a home.
The committee also commented: “Reducing the cost of changing tenancies might reasonably be expected to reduce the length of the average tenancy and to place increased competitive pressure on landlords, thereby reducing rents.”
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