Monthly Archives: April 2011

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By Mike Edwards

Many Landlords aware of the proposed cuts in Local Housing Allowance (LHA) formerly Housing Benefit understand that the cuts only apply to new tenancies commencing from the 1st of April onwards. But we have become aware of a case where the tenancy commenced on the 16th of March on a 12 month tenancy. The rent was £2300 a month on a London 5 bed house which the local LHA office had agreed to pay when the claim commenced on the 16th March.

However in early April the tenant received notification that as from the 1st April, LHA of £1500 only would be paid. Can this significant shortfall be right?

If the LHA prove to be in error and will in fact pay the agreed figure of £2300 for the 12 month duration (because the tenancy was created before the 1st of April deadline when the changes were introduced in London), this raises another question. What of existing tenancies created before the deadline which have gone periodic? My guess would be that a periodic has the same new rules applied. After all it could stay periodic forever and never be subjected to the changes which rather defeats the object of them. 

The danger here is how the new rules are interpreted, and local variations are not unknown as with Council Tax where, for example, when discounts applied on unoccupied properties some CB offices said a property had to be uninhabitable as opposed to what the rules said – uninhabited!! Similarly when the under 25’s rules on the then Housing Benefit came in many years ago they were only supposed to apply to new claimants not existing ones and not even on their annual reassessments.

In fact many HB offices (wrongly) reduced the payment down to the new room allowance for all under 25 year old existing claimants though admittedly from their next annual reassessment.

In terms of what an LHA office will allow and what they will not they are bound by the terms of the Regulations and the rules are clearly laid out in the guidance manual at  and scroll down to


But there are a number of possibilities in this particular case. Firstly, this could simply be a misunderstanding. The rate for that property is capped to a 4 bed rate from 1 April, but any existing tenants would enjoy 9 months transitional protection. It is possible that the letter from the LHA office is simply informing of the new benefit level, ignoring the protection that exists for any current tenant. So maybe the LHA office will honour the existing rent for one month only before applying the cut?

By Steve Roulstone

 As this report shows, it is still not difficult to find evidence of poor standards in the Private Rental sector. Yet again the Industry as a whole suffers from the performance of one individual as we suffer by reflection, although I note there is no mention of an agent in this case. The frustration for me as a Letting Agent is that we are available to give the kind of advice that would ensure standards could be upheld should we be asked, and of course listened too!

Property shortages do not help.

As I am only too aware, during periods when available housing to rent is at a shortage the limited choice means that many will not have the options they would appreciate when choosing a property to live in. I have just experienced something similar when looking for a Country property and only because I happened to look very early one day and by an incredible piece of luck (the person I asked for directions was part of the family who owned the property; access gained no more than thirty minutes later!) did we manage to get first ‘dibs’ on a Farmhouse close to where we work. But for those who are not so lucky, they can be forced to take the best of what is left and of course conscious decisions cannot form part of the process.

Professional links.

Just like the new Kitemark being pushed by our industry at present, professional links for both Landlords and Agents would allow people to have a considered decision to make; lack of available property removes that decision in so many cases. Not that I would ever discourage anybody from forging such links, as the person reports from the local Landlords association, poor Landlords do exist and the more we bang the drum about professionalism the better we will be heard. So whenever possible Tenants should look for some kind of link with a body who promote good standards to give them some re-assurance about the lease they are entering in to and the future maintenance of the property they wish to call home for the next few years.

Advice is needed.

As the property programmes show, good advice is not always listened too, but when it comes to basic standards, unless a Landlord has asked, or been offered advice by somebody within the profession, then there remains nothing more that can be done to say if the Landlord then goes on to look after the property in question and therefore the Tenants who will presumably be paying the Landlords Mortgage or giving them a good living, or if they take the opposite view and look at the situation purely from a financial standpoint, which is surely what causes the majority of problems for Tenants and just will not spend on basic housing standards that most of us would view as second nature. (and of course is covered by Government legislation)

Another call for registration?    

The result (indeed the National picture) is more proof of the need for some form of legislation to put a stop to the ease with which people can become Landlords without even asking one simple basic question about the Tenants rights, even though they are going to have such an influence on the standard of the Tenants life for the duration of the agreement. At present the need is becoming greater as Landlords, being no different than anybody else protecting their income at the moment, look for ways of cutting expenditure where possible. But when that decision effects the life of others, that’s when we should be able to turn  to those who legislate the Country for support, but hopefully the comment from the Housing Minister Grant Sharps, that the situation was under review in the medium turn suggests that the banging is beginning to get through!

By Steve Roulstone

The Deposit Protection Scheme has recently had some figures released in a recent press article and on the face of what they state, they do look impressive. Indeed, I would say that the scheme has been vindicated as one of the best available to Agents and Landlords as they approach ¾ million active deposits. I could not help but notice though a couple of what I believe to be very pertinent facts behind the figures, which in no way reflect on DPS as an organisation, but what they do show is that the Industry is still far from committing itself 100% behind the legislation.

Where have they been?

Firstly and separated from the main section if facts and figures  in the report is the somewhat surprising fact that as a Company, DPS are still registering around 200 new Landlords a day. This is allowing for working days alone, a rate of around 10,000 a year. Now my mind immediately asked where they have been until now, because even allowing for cross registration when Landlords decide to change or indeed new Landlords coming to the system for the first time, this figure shows a large percentage of Landlords were outside of the legislation, which do not forget, is now four years old.

Time for teeth?

It would be interesting to see if companies such as DPS, who of course must accept the contact and register the deposit at face value, actually take data about the history of the Tenancy. For those of us who wholeheartedly accept and encompass such legislation, do so with the hope that the legislation will deal with those who do not. Of course I am fully aware of the costs and penalties associated with not registering a deposit, but surely there has to be a time when you have to ask Landlords to prove why deposits for the property concerned were not registered prior to this date and for me four years is long enough for such situations to be questioned!

Landlords found wanting.

The second and more important fact that most Agents would have picked up on will be that two in three adjudications where sole culpability was awarded was awarded against the Landlord. Now what I would like to know and I believe should know, is how many of these cases (3518 in number using the figures quoted) were tenancies in Management and how many were through Agents. I am aware through the cases involving Castle Estates that where the correct paperwork and procedures have been presented, that the Landlord is usually successful, because if we believe that he would not succeed, we would recommend settlement and negotiate with the Tenant rather than go through adjudication in the first case.

Proof is in the figures.

The figures that I believe should be included in this release are those confirming how many unsuccessful Landlords were self managed? And indeed it would be good to see what percentage was managed by unlicensed Agents who are not connected with Industry regulators. (NALS, ARLA, RICS) This is an age old problem and such numbers would indicate how successful the recent legislation introduced by Government has been at changing the face of the Industry. So conversely we would also need to know what percentage were Managed by what I have always referred to as Professional Agents who do believe in running their businesses to the standards set by such bodies. The second half of this request is probably impossible for DPS to judge, but I believe that we would start to see justification of our shout for professional registration for all Agents and Landlords if they were made available – anybody listening?

By Steve Roulstone

One of the advantages of being part of a Company that both sells the Franchise and runs a Franchise is the close access and conversations that I hold with my Staff. For example, Suzie who has worked at our Stafford office for the last two years was telling me this week how difficult it was to get people through their referencing at present, something which in the current financial environment we could all probably understand.

The requirement is justified.

What has to be remembered here is that Landlords must have a successful reference to be able to obtain a Rent and Legal expenses policy, something which I have confirmed on many occasions, is a must in the present climate. So as agent of the Landlord, we must do what is best for our Landlords at all times, the problem can occur when the Tenant who wants to live in the Landlords house, feels that our requirements to get such a pass are either becoming expensive in the Tenants eyes (which is a problem that has been reported for years and I fully expect it to be in the news again this year) or that the requirements to achieve the pass (Self employed parents usually the problem, or Guarantors who are retired) are far too onerous for the circumstances.

Information is everything.

Of course, what every agent should do is provide the prospective Tenants with as comprehensive a pack of information explaining the process they are entering in to as clearly as possible, as well as costs associated with the process and options available as the process develops. But it is our experience that Tenants do quite often sign without reading, or pay scant regard to the content. It is only when, again in doing our job, having already assessed the situation prior to taking any costs from the Tenant, initial applications fail and we try our best to find an acceptable solution to enable the Tenants to move ahead, that the process can suddenly come under scrutiny when full attention at the commencement could have avoided this common scenario.

Openness and Honesty.

The worst case scenario for us is when the Referencing Agency come across something in the Tenants background that has been omitted from the initial information requested. Now we have a problem for all parties having advised the Landlord we have a Tenant being processed and a Tenant having to find somebody to stand in their shoes (Guarantor) to enable them to proceed. This can be the time, depending upon what has been discovered, to take the Landlords opinion, with our recommendation and bring a stop to the process. But if a decision is made to continue Tenants must understand that for both the re-application to the Referencing Agency and the additional time and effort put in by our staff additional costs will be generated and therefore paid for.

Producing effort and savings.

So at a time when Referencing Agencies are correctly taking a sterner view on Tenant applications, complications are just not needed, because Tenants must remember that the property is effectively off the market whilst we go through the process with them and other Tenants more suitable could have come and gone during the Referencing period, so our recommendations has to be to give full disclosure from day one. Honesty really is the best policy and you will either get the full effort of the Agent to guide you through the process because of this or at least be given an experienced opinion which could save you your money in the first place.

By Steve Roulstone

As a Landlord with several houses purchased through my time as a Letting Agent it is nice to know that my investment in bricks and mortar has been well spent and even taking the current down turn in sales and property value, the investment stands up well against other investment opportunities.

Presentation figures.

As part of a process that I undertake with potential Franchisees, I have put together figures from several sources to confirm how property has performed against its rivals. I chose figures from the last ten years; indeed the last decade 2000 through to 2010 inclusive. It is not that as agents we have to convince people to buy property in the first place, far from it, we enter the scene when owners are deciding if either the market is what they want for their property, or if having made the decision, they wish the property to be managed by Agents rather than themselves. As I point out, it does no harm to be aware of how much better bricks and mortar have performed against what some would perceive as the normal route for investment.

Property v Stocks

 Over the whole eleven year period, property produced 64% growth (National House price statistics) whilst stocks only gave a 6% return (Stock exchange growth figures) Now I am fully aware that the whole point of Stocks and Shares is to buy and sell but this is of course not needed for property so I believe it fair to directly compare one with the other. I am also aware that S&S pay dividends and the average return over the same period was an additional 20%, but then rent also counts and on average, Landlords make 10% of the rent after mortgages have been paid. When both are taken in too account property still looks ahead of the game by some way!

Not forgetting inflation.

I added inflation in (3% gain and 3% inflation = 0% growth) and then looked at information from the Barclays Capital Guilt study 2010 which did the same for Shares, Bonds and Cash. The outcome for property allowing inflation at 28.2% and after paying Tax at 25% gave property at a return of 38% and the best that either Bonds or Cash could offer after inflation was less than 3%, with shares actually losing money! Quite a result I am sure you would agree, as property outperforms its rivals to the power of 10 which all points to Money well invested!

By Craig Smith

From 1st October 2008, most residential properties need to have an EPC (Energy Performance Certificate) in place before they are able to be marketed. However, this looks set to change from 1st July 2011 due to new government rulings which have been announced to the energy assessors.

Current Regulations

At the moment, an EPC graph should be provided to prospective Tenants at a viewing and most certainly before they take tenure of a property. An EPC will last for 10 years for a rental property unless there are significant changes made to a property, such as the fitting of a new heating system, insulation being put in or new double glazed windows fitted.

Are EPC’s Useful?

If you asked us how many times a prospective Tenant has asked to view an EPC at a viewing since October 2008, you could probably count them on just one hand! This seems to be the general feedback from many Landlords and Agents. So that must mean that not many people even bother to look at them!

The certificates do good information on how to reduce the amount of energy used and improve efficiency. But again, if no-one looks at them what use are they?

The New Rulings

A government memo has been seen by one of the industry’s biggest publications which suggests that from July 2011, a full EPC report should be provided with ANY written details for a property. At the moment, the first page of the report is sufficient as this shows the performance graphs. So lets just get this straight, we should have to provide a complete document, usually around 7 pages, for most people to throw away. Why?!

Full EPC’s are available on request anyway (not that we ever seem to have requests for them) and if anybody does happen to be interested in the energy usage, it is usually only a quick glance at the graphs. Being perfectly honest, we cant remember having a single viewer say no to a property because of the results of the EPC!

Your Opinion?

We would like to hear your opinions on the subject, whether you are a Landlord or a Tenant. Maybe you have found an EPC to be useful when refurbishing a property or when choosing a property to move in to, please feel free to add a comment using the button below! 

by Nick Strong, MD

Lettings agent franchise networks are understandably excited about the potential for market growth in the buy to let market sector in 2011.  In the recent budget George Osborne made it easier for large investors to enter the buy-to-let market. 

 The coalition government has identified buy-to-let as a way of solving the housing crises that has been exacerbated by the difficulty of first time buyers accessing funding over the past two years of recession.

 Buy-to-let opportunities have therefore been opened by stamp duty reform.  So much so that Aviva, which has been lobbying for reform for some time is seeking to put together a £1billion fund which could be enough to purchase 5000 buy-to-let properties. This is because stamp duty on the purchase of more than one property will now be calculated by the average value of the properties, not the bulk value, which the industry has campaigned for.

 It is understood that other institutions and pension funds who have eyed the sector are Aegon, Terrace Hill, Legal & General, and LaSalle Investment Management. Property agent CBRE has estimated that institutional investors have allocated £7.5bn for residential property.

 It is thought unlikely that these initiations will want to manage their own property portfolios given the difficulties that the likes of Countrywide experienced when they entered the property market.

 There is clearly the opportunity potential for Letting franchise sector business to grow if large investing corporate decide to distribute their buy-to-let portfolio via agents with significant access to market across the UK.

 Steve Roulstone, MD of Castle Estates said ‘I have been lobbying for changes such as this especially through the pages of this site, for some time now, as I firmly believe that by easing the way for Landlords to start investing again we will start to build confidence in the property market again. Nobody is asking for financial restraints to be removed completely, as nobody sensibly wishes to go through a period of unrestrained growth that could then result, but sensible steps such as easing tax burdens imposed on Landlords can only help’.

By Matthew Carter

Lots of letting agents are still questioning whether twitter is right for their business. The primary role of twitter for a letting agent is to connect with their local community, be more accessible to their potential client base, promote their latest properties and generate business leads. I started a twitter account for our business back in 2009, over the years I’ve picked up a few tips that you might find useful:

  • If you’re new to twitter you might want to follow lots of people to start with to inflate your own follower numbers – you follow them they might follow you back – simple (remember the more followers you have the more people there are to see your tweets – potentially).
  • But do your followers care what your business is saying? Possibly not, so after a few weeks start to be picky about who you follow and create you own niche/community this could include existing clients, potential clients, trade press, and competitors (why not keep an eye on them?).   
  • Make the most of lists – I utilise lists in twitter this way you can keep track of how many clients or potential clients are following you
  • Get it on your phone – it can be difficult to tweet when you’re busy, so register your business profile to a mobile twitter App this way you can do it on the move! (You don’t necessarily need an iPhone)
  • Keep it personable – relax a bit, use your tweets to get the more human side of your company or organisation across from time to time
  • Show of your knowledge every now and then – You want your customers to know that you’re a thought leader so, comment on the latest industry news, flex your grey matter – show your customers what you know and why they should chose you  
  • Get your twitter feed on your website (not just a link!) – this can be great for Search Engine Optimisation, the content is constantly changing and you’ll be using keywords in your tweets that could help you float up in the Google rankings     
  • Link twitter to your facebook page, this way any facebook updates go straight out as tweets! (I usually use
  • You can also create a news feed in Google reader and link it to your twitter account, subscribe to stories and keywords that you customer base might find interesting in Google reader – ‘share’ a story and it appears on twitter (again you can use twitterfeed) 
  • Use tiny cc to shorten your links – more space to get across what you want to say! You can also chose the name of the link to make it more appealing 
  • Add a link on your email footers – let your customers and suppliers know that you’re contactable through twitter 
  • Make sure you link to any articles or PR that you might have been mentioned in to help spread the good word and give your PR more longevity (and hopefully more exposure)
  • Get some conversations going, take the time to comment on your clients tweets and strike up a conversation
  • Report the success of twitter – let your board know about twitter, don’t keep them in the dark! Who’s following you? How many referrals from twitter does your website have? How many people follow you? (You might also like twittergrader to keep track of your stats) 


By Craig Smith

A lot of Landlords may not realise that, even if a property is unoccupied, they could still be liable for utility bills at a rental property. Usually, unless a property has been let with bills included, the Tenant would be responsible for payments. But what happens during the periods that a property is empty?

Ensuring the Accounts are set up Correctly

During an empty period, the utility accounts need to be set up in the name of the Landlord. It is important to take meter readings at the start and end of a tenancy to ensure that Tenants and Landlords don’t pay for each others energy used. A lot of companies will automatically send an estimated bill so regular meter readings should help to keep costs down. Most utility companies will be happy to send billing to another address, such as the Landlords home or letting agent address, which helps to prevent any debt letters coming through the post.

Debt Chasing and Court Action

If a bill gets missed, the utility companies usually send reminders and letters threatening court action, regardless of whether or not they intend to take you to court. (See Steve Roulstone’s Blog here for more information.) The best action is to act quickly to resolve any issues, the majority of cases are where the companies haven’t taken note of meter readings or start/end dates of a tenancy.

Choose Your Suppliers Wisely!

Landlord cannot force a Tenant to take a particular supplier for gas & electricity, although there is usually no choice for water and Council Tax! However, different suppliers charge different amounts for energy used. If a property is going to be empty for a period of time, it is always worth looking into the prices charged by different suppliers. Some suppliers will charge a standing charge, so even if no energy is used at a property a daily charge could still be payable!

Whenever a Tenant leaves a property, the Landlord should always aim to obtain the gas and electricity providers. If the Tenants don’t give the information, the suppliers can be found by contacting National Grid for gas and MPAS for electricity.

Water Supply

Some water companies will also make a standing charge even if no water is used. This is to cover costs of drainage and maintenance to the pipe supply. If the stop cock is turned off in a property, inform the supplier! Usually, if the supplier has been informed that the stop cock is turned off then the standing charges are normally cancelled (from our experience with Severn Trent).

Council Tax

A property can have an exemption from council tax payments if it unoccupied & unfurnished, usually for up to 6 months in each financial year. After this, a 50% rate is applied and will become payable, although after 6 months you would certainly hope that the property has been relet! 

By Joel Caws

Investing money into a new venture can be a good way of putting extra capital to work in order to make a profit. There are plenty of ways to invest capital from merely putting it in a high interest bank account or investing it into a business opportunity.

Generally, the more riskier the investment the bigger the pay back or loss. When you place an investment into a savings bank account you’re confident your capital is going to be safe, on the other hand the gain you will get from the invested capital is often low. It’s also associated directly to the interest rates at that time, hence if interest rates go down, the benefit from your investment may also be reduced.

Many people choose to make an investment into the stock market which can be an activity that carries much higher risk. The profits can be high for those who have taken the time to know the reasoning behind the way stocks and shares move, however for people who are uninitiated it could be a fast way to lose your money.

Property is another recognised investment preference having a pretty sturdy track record. Although property markets can go up and down in the short term, they have a tendency to rise gradually in the long term. As a result many investors put funds in property because they want to see a positive benefit in the future.

Investing capital into a business venture is a well-liked option. You will find a few methods to do this by means of either starting a new enterprise or looking for an established one that is already operating.

Opting for a franchise may improve the success rate further because a franchise business relies on a proven franchise formula. Quite a number of franchise business opportunities can be run as management franchises which are perfect for individuals who wish to put capital into a business venture but not be hampered with the actual every day running of the business. By employing staff to operate the franchise business, it is possible to manage the business without getting your hands soiled.

There are also franchise resales which are franchise businesses which have already been setup and have been trading for some time. Deciding on a franchise resale may help to further lower risk as you will benefit from a business history to look at prior to deciding to put your cash into it.

No investment is completely devoid of some risk, nevertheless a franchise system provides the extra support of a tried and tested business formula along with training and support. Generally speaking, the success rate of a franchise is good with nine out of ten franchisees each year turning a profit according to Natwest/BFA annual franchise industry surveys. Whether or not you choose to put money into a franchise opportunity or some other business venture, one point is for sure: the success of the business (and the return on your initial investment) will likely be measured by your commitment, hard work and dedication. If you don’t use a strong-minded and disciplined approach, any venture will most likely be doomed to fail.