Author Archives: Craig Smith Marla

30Nov 2012

Tenancy Deposit News: DPS Announces New Insured Deposit Scheme

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By Craig Smith

The Deposit Protection Service has recently announced its new plans to setup a new insured deposit scheme alongside its already well established custodial scheme in 2013.

Custodial Vs Insured

The difference between the custodial scheme and the insured is what happens to the actual deposit money. Custodial is exactly what it says on the tin, the deposit money has to be given to the DPS for them to hold securely whereas with the insured scheme, it is simply registered rather than being paid over.

Why Use Custodial?

Prior to 2010 we used to register tenancy deposits with The Dispute Service (TDS) and had to pay a yearly fee in order to confirm our registration. The renewal prices were hiked up so high that many Landlords and Agents were forced to move elsewhere, hence our move to the DPS. (There are too many abbreviations in tenancy deposit protection, or TDP for short!)

By using the DPS, we found that Tenants know that their money is safe and there is no risk of it being used for anything without their say so. Nor can it just happen to be used ‘by accident’ by a forgetful Landlord! One other agent local to us closed down recently which left a number of Landlords and Tenants reportedly losing out on money as the deposits were held in an insured scheme. No such chance if the money is held elsewhere!

Downfalls with Insured Schemes

Now I don’t know exactly how the insured scheme will work with the DPS but it looks as though a Landlord or Agent will not need to pay a registration fee but will need to pay a fee per deposit registered. This seems fair enough but still begs the question, why bother when there is a free alternative?

There seems to me there is no point in holding a deposit in your own account. The amount of money to be earned from interest is barely pennies with interest rates lower than low and the custodial option even offers a free dispute service to boot! Not to mention the extra hassle of having to pay back the money yourself whereas a repayment with the DPS custodial scheme can be done & dusted with the click of a few buttons.

The Future for Deposits

Back in April 2012 the law changed with regards to the registration of tenancy deposits. Any deposit taken for an Assured Shorthold Tenancy needs to be protected and the future surely looks set for further tightening of the protection process.

I can honestly say that I think deciding to use the DPS is perhaps the best decision any Landlord can make. It is free, easy and everybody knows exactly where their money is!

22Nov 2012

Rental Property Advice: Damp or Condensation?

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By Craig Smith

One common issue reported by a lot of tenants is that of damp appearing in a property. But it isn’t necessarily damp that is the issue as a lot of ‘damp’ turn out to be nothing more than condensation which can be cured with a few simple pieces of advice.

Condensation Problems

The majority of these issues are, of course, condensation. This can come about if there is a lack of ventilation in a particular part of a property where the moist air can’t escape. Although we are approaching the winter months and the temperature is gradually getting colder (although hopefully not too cold this year!) it is still important to ensure rooms are kept well ventilated, mainly when showering or cooking.

Both of the above generate warm, moist air which can mostly be seen on window panes. What can’t always be seen is the amount of warmer air that cant escape and will eventually appear as black marks or peeling paint on walls or ceilings. We tend to find that most of these reported problems occur in bathroom or upstairs bedrooms, bathrooms due to the obvious showering & warm water and bedrooms as a lot of people prefer a nice warm bed to go home to and leave windows etc closed.

Putting a Dampener on Things

The symptoms for damp and condensation can be very similar; typically a black or mouldy mark and a musty smell where it has occurred. When someone notices a mouldy or wet patch on a wall or ceiling it is easy to mistake this for damp, particularly in older properties such as Victorian terraces. Damp is usually caused when there is a leak of water into the property such as a leaking roof or gutter or water coming up from the ground through the walls.

The repair job might not be as big as it sounds and can sometimes be fixed with a couple of hours work from a local trusted builder. From experience in our office, items such as a slipped roof tile, blocked/broken guttering or a crack in the outside wall are the most common causes of this.

Putting the Damage Right

For condensation the best cure is to keep the affected areas well ventilated (for example, using extractor fans where there is one and opening windows to keep air flowing through) and to wipe down any areas where the mould appears to help prevent it spreading. It will take time for it to eventually die down but with some good ventilation and some old fashioned elbow grease you should soon notice the difference.

As above, damp may need a little more than just cleaning but a good builder can recognise exactly what needs to be done to cure the problem. Once the job has been finished you will probably need a few coats of good paint or stain block once the moisture has dried up to stop the marks from appearing again.

Big Difference

Condensation usually occurs higher up in rooms whereas damp can lurk around outside walls where moisture can come in rather than it trying to get out. Sometimes it is better to do some investigative work yourself before involving any costly call out charges.

15Nov 2012

Rental Property News: Survey Shows High Number of Properties Left in Poor Condition

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By Craig Smith

At the end of every tenancy comes the day that a lot of Landlords and tenants both dread… the day the tenant hands the property back to the Landlord. The actual arrangements can be simple enough but sometimes the property can be returned in a less that satisfactory condition.

Landlords Not Happy

A recent survey of 300 Landlords by Meet My Agent suggests that 73% were not happy with the condition in which their rental property was returned to them. This doesn’t necessarily mean that the properties needed a complete refurb but can mean items such as cleaning or repairs were not up to scratch. That said, the survey also suggests that 41% of Landlords’ properties have needed a complete refurbishment following a tenant vacating which is staggering!

Our Recent Statistics

I’ve looked back through our most recent 20 check outs and can conclude that, in general, more properties have issues upon the tenants vacating than those that don’t. The split is 60% that have issues, whether it is something small such as a couple of hours cleaning or more in depth works, to 40% that were left with no issues whatsoever and are ready to be occupied again.

Facts Instead of Presumptions

To get a better picture I think it is more important to look at the actual level of works required rather than just looking at the number of issues. Looking back again at the 60% which needed works, I cant find a single one which didn’t need some form of cleaning following the tenant vacating. Again, this doesn’t mean that these tenants have lived in squalor, (far from it!) but does mean that the property wasn’t left in such a clean condition as when the tenancy first began.

3 out of those 12 needed items other than cleaning such as replacement items but none of these were anything too major.

Preventing Extra Works

One way to better the chances of a property being returned in good condition is to not only take an inventory at the start of the tenancy but also to tell the tenants what you would expect. Part of our usual process is to send a short set of guidelines to the tenant which lists some of the most commonly forgotten items. Some of the main concerns mentioned above include dusting down skirting boards or making sure a kitchen extractor hood is left clean.

Best Practice

Through the experiences this office has gained we find that advising tenants before they vacate can help to ensure a property is returned in a good condition. Of course this isn’t always the case but it does all add up to ensure a smoother handover!

18Oct 2012

Landlords Lose Money to Greedy Utility Companies

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By Craig Smith

A little while ago, Steve from our office blogged about some of the issues he was having with a certain utility company, namelyUtility Warehouse. Well it seems they are still trying to overcharge for energy used in rental properties!

Incorrect MeterReadings

The usual process for our office when a tenant moves in or out of a home is to inform the relevant companies, in writing, of the correct readings and forwarding address. The property in question was no different where after a brief empty period, new tenants moved in and the emails sent off to the utility companies. We would normally expect to get any final bills within a few weeks, arrange for the payment to be made and everything can be forgotten about until next time.

Well, the bill came through with estimated readings! This basically means that the energy supplier hasn’t taken any notice whatsoever of the readings we have taken and made up their own readings. Surprise, surprise! They are usually always over-estimated and this case was no different, which meant that we need to send the correct readings over… again!

Lack of Contact

This all happened in August (2 months ago) and since then we have had no contact fromUtility Warehouseregarding this account. Until today. A letter arrives through our door from a debt collection agency chasing the outstanding amount of just over £20! (Now, you might think that arguing over such a small amount is silly but you should only pay for the energy you have used!)

Needless to say that due to the lack of contact and the usually less than helpful nature of some of the debt chasing staff, we have made contact & told them what we think of the service!

Not the Only One!

It may sound like I am singling out a single supplier here but the truth is that this seems to arise with numerous companies and some are worse than others. Which begs the question, how many people (not people, not just Landlords!) are out there that have been scared by these tactics and ended up paying more than they should have done?

Deemed Rates

Another big money-earner is the type of tariff the account is put onto. When you are living in a property it is easier to research cheaper rates for your energy bills but something that a lot of Landlords forget when a property is empty. This is particularly important if a property is left unoccupied for a longer period of time. We have had instances in the past where no energy has been used at all but standing charges still apply.

The Solution

Unfortunately, there doesn’t seem to be any way of making dealing with some of these companies any easier and sometimes you just have to grit your teeth and get on with it. By always informing any changes in writing, it gives a good backup should accounts not be updated as they should be. For now, we shall carry on…

12Oct 2012

Property Landlord Advice: Quick Turnarounds Not Always the Best Way!

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By Craig Smith

With some of us here at Castle Estates being Landlords ourselves, we understand how important it can be to keep any downtime of a rental property to a minimum. When a property becomes untenanted, the mortgage still needs to be paid along with insurance and, more so during the winter months, heating bills increase.

Breaks Between Tenancies

When marketing a property that is still occupied one of the biggest hurdles can be that the incoming tenant wants to move very quickly. We have instances such as this on a regular basis but sometimes have to be firm about the move in dates.

It is not as simple as one person moving out and another moving in the next day as there may be cleaning or decorating work that needs to be completed in between. By booking someone to move in the very next day or even within a few days later can cause the new tenancy to start on the wrong foot which then has a knock-on effect for the rest of the tenancy.

Best Presentation Always Important!

Some tenants are happy for works to be completed after they have moved in, usually small things such as a repair to a leaky tap. The biggest issues can be checking somebody in to a property that is unclean or needs the gardening tidying up as this can be used ‘as ammunition’ when something goes wrong further down the line.

We always recommend to our Landlords that their property is presented cleanly and, if applicable, gardens left tidy. This helps to stop any arguments at the end of the tenancy which can get very messy (no pun intended!) when trying to agree any deposit costs.

Extra Time to Ensure Safety

We had a tenant moving forward with a property a few weeks ago who needed to move quickly. This was fine but the property wasn’t quite ready and the move in ended up being delayed in order for the outstanding issues to be resolved. Luckily it wasn’t anything too major and the delay was only a few days but any more than this and the tenancy may have fallen through before it even began!

There are some examples where tenants don’t understand the reasoning behind delays, particularly when it could be a matter or breaking the law. If a property hasn’t had its annual gas safety check, for example, there is no way we could sign the tenancy agreements as without the pass on the certificate, we would be unable to do so. The reason is that the law states the gas safety certificate must be in place and to ensure the safety of any occupants. Not only would this be against the law, I also think it is morally wrong to place a tenant in potential danger.

Stuck in a Chain

The other common example that crops up regularly is when an outgoing tenant is purchasing a house and they are stuck in a chain. If a new tenant is already lined up to move in there is still nothing we can do to ask the current occupiers to leave as, even if they have given their correct notice, it can still be extended!

Best Advice

Going back to the start of this post, we understand how Landlords need to have the minimum amount of empty periods possible. Sometimes, a little extra time between moving out & in can prevent a lot of hassle later on!

17Sep 2012

Not All Rental Properties Are Suitable for Students!

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By Craig Smith

Over the summer and early in September we always have a number of enquiries for student properties. Once the university acceptance has come through the next hurdle on the way to further education is finding suitable accommodation. The key thing to remember is not how many bedrooms the property needs to have (a 2 bed terrace will probably be no good for 4 sharing people!) or even how close it is to a university but rather if it is suitable for the tenancy.

Some Landlord Prefer No Sharers

Most Landlords, certainly from our experience, prefer not to accept sharers in general. Perhaps two friends or colleagues looking to share to save on living costs would be OK but not usually more than that. The problem is so many bad experiences that Landlords have had where properties haven’t been kept in the best condition by sharing tenants.

We have had some instances where the ‘blame game’ is played. Maybe a rota has been set up to tell who should do which job and when but not everybody sticks to it. Tenants sometimes forget that if they are all named on one tenancy agreement then they are all jointly liable for any damages or outstanding rent. This means that all of the tenants are able to use all of the property.

Specifically Designed Sharing Properties

The same problem can occur when each tenant has an individual tenancy agreement but still has use of some communal areas. For example, renting a single room with a shared kitchen and bathroom. Each room is the responsibility of the individual tenant but the shared areas can remain a grey subject.

We had one instance recently where a particular tenant denied leaving the shared kitchen in a mess after use. Quite a coincidence then that as soon as this particular tenant vacated the condition of the property has improved!

Students Renting Issues

The main issue that some Landlords have with students is not the lack of rent payment. Most rents are paid in advance with thanks to student loans or the bank of Mum & Dad. There is a common stereotype of a student being a wild, partying lout who will trash the property without a care in the world. Of course, this isn’t the case but looking at other situations before, it only takes one bad experience for a Landlord to be put off.

Student Specific Properties

Most properties are subject to HMO Regulations (Homes in Multiple Occupancy) which means that it needs to have up to date safety equipment, signs etc if it is to be let to sharers. There are other properties that are designed just for student accommodation which may already meet the necessary requirements. This is also something that you should look out for if you are looking for a rental property and yet another reason why sometimes going through an agency is best!

 

31Aug 2012

Viewers Put Off By Poorly Presented Properties

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By Craig Smith

As one of the largest agents in Staffordshire, we get to see a wide range of properties in different areas around the county. It is always nice to see something different and how different owners have designed their homes to suit their needs and, particularly in smaller homes, how they have made best use of the space they have. But one of the issues we have is marketing a property that is not presented at its best.

General Cleanliness

One property that I showed to a couple earlier this week is a prime example. The current occupiers were still in the process of moving out so there were a few dismantled beds and pieces of furniture still to be taken away. Usually this wouldn’t put any viewers off as people who are about to moves themselves can appreciate the amount of work it entails.

The main issue for this property was the amount of cleaning that was needed. There were bags of rubbish piled in the back garden and the house really just needed a good going over with a damp cloth. If a viewer sees a property in this kind of condition it is hard for them to imagine how it will look when they are ready to move in. It also puts doubt into their minds about whether the Landlord would be proactive with any future issues during the tenancy.

Does the Paintwork Need Touching Up?

Another issue the viewers had with this particular property was the condition of the walls and paintwork throughout the house. Again, most people can look past a wall or two that is yet to be made good but when the majority of the walls need filling in and completely repainting, it can be hard to visualise the end product.

It is easy to tell someone what work is going to be carried out before they move in but it is hard for them to actually believe you without any actual evidence. For example, if one room had been started and the viewers could see tools or paintbrushes etc then they might have believed me a little more!

Keen to Get the Property Let

We understand from a Landlord’s point of view that it is best to get the property let as soon as possible to avoid any prolonged empty periods for their property. But when a property is poorly presented it can sometimes make us agents feel like we are wasting our time. Sometimes it is best to hold off on any marketing and wait until the majority of any work is completed.

Needless to say we have spoken with our Landlord since who has welcomed our advice, even if it is sometimes a little hard to put it across in a polite way!

17Aug 2012

Property News: House Prices Increasing for Both Purchasing & Rental

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By Craig Smith

The BBC has produced an article today showing that house prices continue to rise and that families are being forced out of their homes due to ever increasing costs.

Facts & Figures

Before we all start getting scared and wondering just where will we all live in the next few years, lets look at some of the facts.

Yes, rent amounts have increased in the last few years in particular. But if we look at the amount they have risen in comparison with house prices, which have risen by around 59% in the last 10 years or so, the average rent amount has increased by around 44%. This means that Landlords are getting less return for their property than they would have done 10 years ago.

Current Rents Increasing

With this is mind and the huge amount of rental property that is now available, Landlords are finding it more difficult to increase the rent on a current tenancy. It is better to keep a good tenant in place rather than risk pushing them out with higher rents and having an empty period at the property. Most tenants who find their rent going up will notice that it might only increase by a small amount.

People Still on the Move

In the BBC report is suggests that it is now harder than ever to purchase a property. With lenders being very careful about the amount borrowed, buyers are finding themselves shaving to find bigger and bigger deposits. Although, all things considered, over the last 12 months we have generally seen a rise in the number of our tenants who are leaving their rental accommodation and who have purchased their own home. So the property market is still active, albeit slower than we might be used to.

More Homes Still Required

Many people comment on how many new homes might be appearing in their local area but the facts show that the amount of new homes being built has decreased. The Office of National Statistics shows us that the population ofBritain is ever increasing. Couple this with relationship break ups and more & more people wanting their own home, demand is ever increasing. 

The End Result? 

As buyers struggle to find deposits, the demand for rental property increases. In order to get the property market bump started again, lenders need to lower the deposit rates for mortgages!

01Aug 2012

Property News: Full Council Tax Charges May Apply to Vacant Properties

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By Craig Smith

If you have had a property empty for whatever reason, you may know that a property can be exempt from council tax charges for up to 6 months, provided that it is unoccupied and unfurnished. This is known as a Class C exemption.

Under the Localism Act (which has also changed the way in which tenancy deposits are dealt with recently) the Government is planning to allow local authorities to charge almost whatever they like whilst the property is empty. In theory, the council could still allow an empty property to be exempt from the charges but, on the other hand, they could charge the full amount of council during that period.

Bad News for Landlords

Lets just put one thing into perspective here. Yes, sure, the local authorities could earn a little extra cash with the budgets being tighter than ever, but have they thought how this would actually affect homeowners?

It is not always possible for tenants to move out and in on the same day and it is not usually advisable especially if any work was needed between tenancies. A Landlord could find themselves not only out of pocket but in a financial mess if their property was empty for a month or two. Not only would they have no rent coming in to cover the mortgage, insurance etc but they would also have the expense of paying the council tax for a property they don’t even use!

The Knock-On Effect

If your not a Landlord yourself then you might think I’m being biased here but what about the knock-on effect on regular homeowners? For example, an elderly person moving into a care home might leave their home empty whilst they sell it, another expense to prevent them moving forward with their lives. Or how about someone relocating for work and needs to move away quickly?

And this is a Government that is trying to get the housing market back on an even keel?

Looking at this from the other side, most rental properties would hope to be empty for only a few days between tenancies which would mean that only a small amount of council tax would be due. Now, it is isn’t always easy to contact Landlords, particularly if the Council haven’t got the Landlords home address to address any billing. This would create a whole load of extra work for the Councils to chase outstanding amounts so all that money that could earn from empty properties could all be lost in chasing the debt!

Is This Really a Possibility or Just Scaremongering?

A consultation has already been held and 169 councils voted in favour of the extra charges and only 25 against so it is clearly obvious what the majority want. Unsurprisingly, the majority of Landlords are against the idea and quite rightly too!

I’m sure that this is by no means the last we will hear of this as we trundle towards the inevitability of the ever increasing costs of being a Landlord!

19Jul 2012

Rental Property Advertising: Energy Performance Certificates to be Shown with Particulars

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By Craig Smith

Just over a year ago I wrote about some changes that were planned with regards to including Energy Performance Certificates as part of the details shown to prospective tenants. Well the changes are now in place and, despite quite a lot of confusion, we finally have the answers to some of the questions that have been asked repeatedly over the last couple of weeks!

New Style EPC’s Now Available.

There is now a new style Energy Performance Certificate which still shows the same details as the ‘old’ ones but just in a different format, a bit like a newer model of a car! Some experts have been worried that any older format certificates would need to be replaced by the newer ones each time a property is re-let, even if the certificate has not yet expired. We can now confirm that this is not the case and that older format certificates are still valid, provided they are not out of date.

Should EPC’s be Available when Marketing?

The certificates should be included with printed details if they are being given to a prospective tenant and indeed available at viewings. They should also be provided to a tenant when they move in to a property whether they request one or not. The other change is that the first page of the document should be visible on any electronic advertising such as websites.

However, they do not need to be provided in window displays (imagine the amount of extra windows agents would need just to show them!) or in printed advertisements, for example newspaper adverts.

Should a New EPC be Obtained for Every Letting?

The short answer to this is no! An EPC that has been carried out for the purpose of letting a property is valid for 10 years and the only time it needs to be renewed before this is if any changes have been made to the property that might affect the rating. For example, having new double glazed windows installed or insulation put in.

Further Advice: Saving Energy in the Home

The certificate gives an estimated amount of how much it would cost to run the home over 1 year, based on assumptions of how long the heating will be turned on etc. This won’t be an exact amount that the occupier could expect to pay but does give some idea of how much they would be looking to pay at the property.

Just this Saturday at a viewing, a gentleman asked to look at the EPC as he wanted to compare the energy rating to his current property. He was going to look at the pro’s and con’s of paying extra rent for a new property compared with how the energy bills would stack up. I have to say, I can still count on one hand how many people have actually asked to look at the certificate in the last 5 years!