Category Archives: Letting Update

25Oct 2011

Property Letting Update: Tenants Numbers Fluctuating

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By Craig Smith

We were having a conversation in the office just last week about how the number of tenant enquiries seems to have dropped rapidly. The number of telephone calls receiving asking about properties had fallen but Landlords are still as keen as ever to get their properties let, if there is no tenant there is no rent coming in to cover mortgages, insurance etc.

More Tenants on the Move

But wait, its not as bad as it sounds! By looking at the number of enquiries compared with the last 2 years there is still an increase in the number of tenants on the move. For example, on our website alone, the number of views from August 2009 to August 2011 had risen by more than 12,000. It is the same story comparing the number of views from March 2009 to this year with an increase of more than 13,000!

This doesn’t necessarily mean that there are 13,000+ more tenants moving. More and more people are now using the internet for everything from ordering their weekly shop, to social media, to finding a roof to go over their heads! Perhaps the increase could be blamed on a mix of properties being more easily accessible online and an increase in the number of properties in the rental market.

Higher Demand, Higher Rents?

There have been a number of news reports recently stating how poor the housing market is and that many people cant afford to get themselves onto the property ladder, so perhaps this is why more people are looking to rent instead? It has been reported on the ARLA website over the last couple of weeks that demand seems to be outstripping the supply of rental properties.

Well, we always have properties available and I very much doubt that we’ll ever see a day where we have absolutely nothing left to market but this isn’t quite what is meant by this term. Sometimes we see a high demand for family homes, such as 2 or 3 bed houses and as they get snapped up, the number still available will decrease. This is when tenants may be willing to stretch to pay a little more rent to make sure they get the house they want. At this time of year, there is always lower demand for rental properties and we can prove this by looking at the number of enquiries in October year on year.

Should We Be Worried?

It seems that the only news we see about property in this country is how about how poorly the market is doing and how the country is on its knees. Yes, it is true that a lot more people are trying to spend less wherever possible, not just in the property market but life in general. I don’t think we need to be worried but perhaps just a little more cautious. 

10Oct 2011

The Benefits of Regulated Letting Agents to Landlords and Tenants

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By Craig Smith

Wow, it seems like only  minutes ago that our blog was last updated but it is nearly 2 months already! Anyway, not too long ago I published a post raising some concerns that some people have with unregulated letting agents not being properly trained. Well, I can confirm that I have now passed all four of the ARLA Technical Award examinations which means that I will soon be able to become a member of ARLA!

Because of this, myself and one of our directors attended a regional ARLA meeting just last week. This is where members from the surrounding regions (in our case, Staffordshire and Shropshire) get together and discuss the latest legislation changes and ideas to promote our businesses and ensure that we always give the best and up to date advice.

Unregulated Agents Under-Cutting

One topic that was discussed was an unregulated agent who was seeing properties with a to let board and contacting the owner with false promises of having a tenant who is very interested. Of course, once a Landlord has moved to the agent the tenant has magically already found somewhere else but the agent has then gained (or in some peoples opinions stolen) the business from a professional organisation.

Sometimes a logo doesn’t mean much but a little homework can go a long way. For example, as you are reading this now, do you really know what ARLA means and how they look after both Tenants and Landlords? By being a member, an agent has to follow the codes of practice as set out by them which gives a more professional letting service and better management of a rental property.

Proper Training for Professionals

Another good service provided by ARLA is the training that they can provide. Not only the exams as we spoke about earlier, but training sessions throughout the country for different areas of property management. You might think that an agent should already know everything about everything but there is always something new on the horizon! Updates in law can determine whether a process needs to be changed or different advice needs to be given to a Landlord.

Of course, not every unregulated agent should be treated as cowboys, it always takes time to become established and better known in an area and also time to gain the experience needed. Unfortunately, like with most walks of life, it only takes a handful of the bad guys to give others a bad name.

Important Updates for Landlords

As mentioned earlier, it is important for Landlords and Agents alike to stay in the know of changes to legislation that may affect their rental properties. This is another benefit of being a member of a professional body as we found out last week with the changes to the payment of water rates for a rental property, more about this to come soon! 

10Aug 2011

Landlord Property Advice: Always Allow for Wear & Tear

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By Craig Smith

When a tenant leaves a property, some Landlords think that they are automatically entitled to have items such as carpets replaced or walls repainted at the tenants’ expense. But this isn’t always the case as Landlords must take into account fair wear and tear.

What is Classed as Wear & Tear?

As a general rule, wear & tear is usually worn carpets or  a reasonable amount of scuffing to walls in high traffic rooms such as a hallway or stairway. Over time a cooker or hob may start to look a little shabby purely because of the amount of use it has had. Landlords should expect this during a tenancy and need to make reasonable allowances when a tenant vacates.

Certainly staining or deliberate marks are not just wear & tear but can be classed as damage. Yes, everybody has accidents from time to time and the odd drink will be spilt or food dropped at a meal time and replacing a large carpet could be expensive, but don’t forget that tenants can take out insurance for such incidents. (Refer to our previous blog regarding insurance.)

Longer Tenancies Means More Wear

Something that you learn very quickly in this business is that everybody has different standards, one persons ‘filthy dirty’ is another persons luxurious palace. It is very difficult to police how somebody lives in their home which is something that some Landlords forget. Generally speaking, the longer someone lives in a house the more wear is to be expected. For example, a property that has been tenanted for 5 or 6 years should expect more wear than one that has been let for just 6 months. Obviously there are some exceptions where there may be an exceptionally good or bad tenant.

The More Tenants, the Higher the Wear?

Another factor to take into account is the number of tenants who will be occupying a property. Imagine a typical 3 bedroom house, with a tenancy that has run for 3 years. If the tenant was a single person living on their own, you would expect less wear than a family with 2 adults and 3 children.

The same can be said for pets. Most pet owners are responsible people who look after their pets and the property they live in. However, if a Landlord chooses to accept a pet in the home then the Landlord should also expect some additional work at the end. Yes, it is the tenants responsibility to leave the property in the same condition as when they took it on (not forgetting some reasonable wear & tear!) but the Landlord should make some allowances when discussing any costs.

Excuses, Excuses

So we should avoid any tenants with pets? Wrong! If all Landlords avoided these sorts of tenants, there would be an awful lot of homeless people! Don’t forget that obtaining good references before a tenancy commences will help to determine how good the tenant is and, although circumstances can change, will give a Landlord good indications of whether to proceed. The same can be said for gardening, if a tenancy started with a neatly cut and well presented garden but left overgrown and weedy, the tenant cant say that this is because they aren’t gardeners. The property should be left in the same condition and this shouldn’t be used as an excuse! 

13Jul 2011

Advertising a Rental Property: Where and How?

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By Craig Smith

Each advertising platform may try to tell you that they are the best to market your property, whether it be online or in your local newsagents. But which really is the best way of advertising a property?

Internet Property Advertising

Well, I guess there can’t really be a right or wrong answer to this as there are so many factors to take into account. Perhaps the most wide reaching method is the Internet with, according to the Office of National Statistics, more than 30 million adults having Internet. In turn, some of the more widely recognised property advertising sites advertise using television and radio campaigns, which then generate more users for the agents using the sites.

It is a fact that most enquiries we take are from Internet sources. The majority seem to be either from our own website, Zoopla or Rightmove just to name a few. Some of these sites are particularly useful to working professionals who might not always be at home to read the local newspapers or they can perhaps even look whilst they are at work or travelling with the aid of modern mobile phones or a laptop.

As an ARLA regulated agent, Castle Estates also display available properties on Property Live (refer to our previous blog on agent regulating).

Your Local Newspapers

If you are looking to stay in your local area, most local newspapers have sections for property for sale and to let. The disadvantage to this is that it will only reach a local audience and won’t appeal to the national audience. We see a large number of professionals who move from various places around the country and even abroad for work or to be closer to family. However, newspapers might only be published once or twice a week, whereas Internet advertising can be changed as and when properties come available.

Of course, there are still a number of people who don’t have Internet access or prefer not to use it, which is where the local newspaper will reach more prospective clients. Most areas have a weekly free newspaper which will be distributed throughout the area and should reach a large number of people.

The Good Old Advertising Boards!

Some people will see boards displayed at a property as a nuisance, particularly if a number of properties are available in a small road. However, on busy roads and popular housing estates, these boards can generate a lot of interest in a property. A lot of people will see a board and then go onto the Internet to find out further information. They also come in very handy if your not sure whereabouts the property actually is!

So Then, Which is Best?

Unfortunately, there is no definitive conclusion on this. Each way of advertising has is benefits and disadvantages, which might suggest that the best way is to use all of them. The best would be whichever suits the clients that are being targeted, in our area there are rural villages where many people prefer a local paper than using the Internet, but also people relocating who find it easier to look at the up to the minute details on the web. 

05Jul 2011

Property Rental Advice: Unregulated Agents May Not be Properly Trained

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By Craig Smith

There have been a number of news articles recently about the number of letting agents going out of business whilst still in possession of money that is owed to Tenants and Landlords. Sometimes the office may relocate to save costs but sometimes poor communication can lead to a lot of confusion and Landlords being out of pocket.

Professional Bodies

There are a number of professional bodies that agents can join, there is ARLA, RICS and NALS to name just a few, and Castle Estates Staffordshire is an ARLA regulated agent. By being members of a governing body, this can give Landlords and Tenants reassurance that their money is safe and protected as necessary.

Is Your Agent ‘In the Know’?

There is no current law that says a letting agent must be governed and near enough anybody could start their own letting agency. Some of these agents may be charging very low management fees which will no doubt attract some Landlords due to the lesser amount of money that they would have to pay out. But do some agents have the experience and the knowledge to manage a property correctly?

We are proud to have 4 fully ARLA trained staff in our office and 3 more staff members currently working their way through the training material and examinations. By having staff members completing this training, they show that they understand the current legislations and practices that dictate the world of lettings as well as receiving regular updates in lettings news.

Safety Risks

As mentioned earlier, some agents may not have the experience or the know-how when some matters arise. In turn, this could compromise Tenant safety during a tenancy, for example not having a Landlords Gas Safety Certificate completed each year. The safety check is perhaps the most commonly thought of but there are dozens of other examples, such as the Fire & Furnishing Regulations Act 1988 where furniture provided by a Landlord must meet certain safety criteria.

So Who Can We Trust?

There are a number of unregulated agents who are more than trustworthy and we do not aim to ‘tar everybody with the same brush’ where this is concerned. Likewise, there are still a few rogue agents who will be regulated but may still choose to deal in an inappropriate manner. Sometimes the best marketing tool is the simplest… recommendation! 

28Jun 2011

Cost Cutting Leads to More Disputes Between Landlords and Tenants

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By Craig Smith

In recent years, the country has been through a recession (some people would argue that we a still in the recession) and the cost of living seems to be ever increasing. Not only the cost of food and necessities but the cost of fuel has risen dramatically in just the last few months. This has had a knock on effect in the way that some properties are presented at the end of some tenancies.

Increasing Disagreements Between Landlords & Tenants

We have seen an increasing number of disagreements between Landlords and Tenants over some items which may be considered insignificant in the scheme of things. For example, a shower curtain may be left in a well used condition at the end of a tenancy by a Tenant who doesn’t think they should spend £10-20 replacing it. However, the Landlord may also be less willing to replace it as they may see this as an unnecessary expense. This then leads to a dispute between them and can sometimes turn what was a perfect tenancy into a feud.

Deposit Disputes

Thankfully, we don’t have a great deal of deposits that go through the DPS adjudication process (please refer back to our blog relating to best practice for deposits) although it is increasingly difficult to reach an agreement between both parties. We act as agents on behalf of our Landlords which means that some Tenants see us as ‘taking sides’ This isn’t the case and whilst we do work for Landlords primarily, we always try to reach a fair decision. For example, a Landlord who may be trying to charge £100 for that shower curtain probably wont get his money if the case went to dispute.

Issues at the Start of a Tenancy

Not all disagreements occur at the end of a tenancy. Some Landlords may not see the need to clean a property before tenants move in or have those little jobs finished. This then comes back round in a circle at the end of a tenancy when the Tenant may feel that they should leave it in the same condition.

What to Do?

Best practice dictates that a property should always be presented clean and in good condition at the start of a tenancy. By doing this, there is a benchmark for how the property should be returned when a Tenant vacates. Although wear and tear can only be expected, properties should always be presented as you would like to find it!

23May 2011

Property Letting Advice: The Importance of Good Communication

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By Craig Smith

In a recent ARLA publication, the property ombudsman (Christopher Hamer) has written an article relating to a tenant decorating a property. The story goes that, following the tenants request prior to signing the tenancy agreement, the Landlord would not decorate the property. The agent had then given permission for the tenant to carry out the works themselves. However, the Landlord had no knowledge of this and as such tried to claim for the costs of returning the property to its original condition from the deposit.

Tenants Decorating Permission

In this case, it appears that the Landlords agent had given permission for the tenant to redecorate, which could have cost the tenant a substantial amount of money, without first gaining the permission of the Landlord.  There really can be no excuse for this, even if the Landlord was away or unable to be contacted the agents should not have given the permission to the tenants.

Payback Time

As the Landlord had claimed for recompense from the deposit, the tenant then complained to the property ombudsman due to the distress caused by the lapse in communication. If an agent is a member of the ombudsman, it will deal with any complaints made in the most suitable manner.

The article states that the ombudsman awarded £200 in compensation to the tenant for the stress.

Lessons to be Learned

Although the tenant had quite rightly sought permission from the agent to carry out the decorating, the agent had not contacted the Landlord for their advice. Ultimately, it should have been the Landlords decision whether or not to allow the decorating to be carried out.

Best practice dictates that permissions should be in writing and a record kept of and do’s and don’t given to the tenant by the Landlord. The agent in question was at fault for not fulfilling their obligations to their Landlord, which goes to show the importance of having trust in your agent. 

17May 2011

Local Housing Allowance Changes to Affect Landlords & Tenants

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By Craig Smith

Since the coalition government came in to power in May 2010, a number of cuts have been announced as part of their plan to reduce the deficit. One of these cuts is to the LHA (Local Housing Allowance) which is paid to the unemployed or those with lower incomes who are living in rented accommodation.

The Affect to Tenants

The amount of LHA paid to tenants will be reduced, typically around £30 per month on a 3 bedroom house (see the handy table which has been produced on the DirectGov website). This might not sound like a lot to lose, but this could be an extra £360 a year to find, and when your already struggling to make ends meet this can be a lot of money. Put this together with the ever increasing cost of living and things only seem to look worse!

The cuts come into place either on the renewal of a claim (12 monthly anniversary) or when there is a significant change to the claim, such as a new baby or moving from one property to another.

Landlords Reactions

A member of staff from Castle Estates recently attended a local Council Private Sector Landlord Forum which was to discuss the changes and keep Landlords informed of what is going to happen. The meeting itself was perhaps aimed more at private Landlords (as the title suggests!) although a lot of useful information was provided to everyone who attended regarding the cuts.

As the amount paid to Tenants is to be reduced, the extra money needs to come from somewhere. And if the money can’t be found then the council’s answer was simple… reduce the rent. At this moment the room fell silent for a second or two, until a few Landlords began to chuckle. They seemed to have forgotten that Landlords still have mortgages to pay, insurance to cover and repairs to be made.

The Route Forward?

Perhaps the first thing to come into a Landlords mind is to steer clear of any Tenants who may be in receipt of LHA payments. However, in the long run this would mean less and less housing available to those Tenants. This doesn’t necessarily mean that some Tenants may not be claiming in the future, for example, someone who has recently been made redundant and is unable to find new employment?

The other way of looking at the situation is that although the payments would be a lesser amount than would have been expected before, the payments would be made regularly to the Tenant. This doesn’t always guarantee that the Tenant will pay the money to the Landlord, but some good tenant referencing would also help in the selection of a suitable tenant. 

13Apr 2011

Lettings Update: Change in EPC Rules to be Implemented

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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! 

05Apr 2011

Landlord Advice: Keeping on Top of Utility Bills

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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!