Tag Archives: Rental Property

19Jun 2013

Property News: The Green Deal Yet to Make an Impact

⋅ Leave a Comment

By Craig Smith

Green Deal

Earlier this year a new initiative was introduced by the Government called the Green Deal which is designed to help households make energy saving improvements to their home and pay the cost in monthly instalments.

In case you haven’t heard much about this before, don’t panic. The basic idea is that a survey is carried out on the property, you can agree to have works done (such as having insulation installed or a new energy saving boiler) and the cost is included in your monthly electricity bills. If someone else should move in before the amount is paid off, the new occupier takes up the repayments. As a letting agent managing more than 300 properties, and around 150 where we act in finding tenants only, we can honestly say that not a single tenant or Landlord has asked us about it!

When the offer of free insulation was still around, there were households queuing up to try and get some, which is understandable. Late last year we were trying to work with a company who could offer free cavity wall & loft insulation on some properties but funding for this has now been ceased. There are only some people who are now eligible for this depending on what type of benefits they may receive and their overall household income.

The Green Deal is the new scheme now but not many people seem to have taken notice. I’m starting to wonder just how many people have actually looked into it nationwide or if it is just something that nobody is interested in. It doesn’t appear to have been advertised very much in the national press, more so around the property professionals who might be affected by it.

From 1st October 2008, most rental properties will require an Energy Performance Certificate before being able to be let by law. (There are certain exemptions such as room shares.) This was really the start of the energy saving regulations coming into the rental sector and, looking to the future, it will certainly have further implications in the industry. For example, it is almost certain that as of 2018 a property with an energy rating of E or lower will not be able to be let at all.

Whether or not you agree with the energy saving measures is another talking point, but the time to start thinking of potential improvements and planning for the future is now, before it is too late!

11Jun 2013

Utility Companies Who Expect More Money Cause Headaches in Rental Properties

⋅ Leave a Comment

By Craig Smith

Utility Companies

Over the past few years we have seen an increased amount of people who have some form of poor credit. It doesn’t seem unusual these days for someone to have a CCJ or a repayment plan with a debt management company but it sometimes the lesser known about forms of debt management that can have a knock-on effect for other people.

For instance, most gas & electricity suppliers will install pre-payment meters if a customer is constantly late with their payments or doesn’t pay at all. This might seem like a fair form of punishment for non-payment but it is the Landlord and even the next tenant who are left to pick up the pieces.

One property that we manage was fitted with pre-payment meters for that reason and this was only found out when the tenants moved out. (The utility companies have no dealings with the agent or Landlord once the tenant is responsible.) The Landlord ended up having to top up the meter once the tenants had left as it had still been left in debt and to ensure it was kept topped up to keep the heating etc ticking over. Then, when the new tenant moved in, the energy company stated that the new tenant should pay on time for the next 12 months before they would even consider changing the meters back again!

There is one certain company that ask for a deposit of £100 each for gas & electricity supplies otherwise they will take further action. Just a few weeks ago we had a property come empty that was supplied by Utility Warehouse and they requested such a deposit. They informed us that the deposit would only be waived under 3 circumstances. The first was to setup a monthly direct debit for the payments which is unnecessary as the property would only be empty for a few weeks. The second was to have prepayment meters installed which would cause yet more disruption to the Landlord and the property. So, we opted for the third option which was to change to another supplier.

All this is just so much hassle considering only a small amount of energy is used during an empty period, and given the fact that we always take move in & move out meter readings for each tenancy there should be no incorrect billing whatsoever!

Going back to my first point here, how does any of this help somebody who has had financial difficulty to get back on track?! Some of these utility companies seem determined to make life difficult and don’t seem to be able to make a reasonable decision for the right circumstances!

02May 2013

Deposit Protection Schemes: Which One to Use?

⋅ Leave a Comment

By Craig Smith

When the law was changed back in 2007 it meant that any deposit taken for an Assured Shorthold Tenancy needed to be protected. There were 3 schemes set up that could offer this service, each working in a slightly different way but all with the same goal in mind. (There are now 4 but more news on that later!)To ensure that tenants’ deposits are properly protected.

Each of the schemes have their own set of rules and terms & conditions but the law governs that the deposit should be protected within 30 days of receiving it. Each Landlord or agent tends to stick to one of the schemes, knowing that all of the deposits that they take are in one place which makes everything that little bit easier to deal with. Although there is no right or wrong answer, which scheme do you think is best?

MyDeposits

Unfortunately, Castle Estates have never used My Deposits but there are a few of our tenant find Landlords that do use them. This is a ‘pay as you go’ service where any Landlord or agent has to pay a registration fee per deposit registered. The current prices for individual Landlords start from a £36 joining fee and £18-£24 per deposit, depending on the amount of the deposit.

Depending on the amount of deposits registered, this could turn out to be costly for a Landlord but the money can still be held by the Landlord themselves. My Deposits is what is known as an insured scheme where only the details of the deposit are registered.

Should any deposit deductions go to dispute and the adjudication service is used, they aim to resolve any disputes within 15 days which does seem very speedy.

The Dispute Service (TDS)

TDS is another insured scheme and offers a similar service to My Deposits. Castle Estates did use this scheme when the legislation first came in to place and continued to do so for around 3 years. It was only when the agent registration fees were hiked up, by around 400% in some cases, that the decision was made to switch to another.

Although we haven’t used this for 3 years since, they do now say that there is no joining or administration fees for Landlords. This is another insured scheme so the Landlord can keep hold of the money themselves, although if a dispute is raised the amount in dispute then needs to be paid over to them so they can pay it to the relevant party when a decision is made.

The Deposit Protection Service (DPS)

The DPS now offer an insured scheme, working in much a similar way to those above, running alongside their original custodial scheme. The custodial is basically what it says it is, any deposit monies registered are held physically by the DPS rather than sitting in the Landlords account. Currently, they are the only organisation who offer the custodial service.

This can put a lot of minds at rest, both for Landlords and tenants. There was one agency in our local area a few years ago who ceased trading for one reason or another and we had a number of their Landlords approach us who didn’t know where the deposit was. Some of the deposits were registered in an insured scheme and there is some protection offered but within a certain timescale. Some tenants didn’t realise what had happened until too late and ended up losing out.

As the DPS can hold the money themselves, should a Landlord (or tenant for that matter!) disappear without trace, the money is still held securely.

Your Choice!

So there we have it. There is no right or wrong answer as to which scheme a Landlord should use and everyone will have their own personal choice. The point is, each scheme has the same goal in mind; to protect the deposit that is held in line with the Housing Act 2004 legislation.

11Feb 2013

Councils to take Action Against Letting Agents’ Fees

⋅ Leave a Comment

By Craig Smith

In Scotland it is illegal for a letting agent to charge a prospective tenant any fees during the move-in process. Whether it is for credit checks or an administrative fee, it isn’t allowed.

Reasonable Charges

Since the law changed inScotlandwe have always been wondering when it would have a knock-on effect here inEngland. Well, it looks as though the time is now as some local governments are starting to tackle rogue Landlords and agents that charge higher fees.

Before we go any further into this, I would just like to point out that from what we hear from some of our tenants, we are not the cheapest agent in our town for tenants’ fees but nor are we the most expensive. The fee charged to a tenant looking to move into one of our properties covers the costs of the referencing/credit checks, the time to prepare the legal documents and also the check in appointment. If we charged much less, we wouldn’t be able to do half of that list and the tenancy would more than likely go pear-shaped further down the line because we weren’t able to do our job properly! And don’t forget, we’re not running a charity here.

We have heard from tenants who come into our office stories of other agents in the area who seem to charge for anything and everything. Personally, I have never looked any further into this so cant comment one way or another. The one thing I will say is that both tenants and Landlords need to be careful as some ‘rogue’ agents will charge a lot of hidden fees.

Law Surrounding Fees

It is generally well known that if you are going to charge for any service that you offer, you need to make your customer aware before providing the service. You wouldn’t want to eat in a restaurant where the prices weren’t included on the menu, would you?

We have a good legal team here at Castle Estates who always advise us on the latest changes in law so that we know what we are doing is the right thing. Whether you are a Landlord or tenant of ours, you will probably remember seeing a list of our charges in the paperwork you signed before agreeing to do business with us. (If not, double check as they will be in there!)

Tackling the Bad Guys

The government is getting worried as there are a lot more people in the private rental sector than ever before, more than 3½ million in fact. It is no wonder then that there are more and more stories of rogue Landlords trying to rip off their tenants and these are the people the government is looking to tackle.

There is still call to have a register of all Landlords and/or agents who are able to let property. Whether or not this will eventually come about is yet to be decided in parliament and it would be interesting to know if this would be on a national or a local scale.

I believe that it should somehow be linked nationally to prevent any Landlords ‘getting away’ without facing up to their responsibilities. Where we are based, we are only 25 minutes from theShropshireborder so what would stop a Landlord who has properties in both counties being labelled a rogue in one and not the other?

This does look to be moving forward now as this is due to be raised in parliament later this month. So sit tight and lets see where this goes!

22Dec 2012

Letting News: Tenant Information Packs Becoming Compulsory in Scotland

⋅ Leave a Comment

By Craig Smith

As our office is based in the Midlands (England) it isn’t very often that we have the need to report on a change in Scottish legislation. The 2 countries may be very similar but they don’t share all of the same laws and regulations when it comes to lettings.

New TIP Packs

Under the Private Rented Housing (Scotland) Act 2011 any Landlord inScotlandwill soon have to provide each new tenant with a Tenant Information Pack (TIP). This may be new toScotlandbut may I just point out that Castle Estates have been producing these packs for almost 10 years! It has changed over the years to cover the ever changing legislation and changed layout once or twice but has remained generally the same.

Why So Long?

The Scottish equivalent could be up to 30 pages long with various information about the property and its necessary legal requirements but our fits neatly enough into 5 pages and covers, we feel, all of the general information a tenant might need. It is our general practice to go through this with every tenant at the check in to ensure that they understand their rights & responsibilities before they sign any tenancy agreement.

Don’t get me wrong, I’m all for making sure that everyone knows exactly what is expected of them but being perfectly honest, I don’t know how many people actually take the time to read it during their tenancy or remember most of what it means. Which only begs the question, what is the point in having a compulsory version that is 6 times as long?!

Waste of Effort?

If the government stopped and thought realistically for a moment, they might share the same viewpoint. Maybe this will just be yet another stack of paper wasted and extra money down the drain for no reason?

The same has happened in relation to deposit protection (uh oh, here we go again with deposits!). We now need to ensure that the terms & conditions for the relevant deposit scheme are provided to each tenant at the start of their tenancy. This is just over 10 pages of information which seems to end up in the bottom of a drawer or at the back of a cabinet.

Good Idea or Bad?

In general, I do think it is a good idea to have certain information for tenants although some of it may just be overkill and could be found with 2 minutes searching on the internet. I guess we’ll have to see if this becomes law in England and Wales too and how well it goes in Scotland!

21Sep 2012

Property Landlord advice: Insulation now available!

⋅ Leave a Comment

By Steve Roulstone

A few weeks ago I wrote that Residential Insulation which is currently being promoted through the Governments Carbon Emission Reduction Traget CERT and the possibility of Landlords being able to claim for expenditure against annual costs, was very difficult to explain to current Landlords and Tenants when the Industry itself had no way of communicating its message.

VNR Contracting Services

I am pleased to confirm that I have now found a Company who is not only being proactive in speaking and working with other organisations, but that understood what we are trying to do, but is also happy to put leg work in themselves in achieving a result.

Landlord and Tenant Choices

What we need to know is that as Property Managers, we can rely upon a Company who specialise in the Insulation field to explain clearly the benefits of having Insulation fitted and the grants that are currently available for Landlord and Tenant alike, one through direct costs and one through the tax incentive currently being offered.

Action Plan

This means we will be able to write to our Tenants and Landlords alike with information relevant to them and then allow the Company to follow up with visits to answer questions and quote for the work direct ensuring that our Tenants and Landlords are able to take advantage of the schemes before winter this year, if they choose to get involved.

Service Provided

To us, this is part of what we should be doing as Property Managers on behalf of all of our clients, not for any other reason than from a central point we are in a position to receive information as Companies approach us and distribute the same to a wide audience. It is not for us to dictate what decisions are made or even recommend what options are pursued, rather to place the information in front of those who have the right to take advantage of the grants etc that become available.

Reliable Contractor

What is reassuring now is that having struggled to find a Contractor to work with, we have been approached by one who already works with local Councils and as such carries a pedigree that is re-assuring. I am happy to recommend VNR Contracting Services Ltd and in reality that is only the second recommendations we have made in over two years of writing!

17Feb 2012

Lettings Blog: 1st Anniversary!

⋅ Leave a Comment

By Craig Smith

How time flies when your blogging! Today is the first anniversary of our lettings blog and whilst we’ll hold off buying a cake or organising a party we did think that this would be a good opportunity to look back on the last 12 months and look towards the future also.

The Past…

When we decided to begin publishing our lettings blog, the aim was simple; to keep tenants and Landlords informed of the big news and upcoming events in the lettings industry. We do feel like we have achieved this although with an office as busy as ours its not always easy to post as much as we would like but we have managed to keep up to date with the bigger issues.

With 12 months of blogging behind us this will be our 21st post. We’ve covered almost everything from changes to EPC rules to deposit disputes and no doubt this has been useful to a good number of readers.

The Present…

Right now we’re keeping a watchful eye on the news, not just in the lettings industry but worldwide events too. Every main news headline at the moment seems to concern the world’s money, or should that be lack of it?! Everything that happens has a knock on effect on others, such as if a factory closes down and 50 jobs are lost, that’s 50 less people who live in the area that are unable to pay their mortgages or rents.

It’s a tough time for almost everybody at the moment and things cant just change overnight. Forecasters can predict what is going to happen next but nobody knows exactly what is around the corner.

The Future!

Our aim for the future is to keep growing and providing the up to date information and continue to be at the forefront of the lettings news. It’s not all bad news so we hope to focus on some more of the positive updates rather than the negatives. 

25Oct 2011

Property Letting Update: Tenants Numbers Fluctuating

⋅ Leave a Comment

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. 

13Jul 2011

Advertising a Rental Property: Where and How?

⋅ 1 Comment

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. 

17May 2011

Local Housing Allowance Changes to Affect Landlords & Tenants

⋅ Leave a Comment

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.