Reeds Rains Property Blog

Property News from Reeds Rains

Rental Regional Review...

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England 

The housing market as a whole has recovered well since the credit crunch, with the average house price now standing at just over £34,000 higher than the previous peak in February 2008, according to our own Reeds Rains property price indices. Although the average price growth in London has dropped, due to revised Stamp Duty Land Tax and the pre-election threat of ‘mansion tax’ affecting the top end of the market, the lower rungs of the property ladder are thriving, particularly in the east of the capital. Newham, Dagenham, Bexley and Waltham Forest have all seen rises of well in excess of 15% in the past 12 months, a stark contract to Kensington & Chelsea, where values have dropped by an average 7.4%.

Still in London, the Greater London Authority’s Rental Standard scheme has been a tremendous success, with over 14,000 private landlords and more than 300 letting and managing agent firms having signed up, as of mid-March. As early adopters of the scheme, our branches all display the LRS badge that reassures tenants they’re renting from a responsible agent. Find out more here.

Liverpool

Measures to improve standards in the PRS in the north of England have recently been implemented in two of its major cities. Firstly, Liverpool Council has introduced a mandatory Landlord Licensing Scheme, requiring all private landlords to apply for a five-year licence for each of their rented properties from 1st April. Landlords must satisfy the council that they are a ‘fit and proper’ person to manage their properties, as well as meet certain conditions relating to health and safety and handling complaints about anti-social behaviour by their tenants. The licence costs £400 for the first property and £350 for each additional property, with landlords who are already members of a council-approved accreditation or regulation scheme receiving a discount and paying just £200. Visit Liverpool City Council’s website for more information. 

Manchester

And in Manchester, the council has recently introduced a Renting Pledge as an alternative to licensing. It is a simple set of standards that landlords can sign up to, to demonstrate that they are responsible and provide a good standard of home for tenants. Tenants of these landlords will also be required to make a pledge to pay their rent on time, look after the property and be a good neighbour. All the key professional associations, including ARLA, RLA and NALS have already signed up and the scheme has been generally well received in a city where 27% of residents live within the PRS. Visit Manchester’s local authority website for more information.

Wales

The average rent across England and Wales is 3.1% higher than February last year, the biggest year on year increase seen in the last two years according to our latest Buy to Let Index from Reeds Rains. Average rents in Wales were £566 per month, which was one of the highest increases of 1.8% year on year. Average yields remained at 4.3%, which is just below the average of 5% yield for England and Wales.

Oliver Blake, Managing Director  of  Reeds Rains, comments: “The  rental  sector  is  carrying  the weight  of  the  housing  crisis. More homes are  needed  to house  an  ever growing population. The supply simply isn’t there. The result is that landlords are catering to those who can’t afford to buy as well as those who choose renting for the flexibility it offers them workers moving into new jobs, or people wanting to get a feel for an area before committing to property ownership and setting down roots.”

Northern Ireland

According to the ‘Northern Ireland Quarterly House Price Index’ 2014 was a “journey back to a more normal housing market” with steady growth returning in both sales and prices – with the latter increasing by over 8%, suggesting 2013 was the year property prices bottomed out. 

Price wise, the average price ended up at £143,675 at the end of the year, much higher than the £133,000 it was the previous year and showing a pick-up in prices versus the last quarter too. Semi-detached bungalows and apartments grew at highest levels, breaking double digit growth, while terraces and townhouses rose by less than 3%. 

Belfast and areas such as Derry/Strabane saw the highest market rise at 14% year on year, while most other areas saw prices rise between 5 and 10%, with the exception of Antrim/Ballymena where prices actually fell just under 5%. 

Rental income wise, we are seeing rents stable to rising over the last 12 months. 

Ryan Andrews, Director of Reeds Rains Northern Ireland explains “We have noticed in recent months the return of chains to the marketplace which is due to more and more houses being sold at a higher level than previous years.” Ryan believes “this is a really positive sign which has been helped by the recent changes in stamp duty, with some excellent savings to be made especially in the £250,000-£300,000 bracket.” 

From the Buy to Let investors perspective, “the market is strong and lots of investors want to purchase before house prices rise any further.” 

For more information about the property market in Northern Ireland, please do visit one of our offices, call 0845 450 0865* or email Landlords@ReedsRains.co.uk. For the full property price update from Ulster University, read their Housing Index.

Q1 2015 - Landlord Survey Results

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Landlords predict rent rises to tail off

  • UK landlords expect annual rent growth to slow to 1.7% by next year, down from 3.7% currently
  • Finding trustworthy tenants deemed more important to landlords than higher rental yields
  • Nearly a quarter (24%) of landlords want to purchase additional rental properties this year
  • Three in five landlords (60%) think it is a good time to invest in buy-to-let, up from 54% six months ago
  • More than a fifth of landlords (22%) find their buy-to-let mortgage payments cheaper than a year ago

After a recent spurt of rent growth, landlords anticipate that rent rises will taper off over the next twelve months, according to a sentiment survey of more than 1,200 landlords conducted by Your Move and Reeds Rains, the UK's largest lettings agent network.

On average UK landlords anticipate that rents will increase by 1.7% in the coming year, a sharp slowdown from the current rate of annual rent growth to a steadier trajectory. According to the latest Buy-to-Let Index from Your Move and Reeds Rains, average  residential rents across the UK climbed 3.7% in the year to March 2015, the fastest pace for two years.

The proportion of landlords who will not raise their rents in the next twelve months has increased from 56% in September 2014 to 60% currently. Only a minority of four in ten landlords (40%) intend to increase their rental prices before March 2016. 

Read the full report here.

Rental Regional Review...

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England: Latest statistics from the English Housing Survey

At the end of February, the Government published its annual English Housing Survey and, for the year 2013 to 2014, the headline report had some encouraging data for landlords. The private rented sector remained larger than the social rented sector, even growing by 1% to 19% (4.4 million) of households in the country, while social housing held steady at 17% (3.9 million). And in terms of young adults renting, almost half (48%) of all households made up of 25-34 year olds rented privately, an increase of 3% on the previous year. That figure is more than double what it stood at a decade before. Over the same ten-year period, the number of households in this age group owning property fell from 59% to 36%. If this trend continues, albeit steadily, the demand for Private Rented Sector (PRS) accommodation will continue to increase accordingly. 

In terms of rents, the average in the PRS rose over the five years since 2008-9 from £153 to £176 per week, an increase of 15%. Given that inflation stands at roughly 3% per annum, this means that landlords have just managed to keep their rents rising in line accordingly. If you don’t do it already, now is the time to check whether your own rents have kept up with inflation and the local market. If they haven’t, it means the value of your profit is falling year on year, so you may need to review your investment and take steps to ensure it produces the returns you need.

Visit or call your local Reeds Rains branch to discuss whether we can help you do any more to maximise your rents from a market perspective. Call 0845 450 0865*, or email Landlords@ReedsRains.co.uk

Scotland: Tenant antisocial behavior 

Private landlords are responsible for any antisocial behaviour displayed by their tenants or guests in and around their property. That’s anything that results in others feeling alarmed, distressed or intimidated, all of which is subjective and therefore sometimes hard to tackle. To help you, Renting Scotland has released a new guide on how to minimise the chances of antisocial behaviour and what steps to take if it occurs.

Of course, if we are managing the property for you, we will look after any issues and try to resolve them before they become a major problem. If you do manage yourself, though, and receive a complaint from someone else in the property, a neighbour or the local authority, you need to talk to your tenant directly.

Explain what’s been reported, why it’s unacceptable and ask them to change their behaviour, then follow it all up in writing, so you have a clear record, should things escalate. Your tenant may not realise what they’ve done is considered antisocial and it could be easily rectified.

Importantly, then make sure you feed back to the complainant what you’ve done and how you and/or the tenant will attempt to rectify the problem moving forward. Often, the problem relates to noise so, for example, you may have agreed that they won’t play music or use a washing machine after 10pm.

If the behaviour continues, you can ask the council to apply for an antisocial behaviour order (ASBO) or take steps to evict the tenant. Provided you have established a good line of communication and have dealt fairly and clearly with the tenant, you should find it simply a matter of process for them to leave. But do remember that if, at any point, you feel threatened by them, you can always call the police.

For more information, visit www.rentingscotland.org/landlords-guide  

Wales

The market in Wales is currently pretty stable, with neither property prices nor rents rising, on average. At times like this, it is worth knowing what you can do to maximise your returns, through avoiding some costs and reducing others, ensuring your profits don’t drop.

The first thing to do is look at your expenditure. If you haven’t had a mortgage review in the past 12 months, contact your financial advisor or mortgage broker and ask them to see whether you could be on a better rate. Then look at your other monthly costs – utilities, services, etc. - and see if you can reduce any of those. To arrange an appointment with a Reeds Rains Mortgage Advisor, call 0845 450 0865*, email Landlords@ReedsRains.co.uk

The next thing you need to do might seem to contradict the last point, but make sure the property is well-maintained. When the market is stable, it’s an indication that supply and demand are balanced and therefore you need to work harder to get and keep the best tenants, as there’s no shortage of rental property for them to choose from. Do a thorough inspection (or we will happily come round and do this for you) and make sure you touch up paintwork, fix any little problems and generally ensure the property is looking good, inside and out. Your gas system and appliances should all be fine, thanks to the annual certification required, but if you haven’t had an electrical inspection for four or five years, have a ‘Part P’ registered electrician check the system is safe and certify that everything’s working properly.

Prevention is better and cheaper than a cure, and provided your on-going maintenance is thorough, you should be able to avoid having any unexpected bills in the near future. 

Northern Ireland

Research into the rental market in Northern Ireland for the first half of 2014 has just been published and the overall picture for landlords is good, with rents up by 2.6% on the previous 6-month period, demonstrating a healthy demand for private rented sector property.

The volume of rental transactions was down by more than 16% over the six-month period and by over 11% on the same period in 2013, which estate agents have suggested is because the sales market is improving and therefore some landlords are exiting the market. If this continues, it’s good news for you, as reducing rental stock will keep demand high.

Belfast is still dominant and driving the market, with just over 40% of all rental transactions in Northern Ireland being undertaken in the city, and that figure shows a slight rise on the previous six-month period. In contrast, every council area outside Belfast recorded a fall in transactions. Outside the city, the next largest rental market is North Down, which stands some way ahead of the next four: Lisburn, Craigavon, Newtownabbey and Ards. The lowest rental transactions were recorded in Moyle, Strabane and Ballymoney, with the number of transactions in Ballymoney having fallen by more than half over the six months. 

In terms of property type, two and three-bedroom terraces and townhouses continue to have the largest market share (39%) across Northern Ireland, with apartments close behind at 31%. In Belfast city centre, these two types of accommodation together represent nine out of every ten rental transactions. 

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Our initial mortgage consultation is free. We will charge a fee between £349 and £699 on application. The amount we will charge is dependent on the amount of research and administration required.

IN GENERAL BUY TO LET MORTGAGES ARE NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.

Latest Deregulation Bill may make it harder to evict tenants

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Over the last few years there have been studies which have claimed that some landlords are evicting their tenants if they request improvements to the property. This is called ‘retaliatory’ or ‘revenge’ evictions.

To try to change the law to protect tenants from the unscrupulous landlords that evict tenants to avoid improving their property, Sarah Teather a Liberal Democrat MP, introduced a Private Members’ Bill: the ‘Tenancies (Reform) Bill’. 

The Bill wasn’t initially passed, but was reintroduced this month through the House of Lords using another Bill: the Deregulation Bill. Although this bill was actually aimed at reducing the burden of legislation on businesses, organisations and individuals, in this case it was used to incorporate changes which would make it more difficult to evict a tenant via retaliatory eviction.

This Bill has now been passed by the Lords and they are currently urging the Government to pass the Bill too, which is due for its forth reading in March 2015. The Bill needs to be passed by the House of Commons and then has to receive ‘Royal Assent’ before it becomes law.

How will the changes affect landlords?

Currently there are two ways of securing possession of your property. The method which is affected by this Bill is the issuing of a ‘Section 21’ notice. Landlords can serve a Section 21, requesting the tenant leaves without giving any reason. For example it might be your original home and you want to move back in or you want to sell the property. A Section 21 can only be enacted at the end of the tenancy contract period, for example after a fixed tenancy agreement of six months. You will need to abide by the period of notice (normally two months) within the contract.

The changes will protect the tenant from eviction if they have already complained about the property’s condition and, as the landlord, you haven’t provided a response within 14 days or the response you did provide was inadequate and/or the tenant has already lodged a formal complaint about its condition with the LA. As long as the complaint is valid, landlords will be prevented from serving a ‘Section 21’ eviction notice for six months after the Local Authority has sent a letter requesting the improvements.

What can Reeds Rains do to help you? 

From our perspective, the idea of evicting a tenant because they have fairly requested repairs or legally required improvements is unfair, so it is best to ensure the tenant has no reason to complain in the first place.

We will keep you up to speed on what’s happening with this legal change and let you know if it comes into force. If we fully manage your property, we would aim to make sure your property is let legally at the start of the tenancy and advise of any repairs are required if we re-let it for you. And, if we receive any complaints from the tenant, we will make sure we get back to them within the required number of days.

To keep up to date with the latest news and changes sign up to our mailing list here.

An invitation to join the Reeds Rains Landlord Event

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Refurbished branch - Reeds Rains Chorley

In response to increased activity in the local market and demand for its services, estate and letting agents Reeds Rains are hosting an event dedicated to landlords.

The event is for current and potential landlords who are looking for advice from industry professionals and will be held in a selection of their branches during March. 

Lee Gallagher is the lettings manager for Reeds Rains in Chorley who says: “We are passionate about lettings and are excited about welcoming landlords to our office. At the event, experts will be on hand to explain a range of topics we think will be of interest to landlords. For example, more information about rental value and yields, tips on the best places to buy, what we think tenants are looking for from renting as well the full range of services available from Reeds Rains.

 Lettings Manager - Lee Gallagher

We are also excited to showcase our updated office with its modern new furnishings and high tech LED displays to enhance the on-going display of properties.

The new office in Chorley also features eye catching custom made wallpaper featuring the striking Buckshaw sculpture, which reinforces Reeds Rains interest in its local area. Inside the office, the new Reeds Rains logo has also been designed to highlight its long standing position in the property market but also its forward thinking approach to residential sales and lettings and can been seen as a key feature within the office.

Custom made wallpaper -  Buckshaw sculpture - Reeds Rains Chorley 

This new office makes it the ideal setting for us to demonstrate our revolutionary new system which helps landlords to manage their properties more easily using the Landlord and Tenants Portal. This is an online system which allows landlords to check the circumstances of their let. Landlords have information readily available about rental payments, outstanding maintenance issues as well as an array of useful information that landlords themselves have requested.

All in all we hope the event provides useful and we look forward to welcoming landlords new and existing to find out for themselves what great services Reeds Rains can offer.”

The landlord event will be held in the the following locations and the details are below:

Preston
Thursday 5th March5.00pm - 7.00pm
Address - Reeds Rains Preston, 80 Fishergate, Preston, PR1 2UH
Telephone - 01772 561666

St Helens
Thursday 5th March5.00pm - 7.00pm
Address - Reeds Rains St Helens, 15 - 17 Barrow Street, St Helens, WA10 1RX
Telephone - 01744 733633 

Pemberton
Wednesday 11th March: 5.00pm - 7.00pm
Address - Reeds Rains Pemberton, 798 Ormskirk Road, Pemberton, Wigan, WN5 8AX
Telephone - 01942 216381 

Hanley
Thursday 12th March:  5.00pm - 7.00pm 
Address - Reeds Rains Hanley, 17 Piccadilly, Hanley, Stoke On Trent, ST1 1EN 
Telephone - 01782 204244

Bamber Bridge
Thursday 12th March:  5.00pm - 7.00pm
Address - Reeds Rains Bamber Bridge, Unit 5 185 Station Road, Bamber Bridge, Preston, PR5 6LA
Telephone - 01772 336183

Chorley
Thursday 12th March:  5.00pm - 7.00pm
Address - Reeds Rains Chorley 24 High Street, Chorley, PR7 1DW
Telephone - 01257 267626

Blackpool
Saturday 14th March: 5.00pm - 7.00pm
Address - Reeds Rains Blackpool, 69 Whitegate Drive, Blackpool, FY3 9DA
Telephone - 01253 304060

Liverpool
Thursday 19th March: 5.00pm - 7.00pm
Address - Reeds Rains Liverpool, 24B North John Street, Liverpool, L2 9RP
Telephone - 0151 227 2027 

Wolverhampton
Thursday 19th March: 5.00pm - 7.00pm
Address - Reeds Rains Wolverhampton, 4 Waterloo House, Wolverhampton, WV1 4BL
Telephone01902 428888
 

 Calls may be recorded and/or monitored for training and/or data protection purposes.

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