|We are writing during our third national lockdown with a hope that this mail finds you all safe and well. |
There are a number of items relevant to you as a landlord that have been in the news, and some that haven’t, so as part of our client base we would like to share them with you.
At the date of writing, the housing market remains open for business under instruction from the Government, and therefore we as much as we can be, business as “normal” (whatever normal looks like during a global pandemic. Obviously, all relevant precautions are being taken, the safety of our staff and clients is at the forefront of our minds at all times.
Here at SWR we continue to work through the pandemic, with several team members working from the office and the rest working from home. We thank you all for your patience during this time; balancing family life/home schooling, the ongoing logistical issues surrounding the pandemic and the needs of our clients is no mean feat but thankfully we have a good time and we are all working hard to ensure it is as much as possible “business as usual”.
Mortgage Payment Holidays
The mortgage payment holiday has been extended to 31st March 2021, if you have not used this facility yet you will be entitled to a six month holiday.
Changes to the eviction process
Late last year, in response to the pandemic, we saw a change to the notice periods under section 21 of the Housing Act (from 2 months to 6 months’): a change which is in place until at least 31st March 2021.
Following this, we then saw the introduction of a straight ban on enforcing a possession order (provided by the court) until 11th January 2021, and this was subsequently extended to 21st February 2021.
There is every expectation that it will be further extended and we will keep you updated on this. This ban applies in all but the most serious cases. These rules are known as the Public Health (Coronavirus) (Protection from Eviction and Taking Control of Goods) (England) Regulations 2020 – just if you feel in the mood for a google.
Notices can still be served during this time; they just cannot be enforced.
There are a couple of exemptions, the ones that are most relatable are where there are grounds of anti-social behaviour and/or domestic violence, or if there are substantial rent arrears. Initially “substantial” meant nine months’ rent, this has thankfully been reduced under the newest legislation change to six months’, and does take into account arrears accrued prior to COVID-19.
There is also nothing stopping you going to court and gaining possession order, you just can’t enforce it…. However, be aware there is now a lengthy backlog at the courts. If you need to ensure your tenant leaves the property on time, you may have to think outside the box for at least the next 12-18 months.
The government have also mentioned the introduction of a new “mediation pilot” in February. We will share more information when we have it.
A piece of legislation known as the Dogs and Domestic Animals (Accomodation and Protection) Bill is slowly making its way through parliament. If approved, this would mean tenants would have a right to have a pet without to approval of their landlord.
We will keep you updated as progress occurs.
This may be a good law for tenants, but we can see this may be the final “nail in the coffin” for a number of landlords.
For our Block Management clients, an exciting development in leasehold law has been announced, with the housing secretary set to overhaul the whole leasehold system.
Currently, leaseholders are able to extend their leases by a 90-year period, this is proposed to change to 990 years.
The government is also looking at the option of Commonhold, an idea that was originally introduced in 2002 but never really “took off” as well as restrictions in how ground rent is able to be increased by freeholders.
We will be watching this legislation with interest.
Green Homes Grant
The “green homes grant” was announced by the government on 30th September 2020 and it is said to the biggest proposed upgrade to the nation’s buildings in a generation.
If you are eligible, you will be able to apply for a voucher worth up to £5000 per rental property to help with the cost of improving the energy efficiency of your rental property and you have until 31st March 2021 to apply.
The grant is non-repayable, and includes labour, materials and VAT costs – of up to 2/3rds of the total renovation costs.
Improvements are split into “primary” and “secondary” measures.
Primary includes works such as insulation to walls and flooring, secondary includes works to windows and doors.
You must use the grant for one primary measure before you are able to use it for any secondary measures.
The full list of measures can be found here: https://www.gov.uk/guidance/apply-for-the-green-homes-grant-scheme#what-the-voucher-can-be-used-for
You can apply here: https://www.gov.uk/apply-green-homes-grant
You can find registered tradespeople here: https://www.trustmark.org.uk/
A gentle reminder that your tax return is normally due by 31st January 2021 but has just been extended to 28th February 2021. Don’t miss the date!
As you will be aware, the UK has now left the European Union. Whatever your opinion on “Brexit”, it will undoubtably have an impact on the UK housing market and subsequently on you as a landlord.
Since the beginning of this year we have seen an unprecedented demand for property so at this point the impact does not look to have been negative, but we are watching the market closely.
It is worth noting that the process of checking a tenants’ Right to Rent prior to the start of a tenancy has changed substantially over the past 12 months.
A new code of practice was released on 2nd November 2020 under the new legislation The Immigration (Residential Accomodation) (Prescribed Requirements and Codes of Practice) (Amendments) Order 2020, which brought in the following changes:
1. A streamline to the process for B5JSSK nationals (USA, Canada, Australia, New Zealand, Japan, Signapore and South Korea).
2. The introduction of an online right to rent process
3. Changes to time limits on checking Right to Rents prior to a tenancy start
At this point, EEA nationals are still recognised as having a right to rent in the UK until 30th June 2021. You can sign up for regular updates here: https://www.gov.uk/check-tenant-right-to-rent-documents or we will update you as more information becomes available.
Electrical Safety Standards
The date by which your property requires a satisfactory 5-year fixed wire test (Domestic Electrical Installation Condition Report) is quickly approaching.
As of 1st April 2021, any tenanted property in England must have a certificate in place, and this should have been provided to the tenants.
There is a common misconception that this will only apply to “new lets” after this time: it will apply to ALL tenanted properties.
The government will be introducing a new debt protection scheme on the 4th May 2021 known as “Breathing Space”.
There are two types of breathing space.
Under a normal “breathing space”, a landlord will not be able to pursue rental arrears for 60 days (this includes any contact regarding the debt or enforcement action).
The second type is a “mental health crisis breathing space”, which is available for those people during a mental health crisis and will remain in place until the end of treatment, plus 30 days.
If you would like to read this legislation, have a look at The Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium (England and Wales) Regulations 2020.
A breathing space can only be initiated by a debt advice provider registered with the Financial Conduct Authority or a local authority.
This will likely be a worrying development for most landlords but we of course will keep you updated as we know more. The introduction of the scheme hammers home the important of thorough pre-tenancy referencing checks and a risk based approach to offering contracts to tenants going forwards.
We hope you have found this update useful. Please do not hesitate to get in touch with us if you have any questions or comments!
This information is valid as of 10th January 2021
As you may realise, the government has asked the housing market to remain open during the latest lockdown.
We are committed to protecting our team, clients and contractors so have taken the following steps:
1. Most of the SWR team are now working remotely from home. Please bear with us during this time, we are not together in the office and communication may not be as fluent as during normal times. Several team members remain in the office for key collection and drop off/as a buddy system to avoid unnecessary lone working, but are in bubbles and are fully socially distanced.
2. The office is now not open to general visitors. Key collection and drop off will continue, behind a protective screen. Track and trace is in operation and all keys are sanitised when leaving and entering the office.
3. Viewings in empty properties will continue, but applicants will be met at the door and will not be accompanied around the property. All internal doors will be open to allow for a zero contact viewing.
4. Viewings in tenanted properties will be carried out virtually. This will be through a WhatsApp video call. No in-person viewings will be carried out within tenanted properties at this time.
5. Property visits (inspections) will continue to be carried out via WhatsApp or Zoom. Full PPE will be worn at all times by both our team and our contractors when on site at any of our residential and block/estate management sites. If a contractor does attempt to attend your property without the relevant PPE, please refuse them entry and contact the office on 01454 612735 as soon as possible.
Please stay safe in these challenging times!
Landlords from the UK who choose to live abroad can enjoy living their dream lives in another country while enjoying a steady income flow from their rental property. However, there exist some challenges you’ll face acting as a long-distance landlord. Difficulty communicating and the inability to meet tenants in person are just some of the challenges you may face. Also, if a tenancy ends while still abroad, landlords are left with the singular choice of asking someone else to carry out viewings for them.
For these reasons, landlords who live abroad prefer using a letting agency to manage their property while they live their lives undisturbed abroad. Are you an international landlord? Are you planning to become one soon?
This write-up will discuss some 4 tips to help make the letting process the easiest for you. Sit back, relax, and read on!
Get to Know Your Legal Responsibilities
All rental property owners in the UK are required to pay tax on the rental income. As an international landlord, you are no exception. The HM Revenue and Customs (HMRC) consider you a ‘non-resident landlord’ if you live out of the UK for 6 months or more in a year. However, this won’t be your case if you live outside the UK only temporarily, i.e. less than 6 months in a year.
You can pay your tax by taking out an essential tax rate from the rents or better still by using a Self-Assessment form for tax return. Payment can be done by a tenant or a letting agent. At the end of each year, the agent will provide you with a certificate. If you do not wish to do this, you will need to join the “Non-resident landlord (NRL) scheme. More information is available by clicking here.
Carry Out Screening through Skype
Meeting tenants one on one before accepting their rental application has proven to be one of the greatest challenges faced by landlords who live abroad. This of course won’t be a problem if you choose to use a letting agent. However, determining whether or not a tenant is the right person for your property without seeing them can be difficult. To help solve this problem, consider using Skype, Zoom, or any other video conferencing platform to discuss with tenants before deciding to accept or decline their rental application.
Give Priority to Long-Term Tenants
Administrative demands are higher for shorter tenancies than longer ones. Also, landlords are more likely to develop stronger bonds with long-term tenants. This helps take away much anxiety concerning how your property is being treated.
Consider Using a Property Management Agency
The best and simplest way to avoid any headaches with regards to managing your property from abroad is to have someone else do it for you. Most landlords have found this to be the best way to live a stress-free life abroad.
A trustworthy and reputable property management agency like us (SWR) can bear the burden for you. We take care of everything from collecting rent from tenants to ensuring that you pay just the right amount of rental tax as you should normally pay.
Owning an apartment block or a flat on a lease comes with many challenging responsibilities. However, a block management company can help you carefully oversee the welfare of your building and cover all legal responsibilities on your behalf.
The block management company is responsible for the overall maintenance of residential blocks, providing proper assistance for the client (property owner) all the time. Some of the responsibilities of a block management company include:
The block management company is wholly responsible for appointing professionals to visit and inspect blocks on their portfolio, noticing and diagnosing legal risks or potential problems on the block. When you own an apartment block, there is a need for these routine inspections. Block management companies take up this challenging task as part of their many responsibilities. The inspection covers all areas, from accounts to records to maintenance. The company makes sure all legal domains and functions are correctly taken care of.
The continuous stability of a site is dependent on specific health and safety precautions. The block management company is responsible for making sure that health and safety laws are regulations are strictly followed. The company helps to implement and manage these safety laws consistently. Block management companies take health and safety precautions seriously and handle them professionally for the smooth sailing of property operations.
An insured property gets covering against several unexpected risks that may arise at any time – risks from fire hazard, natural damages like hail or storms. A block management company helps you to identify the right cover or insurance policy for the block. It is among the duties of the company to assess the number of occupied or rented apartments and the types of occupants, and then find a suitable insurance policy for the block.
Legal records, files, and statements can often become cumbersome to keep track of. A block management company is responsible for keeping detailed records of all transactions, work, and inspections. These records are especially vital at certain times. Making use of a block management company saves you from worrying about paperwork and documents. The company carefully holds all necessary records for safekeeping.
Accounting for a block property involves many responsibilities, including rounding up rents and services charges, correctly allocating resources, creating a budget to make sure money is readily available. And overseeing account creation for shareholders of the block. All these accounting processes are vital and delicate and require the professional attention of a reliable block management company. The company appoints a professional accountant to make sure all accounting processes are on track.
The block management company ensures that maintenance contracts are in place and operational, ranging from general cleaning to gardening to cost-effective installation of necessary facilities.
At South West Relocation, we offer trusted and reliable letting and block management services to our clients. By partnering with us, you have the assurance that you will receive professional and up-to-date management services for your properties.
It has come to our attention that since the 31st May 2019 there has actually been two minor changes to the Government “How to Rent” guides.
This guide must be given, by law, to all new tenants prior to their occupation and in the Deregulation Act of 2015 it is clearly stated that it must be the most ‘recently updated’ version.
Permitted Payments you may be charged:
Holding fee of one weeks’ rent
One months’ rent in advance
Five weeks’ rent as a security deposit or six weeks’ rent if the rent is above £50,000 per annum.
A reasonable charge for loss of keys/security device during tenancy
An interest charge for late rent of 3% above the Bank of England base rate for each day the amount is outstanding, when the rent is outstanding for at least 14 days
A reasonable cost for contractual damages under the Assured Shorthold Tenancy Agreement
A reasonable charge will apply for changes to the tenancy agreement or a change of sharers.
Charges will apply for the early termination of a fixed term agreement.
We are registered with The Property Ombudsman and our membership number is L00493
We are registered with the ARLA Propertymark Client Money Protection Scheme and our membership number is C0123573