Property Market Facts & Figures – January 2014

Here is a great infographic we recently discovered over at Rentguard Insurance looking at the property market in January 2014. As you can see property prices & rent is likely to increase sharply in the near future meaning it is even more important that you protect your property.
 
 
January2014marketwatch

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Renting in London: What You Need to Know

London is one of the world’s great cities and has something for everyone. Living in this city is an ambition of many people; however, with the cost of buying a home in the capital is more than many people can afford; therefore, renting is the best option. However, once you have made the decision to rent, how on earth do you find somewhere suitable? London is a huge city and if you are not familiar with the various boroughs, finding a nice property in a good location can prove virtually impossible. Fortunately, we are here to help, so here’s what you need to know about renting in the capital.

Finding a property

London_Big_Ben_Phone_box

London has an abundance of houses, flats, apartments, and bungalows available to rent, so you don’t have to worry about finding something that suits your tastes. What is trickier is finding the ideal property in an ideal area; to do this you will need to consider several factors:

  • Time to central London – the chances are you will not find a place right in the centre of the capital, so instead you will need to look for something within close proximity.
  • Transport – driving in London is a pretty stressful task, so you will probably need to look for somewhere that has good transport links.
  • Green areas – life in the city is not for the faint-hearted, so having parks and open spaces close by will be beneficial.
  • Safety – some areas of London have higher crime rates than others. Safety is paramount.
  • Cost – the most important factor. Ideally, you’ll want to find a property that meets all of the above preferences at the cheapest possible price.

Recommended locations

With those factors in mind, you can narrow down the search to several areas.

Highbury
North London is considered an established and trendy area to rent. Within 10 minutes of central London is Highbury, in the Borough of Islington. The transport links here are excellent and there are plenty of restaurants and bars with a real multicultural mix of people. Average rental in this area is around £310 per week.

Battersea
Battersea (home of the power station and famous dogs and cats home) is south of the River Thames and is considered an up-and-coming place to rent, making it more affordable. This ‘urban-cool’ area is a buzzy place to live and has plenty of pubs and bars to enjoy. Average weekly rent is around £310 per week.

Shoreditch and Bethnal Green
Over in east London, Shoreditch and Bethnal Green blends corporate lifestyle with bohemia, as bankers and arty types live side-by-side in one of the London’s trendiest areas. Given its location, Shoreditch and Bethnal Green is one of the most in-demand rental areas in the capital, with average weekly rent somewhere in the region of £380.

Renting a home

view london

Before you rent a home in the capital, it is essential that you view the places that you like before moving in. With rental and deposit significantly higher than most other places in the UK, it is also wise to request that the landlord carry out a property inventory, or else have one done yourself. There are several property inventory services in London that can provide you with an in-depth inventory, ensuring that any pre-existing damage is flagged.

While we are on the subject of inventories, you should make sure that one is carried out just before your tenancy ends – this will prevent you being blamed for any damages that are not your fault and will simplify the exiting process.

The final thing to do before you move in is sign the rental agreement. A property inventory will also be part of the agreement, so that will need to be signed too. A tenancy agreement should include:

  • duration of tenancy
  • rental cost
  • your responsibilities
  • your rights
  • the landlord’s responsibilities.

Remember to always read the agreement carefully and do not sign it until you are happy.

With all of the paperwork in place and the property inventory signed, you will then be ready to move in to your perfect London home!

 

Photo sources:  Julian Osley

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You Break It You Pay For It: Student Housing Advice

student break

As a student leaving home for the first time the thought of going to live with other students is an exciting one. Living with other like-minded individuals, staying up until the small hours of the morning and bonding over Pot Noodles are all part of the student lifestyle and some of the most enjoyable years of your life will be spent in student accommodation. However, living in rented property isn’t all fun and games and it’s important to remember that the house or flat is not owned by you or your fellow students. There are rules that must be adhered to – rules laid out by a landlord when signing a rental agreement and national flat inventory.

Getting back your deposit

When you move into a rented property, the landlord will generally ask for a deposit. This maybe to the sum of one month’s rent, maybe two months’ rent – either way, you are going to be handing over a significant amount of cash.

The idea behind taking a deposit from the landlord’s point of view is that it gives you as the tenant an incentive to look after the house. What it also does is provide the landlord with some financial collateral should any damage show up in the end of tenancy inventory report.

To ensure that everyone is able to have their deposits returned without dispute, you should lay down some ground rules before moving in.

First, every person living in the property should be clear about the rental agreement and what is and is not allowed. Establish how much rent each individual has to pay and when. It can be a good idea to have each member of the household pay their share of the rent by direct debit, this way everyone can avoid lending money and the risk of jeopardising a friendship over disputes.

There should also be a common understanding that whoever breaks something pays for it. That way bills will not end up falling in the lap of other students.

Try to spend as much time together as a group as possible, that way you can all pull together to abide by the rules of the landlord and air any grievances without causing too much tension.

UK property inventories

UK property inventories are an essential part of the rental agreement and something that should be done before you move in and after you move out. Generally, the landlord will compile a property inventory and you will be required to sign it, declaring that the condition of the home and its contents is as the document says. If the landlord does not provide you with an inventory report it is well worth investing in rental inventory services. UK companies carrying this type of report are comprehensive in what they do and will check the house top to bottom for damage, ticking off items down to the last piece of cutlery.

It is also worth carry out regular inventories yourself during your tenancy, just to ensure everything is as it should be.

An inventory report will help prevent disputes over damage and the general condition of a home (usual wear and tear is allowed) and should be signed by all parties involved in the rental agreement.
Before moving out of the home, you should give yourself a few weeks to carry out any cleaning and minor repairs. Schedule an appointment with the landlord at least a week before you move out. This way, anything that is flagged can be rectified. As long as you have kept to the inventory checklist, there will be no dispute over the returning of your deposit.

Living in rented accommodation with fellow students should always be an enjoyable experience that results in you receiving your deposit back and the end of the tenancy. The arrangement of UK property inventories will help ensure that you do get your money back, and we all know how much you’ll need it!

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Trouble with Tenants? How Landlords Can Protect Themselves

There is a lot said about so-called ‘landlords from hell’; newspapers publish features of bullying landlords and television stations run shows all about the plight of tenants.

However, what about the other side of the rental agreement?

Tenants can be troublesome too; in fact, there are more disruptive tenants out there than there are bad landlords. There are dozens of articles online advising tenants of their rights and how to protect themselves from landlords, yet there is virtually nothing on how landlords can protect themselves from tenants – how a landlord inventory and insurance can be used to give a property owner protection.

In this post, we are siding with the landlord and looking at how you can protect yourself from troubling tenants.

Landlord insurance

landlord insurance

As a landlord renting out a property to tenants is largely based upon trust. While references can be sought and background checks can be done to try to determine the history and character of a tenant, ultimately you put your trust in them to respect the property and look after it during their stay.

One of the rights that a landlord must provide a tenant is to allow them to live undisturbed in a property. Unfortunately, the tenant can often abuse this right and your property could be being dismantled without your knowledge. A tenant could be knocking down walls, selling appliances or renting out a spare room without your knowledge. To protect yourself from any such instances, it is advisable to have landlord insurance in place.

Given that you must keep a property in a good state of repair at all times, landlord insurance is pretty useful to have anyway – covering you for damages and any rent that is lost due to repairs being carried out.

In the event of a dispute with a tenant, landlord insurance will also cover legal expenses – both in the event of a tenant taking action against you and you attempting to evict a tenant.

Landlord insurance is based upon the cost of a home being rebuilt in the event that it is completely destroyed, therefore you should consider the building sum insured (BSI) factor and include the actual cost of the build, clearance costs, and surveyor fees when calculating how much insurance you need. Complete landlord insurance should include:

  • building and contents insurance
  • liability insurance
  • alternative accommodation cover
  • loss of rent cover
  • emergency assistance cover
  • rent guarantee cover
  • legal cover.

Landlord inventory

inventory clerk

Since the Tenancy Deposit Scheme (TDS) scheme was launched back in 2007, landlords are required to protect the deposit of a tenant through a government-backed scheme. This has meant landlords and no longer able to control a deposit and tenants have more power to challenge the withholding of their money. Backed by this scheme, more and more tenants are taking on landlords even when they know they are in the wrong – the only way to protect yourself from this is with a landlord inventory.

An inventory is a detailed report of the contents and condition of a property. This document contains written and visual evidence of everything related to a property and must be signed by both landlord and tenant, forming part of the legally binding tenancy agreement contract.

A landlord inventory should be carried out just before a tenancy starts and just before a tenancy ends and offers a hassle free way to assess any damages and decide what, if anything, should be paid for out of a deposit. If you are worried about how tenants may be treating a property, it is advisable to also carry out a landlord inventory during the tenancy.

Remember, when it comes to a tenancy, it is your property and your investment and you should do everything you can to protect it. A landlord inventory and landlord insurance are both reccomended but it also helps finding the right tenants in the first place with online services such as Rentonomy and Upad helping landlords do just that.

 

Photo source  – flickr: Chris Potter

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Tenants – Protect You Deposit; Know Your Rights

Before renting a property in the UK, the landlord you are dealing with will ask you to pay an up-front deposit. This will usually be to the total of one or two months’ rent. The general reason for taking a deposit is to give the tenant an incentive to look after the property; however, while most landlords are trustworthy, as a tenant, handing over such a large amount of money to someone you don’t know has to be seen as a risk. Therefore, it is essential that you know your rights and responsibilities.

Here are some tips on how to protect your deposit when moving into a rental property.

Make sure the landlord is a member of a Tenancy Deposit Scheme

As of 6 April 2007, all deposits taken by landlords must have been safeguarded by a Government approved Tenancy Deposit Scheme. There are three schemes available and landlords are free to choose which one to use; safeguarding each deposit and informing the tenant of the scheme used within 30 days or receiving the money.

Before handing over any money to a landlord or signing any home inventory, UK residents are urged to check that the landlord is part of a Tenancy Deposit Scheme. It is also essential to keep a receipt of payment as evidence.

Understand the tenancy agreement

tenancy agreement

Tenancy agreements may seem overly wordy and tedious, but they contain essential information about what you can and cannot do while renting a home. Rental agreements often contain clauses related to the keeping of pets, and certain aspects of the home; if you do not clearly understand these clauses and do not abide by them, you may lose your deposit.

Also essential is a full home inventory. UK-wide inventory company services specialise in providing comprehensive reports into the condition of a property and its contents before a tenant moves in to a home and after they move out. A landlord will generally provide you with such an inventory and it is important that you read and agree with it before signing, otherwise you may be accused of causing damage that was pre-existing.

It can be wise to hire a home or flat inventory company of your own to carry out a report before moving in and out of a property. This will help protect you in a dispute over deposit.

Don’t make changes without permission

If you wish to make any changes to a property, such as replacing doors or painting walls, make sure that you get permission IN WRITING before doing so.

Look after the property

Remember, as a tenant it is your responsibility to look after a property. This means causing no damage and returning it to its original state at the end of the tenancy. Most disputes between landlords and tenants are over the general state of cleanliness. Not keeping a home clean is a silly way to risk losing your deposit.

Only use regulated agents

To avoid rogue landlords, only rent from agents that are regulated by one of the following professional bodies:

  • National Federation of Property Professionals (NFoPP)
  • Royal Institution of Chartered Surveyors (RICS)
  • National Approved Letting Scheme (NALS).

When hiring a home or flat inventory company, it is recommended that you use a member of the AIIC (Association of Independent Inventory Clerks).

Court action

If you believe that a landlord is wrongly holding your deposit and they cannot be convinced to give you it back, it is possible to have a court settle a disagreement. The court will look at all of the evidence in the case and make a decision on whether a landlord should return part or all of the deposit.

In the event of a dispute, a home inventory will be vital in helping a court decide a case, although it should be said that the evidence contained within inventories often prevents disputes reaching court.

 

Photo sources: ohmyapt.apartmentratings.com

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The World’s Most Expensive Homes Infographic

We recently found this infographic over at www.moneysupermarket.com showing the world’s most expensive homes which we thought was well worth a share. Buckingham Palace leading the way is no surprising but there is some international property that you may not of heard of before. Would definitely be worth carrying out a professional property inventory in a few of these to protect against damages!

expensive homes infographic

The world’s most expenisve homes

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Are Photos Worth A Thousand Words During Inventory Checks?

Photos-Property-Inventory-NoLettingGoWhether you are a landlord or a tenant, letting inventory services in the UK are an essential part of property rental. The idea of an inventory is to catalogue the contents and condition of a property recording details of the home and any items that are included in the tenancy. The compiled report is then used as part of the legally binding contract between landlord and tenant preventing disputes over possible damages between both parties and aiding in a smooth transition from one tenant to the next.

Over the years, inventory reports have traditionally been compiled in writing, text still rules the roost; however, as technology advances and many people now have access to cameras in smartphones and tablets, there are an increasing number of landlords incorporating photos into inventories. There is an old saying that ‘a picture is worth a thousand words’ and it’s hard to argue with this; but, can this saying really be applied to property inventory in the UK?

Finding the right balance

A picture can add a lot to an inventory, and photographs of large areas of damage such as holes in doors, carpet burns, and damage to worktops will go a long way in building a solid case against a tenant. However, when it comes to providing the perfect inventory report, a photo is only worth a thousand words if the right balance is found.

According to the Association of Independent Inventory Clerks (AIIC), an overseer of excellence in rental inventory services in the UK, photographs are being used more regularly in inventories. However, they are at the expense of written descriptions and this is leaving landlords exposed to costly disputes with tenants over damage.

In many reports, the AIIC has found that photos no bigger than thumbnails are being used as evidence. Naturally, with a picture being so small, detail is hard to see. Photographs of a decent size and quality though, can be very useful and many of today’s modern smartphones have the capability to produce detailed images.

Only quality photos will do

NoLettingGo-Inventory-ReportThe comprehensive nature of inventories means that it photos must only be provided if they are backed up by a written presentation. The most common disputes between landlords and tenants are over small damages, such as chips in cupboard doors, scratches in sinks and baths, and knife marks on worktops. Such damages, while minor, can result in financial losses for landlords and tenants if negligence cannot be proved and a photo alone is often not sufficient evidence as details are so fine.

In order for property inventory services in the UK to help landlords win disputes for either side in a rental agreement, it is essential that photos are of a high quality and printed in A4 or even A3. In addition to this, the photo should be dated on camera and only be used to make up part of a written report.

The written inventory may still rule the roost, but the use of photos is definitely here to stay.

Photo source: Paul Reynolds

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Superstrike v Rodrigues landmark decision in lettings industry?

By now everyone has heard of the landmark decision of Lord Justice Lloyd on 14 June in a case that has sent shockwaves through the lettings industry. Put simply, the Court of Appeal decision in Superstrike v Rodrigues states that where an AST started before the advent of the deposit registration regulations but rolled over into a statutory periodic tenancy after 6 April 2007, any deposit should have been registered and prescribed information served. The implications of that decision are significant for the thousands of landlords and their agents who still have statutory periodic tenancies that arose in the months after April 2007. The decision is also a worry for all of those tenants who may have been evicted since then on the basis of an “unlawful” section 21 notice. After all, if the deposit was not registered and prescribed information not served, their landlord was not able to serve a valid section 21 notice to bring the AST to an end.

Since April of 2007 official sources suggest that over 1 million individuals have been forced to relocate in circumstances where, thanks to the Superstrike decision, a possession order was made on an invalid section 21 notice. The implication for landlords, managing agents and the judicial system is troubling. It is doubtless causing sleepless nights for those in the Department for Communities and Local Government charged with bringing some order out of the chaos.

Accordingly, it will come as no surprise for readers to learn that over the last few weeks there have been a number of meetings at a fairly senior level between representatives of the lettings industry, including ARLA, the principal deposit registration organisations and government officials to map out a way forward. Whether Mark Prisk, the current housing minister, will table new legislation to effectively overturn the Superstrike decision remains to be seen. However, with Parliament about to recess as I type this blog, it looks highly unlikely that there will be any significant change in the current position until October 2013 at the very earliest.

In the circumstances what should agents and landlords do if they have a pre-April 2007 AST which is still running on as a periodic tenancy?

The short answer is to refund the deposit as soon as possible to the tenant. Sadly, with the implementation of the Localism Act 2011 last year, it is no longer an option simply to register a deposit late if one wants to serve a section 21 notice. The deposit must be refunded in full.

To make matters worse, even if a deposit was registered on time – and remember time limits changed with effect from 6 April 2012 – if the prescribed information was served late, that now triggers a penalty of between 1 and 3 times the deposit plus the return of the deposit itself.

One intriguing aspect of the Superstrike decision concerns comments by Lord Justice Lloyd which suggest that when an existing AST lapses from a fixed term into a statutory periodic tenancy, it may be necessary to re-register the deposit, or at least re-serve the prescribed information. Logically this must be correct as the effect of the Housing Act 1988 is to create a “different” type of tenancy when an initial fixed term comes to an end. As a purely precautionary measure, therefore, we are now suggesting to all our clients that at the end of a fixed term, prescribed information is indeed re-served. Individual landlords and managing agents should also check with their deposit registration provider as to what else might need to be done to avoid their tenancy becoming a future test case!

One area which is being actively explored by some of the larger national chains is whether the entire problem of re-registration/re-service might be avoided by changing the definition of the fixed term. To avoid a statutory periodic tenancy arising at the end of, say, a twelve month AST, consider adding a rider to the definition of the term. This might provide that the tenancy continues “thereafter on a month by month basis until terminated by two months notice on either side”. Arguably this could prevent the tenancy changing from a contractual to statutory tenancy in the way that Lord Justice Lloyd mentioned in his judgment.

Clearly this has implications for renewal fees and flexibility. Accordingly, landlords and agents should seek professional advice both on the efficacy of adding such a clause and its exact wording.

As always, subscribers to our telephone helpline can receive “free” advice by calling the dedicated line provided. If you are not already a member of the Dutton Gregory telephone helpline service, please telephone one of our team on 01962 844333 for further details.

ROBERT J BOLWELL
Head of Landlord and Tenant Department
e-mail: r.bolwell@duttongregory.co.uk

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Landlord won’t make repairs? Here’s some legal advice

Mention the word ‘landlord’ to some people and it will yield a reaction of dread or intense anger. Stories of landlords from hell are all too common, and while most are genuine and responsible, a small number of landlords ignoring their legal duties have allowed the few to tarnish the name of the many. If you find yourself in a situation whereby a landlord is refusing to carry out repairs that you feel are his or her responsibility, there are steps you can take.

Build a case

Home-Inventory-NoLettingGoIf a landlord is flat out refusing to do repairs or is ignoring your repeated requests, it may be that you have to take legal action; but before doing this you will need to build a strong case, which requires the help of a home or flat inventory company.

An inventory report is generally carried out before a tenant moves into a property and after they move out. However, it is possible to have in-depth reports quarterly, yearly, or at the mid-point in a tenancy agreement. By compiling a report, home or flat inventories can show clear evidence of damage and how a property has deteriorated since a previous report.

In addition to this, you should compile your own portfolio of evidence, by taking photographs of required repairs, copies of medical notes showing proof of your health being affected by the problem, receipts for any money spent on trying to fix the problem, and copies of letters sent to a landlord in relation to repairs.

While building a case, you should continually write to your landlord about the issue.

Contact Housing Standards Team

The next step is to contact your local council housing standards team. Housing standards are committed to ensuring all properties within their borough meet acceptable living conditions. Housing standards will ask for details and evidence of disrepair as well as name and contact details of the landlord. They will then arrange to visit the property and inspect the damage. At this time, the landlord will be contacted and given the opportunity to undertake all repairs. If he or she fails to do so, the council may serve statuary notices, followed by court action.

Taking legal action         

House-Repairs-NoLettingGoIt may be possible to take your landlord to court where an order can be given for necessary repair works to be carried out and possible compensation paid to you for inconvenience, damage to personal property and health caused by repairs not being done. Before taking this step though, you should be aware that court action can be a long and expensive process and should always be a last resort.

It is essential that you speak to your solicitor or to Citizen’s Advice before making a decision on legal action, and find out if you are eligible for legal aid. The evidence compiled by a home and flat inventory company and yourself will ensure you stand a good chance of winning in court; however, only ever proceed after having received comprehensive legal advice.

Photo sources: roaringapps.com – everythingsimple.com

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How selling the benefits of the local area can pay dividends for landlords

London-Areas-NoLettingGoThere’s no doubt that the process of finding tenants for your property has been made far easier thanks to the web, but are landlords using online resources effectively to maximise revenue off the back of increased demand?

When it comes to property, location is everything, but often that maxim is never fruitfully applied to the rental market where competition for properties in certain parts of UK ensures that even the most run-down rooms in less-than-desirable neighbourhoods command a battle for occupancy.

If you’re a landlord, why not try following these 3 simple steps to ensure that increased demand results in increased rent as a result?

Step 1: Understand the value that the local area brings to your property

No man is an island, wrote the poet John Donne, but equally, no property is either. Understanding how local amenities create demand is key to pricing your rent effectively.

Recent research from LSE suggests that a property in the close vicinity of a school rated Outstanding can be worth up to 8% more than those near to merely satisfactory schools. Schools, parks, leisure facilities, open spaces, great pubs and restaurants all act to push up the desirability of an area, and it’s only right that properties ticking all the boxes should command a premium. In fact, anecdotal evidence from Savills indicates that even the smallest things can have an impact: homes that have Waitrose as their local supermarket are typically worth 10% more than those with access to other brands.

ACTION: Identify all the potential selling points for the local area and try to assess the uplift in value that each one brings

London-Underground-Map-NoLettingGoStep 2: Prepare an information pack outlining the neighbourhood benefits

There’s no doubting that property particulars are important, but have you considered providing prospective tenants with an information pack about the local area? As well as being an excellent way to demostrate your utility and support as a potential landlord, it’s another great tool for helping tenants understand the triggers that are creating local demand for housing.

Don’t stop there though; use the information pack to highlight why there’s such interest in your property and why it might be worth paying more for ready access to a neighbourhood containing everything a tenant might need.

ACTION: Create or download information packs for your property to sell the benefits of the local area

Step 3: Understand the demographic demand of the area

Demographically, property values and household income used to be closely intertwined, but over time the link is becoming looser and looser, particularly in densely-populated urban areas. If you want to maximise rental income, it’s important to understand the demographics of those creating demand in the area – and to respond to that need with an appropriate rental price. High-income city workers might consider living in less affluent areas for reasons of convenience and accessibility, and in some instances that demand can allow landlords to increase rents above the local market average.

ACTION: Research the demographics of those moving into the area and pitch your pricing at the trend, not those already living there

Author: Barry Bridges is the Co-Founder of Property Detective; a powerful tool that helps landlords, buyers and tenants research more intelligently the local issues affecting a property. He writes about property research, data and due diligence on their blog: www.propertydetective.com/blog

Photo sources: flickr.com/photos/ingythewingy – flickr.com/photos/neshuma

Posted in Landlords | Tagged demographic, London area, moving | Comments Off