News

Holden Park Redevelopment

Hayfield Robinson L&M are delighted to be able to support the redevelopment of Holden Park in Oakworth.  The park has received considerable investment from Wren Landfill Tax Community Fund along with Bradford Council and a number of local companies.  Director Lee Bilbrough commented “We let and manage a number of properties in the Oakworth area and are very grateful to the local people for the support they have offered Hayfield Robinson.  When we were approached to assist in the regeneration of the park we were more than happy to help as the park is in need of a facelift”.

Category : News

Attitude of Modern tenants makes good reading for Landlords!

Six out of ten tenants do not think they will ever own a home, according to a recent report carried out by Castle Trust.

The housing investment and mortgage provider found that three million social renters and 1.5 million private tenants do not expect to buy a property.

Meanwhile, of the three million people who do envisage themselves owning a home, half think it will be at least five years before they look to buy.

Earlier this year, Castle Trust carried out research that showed the number of renters in the private sector grown substantially. There were 3.8 million private tenants in 2012, which is an increase of 23 per cent on the 3.1 million figure for 2008.

Sean Oldfield, chief executive officer at Castle Trust, said: “Many people are either unable to get on the property ladder or stuck in their current home, despite interest rates still being at an all-time low.”

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Nervousness Over Long Term Lettings

The Council of Mortgage Lenders have responded to Labour leader Ed Miliband’s call for longer tenancy agreements by warning that such agreements could lead to a rise in rent arrears.

Crucially, they were quick to point out that a build-up in rent arrears would not only take money out of the landlord’s pocket in the short-term, but also that this short-term loss could also affect the landlord’s ability to pay their mortgage.

Miliband argues that longer tenancies afford tenants greater security in their accommodation, a sentiment echoed by homelessness charity Shelter.

However, CML have said that such agreements are making lenders nervous because of the increased potential for arrears.

At present, lenders prefer to allow landlords to offer six or twelve month Assured Shorthold Tenancies within the terms and conditions of the mortgage. The benefit of this is the landlord is then able to regain possession of the property after six months with a two-month notice period should the tenant fall into arrears.

The CML stated:

“Were longer-term tenancies to lead to the build-up of higher mortgage arrears over time, they would become more difficult to manage, not least because a lender’s ability to obtain vacant possession would be impeded.

“We favor a policy approach that delivers an adequate supply of affordable housing in a range of tenures that meets the needs of consumers.” It also says that private renting plays an increasingly important role in the market and that individual landlords have done much to increase the quality of housing in the private rented sector.

“The CML also notes that in recent months, a number of campaigning bodies and political parties have raised questions about whether the typical tenancies of six to 12 months currently offered to most of those renting in the private sector provide the security and stability that some tenants would like”.

“We accept that the implications of longer-term tenancies need to be explored, but any resulting changes must reflect the needs of landlords and the lenders who fund them, as well as those tenants who would opt for a longer-term tenancy. And it should be remembered that many tenants will continue to prefer a shorter tenancy of six or 12 months because it better suits their needs”.

“We are working to understand the barriers to longer-term tenancies, but change can only come if everyone’s interests are protected”.

Data collected by the National Landlords Association showed that 49% of landlords had experienced missed payments by tenants over the previous year.

The CML concluded:

“Part of the solution may be provided by break clauses, over and above what is standard in an Assured Shorthold Tenancy of six or 12 months. There will also have to be different terms and conditions in these cases.

“For longer-term tenancies to be attractive to all parties, lenders, landlords and tenants would also need to investigate fair and transparent ways of reviewing rent while the agreement runs its course.

“The lending industry acknowledges the aspirations for longer-term tenancies and will continue to work with landlords, tenants and policymakers in determining how they could be made more widely available. Lenders may take the view, for example, that longer-term tenancies might be an option for experienced buy-to-let landlords”.

“But let us not assume that these will instantly become the norm: for many groups of private tenants, the shorter and more flexible terms associated with existing six- and 12-month tenancies are likely to remain the preferred option”.

Category : News

BUYERS BEWARE! New landlords need to consider all options before buying to let

The rental sector is witnessing a boom in inexperienced landlords snapping up buy-to-let (B2L) properties in the hope of protecting their financial assets from plummeting savings rates.

These people are putting themselves at risk of being left out of pocket if they do not consider all the issues landlords have to deal with when both letting and managing residential property.  The most common problem is that many are not prepared for the costs or for the legalities and responsibilities of owning a B2L property.   Lee Bilbrough commented “Not only are there many costs involved in owning and letting houses but void periods are also often overlooked which can be a big hole in the annual income and may even be the difference between a B2L being a viable proposition or not” 

Lee did however say that many individuals “can do very well” from B2L investment, but it is important to carry out thorough research of the market and plan for all eventualities.

HRL&M Ltd offer a comprehensive investment service which can identify the right property type and location and more importantly our skills and knowledge can help discount those properties and areas to avoid

Category : News

Rent arrears – Don’t let them get out of hand!

The main worry both existing and new residential landlords have when they decide to let a property is “what happens if the rent doesn’t get paid?” With the UK still slowing recovering from a double dip recession money is tight all around and with some tenants still struggling financially and many finding it increasingly difficult to meet their monthly commitments the possibility of a tenant falling into arrears must be considered very closely. Many tenants experience problems due to changes in personal circumstances, such as redundancy or pay cuts, rather than intentionally refusing to pay rent.

There are of course a number of insurance policies available to landlords such as rent guarantee schemes, which must be taken out prior to the commencement of the tenancy, however if insurance is not in place then there are still a number of options open to landlords before resorting to possession proceedings.

The best advice is to act quickly and try and resolve arrears or late payment with the tenant and try to understand why the rent is not being paid. Discuss the possibility of a realistic repayment plan with the tenant and encourage them to pay what they can each month to keep down their arrears. A little amount often is much better than ignoring the problem and seeing arrears escalate to a point where they can very quickly become unmanageable. If the tenant refuses to pay, or are not in a position to do so, then it is often best all round to serve notice at the earliest possible opportunity and then follow the legal process for eviction in order to recover possession. Once the tenant has then vacated and legal possession obtained the landlord can still look to recover the outstanding debt by using the security deposit and the courts if necessary.

In a nutshell, arrears should not become a problem if landlords deal with them sympathetically and more importantly act swiftly to minimise any losses.

If you are a landlord experiencing issues with tenant arrears then feel free to contact us and we would be happy to provide a free, no obligation review of your situation.

Category : News

Rise in rent arrears leads to growth of landlord repossessions

Landlord possession claims in England and Wales are rising as rent arrears increase to their highest level in four years, it is claimed.

In the second quarter of 2012, there were 25,422 landlord possession claims that led to an order being made on the seasonally adjusted basis. This is slightly higher than in the first quarter of 2012 and continues the upward trend since 2010, according to the government’s quarterly Court statistics.

Landlord possession claims leading to orders made in England and Wales are up by 8% year on year to the end of the second quarter of 2012.

Areas with particularly big rises include Gloucestershire up by 29%, West Sussex up by 20%, and Hampshire up by 29%. Some towns have also seen big rises such as Bournemouth up 30% and Croydon up by 28%.

The rate of growth in the number of tenants in severe arrears is slowing, but nevertheless rose by 1.6% in the third quarter of this year. There are now 99,000 tenants in arrears of two months or more, the highest since 2008 and 15% more than last year, according to figures from Templeton LPA, a specialist practice of LPA Receivers and part of LSL.
Tenants in severe arrears represent 2.5% of tenancies in England and Wales. Although severe arrears cases climbed steadily last quarter, overall tenant arrears fell slightly in August, with 9% of all rent late or unpaid, the first improvement in this measure in three months.

Despite the steady growth in severe tenant arrears so far this year, there was a slight reduction in the number of tenants who faced eviction through court order on a quarterly basis.

In the second quarter of 2012, 25,422 tenants faced eviction notices, a quarterly fall of 6% compared to the previous quarter, reversing the previous 6% quarterly increase. However, evictions remain 8% higher on an annual basis.
‘We have seen a sharp increase in demand for rent guarantee insurance as landlords and agents look to find ways to protect their rental income. It is clear that this problem is not going to go away and we expect tenant arrears cases to continue climbing during the remainder of this year,’ said Michael Portman, managing director of LetRisks, a specialist provider of risk management and insurance to the residential let property market.

‘The double dip recession is putting huge pressure on the nation’s pockets. Rising fuel and food, unemployment and increased rents is putting tenants in difficulty. Many tenants have fallen on bad times and have no financial resources to clear arrears debt has led many agents and landlords to pursue possession only, foregoing any attempts to secure rent arrears through the courts,’ he explained.

‘For many Landlords and agents, they face better odds securing new tenant rental income than they do securing rent arrears from an existing tenant. My advice to landlords and agents is make sure that they consider the strength of the tenant when letting the property by taking out full references and to consider specific insurance through a specialist company for loss of rent if the tenant defaults and the cost of legal expenses,’ he added.

The firms tips to help minimise the risk and disruption for landlords and agents include not delaying action if the rent is late and chasing the rent arrears. It advises establishing a firm rent chasing timetable including letters before legal action, telephone scripts, serving notices etc, and making sure that that all staff are aware of these procedures.
It also says that getting the right tenant is crucial and it may help to work with a good tenant referencing partner and making sure that corners are not cut when it comes to checking procedures.

It adds that is changes to the Localism Bill that take effect next April should be observed. The firm has heard of solicitors acting for tenants on a no win-no fee basis to catch out landlords and agents if they haven’t complied with the regulations.

Category : News

Newsletter – Issue 3

Our latest newsletter has been launched.  Subscribe today and be in with a chance of winning a meal for two at a Timothy Taylor pub!

Category : News

LANDLORDS – Don’t get your fingers burnt this Bonfire Night!!

A landlord friend of mine, although I’ve been trying to convince him to allow me to look after his properties properly, has a couple of properties that he lets out himself. He has let one such property out to a friend of his and his mate.  Given that one of these tenants was a so called “mate” he decided to cut the usual corners and let the property out without drawing up a tenancy agreement or do the necessary checks etc.  A decision he quickly grew to regret!!!

These tenants have now stopped paying rent and are proving to be the stereotypical “nightmare tenant” It also appears that the one of the tenants has a solicitor as a father and are able to quote their rights and are happy to sit in the house, without paying rent until they are lawfully evicted.

Even  though there is no written tenancy, there is still a verbal agreement so a Section 21 Notice can still be issued giving at least 2 months notice to leave (with an eviction date ‘after’ the end of a tenancy period (e.g. if rent is due on the tenth of the month, the Section 21 must expire after the ninth).   The one problem he will face is that, because there is no written tenancy, if the tenants do not leave he will not be able to obtain a possession notice through the accelerated process and will have to go to court. 

Our advice to all Landlords is, while it can seem a pain getting tenancy agreements, inventories, references etc done when the relationship is amicable at the start, it is much, much easier than resolving an issue later on when you haven’t.  Never could the saying “prevention is better than the cure” be truer.

Category : News

General Market Commentary

Rents in most UK regions rose during the second quarter of 2012, however there remains a large variance from region to region.  In the North West rents rose by a significant 7.5% on the previous month.  Average UK rents are now £768 which is an annual increase of 2.4% on the same time last year.  Unsurprisingly the cost of renting a home in greater London remains considerably higher than the rest of the UK, with the average rent £1205 per month.  This is 7.2% higher than last year.

Category : News

HRL&M Team Up with G Moore & Co Insurance

Following our article in the Spring Newsletter on the importance of landlords insurance, we have teamed up with local insurance broker, G Moore & Co from Crossroads who are able to offer not only specific landlords insurance but also rent guarantee and legal expenses policies.  Lee Bilbrough commented “When property owners decide to become a landlord there are many issues to consider, however one area that is often overlooked is insurance.  Ensuring our landlords are adequately covered is very important to us and while there are a considerable number of internet based companies offering specific landlords insurance we felt a local broker who will not only search for the best possible cover at the most competitive price but, will also take care of the policy from beginning to end, including any mid term adjustments and claims”.  For more information on landlords insurance please contact us or alternatively G Moore & Co directly on 01535 643262 quoting HRINS when calling.

Category : News