According to new Government figures published in the housing survey, landlords in the private sector put up rents by 8.2% last year. The increase in London was even higher, with rents going up by 8.4%. Unfortunately, Consumer Price Index inflation fell to less than 0.5%, so rent rises will affect tenants.

A survey published by Survation at the beginning of this year revealed that an overwhelming majority of people are in favour of rent controls in the private sector. Less than 10% of those surveyed said they were against the idea of rent caps in the private sector whereas 59% were strongly in favour of the idea.

Labour Says No, Green Party Says Yes
Labour wants to introduce limits on future rent rises, but the Conservatives, Lib-Dems and UKIP don’t advocate rent controls at all. The Green Party supports rent controls and has been campaigning for them to be introduced in London for some time.

“We give our tenants some of the weakest protections in Europe, we should copy the smart rent controls and security enjoyed by tenants in countries like France and Germany where rent can’t rise faster than inflation guaranteeing fairness and predictability for tenants and landlords,” said Green Party London Assembly member, Darren Johnson.

RLA Against Rent Caps
The Residential Landlords Association is against rent controls in any form. They believe that the introduction of rent controls will damage the private rental sector and drive landlords away. They also point out the majority of landlords intend on freezing rents in 2015.

Liverpool City Council has decided to introduce a compulsory licensing scheme for its private landlords, in an attempt to improve housing conditions in the private rental sector. Around 50,000 rental properties in the city will be affected and landlords will be expected to pay a minimum of £400 as of April 1st. Subsequent properties will be given a small discount and landlords who are accredited members of an approved scheme will only have to pay £200 per property.

Heavy Handed says NLA
The National Landlords Association has described the licensing scheme as “heavy handed” and believes that landlords will feel alienated as a result of stringent checks to see if they are a “fit and proper person” (i.e. they don’t have any convictions for drugs, violence, dishonesty and abuses of housing law).

Costly Fines for Non-Compliant Landlords
Landlords affected by the licensing scheme will be expected to meet health and safety guidelines, deal with anti-social complaints quickly, and maintain the exterior of their properties. Eligible landlords who don’t bother applying for a license face fines of up to £5k. They might also have their properties confiscated by the council.

“Responsible landlords… have absolutely nothing to fear”, claims Liverpool Council’s Assistant Mayor, Ann O’Byne. However, she added that the council was “concerned about a number who rent properties that fail to meet satisfactory standards.”

“This has a negative impact on the health and welfare of local communities and on a housing market that is already vulnerable in terms of vacant properties, low house prices and depressed rental values.”

The number of bailiff repossessions in 2014 rose to 41,965, which is an 11 per cent rise on the previous year – and the highest figure since records began in 2000. In contrast, the number of landlords starting the repossession process to reclaim their property has actually fallen to 161,257, a 5 per cent decrease on the previous year. Social landlords made the majority of the claims for possession (62 per cent); private landlords made a further 13 per cent of the claims; and the rest were accelerated claims where a landlord just wanted his property back and there was no overdue rent.

‘It’s Grim in the Rental Sector’ says Shelter
Housing pressure group, Shelter, claims the statistics released by the Ministry of Justice paint a very grim picture of life in the private rental sector. In a statement made to Channel 4, Shelter’s chief executive, Campbell Robb, says:

“The failure of successive governments to build anywhere near enough affordable homes combined with a wave of welfare changes is making it harder and harder for people to stay in their homes. The only way for politicians to fix this crisis for good is to commit to building the genuinely affordable homes that we desperately need.”

‘No, it’s Not!’ says NLA
The National Landlords Association disagrees.

“These statistics reinforce what the NLA has consistently said, that repossession is always a last resort for landlords.

“A landlord will always aim for good, stable, long-term tenancies and repossession just doesn’t make good business sense. Repossessions mean additional costs for landlords in the form of court costs, loss of rent, letting agents’ charges and local empty property charges.”

Figures released by an auction research group have revealed that properties sold via auction usually sell for 15 per cent less than properties marketed via estate agents.

To illustrate this trend, there were 2,712 residential properties offered for sale via auction in December 2014, of which 2008 were sold. The average sale price was £154,014. By comparison, the average sale price for a residential property not sold via auction during the same period was £177,766.

Record Year for Auction Sales
“In the residential sector, the gavel fell on 21,834 lots during 2014 – a 2.1% increase on 2013. More significantly, this sets a new record for the highest number of residential sales in a calendar year, surpassing the previous high recorded in 2007,” said David Sandeman, managing director of auction research firm, El Group.

“We have also seen the amount raised at residential auctions increase throughout the year, often in double-digit percentage terms, and the yearly figures below show the total has broken through the £3 billion mark for the first time in seven years – a fantastic achievement for the industry.”

Auctions not for the Faint Hearted
Buying properties at auction can be a smart move for property investors, but bidding at an auction is not for the faint hearted. For one thing, you need to have your finance sorted out before the auction as once the gavel falls you have a limited time to complete the sale. For another, you won’t be able to back out of the sale if you subsequently discover that the property has some catastrophic or expensive fault, so surveys, etc., need to be sorted out before the auction begins, which is money spent with no guarantee you will even be the winning bidder.

According to the Residential Landlords Association (RLA), landlords are dealing with rising rent arrears, caused by their tenants’ Housing Benefit being unfairly suspended or cancelled. The problem is being blamed on the Department of Work and Pensions (DWP). The RLA says the problem is getting worse, even though the DWP and local authorities are aware there is a serious issue.

Housing Benefit Cuts
The problem arises when benefits claimants are told they aren’t making enough effort to find work. The tenant’s benefits are cut as a result, but what many tenants don’t realise is that their Housing Benefit is also affected.

“Landlords, already reeling from some of the worst effects of welfare reform, are also experiencing mounting rent arrears, caused by this same issue, which needs to be addressed by both councils and DWP urgently”, says the RLA.

Housing Charities Concerned
Housing charities are also concerned about the issue and have raised concerns with the DWP.

“People are not being advised that their housing benefit will be affected and that they may need to re-apply for it,” says homelessness charity, Crisis.

“Often they only realise there’s a problem when they are in arrears or facing eviction. There needs to be clear communication between the different [council] benefit departments to prevent people’s housing benefit being affected by sanctions [applied elsewhere].”

Landlords Struggling
Many landlords are struggling to get anywhere when they submit Alternative Payment Arrangement (APA) applications at the two-month rent arrears tipping point. Landlords should be able to submit APA applications online, but the system isn’t working and therefore they have to post them instead. The whole system is a shambles, which is leading to huge rent arrears and the threat of eviction for tenants.

The London property market is beyond expensive. The average property price is now more than half a million, whereas for that you could easily buy a ten-bed mansion with indoor swimming pool in Newcastle. Rental prices are also similarly high – the average monthly rent in London is currently £1,412, compared to £694 outside of the capital. But all this is just a drop in the ocean when you hear just how much a penthouse apartment in central London is being marketed for sale at…

An Exclusive London Address
A luxury flat at One Hyde Park, the most exclusive address in London has gone up for sale at a cool £10 million. With this sort of price tag, only Saudi princes or mega celebrities will be able to afford it, but if you are the type of landlord who markets his properties at posh tenants, this could be a good investment.

So what do you get for your cash?

The Height of Luxury
The apartment only has one bedroom, but what it lacks in beds, it certainly makes up for in luxury. Notable features include:

• In-house maid service and concierge
• Room service from the adjacent Mandarin Hotel
• A same day laundry and dry cleaning service
• Temperature controlled wine store
• Use of an on-site swimming pool
• SAS trained security guards
• The Queen lives just up the road

If the apartment sounds right up your street, don’t forget to budget for the £2k annual ground rent, £32k annual service charge, and a hefty £1.1 million stamp duty bill.

The Citizens Advice Bureau (CAB) is calling for tenants renting in the private sector to be given the legal right to ask for their money back if the property they rent turns out to have structural problems, dodgy wiring, and other health hazards.

In its report, Renting Uncovered, the Citizens Advice Bureau says that although there are plenty of statutory obligations in place to force landlords to make fundamental repairs in a rental property, there is nothing in place to prevent landlords from evicting tenants if they try and pursue their right to force a landlord to make repairs.

An Unfair System
The Citizens Advice Bureau says this goes against the Sale of Goods Act, which states that goods must be ‘as described, of satisfactory quality, and fit for purpose. So in other words, if you buy a kettle from Argos and it causes a fire in your kitchen as a result of faulty electrics, you can demand your money back under the Sale of Goods Act. But if you move into a rental flat and subsequently discover it is riddled with damp, you can’t ask for your money back from the landlord.

According to Gillian Guy, Chief Executive of the Citizens Advice Bureau:

“These days people rightly expect to get their money back if something they pay for is not up to scratch. Private renters can end up thousands of pounds out of pocket when they are let a home which turns out to be unfit to live in. We’re calling for a system which provides people with a refund if a private rented home doesn’t meet the most basic standards like safe electrics and being structurally sound.”

NLA Comments
The National Landlords Association says that the Citizens Advice Bureau is lumping all landlords under the same umbrella when it is only a few who wantonly evict tenants for asking for repairs to be carried out.

“There are times when well-meaning landlords do not respond adequately to their tenants’ needs. In these circumstances, surely education and support are more effective than penalties and demonisation?”

Fires are not an extraordinary occurrence. Sometimes accidents happen and a fire starts in a rental property. If a landlord has installed smoke alarms and provided his tenants with a fire blanket, fire extinguishers and other fire safety equipment, the chances are good that there will be no significant damage and/or loss of life. But this isn’t necessarily the case in other countries where fire safety legislation is often absent.

Hocus Pocus
In Dubai, for example, landlords seeking insurance compensation for fire damage to their property have been claiming that goblins and angry jinns are responsible for the fire. However, although there are undoubtedly plenty of people who believe in such nonsense, Ahmed Mohammed, a senior fire expert at the Criminal Evidence Department of the Dubai Police, says the practice of blaming supernatural entities for property fires is simply a scam. He insists the fires are more likely to be the result of negligence or criminal activity.

“Fire experts follow scientific methods according to specific rules. There have been cases in which a person or persons tell lies, and make weird claims that a jinn is behind the fire.”

Mohammed says landlords do this because a lot of tenants don’t know how to deal with fires when they start and therefore the damage is a lot greater.

Believe It Or Not…
In the UK, jinns (also known as genies) only appear in pantomimes, but Arab mythology is full of tales of vengeful spirits. Jinns are believed to be able to influence the actions of humans and in 2014 a Dubai man was granted a divorce after the court believed his assertion that his wife was possessed by a jinn.

Scottish landlords can look forward to a fantastic New Year as rents in Scotland are at an all-time high.

According to the buy to let index on the YourMove website, rents in Scotland have risen by 2.2%. This means the average monthly rent on a property in Scotland is £527 per month and Scottish landlords are now enjoying a fantastic 8.4% return on their investment.

On the opposite side of the coin, YourMove has also revealed that the number of tenants in arrears has risen to 6.6 per cent, which is not so good for landlords.

More Landlord Investment Needed
According to Christine Campbell from YourMove, “Scottish rents have been steadily edging forwards and reached a new pinnacle in November. Demand and supply are still out of kilter and in highly sought-after employment and cultural nerve-centres like Edinburgh this overflowing competition for homes to let has topped up rent prices.”

Campbell believes that the only way to reduce the current rental housing shortage is for more private landlords to invest in rental properties.

“If buy-to-let investment dries up, and the pool of properties to let contracts, rents will swallow the shortfall and eat into tenant finances,” she adds.

Ban Rip-off Rents Says Labour
Michael McMahon, the Scottish Labour housing spokesman says these figures indicate a need for reform in the Scottish private rental sector.

“Too many families are just getting by, the last thing they need is an exploitative rent hike from a bad landlord. That is why Scottish Labour proposed to ban rip-off rent rises.”

Private landlords guilty of serious safety breaches have been named and shamed on a publicly accessible database. The database has been created by the Chartered Institute of Environmental Health magazine and maps the landlords and firms that have been convicted under the Housing Act 2004. Now that this data is in the public realm, tenants will be able to check whether their landlord or letting agent has been prosecuted.

Pigeon Infestation
In total, the database lists 57 companies that are responsible for a total of 68 offences. The worst offender on the list is Aspire Group Developments – they have been prosecuted five times for various offences, including a failure to make repairs to a property infested with pigeons. Despite this, the firm appears to do remarkably well from the public purse because it received more than £184k in housing benefit in 2013.

The two firms with the dubious honour of attracting the highest fines are Watchstar Ltd and Watchacre Ltd, both owned by the same man. Haringey Council branded him a rogue landlord in 2013 and he was fined £40k for renting out flats in an “appalling and dangerous state of repair”.

Database Useful for Councils
Generation Rent says the database will be very useful for councils and tenants and should enable rogue landlords to be driven out of the marketplace.

“As more authorities introduce licensing and identify criminal landlords, they will start to be driven out of certain areas so neighbouring councils need the means to stop those landlords exploiting their residents,” said Alex Hilton, the director of the Generation Rent.

However, as the Chartered Institute of Environmental Health points out, prosecutions are only the tip of the iceberg and many landlords get away with flouting the law.