An MP for Brent is trying to table proposals in Parliament that will aim to prevent landlords from evicting tenants in retaliation for complaining about properties or asking for essential work to be carried out. She argues that too many landlords are using ‘retaliatory evictions’ as a way of getting rid of tenants who complain. But is this true and what would happen if the proposals go ahead?

Section 21 Notices Could Be Withdrawn under New Proposals
MPs say that retaliatory convictions are a real problem and security of tenure is at risk. If the government agrees with the proposals, there is a danger that Section 21 notices will be withdrawn and landlords will find it increasingly difficult to evict problem tenants.

The Role of the Tenant in Evictions
The RLA is concerned that the subject of retaliatory evictions is not as clear-cut as MPs would like to believe. As a result of a survey carried out on RLA members to find out the reasons why landlords evict tenants, as you might expect the most popular reason for evicting a tenant is because they haven’t paid their rent. But the next two most common reasons for evicting tenants are anti-social behaviour and property damage.

It is already hard enough to remove problem tenants who threaten neighbours/landlords and cause damage to properties. Removing Section 21 notices will only make the process of evicting problem tenants more difficult and could discourage would-be landlords from entering the buy to let market, which is bad news for tenants and bad news for the UK property market.

An infamous payday loans company has been in the news in the last few days after it emerged that the company had been sending out threatening letters from a fake law firm. HMRC doesn’t need to send out fake letters – real letters from them are normally threatening enough, so if you are a landlord who has received a terse letter from HMRC reminding you to report unpaid tax, it is a good idea not to ignore it!

Property Let Campaign
HMRC is running a Let Property Campaign. There is a disclosure channel for landlords who wish to come clean and sort out their tax affairs. If you use it, you can take advantage of reduced tax penalties for declaring previously unpaid tax. This channel is available for landlords until next summer. Landlords who have sold property or gifted property are the main targets of the campaign, but it also applies to owners of holiday lets or second homes.

The taxman has all kinds of methods at its disposal for collecting information on property investors and landlords. It trawls records from letting agents, the Land Registry, Housing Benefit records, and many other sources.

HMRC Comments
According to an HMRC spokesperson: “The message to property owners who have not paid their tax is HMRC knows about you and will make sure you pay the right amount of tax on rental profits or chargeable gains – and if you don’t tell us the penalties will be tougher if we have to come after you.”

A website founded in 2008 is proving popular with landlords in London, despite the fact it was designed as a holiday let tool. Airbnb lets homeowners list a spare room or even their entire house as a cool place to stay in one of many cities across the world, the idea being that they use the website to earn some extra cash. However, all is not as it first appears…

The Guardian has analysed data from Airbnb and discovered that a large number of ‘homeowners’ listed on the website are in fact professional and semi-professional landlords. Of the 13,000 listings on Airbnb, just over half relate to an empty property rather than a single room. More than 1,500 of the people using the website have multiple property listings; some have more than five properties.

Worried Hoteliers
This is causing concern amongst hoteliers in the city. The British Hospitality Association (BHA) says: “We are very concerned that large numbers of private homes are being let on a semi or even permanent basis to tourists because it’s unlikely that any of these properties have ever had any fire risk or health and safety checks.”

Buy to Let Investors
The BHA believes that many of the properties are being run by buy to let property investors who are trying to pull the wool over the tax man’s eyes by not declaring that they are running a lettings business.

However, Matt Griffith, associate fellow at the IPPR thinktank isn’t too concerned: “If Airbnb is being used by a professional group of landlords to provide hotel accommodation using residential property then this could potentially have implications for the housing market. But it would have to grow a hell of a lot to have any significant displacement effect.”

Experts reckon that 40% of Londoners will be renting by 2020, mostly as a result of the impossibly high cost of property in the capital. But with average rents currently around £1300 per month and a lack of affordable properties, it is becoming increasingly difficult for lower paid workers to find somewhere to live.

A Raw Deal
Londoners may pay more than anyone else, but they often get a raw deal. Rogue landlords are happy to part them from their cash in return for providing overcrowded rental properties that are not fit for human habitation. The London Rental Standard, otherwise known as a ‘Boris Badge’, aims to improve things, but in the meantime many tenants are turning to live-in rentals instead.

Flexible Living in the City
Renting a flat or room in a shared house usually involves handing over a shared deposit and a significant sum of money in rent every month. Tenants may also be tied into a one-year tenancy agreement and required to give one month’s notice if they want to leave. Live-in tenancies are far more flexible and a lot cheaper. Tenants have their own room and use of shared facilities. It won’t suit everyone, but if you find the right live-in landlady or landlord, it is a more affordable solution.

Landlords can rent a room and enjoy up to £4,250 tax free under the government’s Rent a Room scheme. But remember, earnings over this amount must be declared under the Self Assessment scheme or you could end up falling foul of HMRC.

According to recent research conducted by a large landlord mortgage lender in the UK, the average buy to let landlord fits a particular profile. So if you fit this profile, you are the average landlord!

An Average Buy to Let Landlord

• Earns just under £60k per year, which is double the average salary

• Has a property portfolio of around nine homes, which are worth £1.2 million

• Relies on buy to let mortgages to fund his property investment businesses (66% of respondents had mortgages in place)

• Enjoys an average return of 6.2% – 6.7%

• Is positive about the future of the buy to let market

Phil Rickard, the head of BM Solutions, the mortgage company that commissioned the survey of buy to let landlords, said: “It’s easy to see why people are attracted to the buy-to-let market; it offers a tangible investment which can provide the long-term returns that some other assets won’t.

“For those people considering the opportunities that this market presents it is however important to understand the financial and legal commitments being a landlord brings and to ensure that you undertake the right level of research and due diligence to increase your chances of success.”

Buy to Let Landlord Surveys
Another recent survey revealed that landlords are more likely to invest in buy to let properties in their own neighbourhood, which indicates that landlords are keen to invest in their local communities. Landlords also look at other key features, including the current housing market, whether the area is served by public transport, and what tenant demand is like, all of which are crucial factors when you are running a property rental business.

Student properties have historically offered good rental yields for landlords, but according to HSBC, student ‘housing cities’ are now the biggest buy to let hotspots in the UK.

What are Student Housing Cities?
Student Housing Cities are purpose built blocks of accommodation strictly for student habitation. They are often new build and landlords are asked to make an investment of between £40k and £60k per room. A developer usually takes care of the day-to-day management student city properties, which can be a big bonus for many landlord investors.

Top Student City Hot Spots
Cambridge, Oxford, Manchester, Southampton and Nottingham all feature in the top ten of cities most likely to give you a good return on your investment, but despite all the favourable advertising claims made by property sellers, experts are warning landlords that investing in student housing city properties is not without its risks.

“Despite the high headline yields often touted, student accommodation funds are high risk,” say financial advisers, Chase de Vere. “They are usually based offshore, are unregulated, have high charges and can suffer from poor liquidity, meaning it might be difficult to get your money back when you want it. They are more suitable for institutions than retail investors.”

The risk of losing on your investment is pretty high and if the developer overestimates the rental yield on the properties or goes into liquidation, you may be left high and dry. This type of property investment is not for the risk averse, so do your homework before ploughing your life savings into such a scheme.

According to Philip Inman, Economics Correspondent in the Guardian, the answer is an unequivocal: “Yes”. He says landlords are taking advantage of generous tax allowances and cheaper mortgage rates, but failing to spend any of their profits on the housing stock. He describes the buy to let housing sector as the “route to riches for those denied a big win on the lottery” and calls it a disaster for UK Plc.

Short Term Tenancy Agreements
Now that the banks have made it easier for landlords to take out loans to buy investment property, many landlords are snapping up property at the cheaper end of the market at the expense of first time buyers. At the same time many lenders are forcing landlords to only offer six-month contracts to tenants. Mr Inman says this is causing friction between landlords and tenants. However, in reality most landlords are more than happy to let good tenants stay long-term because it is better for everyone.

Chartered Institute of Housing Advice to Government
Gavin Smart from Chartered Institute of Housing (CIH) believes the government needs to review landlord tax allowances:

“Private landlords currently benefit from around £7bn of tax allowances per year for deductible expenses such as repairs and maintenance, insurance and professional fees, but [ministers] don’t target or incentivise higher standards. If landlords who committed to a higher level of standards benefited from a more targeted allowance, while those who did not saw their allowances stay the same or even reduce, the government could encourage higher standards – without needing to find any extra money.”

Your thoughts?

Everyone has heard of TripAdvisor. It’s the website where people go to check user ratings on hotels, apartments and anything else trip-related. In many ways TripAdvisor can be really useful. In fact I would hesitate to book a trip abroad without checking reviews of hotels I am considering paying a fortune to stay in. Well one enterprising individual has decided to create a TripAdvisor website for tenants and landlords. So how does it work?

Rate Your Landlord
RentalRaters has been launched by Hannah Williams, who says:

“The main catalyst for me starting up the site was a very good friend of mine was stung very, very badly by a rogue landlord. He said to me – and the words really resonated – ‘I just wish that I could stand outside that property and tell other tenants as they’re walking through the door, don’t do it, he will rip you off, nothing works.’”

How does RentalRaters Work?
The website aims to make it easier for tenants to avoid rogue landlords by allowing them to post reviews on rental properties. Tenants considering moving into a new property will be able to perform a search on the RentalRaters website and see if the address yields any dodgy reviews. And if it does, they have the option to steer clear and rent somewhere else instead.

All reviewers are verified in order to reduce the number of bogus reviews.

A Landlord’s Right to Respond
Landlords have the option to respond to any reviews they are not happy with and if the information posted is malicious or simply untrue, they can request that the review is removed via the website’s ‘take down’ policy. Reviews about properties owned by a previous landlord can also be removed via the same means.

The SAFEagent Awareness Week is now in its third year and there are currently lots of regional and national initiatives in place to try and build awareness amongst landlords of the benefits of choosing the right letting agent.

Financial Protection is Important
The SAFEagent scheme is trying to encourage landlords to pick a letting agent that subscribes to a Client Money Protection (CMP) scheme. The importance of this cannot be underestimated. Many letting agents don’t offer any form of financial protection to their customers, so if their business fails or they do a moonlight flit one night, you stand to lose a considerable amount of money.

According to John Midgley of the SAFEagent steering group, “SAFEagent Awareness Week is the ideal opportunity to remind landlords and tenants of the importance of identifying agents who offer financial protection and the campaign has made giant strides in doing so since its launch in 2011.”

Look for the SAFEagent Logo
Despite the fact that letting agents now have to belong to an ombudsman scheme, which gives landlords some redress when things go wrong, their money is still at risk. The SAGEagent scheme hopes to increase landlord awareness about the benefits of working with a letting agent who offers financial protection via a CMP scheme. There are around 3,000 letting agents nationwide who are signed up to CMP schemes and who therefore carry the SAFEagent logo and mark on their marketing materials, so look out for this before you sign on the dotted line.

With demand for rental homes so high in some parts of the UK, it is somewhat inevitable that a small minority of landlords have decided to cash in. The end result is a ramshackle collection of commercial buildings that have been hastily converted into residential lets for tenants, most of them immigrants.

Unsafe Residential Conversions
This type of conversion is a worrying phenomenon in London and the Home Counties. ‘Beds in sheds’ have already been identified in large numbers, but the trend is spreading as rogue landlords see the potential for rental income from old warehouses, office buildings and disused factories. These conversions are unsafe and unregulated, with many having no proper sanitation or heating.

Mount Unpleasant
One such development in Mount Pleasant, Brent, only came to light after a small fire broke out and emergency services discovered up to 100 people living in horrendous conditions. Most of the tenants were evicted, but some 30 still remain, sharing one kitchen and bathroom. One tenant has lived in the conversion for over a year. He is paying £600 per month for the privilege.

Ghost Landlords
Thermal imaging cameras have identified hundreds of suspicious buildings. Last month Harrow Council identified four times as many suspicious outbuildings as they were expecting to find. The problem is that even when such developments are found, it is difficult to identify the landlords responsible because many properties are sub-let multiple times. Rent is also paid in cash, which compounds matters.

According to Kris Hopkins, Housing Minister, £6million has been made available to local authorities to try and deal with rogue landlords. Whether that makes any difference remains to be seen.