Landlords may be leaving fixing old boilers longer than is necessary due in part to some confusion over tax laws.

The specific law in question is the one the government has expects to encourage landlords to bring their properties up-to-date in the heating and environmental stakes. But it seems very unclear at the moment whether they are eligible to apply for the 10% tax allowance if they replace old boilers.

David Lawrenson of LettingFocus.com has been very vocal about the fact that replacing old boilers should fall into the UK’s Landlord Energy saving Allowance.

This seems very sensible to me, in fact you would have thought it was the very essence of the spirit of that law. Clearly new boilers are going to be more energy efficient and that is the whole point.
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After Northern Rock collapsed it was obvious that something needed to be done to stabilize things. New powers were granted to the Bank of England on a temporary basis.

Since then things have gotten worse in the financial world and now these laws have been made permanent in an attempt to help manage the state of flux we are in.

According to an article on the BBC website the new legislation has received mixed reactions. On the face it seems to be a very good thing for the majority of us. If nothing else it allows for savers to receive compensation within one week if a bank is to go bust.

I know that would be a huge relief to many savers, some of whom ended up in the frightening position of not having enough funds to cover their outgoings while they waited for previous disasters to be addressed.

The major objective though is to try to make things a little more stable and to therefore increase confidence.

Peter Thal-Larsen, banking editor of the Financial Times, told the BBC’s Working Lunch programme “The idea is that, if there is a bank that gets into trouble, to insulate it and make the wider impact of that less”. (more…)

It is clear that repossessions are on the rise at the moment and that is, unfortunately, to be expected in the present climate.

Buy to Let mortgages are at the forefront of this rise. The number of buy-to-let landlords unable to keep up payments on their mortgages more than doubled during the second half of last year, hitting record highs for almost 27,000.

People are being urged not to panic if they do get into difficulty.

The government has recently introduced new laws that put pressure on lenders to take it easy on borrowers that fall behind and to resort to repossession only as a last measure.

This is actually believed to be having a positive effect.

The Liberal Democrats are, however, not satisfied with these measures and have urged the government to do even more.

Lib Dem leader Nick Clegg has been quoted as saying “If the Government was serious about stemming the tide of repossessions, it would give courts the power to ensure repossession is the absolute last resort and remove the barriers to allow councils to invest in social housing.”
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The Council Of Mortgage Lenders (CML) has stated that the number of homes repossessed in the UK rose 54% last year to a figure of 40,000 according to a report by the BBC. As dire as that sounds it is not as high as they had predicted.

The lower than expected figure is a credit to the strenuous efforts being made by lenders to make sure repossessions were the last thing on their agenda according to the CML.

They do, however, expect this figure to continue to rise with a predicted 75,000 repossessions this year. They urge homeowners to investigate the possibilities before they take the drastic step of handing in their keys.

“We strongly urge borrowers to contact their lender and work with them before taking this step, as there may be other solutions,” said the CML’s director general Michael Coogan.
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The Council of Mortgage Lenders has indicated that new buy-to let mortgages have fallen to a five year low.

Figures just out show that 37,000 buy to let loans were taken out in the fourth quarter of last year, worth a combined total of 3.9bn pounds, this represents a drop of nearly one fifth in value while volume was down twelve percent.

It is believed that this has occurred at least in part because of a rise in the excess supply of rental properties.

This is also believed to be the cause of the rising number of payment problems with some landlords faced with long periods where their properties are without tenants. The number of properties that are more than three months in arrears has risen from 1.88 percent to 2.3 in the last quarter.
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You will remember that last week I wrote a blog on the fact that the OFT had decided to take a much closer look at the practices of sale and rent back companies.

This was an area that I believe has been cause for concern for quite some time and it appears the OFT agrees. They made three recommendations to the government regarding these companies:

-    Compulsory Regulation.

-    Increased consumer awareness through education.

-    Improved information about housing benefits.

From there the government has launched an extensive consultation period but so worried is the OFT about the actions of some of these companies that they also recommended that something needed to be done in the interim.
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As the effects of the credit crunch are felt people are really looking closely at the state of their businesses and investments and one of the side effects is that an amazing amount of fraud is coming to light.

Jeff Salway wrote an interesting article in the Scotsman last week quoting experts as saying so widespread was the fraud that it is possible it caused the property meltdown. Mr Salway writes

“In December the Professional Negligence Lawyers Association claimed there was “no doubt” that large-scale, organised mortgage fraud at least contributed to or may even had caused the property market meltdown”

Frightening stuff really and perhaps even more scary are the claims that the full extent of the fraud that has been taking place since the credit crunch began will not even yet be known for some time.

Hitesh Patel, fraud investigation partner at KPMG Forensic, said: “As the global economic downturn takes hold and organisations look ever more closely at their operations, it is very likely that more fraud will come to light so that the real impact of the credit crunch on fraud is yet to be fully felt.” (more…)

The next Landlord Buy to Let show is just round the corner so I’m giving you advanced notice of the talks that I will be giving during the two day event.
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