Property Price Rise A Mixed Blessing For Landlords

 According to a recent survey, 70% of UK landlords report seeing an increase in property prices in their area recently. This sounds like good news and in one way it certainly is. The property price increases will go a long way towards reversing the capital loses a lot of landlords experienced in the recent crash. There is also a less favorable side to this bit of news, however.

A lot of landlords who were in a strong financial position had been slowly and steadily increasing the amount of properties in their portfolio, something that is bound to be a financial boon for them in the future. The rise in the market is going to put the brakes on this activity.

One thing is for sure landlords have proven to not be behind the door in predicting the changing face of the property market with the same survey group reporting last month that only 28% of landlords expected to add another property to their portfolio in the next 12 months.

The fact that housing stocks remain low, however, is potentially more good news for the average landlord. Another property bubble could see many forced out of buying into renting ensuring the flow of tenants. 

Landlord Fined Thousands By Environmental Health

 In a timely adjunct to my blog last week about fire safety a landlord has been hit with a massive eight thousand pound fine by environmental health. Apparently an inspection by officers from Swinford council revealed that the premises were a disaster waiting to happen.

The property was four storeys and divided into seven separate bedsits. With in these living areas the officers found broken windows, emergency lighting that was defunct and smoke alarms that were not in working order. Combined with the fact that the fire doors were of the poorest quality they ruled that the landlords needed to face court to answer for the state of the property. He was fined a massive eight thousand dollars.

I think we can all agree that this guy was asking for it. The possibility of a life being lost in this place was too high to be ignored. Personally I genuinely do not know how landlords who pull this kind of stunt sleep at night. The worry would kill me. 

Everyone Loves An Expert

With the property market in recovery and the tarnish of the crash starting to recede slightly people are once more starting to think of property as a safe pair of hands for their investment money. Of course this means that a fair few new people are entering our market and apparently a lot of them are looking for advice.

The property investment marketing sector finds itself swamped with people looking to consult the experts before they put their hard earned into something that they are not totally knowledgeable about. Data from a leading mortgage adviser indicates that fourteen percent of inquiries are from people looking to get set up in buy to let.

Karen Barrett, chief executive of unbiased.co.uk, says “It is essential that both first-time buyers and those looking to remortgage seek professional advice to ensure they are making the best decisions for their individual circumstances,” she said.

I could not agree more wholeheartedly and am glad to see that the horror of the last property crash has also bought some new wisdom. People are starting to wake up and see that property although a great option cannot just be taken for granted as an investment. Research is needed and it seems that people are starting to do theirs.

On the bright side of this is the fact that we could probably hire ourselves out to give these newbies some advice, many of us certainly have enough experience. 

Are You Insured for Liability?

I may well have mentioned something about this before but it is a subject I feel passionate about, insurance. It is such an imperative in so many walks of live but in the residential landlord’s market it is even more so.

Many landlords I know insure themselves against disasters to their property and to their contents, if they own things in the house such as in the case of renting fully furnished but many fail to cover themselves for liability. Frankly I find this astounding because an accident involving one of your tenants or their property, under the right circumstances, has more potential to leave you in financial ruin than any damage to property.

There is such a thing as specialist landlord insurance and I highly recommend going for one of these policies, they are literally made for people like us. I also recommend talking to your broker about your biggest concerns as the policy can also be tweaked to suit your individual needs. If you get a good broker with lot of the right experience they really do now what they are doing, make sure you shop around for the right broker and the right policy.

One In Three Tenants At Risk From Gas Leak

I was astounded this week to hear that the figure for tenants at risk of a gas leak is as high as one in three. After all the publicity that we have had regarding the safety requirements for gas appliances it is almost beyond belief that this number is correct. However, according to a recent survey 36% of tenants are in properties with expired gas safety certificates and even more worryingly 26% inhabit a property that has never been checked for safety.

This is mind boggling to me. As we all know it is now a legal requirement that every rental property is checked for gas safety annually and the certificate provided to the tenant. Ignorance of this particular law is no longer any excuse either legally of morally as it has been in place long enough now for all landlords to be aware of it existence.

The figures from UK health and safety serve to emphasise the importance of following the regulations. In the last twelve months 18 people have died as the result of gas leaks and 310 more ere injured.  The idea of being the landlord responsible for one of these accidents is enough to chill the blood and personally I do everything I can to try and prevent that occurring.

Please join me in being responsible in regards gas safety. You owe it to your tenants and to the greater reputation of the private rented sector.

Landlord’s Predicting Interest Rates Rise By 2011

94% of residential landlords are certain that there will be significant interest rate rises but not until the beginning of 2011. This is in spite of the fact that the Bank Of England recently decided not to shift on its record breaking low rate of 0.5%.

In landlord circles the prediction is that there may be small rises in rates before the turn of the year but it is likely to be 2011 before we see anything that is really worth talking about. They are also putting a figure on things and coming in slightly higher that the average economic expert with a predicted rise of 1.25%. Others have been forecasting more like 1.1%.

Some landlords are displaying somewhat pessimistic tendencies with 10% predicting the rise to reach 2%. Only one in a hundred are pessimistic enough to predict anything as dire as a 3% rise though, so that is some comfort.

With all this in mind it seems that some landlords are still content to start looking for properties to expand their portfolios especially in the London area. Just under half of London landlords are looking to buy up. the rest of the country is slightly more reticent with the figure being more like a fifth.

Regulations and Red Tape For the Modern Day Landlord

A recently released report has finally acknowledged the serious contribution to the housing market made by the residential landlord. We have been going on about it for ages but it is nice to see the government catching on and giving praise where it is due. The most important factor in the government report is that the economic good being done by the private rent sector has also been noted.

This has lead to the treasury stating that it is considering making to the form of buy-to-let regulation it originally envisaged. This is great news. As we have said all along fair regulation is not an issue but there is no need for the everyone to be regulated as strongly. Some parts just do not need to have someone constantly looking over their shoulder.

It seems now that the treasury is leaning a little more towards our view which is that the residential BTL sector should be treated the same as the commercial one but with a few more safeguards in place. Well, at least we are hoping that is what all this means.

At the same time though some parts of society are trying to lay the blame for fewer first time buyers at the feet of landlords, but more about that tomorrow. 

Deposit Schemes Break New Records

I have sometimes been critical of deposit schemes, especially when they go bust and leave everyone out of pocket but a story this week is a very positive one. Apparently The Deposit Protection Scheme has broken all records in protecting deposits recently after recruiting a huge number of new letting agent members.

Kevin Firth, director of the DPS is delighted with the way things are going for the industry in general and his particular company. He has had this to say

“When we launched, we were aimed at private landlords with small property portfolios. However, the DPS has proven popular across the whole industry, including large portfolio landlords and letting agents.We’re continually told by agents that tenants feel safer when their deposit is protected by a trusted third party rather than the agent or landlord – and they would prefer to choose an agent that has our sticker in the window.”

It is probably true that tenants feel safer when their money is protected by a trusted third party and actually landlords may well feel it is easier to hand the money over rather than look after it themselves. Hopefully the problems we have encountered were mainly teething problems and the The Deposit Protection Scheme will be a good thing for all concerned heading into the future.

Property Recovery Likely To Last A Long Time

Many people, rightly or wrongly, are now starting to believe that the residential property market is well on its way to recovery. That is great news in itself but even better is the fact that history shows us that once recovery starts it is unlikely we will take another spill for quite some time.

The last property market crisis was around twenty years ago. Therefore, those people who are now looking to get into property right now can consider themselves to be in a fairly strong position for the near future if they do buy. Experts predict that we can safely assume a decade of relative growth.

This is especially true of the rental sector as this change in attitude towards renting we have been discussing kicks in. Buy To Let looks like becoming a particularly exciting investment opportunity in the near future.

Everything is looking fairly rosy in our sector then, right at present. The only word of warning being sounded by some is for people getting involved in Buy To Let for the first time. Experts talk of the stability of having a fixed rate loan to set your self off so that you have consistency in your repayments.

If you are able to find one that suits you this does not sound like bad advice. It is always comforting to know exactly how much you are paying. 

Property Investment All The Rage For Women

Statistics from the Auction Results and Analysis System (ARAS) reveal that a new wave of wealthy private investor is rising in numbers in the property investment market.

James Cannon, of newly-launched Mayfair–based auctions firm Cannon Capital, has said: “I’ve noticed there are a lot more women in sales rooms nowadays. In residential auctions, buyers have always been mixed and you get a lot of owner-occupiers, but in the commercial market this is a new trend.”

It appears that these female investors have often made their money in other sectors but are keen to get involved in the property market with their investment money. Some experts are putting the trend down to popularity of property TV shows such as Homes Under The Hammer, Property ladder and Location, Location, Location. These shows have bought property investment into the mainstream and exposed it to a wider audience, including women from other work sectors who may never have considered its benefits.

It is important though,  whether you are male or female, you make sure that you are suited to the property market before you get involved. A lot of people took the leap during the last property boom only to find it was certainly not something they enjoyed.