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Right To Rent changes from 30th June 2021

right to rent changes

Changes to Right to Rent legislation in the UK come into effect from 1st July 2021, ending the grace period put into place following the country’s exit from the EU. The change means that letting agents will move from checking nationality to checking the UK immigration status of all adult tenancy applicants.

Right to Rent is the legislation that requires landlords and agents to check the immigration status of prospective tenants to ensure they have the right to rent in the UK. The temporary changes meant that citizens of European Economic Area (EEA) countries and Switzerland only needed to prove their citizenship while applying for settled status in the UK. When the interim measures lift, it will mean that these people need to provide evidence of their UK immigration status too.

New guidance has been issued by the Home Office for agents and landlords to follow from 1st July 2021. The Home Office has been working with ARLA Propertymark, who says that “From this point, if someone is an EEA, EU, or Swiss national, you will need to see evidence of their UK immigration status rather than their national identification”. Anyone who has applied for and been granted settled status will have digital evidence of their application, and this should be shared digitally using the online Right to Rent services from the Home Office on the Gov.uk website.

Digital checks have been an option since December 2020 and involve the prospective tenant sharing a time code and their date of birth, which landlords use to check their immigration status online. However, not all applicants will use the digital service and may have other evidence of their immigration status, including physical documents.

Another change to Right to Rent checks is related to Covid-19. The way that checks were carried out was temporarily readjusted to make them safer during the pandemic. From 1st September, landlords and letting agents will be returning to face-to-face and physical document checks. This is in accordance with the easing of lockdown rules and social distancing measures, aligning with the roadmap for England set out by the Government. This change has been postponed twice, first set for 16th May, then 20th June.

Currently, Right to Rent checks can be made over video calls and tenants can send scanned documents or photos of documents using email or a mobile app. The online Right to Rent service can also be used during a video call if the prospective tenant has a current Biometric Residence Permit or Biometric Residence Card or has been granted status under the EU Settlement Scheme or the points-based immigration system. When these temporary changes end on 1st September, landlords and their agents must either check the applicant’s original documents or check their right to rent online if given their share code for the service.

Both landlords and EEA/EU/Swiss citizens applying for tenancies should be aware of these changes related to Brexit and to Covid-19. The situation regarding Covid-19 could also be subject to change, so it’s a good idea to keep an eye on what’s happening.

Pick My Pad are Walkden and Worsley property experts and can help guide both landlords and tenants through any property related matter. If you need help and advice on the new Right to Rent changes and what is means for you, please contact our team on 0161 790 3999 or use our contact form.

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End of Stamp Duty Holiday: first deadline fast approaching

stamp duty holiday

The Stamp Duty holiday in England will end on 30th June 2021, lowering the nil rate band from £500,000 to £250,000 for all but first-time buyers, who have a threshold of £300,000 before stamp duty is due. The rates will then change again in October to return to the standard amount pre-Covid-19.

The temporary nil rate for Stamp Duty Land Tax (SDLT) was introduced in 2020 when the UK went into lockdown amid the global Covid-19 pandemic, allowing anyone to purchase a primary residential property up to the value of £500,000 without paying Stamp Duty. From 1st July to 30th September 2021, the nil rate band will be reduced to £250,000 and then will be reduced again to return to the standard threshold of £125,000, again, except for first-time buyers who have a threshold of £300,000.

The rate of SDLT that applies to a purchase depends on the date that the purchase is completed and not the date that contracts are exchanged. This means that many people who are in the process of buying a house now could miss out on the extra relief but still have the opportunity to benefit from the £250,000 nil rate if they complete by October. The rate above £250,000 will be 5% on the next £675,000 (up to £925,000), 10% on the next £575,000 (up to £1.5 million), and 12% on the value above £1.5 million.

The adjustments to the Stamp Duty nil rate apply to main residences. Additional properties, for which there is no nil rate unless they are bought for less than £40,000, incur a 3% tax up to £500,000 until 30th June. This then changes to 3% up to £250,000 until October.

Anyone hoping to take advantage of the lower Stamp Duty rates, whether buying a main residence or an investment property, should think about moving quickly. Property purchases can take a number of months, and there are just over three months left until the SDLT rates revert to the standard amounts.

June 30th is the first Stamp Duty holiday deadline to pay attention to if you’re currently in the process of buying a property. Now is the time to try and speed things up and perhaps try to set a completion date before this deadline. If you miss this first deadline, you can still benefit from the Stamp Duty holiday, with a further three months to take advantage of the £250,000 nil rate. To check how much you’re going to pay, you can use the Stamp Duty Land Tax calculator.

If you have yet to find the perfect property, Pick My Pad can help you to speed up your search. Our estate agents will listen to your wants and needs and suggest properties for your shortlist. Please contact us on 0161 790 3999 or use our contact form. If you’re currently viewing properties, you can also speed things up by getting other necessities out of the way, such as lining up a solicitor and talking to a mortgage broker. This will put you in a good position to move quickly once you find the right property.

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Mistoria Estate Agents expands with new Cheadle branch

Our sister company, Mistoria Estate Agents, is opening its 6th North West based office, this time in the suburbs of Cheadle. The new branch joins the already successful Mistoria Estate Agents outlets in Manchester, Bolton, Liverpool and Salford.

Parent company, The Mistoria Group, specialist in property investment, with a particular interest in student accommodation and HMOs. As a result, the Group’s estate agents are heavily involved in the student lettings market, whilst simultaneously providing traditional residential sales and lettings services. The Cheadle branch will further expand on these core property services by also offering mortgage brokering and conveyancing services. This is made possible by the fact that the new estate agents will share office space with MCC Accountants (also a part of The Mistoria Group) at their Church Road location in the heart of Cheadle’s busy high street.

Cheadle Branch Manager, Dewi Caughter, is keen to get going and build up the Mistoria reputation in the local area . He says, “Cheadle offers a new demographic make-up for Mistoria, but we’re keen to establish ourselves here and grow the Mistoria brand across the wider, more lucrative south Manchester area.

“We will provide a bespoke estate agency service for all pricing levels of the local property market. Our aim is to provide high quality customer service standards and competitive prices.”

The Mistoria Group CEO Mish Liyange comments, “This is an exciting time for The Mistoria Group. We already have five successful branches in the North West and have plans to expand into five more areas over the next five years, with the first being Cheadle. As well as Mistoria Estate Agents, our acclaimed in-house accountancy practice, MCC Accountants have also taken up residence in the new office and we hope the two companies will work together and complement one another to meet the needs of the south Manchester property and business sectors.”

Mistoria Estate Agents Cheadle have two opening offers that they hope will attract sellers and landlords alike. Those wishing to sell their property can enjoy fees of just £999, with no hidden extras. Landlords are being offered a fully managed service for just 8%. Both are hugely competitive offers and both are available for a limited time only.

More information can be found by visiting the website: www.mistoriaestateagents.co.uk/cheadle/

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Two Views on the Ending of the Evictions Ban in the UK

walkden letting agents

For the pandemic period, a “new normal” has been in place. This new normal has included an unprecedented financial package from the government to help individuals who have lost their incomes to support themselves and find new work. One helpful measure has been the “eviction ban” that prevents landlords from evicting tenants who can’t pay their rent. But as the pandemic nears its end this ban has been lifted prompting concerns on both sides of the divide. In this article our Walkden letting agents look at the views of both landlords and tenants, each of whom has equally valid views on the government’s latest pandemic decision.

The view of tenants

As the Covid-19 pandemic draws to a close the government has decided to curtail the ban on evictions put in place during the pandemic to protect the homes of tenants. Under this law, tenants are not able to pay the rent due to pandemic circumstances – job loss or furlough – we’re not legally obliged to leave the property – that is no longer the case.

As of May 2021 landlords with tenants who do not pay rent or are in substantial arrears can be evicted from the property. This means that those who have suffered a loss of income as a result of the Covid-19 pandemic and were not able to pay rent, as a result, might now find themselves homeless.

Who is affected?

According to recent reports, the lifting of the eviction ban could affect up to one million people in the coming weeks and months. It’s estimated that 400,000 people have already been served with an eviction notice by their landlords as a result of unpaid rent or rental arrears. This could precipice a housing crisis.

The pandemic has rocked the country as a whole and uncertain times lay ahead, but for renters, with low paying work or zero-hours contracts, their position was already precarious. The eviction ban was a lifesaver for many people as it allowed them some breathing space after losing a job and going onto benefits. While many of those people now have paid work again, rent arrears still put them at risk of eviction.

A housing crisis

Those same people who are only now getting back on their feet now have to stress about whether they will have a bed to sleep in after their shift or if they have to find a way of securing a new property on a low-income wage. Up to a million people are expected to be affected by the lifting of the eviction ban, raising the thorny question of where they are expected to go.

The view of landlords

When the pandemic struck it is fair to say it affected everyone. It’s also fair to say that the response to the pandemic was fair to governments, individuals, businesses, and landlords. It’s hard to imagine a landlord objecting to the eviction ban in the first few months of the pandemic. But now things are different.

As the pandemic grinds on and things appear to be looking more promising with the rollout of several vaccines, the government has decided to lift the eviction ban and give landlords the power to demand their rent from tenants once again. This has not been easy for tenants with high arrears but there are good reasons for it.

The counter-argument

It’s easy to take the side of tenants who have been affected by the pandemic and can’t pay rent temporarily, it’s even easier to take their side when the landlords in question are portfolio landlords with many properties on their books. But that isn’t always the case, and in fact, the majority are single property owners.

Single property owners use the rent from their tenants to pay for their own mortgage, so when this isn’t coming in their mortgage stops. With the eviction ban in place, landlords were finding that tenants didn’t respond to letters asking for rent because they knew they were safe from eviction – some even told their landlords to take mortgage holidays.

The future

As we leave the pandemic and the eviction ban is lifted it would seem to spell the end of a difficult financial time for landlords – but that isn’t necessarily the case. If tenants don’t pay their rent the landlord will be forced to evict them and shoulder the weight of arrears there are owed. Under present circumstances, there is no guarantee of a new reliable tenant either. What is needed is a benefits package from the government to help tenants pay landlords in the short term.

Walkden Letting Agents

As Walkden letting agents Pick My Pad understands the property industry in detail. We specialise in DSS or social housing, and private rentals as well as HMOs but can offer expert help and advice on all forms of property letting. For more information on what we do, contact us on 0161 790 3999 or use the details on our contact page.

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What’s Driving the Current Surge in Property Valuation Prices, and is it Sustainable?

walkden estate agents

2020 was undoubtedly a unique year by any standards. COVID-19 took the world by storm, forcing humanity to rethink its definition of normality and disrupting the global economy profoundly.

In the UK, the housing market was one of the most affected sectors of the economy. The factors affecting this sector include:

  • Brexit
  • The pandemic 
  • The success of the vaccine
  • How businesses will act post-pandemic

However, contrary to many expert predictions, the global pandemic has not spelt doom for the property market. On the contrary, demand for housing has increased tremendously, and it does not seem likely to wane any time soon.

Pick My Pad’s Walkden estate agents look at the factors driving the surge in property values and predictions about its sustainability.

What is Driving the Surge in Property Valuation?

The primary reason for the drastic increase in the valuation of property is the chancellor’s stamp duty holiday. The government introduced this tax holiday to maintain stability in the housing sector, and the plan is working well.

The government is keen to maintain stability in the housing sector to avoid a severe crisis, as was witnessed in 2008. This single move has played the most significant role in ensuring that property value did not plummet due to the pandemic.

Additionally, banks throughout the country are being pragmatic and not increasing interest rates for mortgages. This has undoubtedly played a role in increasing the value of properties because buyers are not afraid of seeking loans to finance property purchases.

Moreover, people have been saving more over the past year than they did previously. This behaviour has also played a part in ensuring that the value of property keeps going up.

The pandemic itself has also led to increased valuation of the property. This is because of working from home, which has forced people to redefine what they want in a home.

For many city dwellers, staying at home for days on end led to the appreciation of space in a house. Consequently, many people are looking to move to the suburbs to have enough space to work comfortably from home.

On the flip side, property in the city has seen a drop in valuation, reflecting the decline in demand for homeownership in urban areas. People are no longer concerned about commuting for hours since they are working from home, which further decreases the lure of city property.

Is the Surge in Property Valuation Sustainable witnessed by Walkden estate agents?

According to many financial experts, the value of real property will level off in 2021. This is partly because the stamp duty holiday is set to expire by the end of June, making the transfer of property quite expensive.

However, demand for suburban property is set to continue increasing since the viability of working from home has been tested and proven. Therefore, people are bound to continue with the practice long after COVID becomes a thing of the past. If you want to sell your house fast, this is certainly the time to do it.

Contrary to many predictions, the value of property in 2021 has been increasing steadily despite the pandemic. This can be attributed to government policies as well as consumer behaviour. However, property value is set to level off in 2021 as the dust settles post-COVID.

To find out more, or for help and advice in any other property related matter, call our Walkden estate agents on 0161 790 3999 or use the details on our contact page.

 

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PRESS ARTICLE: Can Private Landlords Plug The Housing Gap For Social Tenants?

Recent research for the National Housing Federation and Crisis that was carried out by Heriot-Watt University reveals that 145,000 affordable homes should be built annually for the next five years, of which 90,000 a year should be for social rent.

This is the lowest-cost housing that councils and housing associations provide, with rents tied to local incomes. In recent times, fewer than 7,000 new homes a year have been created in this category in England.

According to Shelter, building social housing will be an investment, as it will cut the housing benefits being paid to private landlords. “The bottom line is, you cannot solve affordability without genuinely affordable homes,” says the housing charity Shelter. “That means we need to address the chronic shortage of social homes in this country. This shortage is at the heart our housing emergency.”

When the ban on tenant evictions ends on 31 May 2021, many local authorities expect to see an increase in levels of homelessness, with 94% saying they expect to see an increase in people made homeless after being evicted from the private rented sector, and an increase in newly unemployed people made homeless by the pandemic.

However, landlords commencing eviction proceedings must give six months’ notice except ‘in the most serious of cases’, such as instances of domestic abuse or anti-social behaviour.

Mish Liyanage, CEO of Pick My Pad, comments: “Affordable social housing has become scarcer, leaving many households with no choice but to rent in the private sector.

“Increasingly private landlords across the country are working with local councils and housing associations to provide housing for social tenants. Alternatively, some landlords use specialised DSS letting agents and let properties to LHA tenants who are on universal credit or housing benefit.

“Over the last 12 months, we have seen a significant increase in private landlords opting for LHA tenants on universal credit and housing benefit, up 28% year on year. With the support of the right letting agent, landlords can benefit from longer tenancies with higher rents than from private tenants.

“There are many advantages of having LHA/housing benefit tenants such as consistent demand; minimal rental voids; rent being higher than private tenants; more secure long-term tenancy; and landlords having more control over their properties.

“There has been a surge in tenants on benefits looking for private rental accommodation in the North West, especially in Walkden, Little Hulton and Salford areas. The LHA rates are very good as they are in line with Central Greater Manchester rates.

“At Pick My Pad, the leading property agent for social housing in the North West of England, we warmly welcome tenants who are in receipt of benefits such as personal independence payment (PIP), housing benefit, disability allowance or universal credit (UL). “We pre-qualify all enquiries and carry out reference checks and where applicants are not able to meet certain requirements, such as guarantors or a deposit, Pick My Pad assists in securing rental deposit certificates and rental bonds from local councils.”

Pick My Pad will liaise with the council to ensure that the benefits/universal credit will be paid directly to the agency thus ensuring the landlords have the peace of mind that the rent being paid on time. www.pickmypad.com or call 0161 790 3999.

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PRESS ARTICLE: Benefits freeze will drive up rent arrears for landlords

The Government’s recent benefits freeze will leave tenants across Britain facing rent arrears of £1,000 (* Source: Observer newspaper analysis of Government data, March 2021).

From April 2021, the government is freezing the amount of local housing allowance (LHA), so tenants will receive the same amount of money as last year, even though rents have risen in many parts of the country. LHA is paid to tenants in privately rented homes, including those on universal credit.

In some parts of the country, tenants are set to lose more than £1,000 a year as a result of a combination of rising rents and the new benefit freeze. According to Citizens Advice, there is a mounting arrears crisis, with an estimated half a million private tenants behind on rent. The ban on most evictions, imposed at the start of the pandemic, was extended last week to the end of May.

The Joseph Rowntree Foundation wants the government to reverse its decision to freeze LHA so that it is recoupled to the real cost of renting.

Mish Liyanage, CEO of Pick My Pad, comments: “Despite the freeze on LHA rates for this year, many tenants on benefits are in a position to cover their rental costs. In towns and cities across the UK, affordable accommodation can be found.

“For example, in Manchester, the LHA rate is 138.08 per/week 1 bed and the average private rent is £120 per/week. If we look at Bolton, the LHA rate 90.90 per/week, while the average private rent is £85/week. The majority of landlords will not be facing arrears and if they use a letting agent that is experienced with social tenants.

“An agent can secure a higher rate/week eligible for the DSS tenant, vet the tenants, get a non-cash damage bond on your behalf. This will cover damage to the property and its contents, fixtures and fittings. The bond is the equivalent of one calendar month’s rent and is valid for up to 12 months, or the duration of the assured shorthold tenancy.

“My advice to landlords is to use an estate agency who has the expertise to deal with social housing and LHA Tenants on Universal Credit and housing benefits, so that you get the best possible income for your property.”

Pick My Pad will liaise with the council to ensure that the Benefits/Universal Credit will be paid directly to the agency thus ensuring the landlords have the peace of mind that the rent being paid on time.

For further information, please visit www.pickmypad.com or call 0161 790 3999.

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PRESS ARTICLE: Why Landlords Should Embrace Social Tenants

Why Landlords Should Embrace Social Tenants

The pandemic, job losses and rising rent prices has meant that in some areas 40% of tenants need benefits help to pay their monthly housing bills.

Affordable social housing has become scarcer, leaving many households with no choice but to rent in the private sector – often paying more than they would for a mortgage. The percentage of homes provided by councils has fallen year on year, falling to 7% in 2018*.

In March 2020, the Local Housing Allowance (LHA) was increased to cover the bottom 30% of rents, but from April this year, it will be frozen again in cash terms, meaning the gap between rental costs and support available will start to widen again. The Joseph Rowntree Foundation wants the government to reverse its decision to freeze LHA so that it is recoupled to the real cost of renting.

“The economic fallout from the pandemic has left millions of families worried about paying rent,” says Darren Baxter, Housing Policy and Partnerships Manager at the Joseph Rowntree Foundation thinktank. “The government should immediately introduce a targeted package of grants to support renters in arrears, ensuring that they can stay in their homes.”

According to the latest HomeLet Rental Index (March 2021), the average rent in the UK is now £922, up by up 3.4% on last year. When London is excluded, the average rent in the UK is now £847, up 6.8% on last year. Ten of the Twelve regions showed an increase in annual variance, with the largest, as last month, being the East Midlands at 10.5%. The South West shows the highest yearly increase of 8% between January 2020 and January 2021.

Leading industry experts say housing support in the benefits system needs to reflect the average cost of renting in any given area.

Mish Liyanage, CEO of Pick My Pad, comments: “Many tenants on benefits are seeking affordable accommodation in the private sector and landlords should be embracing them. However, it is vital that landlords educate themselves with the requirements for DSS tenants. With this knowledge, they can run a very successful tenancy. But without the right know how, landlords could in the worst-case scenario, lose money.

“For those landlords that are new to social tenants, it is important to understand the housing benefit system and payment cycle. LHA councils pay tenants two weekly, four weekly or calendar monthly so there is little point in a tenancy agreement that demands a payment on different dates.

“For example, Bolton council’s 1 bed rate is £90.90 and Salford council’s 1 bed rate is £138.08. Hence there is a massive a difference and social landlords should be aware of this,

“We have currently over 400 tenants on benefits and achieve a rent collection record of over 90%. Many tenants do not want the hassle of dealing with housing benefit and they want the convenience of it being sorted for them. Although many understand that they need to apply for housing benefit, they prefer if the landlord or an agent can assist them with doing this on
their behalf.

“The temptation to spend housing benefit can be far too great for tenants and often they fall into a debt trap by using housing benefit payments for living costs on a short-term basis. So if landlords can help tenants to avoid this temptation and providing the rent is affordable, there is the potential of a long and secure tenancy to be enjoyed by both parties.

“At Pick My Pad, the leading provider for social housing in the north west of England, we warmly welcome tenants who are in receipt of benefits such as Personal Independence Payment (PIP), Housing Benefit, Disability allowance or Universal Credit (UL). We pre-qualify all enquiries and carry out reference check and where applicants are not able to meet certain requirements such as guarantors or deposit, Pick My Pad assist in securing rental deposit certificates/Rental Bonds from local councils.”

Pick My Pad will liaise with the council to ensure that the Benefits/Universal Credit will be paid directly to the agency thus ensuring the landlords have the peace of mind that the rent being paid on time. For more information please visit www.pickmypad.com or call 0161 790 3999.

*(Source: The Guardian, March 2021).

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Preventing Deposit Disputes with your Lettings

walkden letting agents

Deposit disputes can be difficult and time-consuming for tenants, landlords and letting agents alike. Fortunately, with proper planning and preparation, most can be avoided altogether. Here are some things our Walkden letting agents think landlords and fellow agents should know about that reduce the likelihood of this happening.

Schemes, Agreements and Legislation

The Tenancy Deposit Protection (TDP) Scheme and Prescribed Information

As a landlord, you must put your tenants’ deposits in one of three government-approved tenancy deposit schemes (TDP), which protect the deposits, within 30 days of receiving them. Within the same timeframe, you must serve all ‘relevant persons’ the Prescribed Information which contains information about the scheme, including how the deposit is protected and how to apply to get it back. A ‘relevant person’ is any person, company or organisation that contributes to a tenant’s deposit payment, which often happens with student lettings. Failure to place the deposits in a TDP and serve the Prescribed Information within 30 days will incur penalties.

The Tenancy Agreement

Knowing what to include in the tenancy agreement will ensure that your tenants know what is your responsibility and what is theirs, which is crucial to preventing disputes. Two aspects of the tenancy agreement that are often overlooked are:

  • Joint and several liability
    This means that all of your tenants are equally responsible for adhering to the tenancy agreement, so for example if one tenant cannot pay the rent, then the other tenants are liable for that as well.
  • Cleaning and maintenance responsibilities
    This should state who is responsible for things like mowing the lawn and cleaning the gutters. In student lettings, it’s also important to state that every tenant is responsible for keeping communal areas clean and tidy because many of these are let to individuals by bedroom.

The Houses in Multiple Occupation (HMO) legislation

If your letting is a House in Multiple Occupation (HMO) then you as the landlord have extra legal responsibilities. This is primarily to reduce the risk of fire and ensure tenants have adequate facilities. It includes ensuring that annual gas safety checks are carried out and making necessary repairs to communal areas of the property.

Furthermore, the HMO may require a licence. This generally applies if it has five or more unrelated people living in it or two or more separate households living there; however, some local councils require all HMOs to have a licence so it’s worth checking with them.

Helpful Tips

Know your tenants’ contact information

A simple but oft-forgotten way to reduce the risk of deposit disputes is to maintain clear and open communications with your tenants. Obviously, you cannot do this if you don’t have their up-to-date contact details, such as email addresses and phone numbers. As students often change these, it is important to check in with them occasionally to ensure you have the correct information.

Market early for student lettings

Students often begin their property searches around October-time for the following academic year. This is ideal, because it means you can ensure everything is ironed out in plenty of time before the tenancy begins. Therefore, you should try to market your property early. If you need help, our sister company, Mistoria Estate Agents specialise in student lettings and have an expert marketing team who can help with compelling advertisements, shrewd social media management, to-let boards and floor plans and more, so don’t hesitate to get in touch.

Further Information about our Walkden letting agents

Bear these points in mind and you’ll drastically improve your chances of a successful, dispute-free tenancy for your property. However, this isn’t an exhaustive list. Pick My Pad specialises in successful tenancies in Walkden, Little Hulton and the surrounding areas. We offer extensive reference checks so you can find the “right” tenants for your property, and our Comprehensive Property Protection means all properties go through our inventory service to include photographic or video evidence, protecting both landlord and tenant.

If you’d like help, or simply wish to know more about, TDP schemes, tenancy agreements, HMO legislation or anything else related to lettings, contact us on 0161 790 3999 so we can advise you further.

We are members of ARLA Propertymark which means we meet higher industry standards than the law demands. Our experts undertake regular training to ensure they are up to date with best practice and complex legislative changes so they can offer you the best advice. We are also backed by a Client Money Protection scheme which guarantees your money is protected.