UK Rental Market Update: Insights into the Current Landscape

Welcome to our Property Market blog, where we provide you with comprehensive insights into the current trends shaping the UK housing market. In this edition, we'll dive into key headlines of the current Rental Market - including supply and demand dynamics, challenges faced by investors, rental growth versus earnings, and regional snapshots. Let's explore the latest findings!

 

- Annual rental inflation for new lets in the UK remains high at an average of 11%, slightly down from 12.3% in mid-2022.

- Rental growth continues to outpace earnings growth, raising concerns about affordability for renters.

- The demand for rental properties remains significantly higher than the five-year average, while the supply of privately rented homes in Great Britain has seen a minimal 1% increase over five years.

 

Supply and Demand Imbalance:

- The stock of homes available for rent is 33% below the five-year average, highlighting the significant supply and demand imbalance.

- According to the recent ARLA Propertymark Report, the demand for rental properties recorded by member agents in April 2023 was 24% higher than the previous year, further exacerbating the supply shortage.

- Factors such as rapid growth in overseas students and high net immigration contribute to sustained demand for rental properties. This follows the Government shake-up of Visa rules in 2021 to help attract more skilled workers to the UK.

 

Challenges for Investors:

- The number of privately rented homes has only increased by 1% since 2016, as new investment is offset by properties leaving the rental sector.

- Tax changes, growing regulations, higher borrowing costs, and tighter lending criteria have prompted landlords to reassess their portfolios and investment strategies.

- Mortgage rates have increased, impacting the equity or deposit levels required for new buy-to-let purchases, along with stricter lending criteria and stress tests.

 

Rental Growth and Existing Tenancies:

- Existing tenancies have seen rental increases at an average of 4.4%, significantly lower than the market average for new tenancies.

- Landlords are encouraged to review their rents periodically, especially considering challenges such as tax changes and higher mortgage rates, as rent increases can positively impact investments.

 

Breakdown of the Private Rental Market:

- The core private rented sector, comprising long-term lets, accounts for 66% of the market, offering lower hassle and workload.

- Sub-sectors such as holiday and short lets or HMOs may provide higher yields but come with additional costs, workload, and regulations.

 

Regional Snapshot:

- In the West Midlands region, average rents have seen a year-on-year increase of just under 10%, with Birmingham ranking among the top five cities for rental growth.

- Manchester, Edinburgh, Glasgow, and Nottingham also demonstrate strong growth in rental prices.

 

Conclusion:

The UK rental market continues to experience robust demand, outpacing earnings growth and raising concerns about affordability. The supply shortage persists, presenting challenges for both tenants and landlords. Investors face changing dynamics, including higher mortgage rates and stricter lending criteria. Regular rent reviews are encouraged to ensure investments remain financially viable.

Thank you for reading our Rental Market Update blog. If you are a landlord or property investor and would like some advice or to share your views, please contact me anytime...

 

Ali Durrant MARLA

Director of Concentric Sales & Lettings 

ali@concentricproperty.co.uk

UK Sales Market Update

Welcome to our Property Market blog, where we provide you with insightful information on the latest trends in the housing market. In this edition, we'll focus on the sales market, highlighting key statistics and offering valuable insights for both buyers and sellers.

 

1. Transaction Stats:

In January 2023, there was a 10% reduction in property sales recorded year on year, while new home purchases saw a 9% rise in completions. Mortgage approvals experienced a significant 46% reduction, with gross lending down approximately 7%. The decrease in mortgage approvals from the second half of the previous year largely explains the significant difference in lending statistics.

 

2. Buyer Demand:

According to the latest ARLA Housing Insight Report, there was a 30% fall in the number of prospective buyers registered across member branches in April 2023 compared to April 2022. Additionally, member branches reported a 70% increase in properties available for sale year-on-year. These figures indicate a drop in buyer demand, likely influenced by higher mortgage rates and economic challenges affecting affordability.

 

3. Market Activity and Pricing:

Rightmove reported that agreed sales numbers are currently just 3% behind the pre-pandemic market of 2019. The average price of properties coming to the market experienced a 1.8% month-on-month increase in May, reflecting robust activity levels and confidence. Sales agreed in May showed positive growth, and the level of negotiation from the asking price to the sale agreed price remained steady at around 3%.

 

4. Mortgage Rates and Affordability:

Despite an increase in the Bank of England base rate, mortgage rates have remained steady. The average 5-year fixed rate with a 15% deposit is now 4.56%, significantly lower than the 5.89% recorded last October. This decrease in mortgage rates contributes to maintaining home mover confidence in the market outlook.

 

5. House Price Growth and Market Activity:

The Zoopla house price index reveals a year-on-year price growth of 1.9%, the lowest in recent times compared to the 9.6% recorded a year ago. Prices have fallen by an average of 1.3% in the last 6 months due to higher mortgage rates and rising living costs. However, buyer confidence has improved, resulting in an increase in sales agreed, primarily driven by falling mortgage rates during the Spring.

 

Regional Property Price Movements:

The West Midlands region has seen year-on-year price growth of 3.5%, surpassing the national average of 1.9%. Birmingham ranks second among major cities, with a growth rate of 3.8%, just behind Nottingham at 3.9%. These figures indicate a significant difference compared to last April when the year-on-year price increase approached 10%.

 

The Outlook for the Sales Market:

Market activity in the UK sales market remains comparable to pre-pandemic levels. However, predictions suggest that mortgage rates may increase in the second half of the year, impacting affordability and pricing. It is anticipated that the year-end may see approximately 20% fewer transactions than the previous year. Sensible and realistic pricing is crucial for sellers, while buyers should not be discouraged as long as the numbers align. As the year progresses, increased stock levels may provide negotiation opportunities.

 

Conclusion:

The UK sales market demonstrates resilience, with activity levels approaching pre-pandemic norms. Understanding market dynamics, considering pricing strategies, and staying updated on mortgage rate changes are vital for both buyers and sellers. Seek professional advice and remain adaptable to navigate the ever-evolving property market successfully.

Thank you for reading

The Must-Known Legislation To Let A Property Compliantly

Landlords, are you aware of the two main pieces of legislation that you need to comply with to remain safe and compliant? 

In the ever-changing private rented sector, it can be difficult to keep up with the latest laws and regulations that govern this space. However, failing to meet the government’s requirements can result in serious consequences in the form of; notices, fines and prosecution.

That’s why we at Concentric Sales and Lettings are focused on helping you get the compliance information you need on all aspects of Landlord law. In this blog, we’re going to dive deeper into the two pieces of landlord legislation designed to ensure the safety of your tenants within your private rented properties. These two laws are The Landlord and Tenant Act 1985 and the more recent Homes for Fitness & Habitation Act 2020.

 

The Landlord and Tenant Act 1985

Section 11 of the Landlord and Tenant Act 1985 details a landlord’s obligation for repairs. Simply put, as a Landlord, you must ensure the safety of your rented properties.

Specifically, you must ensure that the air, space, water, and heating of the property are properly maintained and kept safe. The law also clearly states that you must carry out repairs on your properties as and when they are due. 

This brings up the question – when are repairs due? 

The legislation states that repairs should be carried out on a “reasonable timescale” based on when you are first notified of the repair requirement. “Reasonable” is somewhat subjective and difficult to define but generally depends on factors such as (a) whether or not the tenant is living in the property and (b) whether or not the severity of the repair warrants an urgent response.

Major repairs (as in water gushing through a ceiling) are required to be acted upon immediately. You, as a Landlord, should take all reasonable steps to carry out any maintenance work or repairs to the best of your ability. Some repairs may take time to be rectified, but as long as you have taken the steps that you can take, the law will consider it reasonable. 

 

Protect Yourself Against Claims

We recommend that you always act as quickly as possible when carrying out repairs for your tenants. This is not just for the comfort of your tenants within your rented property. It is also one of the best ways to protect yourself from potential claims that the tenant may choose to pursue against you. 

Under the law, tenants have the right to report any outstanding maintenance issues to the local authority. The council may then decide to carry out a full inspection which can often lead to a much longer list of repairs. 

It’s important to remember that you are not the only person given responsibilities under Section 11. Tenants are also obligated to “behave in a tenant-like manner”, meaning that they are required to take care of the normal maintenance activities that keep the property clean and functional. This includes things like changing lightbulbs, keeping the drains clear, cleaning the gutters, and other similar activities. Now that we’ve covered the first piece of legislation for landlords let’s cover the second, more recent law. 

 

Homes for Fitness & Habitation Act 2020

This law does not replace the one we’ve discussed but creates additional rights and responsibilities. Generally, it focuses on areas that are not necessarily covered under the Landlord and Tenant Act 1985. There are two key factors you should be aware of when it comes to this law. 

First, this act gives tenants the right, for the first time, to take a Landlord to court for not maintaining their repairing obligations. The government has removed the requirement to first go to the local authorities and has enabled the tenant to go directly to the courts. Landlords must be aware of this change.

Secondly, Landlords are now responsible for hazards and repairs within communal areas throughout the tenancy. You are obligated from the moment the tenancy begins through to the conclusion of the tenancy to ensure that the property is fit for human habitation at all times. The only way to achieve this is through regularly inspecting the property. You must not rely on tenants to report repairs because they do not always do so. 

 

Final Thoughts

Your main focus as a Landlord should be to ensure that your tenants are safe at all times. Failure to comply with these laws can result in; prosecution by the tenant in court, penalties issued by the local authority, fines, and improvement notices that can restrict your right to gain possession of your property. 

With over 170 different pieces of legislation regulating the private rented sector, you may be wondering how to be compliant as a Landlord. 

Fortunately, we have created several resources to help you stay safe, compliant, and up-to-date. That’s why we run a quarterly webinar hosted by Dawn Benett, where we spend 2 hours diving deep into various pieces of legislation that you need to know about. Click here to register for FREE today!

Should Your Address Be On A Tenancy Agreement?

Landlords, did you know that there are over 170 separate pieces of legislation that directly impact the private rented sector? Here at Concentric, one of our big goals is to help educate you to be able to navigate this maze of rules and regulations so that you can stay safe and compliant. 

While you may prefer not to share your residential address with your tenants, did you know that there are laws that govern whether or not you are permitted to withhold your address? The two main rules that apply to your address are Section 47 and Section 48 of the Landlord and Tenant Act (1985). Let’s get into them. 

 

What Section 47 Means To Your Tenancy Agreements

Let’s start with Section 47. Section 47 of the Landlord and Tenant Act of 1985 states that a landlord’s address must be present on all documents that are, in fact, a demand for payment. The document that most commonly falls within the purview of this legislation is your tenancy agreement. This means that you, as a landlord, have a legal obligation to include your residential address on your tenancy agreement. Is your address present on your agreement currently? If not, you could be falling foul of this regulation. What does this mean? 

Your tenants are not legally liable or responsible to pay any rent they may owe you until you have shared your residential address. The law is clear. If you’re using an agent, you are not permitted to use your agent’s address. Rather, the address on the agreement must be the landlord’s residential address, wherever that is in the world. The reason this legislation applies to the tenancy agreement is that it is, in the eyes of the law, a demand for payment. Until and when you have provided your residential address, the tenant does not legally have to pay. It makes sense that you, as a landlord, may feel some reservations about having to share your home address with your tenants. However, in the private rented sector, this is a given right that the tenants have been legally granted. Section 47 grants tenants the right to identify the person from whom they are renting. 

Moreover, if the tenant makes a formal demand, in writing, to you as the landlord or your agent, each party is obligated to respond to that request within 21 days. As we have already mentioned, failure to supply the information within that timeframe could result in the tenant refusing to pay rent until the information requested has been provided. In that situation, the tenant would be in their full legal rights to withhold payment from you, the landlord. 

 

Why You Need To Know About Section 48

The other significant rule that impacts whether or not a landlord must share their address is Section 48 of the same law. Again, this section focuses entirely on the landlord’s address. However, in this case, the legislation refers to an address being given to a tenant in England or Wales for the sole purpose of serving notice to that tenant. In this case, landlords have more flexibility, as the address can be that of your agent or your place of business, depending only on your preference. If you are a company landlord, then the address to provide tenants, under this section, would be the registered address of the business.

Ultimately, these sections of the Landlord and Tenant Act of 1985 do not carry penalties or fines if you are in violation. However, that does not mean that they are inconsequential. The ultimate penalty could be that your tenant simply chooses not to pay the rent. In that event, the law would not require the tenant to pay until the residential address of the landlord was provided. 

 

Conclusion

To recap, Section 47 places a clear obligation on landlords to provide their residential address to their tenants on their tenancy agreement and on any other documents that are payment requests. Section 48 requires that landlords share their business address (or the address of their agent) when serving notice to tenants, only when the tenants reside within England or Wales. 

We hope that you’ve found this information useful. It’s important to always stay informed about legislation so that you can remain in compliance and continue to serve your tenants. If you’re curious about where you can get more information on the latest and most important legislative updates, our very own Dawn Bennett hosts a quarterly webinar where she drills down into a variety of the many pieces of legislation that apply to our industry. 

What you need to know about the immigration act 2016 (2022 changes)

Are you aware of the changes that were made to the Immigration Act 2016 that just came into force in April 2022? The laws surrounding the private rented sector are changing all the time. As a landlord, it can be difficult to keep up with the many hundreds of different laws. However, you understand that there can be serious consequences if you fail to do so. Lettings law is serious. Here at Concentric Sales and Lettings, our goal is to help you by keeping you up to date with all the changes. We’re here to give you the knowledge and practical tips you need to always remain compliant.

So, without further ado, let’s get into the Immigration Act and the 2022 changes.

 

What is the Immigration Act of 2016?

The Immigration Act is a piece of legislation that applies to landlords and letting agents and came into force in England on February 1, 2016. The goal of the law is to ensure that properties are not rented to tenants or occupiers who do not possess a right to rent in the UK. Specifically, the legislation states that a landlord and/or a letting agent must be able to prove any occupier’s right to reside within the property throughout the tenancy. This means that landlords must check that any tenant or occupier within the property has the right to rent in the UK before the tenancy starts. This law applies to every adult who is 18 or more years old and who is living within the property, whether they are named on the tenancy or not. 

How to verify the right to rent

The most important part of the Immigration Act is the requirement that you verify your tenant’s right to rent in the UK. You mustn't discriminate when checking the occupant’s right to rent. Ask each of your tenants, regardless of their backgrounds, to provide the same evidence – namely, that they have the right to reside on the property. The easiest way to prove the right to reside in the UK is by presenting a passport. If it is a UK passport, you have all the evidence you need to prove that the tenant has the right to rent for the duration of the tenancy. If your tenant is from the EU, the process is a little different. In this case, their right to rent can be verified through the government website online. To do this, all you need to do is ask for a share code from the tenant or occupier. Using this code, along with their full name and date of birth, you can conduct an online rent check. Here is where you can do that. Finally, if your occupier is from outside the EU, other documentation will be required to verify their right to rent. Often, tenants from outside the EU prove their right to rent by showing a passport with a supporting Visa that shows the data the tenant or the occupier entered the UK and the expiry date of their visa. For any tenant or occupier that has a limited time to remain, you are required by law to conduct a follow-up check after completing the original right-to-rent check. The follow-up will need to be carried out either upon the date that the visa expires or 12 months after you carried out the initial check, whichever comes last. What this means is that you could, in theory, legally move a tenant into a property today, when their visa expires tomorrow. This wouldn’t be a violation of the law, but it might not make sense for you as a landlord. Therefore, you need to consider all the facts about a tenant’s right to rent before starting the tenancy. Some tenants may not be able to fulfil the fixed term of their tenancy. 

Landlords must keep documentation and evidence that the right-to-rent checks were carried out at the start of the tenancy. Also, landlords should keep records of any follow-up checks that were conducted while the tenant or occupier was living on the property. Finally, the right-to-rent requirements apply to all occupiers as well, so we recommend conducting further checks to ensure that no unauthorised occupants are living on the property.

Two big changes in 2022

Originally, the Immigration Act required these right-to-rent checks to be held face-to-face. However, due to recent events, for the past two years, we have been able to conduct right-to-rent checks via video call. The first big change to the act is that this amendment has been extended to the 30th of September 2022. The second big change is the alterations that have been made regarding biometric residence permits. Biometric residence permits are documentation that we have now used for many years for any tenant or occupier that has a set amount of time to reside. Based on the 2022 changes, these documents are no longer sufficient to demonstrate a right to rent in the UK. Tenants or occupiers that rely on these permits will also need to provide a share code just like EU nationals so that you, as the landlord, can verify their right to rent online. 

Stay compliant, stay safe

Although landlords are not immigration officers, this law is an essential piece of property law that you must comply with. This regulation carries with it fines of up to £3,000 per occupier and, potentially, a prison sentence. However, by ensuring that you are checking both your tenants and occupiers for their right to rent in the UK, you can remain safe and compliant. The Immigration Act of 2016 is just one piece of legislation in our private rented sector that you as a landlord should be aware of. If you’d like to learn more, feel free to join our FREE quarterly webinar hosted by our very own Dawn Bennett, where you can get more detailed information about the laws and regulations that you need to know.

 

The Minimum Energy Efficiency Standards You Must Comply With As A Landlord

As landlords, there are so many different laws, regulations, and standards that you need to comply with to avoid penalties. Plus, new legislation is constantly being added, further increasing the complexity of this space. Here at Concentric Sales and Lettings, we’re here to help guide you through the maze of rules and get you the information you need to stay safe, compliant, and up-to-date. 

Speaking of compliance, does your property/tenancy have an EPC rating of “E” or above? As a landlord, are you confident that your properties are compliant with the minimum energy efficiency standards (MEES)? In this article, we dive into what these energy efficiency requirements mean for you. 

What Are MEES?

Minimum Energy Efficiency Standards (MEES) first came into force in 2018. The standards focus on the energy efficiency of your property. Energy efficiency refers to the ability to use less energy to get the same amount of work done. With a higher energy efficiency rating, your property means that less energy is wasted and also can reduce energy costs for your property. 

What Does This Mean For You As A Landlord? 

The main MEES requirement for landlords is that any property that you own and rent out needs to have an energy rating of “E” or above. If your property falls below an “E” rating and you are not in receipt of an exemption, you are illegally renting out your property and could be subject to fines and penalties. The government expects landlords to spend a maximum of £3,500 to ensure that their properties are compliant. 

What If My Property Cannot Be Made Compliant? 

In the case that you are renting out a property that is not and cannot be made compliant, then we would recommend you head over to the government website and see if your property falls into one of the categories that are exempted from the energy efficiency requirements. 

You must be prepared to meet these standards. There is talk within the industry that the MEES will be higher in 2025 than it is now. It is currently being proposed that landlords’ properties will have to be a “C” rating or above. This could have a huge effect on many landlords. Fortunately, various funding opportunities are available to you as landlords and tenants right now and maybe more in the future too. We recommend seeking out that funding so that you can offset the costs that may accrue as a result of bringing your property into compliance. 

The EPC Requirement

Part of the MEES is the EPC requirement. The term “EPC” is short for energy performance certificate. It is part of the government’s rating scheme to describe the energy efficiency of buildings and properties. The ratings range from “A” (very efficient) down to “G” (inefficient). The EPC rating is how you as a landlord prove that your property complies with MEES. Providing a tenant with a valid EPC before the start of the tenancy is required under the Deregulation Act of 2015. Failure to provide them with a valid EPC would restrict your ability to serve a valid notice on them for possession of the property should the need arise. So although this piece of legislation may not seem that important, you need to ensure that you comply. 

The Penalties For Failure To Comply With This Piece Of Legislation Are Hefty, With A Maximum Fine Of £5000 Per Property

The size of this fine depends on the time that you let the property non-compliantly. EPCs are valid for ten years and, on average, cost less than £100. This means that for less than £10 per year, you could avoid that penalty and ensure that your property complies with the MEES regulations. Fortunately, it is also easy to get an EPC as there are EPC assessors in your area that can be found online and can carry out the job for you to ensure that your property is compliant and safe. It’s important to remember that funding is available at the moment for both landlords and tenants, so please be sure that you are researching any local funding within your area to improve the energy efficiency of your property. This will also help you to prepare yourself for the even higher requirements that may be coming in 2025. 

Always Remain Compliant

We hope you’ve found this post informative and enlightening. If you want to learn more, check out our YouTube channel, where we help keep you up-to-date on the latest and most important legislation for the private rented sector. There are over 170 pieces of legislation that you as a landlord need to comply with. That’s why we offer a free, quarterly webinar hosted by our very own Dawn Bennett, where you can get more details on all these different kinds of legislation. We’d love to see you there! 

What a Landlord Should Do When Their Tenant Has Fallen Into Rent Arrears

Do you know how to handle a tenant that’s fallen into arrears? This can be a difficult issue for landlords as you have to be careful to remain compliant with all of the relevant legislation throughout your process. Also, many landlords do not have a systemised formula for dealing with these situations, leaving them with the sense that they are unprepared. Today, we’re going to cover some of the do’s and don’ts of chasing rent arrears. We’re also going to discuss which legal notices to use, as well as the process we recommend for handling these complicated situations. 

 

A Tale of Two Tenants

At Concentric we have found that there are two different types of tenants who fall into arrears. There are those who do so against their will who have simply fallen on hard times and cannot pay at the moment. On the other hand, there are those who are capable of paying their rent but refuse to do so of their own volition. The tenants in the latter category are always more challenging to deal with. You need to have a process in place so that whether the tenant falls into one category or the other, you will know what to do. 

 

Dos and Don’ts of Chasing Rent Arrears

As you form your process, we’re going to share with you our recommendations for what you should and should not do in these kinds of situations. First of all, communication is key. You should try to make contact with the tenant as soon as you become aware of the missing payments and see if there is a problem and what it might be. 

You can use these communications to ascertain which group the tenant falls into, and hopefully, work your way to a solution that satisfies all parties. The first step to take when a tenant misses rent for 7 days is to send a formal letter demanding the payment. Then a follow-up letter should be sent again every 7 days throughout the process. During this time, you should also be attempting to contact them through phone or email to see if you can get an explanation and negotiate a plan for payment. 

It is of the utmost importance that you do not harass them. Contacting your tenant every hour of the day is legally defined as harassment and should be avoided. Rather, only contact them at previously scheduled times. 

If a tenant is simply unable to pay, it may be worth making an application to Universal Credit for a direct payment. The great thing about this step is that there is no harm done whether or not the tenant is actually in receipt of payments from Universal Credit. All you need to do is make an application. This can be a way to alleviate the tenant of the responsibility of making the rent payments themselves. 

 

What To Do When They Just Won’t Pay

Speed is of the essence when it comes to responding to tenants who are refusing to pay their rents despite their economic ability to do so. In these cases, we recommend quickly acting to take possession of your property. Ensure that the letters demanding rent are sent promptly every 7 days and then on the 28th day, you should send a notice of possession as soon as you can. You need to take court action as soon as you are legally able to do so. Now, you may be wondering, what is the appropriate notice to send tenants in arrears?

Serving a Section 8 notice is what we recommend, citing the grounds you wish to rely on (usually 8,10 and 11). It is the notice to send when the tenant is in two months of arrears or more. We recommend it because it comes with a 14-day notice period in England and is the quickest way to secure possession of your property in these cases. 

You may have also heard of serving a Section 21 notice to tenants in arrears. This is a valid option. However, the notice period on Section 21 is 2 months long, delaying your ability to deal with the situation effectively. 

 

Final Thoughts

In the end, communication is the most important aspect of responding to tenants who have fallen into arrears. For most tenants who may be struggling with financial difficulties and cannot pay the rent, communication will be a way to understand their problems and negotiate a payment plan that will work for you and them. Unfortunately, most tenants who refuse to pay of their own free will are not very communicative, and legal action is usually required. Comprehending the current legislation pertaining to these issues is important. A helpful resource that we recommend is Gov.UK, a site that will give you the latest guidance as well as information on the legal notices we’ve discussed today. 

Hopefully, this has given you more insight into what to do when a tenant falls into arrears. We at Concentric are dedicated to helping landlords manage their rental properties and have released tons of content that will help and advise you with practical step-by-step guidance on the specific legislation that matters for landlords. 

Visit and Subscribe to our Youtube channel for more legislative updates on how to handle your properties and tenancies in these challenging times.

Electrical Certificates – why every landlord should have them

The risks

Imagine if you picked up the phone in the middle of the night to be told that there was a fire at your rented property. As horrific as that news would be, one of the first things that the fire department, the police, and the insurance company would check is whether or not the electrics and electrical appliances within the premises were safe, or whether they could have been the cause of the fire.

And if that were the case, who do you think liability would automatically be with?

If you fail to produce a valid electrical certificate, it could very well be you, the landlord. That would mean that not only do you risk prosecution, but it’s highly unlikely that your insurance would payout.

But, if you have a valid, up to date certificate from a qualified electrician, then you have proof that you have done everything you can to ensure that the electrics in that property are safe. In that case, liability would no longer lie with you as the landlord, but with the electrician, as the question would be whether he had completed the work properly, or with the tenant, who has a responsibility to take care of the property while he or she lives there.

Is it law to have an electrical certificate for my property?

It will be, as right now Government are in processing a law which will mean that all rented properties will have to have electrical checks every 5 years. However, until that time, most agencies are recommending that their landlords get ahead of the game and make sure that all new tenancies start with a valid and up to date electrical certificate, before the tenant moves in.

That’s because, under the Consumer Protection Act Section 37 and Section 19, you have a responsibility to guarantee that your property is safe and fit for tenants to live in. And having an electrical certificate is part of that responsibility.

What will the new law mean for landlords?

Landlords will be required to have electrics checked in their properties every 5 years. This is mandatory, and must be carried out by a qualified electrician. This will be phased in over 24 months; in the first year, all new private tenancies will be affected, and in the second year, all existing private tenancies will also have to adhere.

If a property has recently had an electrical installation condition report (EICR) and has a valid certificate, then the property will not be required to have an inspection until 5 years has lapsed since the date of issue.

What will the required checks include?

The new legislation will require 5 mandatory recommended electrical safety features, which are:

What’s the difference between an EICR and a PAT test?

When we talk about getting an electrical certificate for your property, we’re really talking about the EICR – this is a test carried out by a qualified electrician, and tests the infrastructure of the properties electrics. As detailed above, this includes the wiring, units, plug sockets and switches etc.

A PAT test is really there for the appliances within that property. That would be anything that you include as portable appliances in the property, which might be things like a fridge or freezer, electric oven, dishwasher etc. It’s not mandatory for you to have a PAT test, but some landlords like to get one if they do include these appliances, as again, it provides an extra layer of cover if anything should happen.

In conclusion

While it’s not law to provide an electrical certificate at the time of writing, it’s highly recommended that you obtain one. It’s a small price to pay for peace of mind that your property is safe, and that you won’t be held accountable if something should go wrong.

The Government will be changing the law on this soon, so get ahead and make sure that you’re properties are protected, if not on existing properties, but on all of your new tenancies going forward.

If you are looking to keep all your properties safe by staying compliant with current legislation, click HERE to download our FREE compliance checklist.

How To Get Better Tenants

Who is your perfect tenant?

Let’s think about how we define our perfect tenant. It might differ from landlord to landlord and will depend on what’s important to you. You’ll also consider the type of property you own and the area you’re in – for example, is it a HMO? Are you located in a city centre full of professionals? Or is it an area popular with families?

The type of person you are able to target will determine how you categorise them, such as:

Nice to meet you

The best way to get a feel for a prospective tenant is to actually meet them. As humans, we have an in-built ability to make hundreds of judgments based on seeing and talking to another human being, so what better way to get an idea of whether a person is right for your property?

This creates the opportunity to ask them questions about their situation, such as their reasons for moving, past rental situations, their jobs, and even their hobbies. It’s a great way to get a feel for who they are in a more natural and less formal way.

Don’t make promises at this stage, though. It’s perfectly ok for you to tell them that you’re not ready to make a decision yet and that you’ll be in touch, especially if you’re not getting a good vibe from them. You don’t have to take the first tenant you meet – in fact, you probably shouldn’t.

Check them out

Make sure that you do all the proper checks. Having a credit check, verifying their income, and immigration checks, will all determine whether they are the right tenant for you, and whether they can afford to pay their rent. However, be careful not to discriminate – letting things like race or colour, religion, or even benefit claims cloud your judgement is a big mistake, and as well as being unfair, is illegal.

Something else you might consider; using Google. Many people use social media, whether that’s Facebook, Twitter, or Instagram, and it’s surprising what you can find out about a person just by searching their name. It’s a useful tool if you want to make sure that the person applying to rent your property is right for you, as you can often get a good feel for their background, friends and opinions, which could all give you an indication of how they will be as a tenant.

Go with your gut

Above all, trust your instincts. If you want better tenants, it really is worth making the effort to meet them, talk to them, and don’t be afraid to do a bit of basic research into their background. Ask questions, and take the time to get a real feel for who they are. And be brave enough to admit if you don’t like them – there’s absolutely nothing wrong with admitting they are not a good fit for you, and looking for someone who is. So many landlords are in such a rush to get someone into their property that they just sign up the first person who takes an interest – and then have regrets when they create problems in not maintaining the property, or worse still causing damage or complaints.

Hopefully, this post has given you a little bit more confidence to go out there and seek out your perfect tenant. Making that little bit of extra effort can save you so much heartache in the long term.

Build To Rent

In recent years, there has been significant growth in the build to rent sector, which reports suggest will see heavy investment over the coming months and years, as the demand for privately rented properties hits an all time high. So, what exactly is the build to rent phenomenon, and could it be a threat to private landlords in the UK? Let’s take a look.

Build to rent explained

We’ve seen for a while now that the home-ownership rates have been falling, as people are finding it much more difficult to secure a mortgage, and indeed save for a decent deposit to buy a home. Alongside this, factors such as population growth, changes in the economic landscape, and a shift in people’s perception of the rental market have all contributed to the recent demand for more privately rented housing, not least so in the social housing sector.

While this has been a good thing for landlords, we’ve also seen some major changes in legislation, brought in to protect tenants, but which has left a lot of landlords wondering what the future holds. And there are some big players who have caught on to this, making build to rent an attractive option.

Following the announcement back in 2017 by Sajid Javid about plans to reform the housing sector by building new homes to keep up with the huge demand, we’ve seen a lot of new properties spring up in cities, towns and villages all over the country, and this is one of the key things that has allowed the build to rent movement to take such a big leap forward.

Rather that homes being built to be bought by landlords looking to rent them out, it has given the opportunity for companies to invest in properties built specifically for the rental market.

Corporate clout

There are some big players putting up the money for build to rent projects, and the worry is that the average landlord isn’t going to be able to compete with such competition. Remember that changing tenant perception we mentioned earlier? People in general have a much higher expectation when they’re looking for homes, because whereas before rentals were perhaps seen as a temporary move while they saved for their own home, rental properties these days are more permanent. And so tenants need homes that will allow them to grow, raise a family, and do so with all of the convenience and comfort expected in a modern home.

In this, landlords have a much higher standard to live up to – you can no longer get away with poor décor, inadequate kitchens and bathrooms, and shoddy finishes. Your tenants are looking for longer-term accommodation, and so will need a home that will stand the test of time.

And this is really where the corporate investors are able to put their money down and give the tenants what they need. Where does that leave private landlords, though?

The options for private landlords

It’s been estimated that a massive £75 billion will be invested to the professionally managed private rented sector in the UK by 2025. That’s due to the growing demand for housing across the country. It’s a big number, and it’s even bigger if you consider that right now, there are huge numbers of individual landlords exiting the property market.

Lettings is an increasingly difficult industry to be in, and it’s tough for landlords. There’s no denying that. And yes, there are landlords out there who are struggling, who can’t keep up with the changes in legislation, and are taking a huge hit in income after the introduction of the Tenant Fee Ban earlier this year. But for those of us who are fighting through it, and despite everything, are determined to maintain growth and make thongs better for our industry, what does the future hold? Are we doomed to be held at ransom by these big companies?

Well, I doubt it – and here’s why.

On the whole, the build to rent sector is aimed at a specific client. You’d find, in reality, that many build to rent properties tend to be either blocks of flats, which are quick to build (and therefore quick to start getting a return on), or small units of apartments aimed at people like students, single people, young couples, or the retired community (who typically downsize when they retire or are widowed).

That’s not, in most cases, the market we aim for as landlords. We know that our income mainly comes from the other end of the scale – those who are starting on their career path, and are growing their families. Those who are looking for a family home, where they can stay long-term.

So really, there are two possible options. And these depend on your long-term needs.

Investing

It might be that you’re in a position where you’ve either grown a successful portfolio, and are looking to expand your growth in other directions. Or you might see the benefit of selling up, and putting your money into something which gets you a guaranteed return for little effort.

And yes, there are benefits to investing in build to let, if you’ve got the funds to do so. Perhaps you are one of those landlords mentioned earlier, who are seriously thinking about exiting the market in this difficult new landscape. In which case, placing yur cash in something like build to rent could be a viable option.

Sticking with the current market

Your other option, of course, is to put all of your efforts into that portion of the market you know so well. If you still have that passion for the game, and are prepared to ride out the changes, evolve with them, and push through in order to grow your current portfolio, then the option to stay true to yourself and stay on your chosen career path is what you need to focus on.

I think it’s vital that there are landlords still prepared to cater for this niche, as there will always be the demand for good, well maintained, family homes. And that’s really what we are here to deliver. And if we can do that with professionalism and a personal service, then we are doing justice to our industry.