Monthly Archives: March 2019

Habitable Rules

HabitNew legislation means that tenants can now potentially sue a landlord who fails to adequately maintain their property.

The Homes (Fitness for Human Habitation) Act 2018 means that tenants can take direct action over substandard property, rather than having to rely on their local authority to pursue a landlord who fails to adequately maintain it. Courts will not only be able to force landlords to carry out repairs, but can also award damages to tenants.

The scope of the legislation is wide-ranging, although it is primarily designed to prevent landlords forcing tenants to accept substandard, unsafe or unsanitary accommodation with issues such as blocked drains, damp walls, inadequate ventilation, lack of natural light, etc. This extends the requirements of the Landlord and Tenant Act 1985 as well as numerous other laws requiring landlords to ensure safety in respect of electricity, gas, fire, boiler servicing, etc. The governments existing Housing Health and Safety Rating System provides extensive guidance on this.

Of course, a good landlord would immediately respond to a tenant’s concern over, say, a dampness issue. But this could now go legal if nothing is done about it. The problem is those good landlords who have entrusted their property management to a letting agent who might not be so fastidious, as the landlord still retains liability. It could be costly to assume that these extended requirements are being adhered to – or even recognised.

In some ways, the easy part is finding a tenant – but it takes ongoing care, consideration and an extensive understanding of current and ever-changing regulations to ensure that a property investment is no only profitable, but legal too. We’d therefore recommend that landlords check their property now and if there are any doubts over their agent’s commitment to maintain it in a decent state of repair, do something about it.

There are of course commercial advantages to being a fantastic landlord with an equally fantastic managing agent; a happy tenant stays longer and pays more. Our rule of thumb is to ask “what standards would we expect if we lived there ourselves?” The answer to this question goes far beyond the minimum standards required by law. It means a clean oven, white grouting, a new shower curtain, fresh carpets, clean windows, no dripping taps, good furniture, nice paintwork, well-hung cupboard doors, a neat garden, etc.

Please feel free to call us on 01933 224400 for an initial discussion about how your tenants can expect to enjoy your investment as you as much as you should enjoy your return on it.

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Other Forces

Other ForcesThere was a day when a slight shift in the bank base rate or change in stamp duty could have a profound effect on property market sentiment. Yet the Bank of England’s continuing consensus to maintain interest rates at very low levels (albeit tweaked with the occasional 0.25% here and there) is possibly the strongest signal to date that the British property market is actually driven increasingly by factors other than such things. The general economy, oil prices, employment, and global issues have now largely replaced house prices as a driving force in the interest rate balancing act.

Until recently, most of us ignored the fundamentals of the national and global economy in our quest for advancement in the property arena; we focused wholly on the word on the street as to the future of the property market. We all became economic experts, sagely stating our semi-informed opinions on the future of “the market”.

Indeed, the term “the market” goes a long way towards demonstrating that we have become “market traders” over the years, rather than homeowners peacefully enjoying our chosen abode. “Get on, move on, bank the money” was the order of the day in the extended post-Thatcherite era.

But it seems that all that has changed – and for the better. The complimentary or divergent forces at work on the fate of house prices are now so complex and confusing that even the experts seem to be at a loss to know what is happening.

However, one thing is sure; most buyers and sellers today tend to have a sincere reason to move. They are less driven by “the market” and more driven by real-life reasons such as family issues, downsizing, a job move, leisure, convenience, practicality, and leisure. As an estate agent, the joy of helping people move is what it’s all about. Please do contact us on 01933 224400 if you’d like to us to be involved in your own property journey.

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March Market Comment

March CommentSensation sells! The press is having a field day with all sorts of Brexit-related headlines and claims about how the current state of confusion is negatively impacting on the housing market. The reality is that latest figures published by respected sources support our own view that it’s not quite a buyers’ market yet, even though, according to the Nationwide, house prices are just 0.4% higher than this time last year.

The latest Propertymark Housing Report found that NAEA members report a 2.3% monthly drop in the number of house hunters registered per branch. Yet, in the same period, property supply fell by 14%. So although there would appear to be a softening of activity, demand continues to significantly outstrip supply. So any talk of a property crash is substantially misplaced. Anyone thinking of selling this spring would be well advised to bring this forward asap!

Interestingly first time buyers now represent a record 50% of the market (source Halifax). FTBs have of course been encouraged by the government’s Help-to-Buy scheme as well as SDLT concessions. Nevertheless, the market has historically been fed from below, and people who sell their property to a first-time buyer often become second time buyers themselves, prompting further up-line activity. This activity is likely to be further stimulated if up-line sellers become increasingly willing to accept a lower offer on their property.

Rents continue to rise, with around 26% of tenants experiencing a rent increase in January alone (source ARLA), making home ownership an even more attractive alternative.

This is supported by the latest English Housing Survey from the Ministry of Housing, Communities & Local Government (MHCLG) who report a slight rise in the home ownership rate, which now stands at 63.5%. More people owning means more people buying and selling.

The economic fundamentals for a sustainably robust property market are very much in place – employment is at a 40-year high, interest rates remain incredibly low and affordability has also increased. According to Private Finance, ten years ago, the average mortgage borrower could expect their mortgage to account for 43% of their monthly income; today this stands at just 31% with payments around 13% lower too, despite soaring house prices.

In terms of sentiment, around 59% of Brit are expecting to see property prices rise over the next three years (source AnyVan survey), against 41% not expecting a rise. This suggests the perfect balance for a “keep calm and carry on” approach – generally positive and mildly inflationary. Maybe spring has come early this year!

Needless to say, if you’d like to take advantage of the market, even if only to see how it could potentially affect the value of your home, please feel free to ask us round for a chat. It’ll only cost you a cup of coffee.

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