We shouldn't rush ahead with immigration checks just yet.

You will undoubtedly be aware of the governments plan to roll out immigration checks across the UK to all landlords and agencies when vetting overseas tenants. The plan has been to do this ASAP now that the Conservatives hold a majority government,  yet my advice is to hold that thought until the results of the pilot scheme, currently being run in the West Midlands has been complied and considered.

Only last week a reminder was sent out for landlords and agents in this region to complete the official survey which suggests that we will not see any concrete findings until later this year.

It seems illogical to roll out a scheme without firstly considering the results of this pilot and all affected parties and representatives having had the right to discuss before any decision is taken on who has the 'right to rent'.

There clearly is alot that needs considering before simply rolling this out. There must be consideration on agent and landlord workload in addition to how effective the checks will be, not to mention whether there will be robust Home Office support for all parties concerned. It would also be interesting to note exactly what the associated costs for these sort of checks will be when you consider that landlord, and certainly agencies, are under intense scrutiny regarding the fees they already charge tenants.

All in all I am hoping that we achieve a considered approach to this proposed legislation rather than going in feet first without a thought for the people it will really affect. Time will tell whether this government will firstly consider the opinions of those that matter before introducing anything.

More to follow....

Regards

Richard

Is Kidlington, Oxford's dark horse?

Afternoon all,

For all my die hard blog followers out there ( he says in non delusional fashion!) you will have no doubt noted in recent months that I have posted alot of available property to purchase in the Kidlington area. Why you may ask? Well a landlord popped in to see me a couple of months back about a property he went to view for sale in The Phelps, Kidlington. It was an open house from 11am and he reported in excess of 15 viewers of which most were there for investment, so he wondered why the mad rush for this location?  I decided to look into this further.........

Keeping it relevant I decided to pick on two locations - The Phelps, Kidlington and Wilsdon Way, Kidlington.

A 2 bedroom house in The Phelps recently sold for £205,000 on the 17th May 2013. It then sold again just 18 months later on the28th November 2014 for £250,000. Another 2 bedroom house in this location went for £159,950 in April 2004 and resold on 5th September 2014 for £250,000. Not bad on the CA front you will agree.

2 properties have recently sold in Wilsdon Way both of which were 1 bedrooms properties. Both of which sold for £172,500 in March 2015. If you compare this with purchase in August 2013 it shows a £33k appreciation.

Equally both locations show decent rental movement as well. A 2 bedroom property in The Phelps was renting for £750 in 2010. You can now pick one up for £1000 per calendar month in 2015.

So why Kidlington I hear you ask and why all of this activity from investors recently? Well Kidlington is no great secret. It is close to Oxford, yet cheaper. The returns for these properties are very healthy at 5% + which is becoming very difficult to achieve in certain parts of the city centre. And the pierce de resistance is the rail line going through shortly which will only further the appeal for commuters and people visiting the great city.

Kidlington wont remain a secret for long though folks. Prices are already beginning to climb as the word catches on.

For investment advice on this location or anywhere in Oxford please feel free to call me.

Richard

Landlord and agents may be hit by new heating regulations

Oh what great news for us all. More suggestive legislation! Here is the word with more to follow.....


The Residential Landlords Association says some agents and landlords may be required to notify the National Measurement and Regulation Office regarding their property heating systems by the end of this calendar year.

Typically, anything regarded as a communal heating system will typically trigger a need for landlords to provide details to the NMRO, it says.

The RLA hoped these notification responsibilities would only impact institutional landlords, such as university halls and nursing homes. However, it appears they may affect HMO and bedsit property landlords and agents acting on their behalf, who could be required to send notification of their ‘heating network’ to the relevant authorities.

A landlord must submit notification to the NMRO regarding details about the heating system of the property by December 31 this year and, if required, install individual meters by the start of next April. There will be ongoing duties regarding maintenance and billing.

The RLA advises that an agent or landlord is a heat supplier if all of the following apply:

- there is distribution of thermal energy in the form of steam, hot water, or chilled liquids from a central source in a building (eg a gas boiler);

- the thermal energy is used to provide heating, hot water or cooling;

- the building is occupied by more than one final customer;

- the landlord bills more than one occupier for the heat or hot water that that person has used (or a proportion thereof).

Call me if in doubt peeps.

Investment in OX3 - a beauty!

Back after the break folks with another cracking investment opportunity.

A 1 bedroom second floor apartment on with yours truly at £195,000 offering £900 per calendar month which gives you a 5.5% yield straight out. this is based on the terrible scenario where you have to purchase at asking price and I dont get the £925 per calendar month I would actually be asking for of course!

This let in 2014 within 4 days of it coming on and another 1 bedroom 2nd floor apartment I look after went within the same time frame. They are stick on lets these ones and show positive capital value from purchase history. This one shows a £50k rise from 2008 based on asking price and as I keep saying folks, I dont know any savings account that offers that sort of return!

Call me for more.

Best regards

Oxford heading the list outside the capital

Rising demand from international buyers and others from London relocating to Oxford has contributed to price growth in the city’s prime property market, new research shows.
 
Oxford is a key city outside of London and attracts people because of its internationally renowned university and research shows that last year it outperformed both the wider prime property market in the UK and in the South East.

Prices increased by 1.8% between October and December 2014, taking the annual rise in values in the city to 6.1%. Demand for homes valued between £1 million and £2 million was especially strong.

A key driver of Oxford’s property market performance has been demand for homes from buyers from outside of the city. Indeed, the proportion of property buyers from outside Oxford more than doubled in 2014 compared to the previous year, accounting for 52% of all Knight Frank sales in the city last year, compared to just 24% in 2013.

Demand from Londoners relocating to Oxford rose significantly year on year, from 3% to 18%, with many such buyers looking to take advantage of the relative price difference that currently exists between house prices in the capital and in Oxford. The proportion of international buyers in the city also rose to 17% in 2014, up from 11% the previous year.

Access to top performing schools, strong local employment, as well as improving transport links into London, including a new rail line between Oxford and London Marylebone which is due to open this summer , have helped boost high levels of demand in Oxford, according to the report.

The number of potential new buyers registering their interest in purchasing a new home was 18% higher last year than 2013 and the number of property viewings in the city was 8% higher over the same time.

For more on this a how the lettings market compares please call me.

Best regards

Property Investment Weekly - another cracker in central Oxford

LION BREWERY, OXFORD

I hope you all had a smashing Easter.

This 2 bedroom, 2 bathroom apartment in the Lion Brewery is on with us and available at £475,000

Investor heaven

It is currently rented through us at £1575 and I anticipate £1600 - £1650 per calendar month in this current market which gives it a 4.2% yield but its the location and capital appreciation that really give this its appeal.

It is right in the heart of the city centre and in one of the most sought after developments in Oxford. This property was purchased on 16th Feb 2006 for £282,000. If it is to sell for its asking price this represents a 41% increase to present date and I dont know any interest savings account that can do that for you!

Call me to find out more.

Best regards

What does your Oxford investment look like now??

Ever wondered how your property is performing financially compared with when you purchased it?

Its fair to say that the UK market is well on the road to recovery so now is a very good time to perhaps consider what your biggest investment is worth and how it is holding up against other locations in Oxford.

Here are a few examples based on actual purchase prices on how things have moved in Oxford since 2003 in the selected areas including rental movement:

 
Empress Court, OX1 (1 bed apartments)

Purchase price 6th June 2006 - £210,000
Sold price 8th August 2014 - £285,000
Estimated value now - £315,000 - £330,000
Rental price 2006 - £995pcm
Current rental projection - £1295pcm


Walton Well Rd, Jericho, OX2 (2 bed apartments)

Purchase price 23rd Jan 2008 - £405,000
Sold price 1st October 2012 - £485,000
Estimated value now - £600,000
Rental price 2006 - £1250pcm
Current rental projection - £1600 - £1800 pcm


Reliance Way, Cowley OX4 (2 bed apartments)

Purchase price 16th March 2007 - £244,220
Sold price 12th May 2014 - £305,000
Estimated Value now - £315 - 325,000
Rental price 2006 - £950pcm
Current rental projection - £1200 - £1295pcm

Millway, Wolvercote, OX2 (1 bed apartments)

Purchase price 22nd December 2004 - £136,000
Sold price 28th Feb 2014 - £185,000
Estimated Value now - £315 - 325,000
Rental price 2009 - £700pcm
Current rental projection - £875 - £900pcm




Greater Leys, Cowley OX4 (2 bed house)

Purchase price 19th May 2000 - £95,000
Estimated value now - £230,000
Rental price 2009 - £795pcm
Current rental projection - £895 - 950pcm

Sherwood Place, Headington OX3 (2 bed apartments)

Purchase price 30th June 2005 - £177,650
Sold price 17th Sept 2014 - £225,000
Estimated value now - £250,000
Rental price 2007 - £875pcm
Current rental projection - £1075pcm


Lion Brewery, Oxford, OX1 (2 bed apartments)

Purchased on the 24th March 2004  £299,000






Sold price 27th October 2014 - £527,000
Estimated value now - £575,000
Rental price 2007 - £1450pcm
Current rental projection (variable) £1650 - £1995pcm


Beech Road, Headington, OX1 (2 bed apartments)

Purchased on the 5th Jan 2005  £330,000
Sold price 31st October 2014 - £375,000
Estimated value now - £375,000
Rental price 2007 - £1175pcm
Current rental projection (variable) £1300 - £1350pcm

As I say these are only examples folks. There are so many more so call me to discuss the location and variance of your property.

Best regards

Richard

Deal of the week

Hey folks,

What with all this budget news and recent suggestive measures in the rented sector I have completely neglected my investment duties!

YIELD, YIELD, YIELD!!!

Back to it then and I stumbled across this one. On with Chancellors for £175,000. You can expect £875 for this which starts you out at a 6% yield. Aces!!

Plenty of room for appreciation as well both for rent and future selling. On the 27th June 2014 a similar property sold for £160,000. If we are to believe said agent then this is not a bad movement in the last 9 months.

From the rental perspective these were kicking around at £825 at the start of 2014. Rental continues to move in a positive way and has done in Oxford for a long time, but this one offers more redeeming features other than the apartment itself. It sits close to Headington town centre, is ideal for the A40 for those of you who travel to London and is very well situated for hospitals (JR/ Nuffield)

Of the 4 the I look after on this block, not one of them has or ever has had a void. This is the way of 1 bedroom modern apartments especially in a sought after area such as OX3.

Call me for more.

Best regards

Budget surprise for rented sector – all tenants to be allowed to sub-let

After the Chancellor sat down, it emerged that there are plans to make it illegal to prevent private tenants from sub-letting.

The small print of the Budget – which often proves crucial – reveals the intention to make it illegal for tenancy agreements to include clauses that prevent sub-letting.

While the wording is not particularly clear, it could be seen as a green light for the often controversial practice of rent-to-rent.

Page 51 of the Budget Red Book outlines measures to “make it easier for individuals to sub-let a room”.

The Government says it intends to legislate to “prevent the use of clauses in private fixed-term residential tenancy agreements that expressly rule out sub-letting or otherwise sharing space on a short term basis, and consider extending this prohibition to statutory periodic tenancies”.
The move came under strong attack from Alan Ward, chairman of the Residential Landlords Association.

He said: “The measures on sub-letting are a nightmare in the making and smack of ‘back of the *** packet’ policy making.

“Key questions remained unanswered such as who will be responsible for a property if the tenant sub-letting leaves the house but the tenant they are sub-letting to stays?

“Similarly, given the Government wants landlords to check the immigration status of their tenants, who would be responsible for checking the status where sub-letting occurs?
“Whilst the RLA awaits further detail on this measure, it is difficult to see landlords supporting it.”

More to follow when I have greater detail................

Official budget changes 2015

More from this years Budget from George Osbourne............................

Here are the full borrowing forecasts, compared to the previous ones, showing that Osborne has dropped his aim for a £21bn surplus by 2019-20.

• 2015-16: £90.2bn, down from £91.3bn in December’s Autumn Statement
• 2016-17: £75.3bn, down from £75.9bn
• 2017-18: £39.4bn, down from £40.9bn
• 2018-19: £12.8bn, down from £14.5bn
• 2019-20: A £5.2bn surplus, up from a £4bn surplus
• 2020-21: A £7bn surplus, compared with a £21bn surplus

 and now................................

BUDGET CHANGES 2015

• Lifetime pension relief allowance to be cut from £1.25m to £1m saving £600m. Allowance to be indexed from 2018
• Tax avoidance crackdown to raise 3.1bn
• Bank levy to go up raising £900m
• North Sea oil industry to get tax cuts worth 1.3bn
• Corporation tax to be cut by 20% in April
• Abolishing annual tax return altogether
• Cutting beer duty by 1 pence. The second reduction in a row.
• Scotch Whiskey duty by 2%
• Cutting duty on cider by 2%
• Fuel duty increase scheduled for September 2015 to be frozen
• Personal tax free allowance increased to £10,800 next year and £11,000 the year after.
• New help to buy ISA's to help first time buyers

The 2015 budget as it happens...............

So folks its the last chance for Mr Osbourne to make a national impression on us all in today's budget and the last  one prior the General Election on 7th May 2015, so here are the highlights as they go live:

Highlights from Osbourne's opening gambit:

Osborne says he reports on a Britain that is growing, creating jobs and paying its ways. We took difficult decisions ... and it worked. Britain is walking tall again.

• Britain grew faster last year than any other major economy.
• More people have jobs in Britain than ever before.
• Living standards will be higher than in 2010.
• The deficit has fallen by a half.
• And bank shares are being sold, and taxpayers’ money recovered
•  Osborne says the OBR has confirmed Britain grew buy 2.6% last year.
•  OBR forecast growth has been revised upwards, at 2.5% this year, 2.3% next year and for the following two years, and 2.4% in 2019.
• Unemployment forecast down this year to 5.3%. Its lowest rate since 1975. 
• National minimum wage up from 
• GDP per capita is up 5%
•  Osborne says he can afford real increases in the national minimum wage. By the end of the decade it will be more than £8.
• Forecast for inflation at 0.2% for this year
•  Osborne announces sale of £13bn of mortgage assets from Northern Rock and Bradford and Bingley to be sold.
• Lloyds Bank assets worth £9bn also being sold.

 Budget changes and more to follow...................


Best regards

Changes affecting AST's in England..

Proposed changes affecting ASTs in England

On 5^th February 2015, the Government announced changes proposed by the Deregulation Bill 2015.

The Deregulation Bill intends to restrict a landlord’s ability to rely on a notice ending residential assured shorthold tenancies (ASTs) under Section 21 of the Housing Act 1988.

What this means for Section 21 Notices 

 

Firstly, I just want to clarify what a Section 21 does for landlords now.

A Section 21 notice is now the only means that a Landlord can retrieve possession of his or her property without grounds or reason. It can be issued at any time, with a minimum notice of two months, during a fixed term contract in order to regain possession at the end of that fixed term.
It can be issued also during a Statutory Periodic contract, again within a minimum notice period of two months, for possession to be gained by the Landlord. Should a tenant not vacate at the end of the notice period, possession will be granted by the court and will always be granted as long as the notice has been issued correctly and the dates are in line with the dates of the tenancy.

Landlords may require their property back for a variety of reasons, it may be financial, personal or because the tenancy has not been successful. Many landlords may not want to issue the Section 21, they may have a perfectly good tenant in the property but for a personal reason they need the property back.

A Section 21 allows the owner of the property to claim possession of their property.

What the Deregulation Bill would mean for Section 21 Notices:

 

• A Section 21 Notice cannot be served until month four of a tenancy (therefore cannot be issued at the start of a AST)
• A Section 21 Notice is invalid if before it was issued a tenant had made a complaint in writing to the landlord regarding the condition of the dwelling, and
• The Landlord did not respond to the complaint in 14 days, did not provide an adequate response, or gave a Section 21 Notice following the complaint
• A Section 21 Notice would be invalid if then a tenant took the same complaint to the local authority, and
• The local authority served a relevant notice to the landlord in relation to the complaint, and
• If the Section 21 Notice was not given before the tenants complaint to the local authority, it was given before the service of the relevant notice.
• If a landlord fails to comply with obligations relating to Energy Performance Certificates and Gas Safety Certificates, the eviction of a tenant will be suspended while the landlord is in breach.
• Exemption would be if the landlord is genuinely selling the property and be able to provide evidence they are not selling to a friend or family member.

**These provisions will not affect ASTs where the fixed term was granted before these provisions come into force**

ADVICE

We advice all landlords and agents to serve section 21 notices before 30 March 2015.

More to follow folks but call me in the meantime if you have any questions.

Best regards

Compulsory Smoke Alarm date confirmed....................

The government has confirmed that letting agents and landlords will be required by law to install working smoke and carbon monoxide alarms in their properties from October. 

The move will help prevent up to 36 deaths and 1,375 injuries a year and, according to the government, comes with strong support after a consultation across the private rented sector.

England’s 46 fire and rescue authorities are expected to offer support to agents and landlords in their own areas to meet their new responsibilities with the provision of free alarms, with grant funding from government (more to follow)

In 1988 just eight per cent of homes had a smoke alarm installed but now, even before the mandatory private rental sector measure, it is over 90 per cent according to government.

“The vast majority of landlords offer a good service and have installed smoke alarms in their homes, but I’m changing the law to ensure every tenant can be given this important protection” says housing minister Brandon Lewis.

Official data shows that people are at least four times more likely to die in a fire in the home if there’s no working smoke alarm.

For more on this please call me.

Best regards

 

Smoke and carbon monoxide alarms to be mandatory in all rented homes

The installation of smoke and carbon monoxide alarms in all rental properties, both private and social, is to be made compulsory.

The decision has been taken at the Local Government Association annual fire conference yesterday, following years of campaigning, led mostly by the Chief Fire Officers Association and supported by the British Property Federation.

The BPF said the crackdown was necessary to force the small number of landlords who did not install alarms in their properties to bring them up to standard. The English Housing Survey estimated in 2013 that 82% of private rented homes had smoke alarms fitted.

The BPF said that making the installation of carbon monoxide and smoke alarms compulsory will provide clarity to landlords.

It recommends that the obligation on landlords and their agents should be to ensure that there are working detectors at the time the tenancy starts. There should be an obligation on tenants, however, to maintain and test the alarms and to report any faults.
Ian Fletcher, director of policy at the BPF, said: “It is quick, cheap and easy to install these pieces of equipment, so making them mandatory makes sense.”

Call me for more.

Best regards

Richard

Landlords responsibility for Legionella Disease explained.........

Residential accommodation: Landlords

A new piece of legislation on our shores which I am sure you have all come across but like myself, maybe wondered what it is all about and whether you need to do anything as landlord??

Landlords who provide residential accommodation, as the person in control of the premises or responsible for the water systems in their premises, have a legal duty to ensure that the risk of exposure of tenants to legionella is properly assessed and controlled. This duty extends to residents, guests, tenants and customers. They can carry out a risk assessment themselves if they are competent, or employ
somebody who is.

Where a managing (or letting) agent is used, the management contract
should clearly specify who has responsibility for maintenance and safety checks,
including managing the risk from legionella. Where there is no contract
or agreement in place or it does not specify who has responsibility, the duty is
placed on whoever has control of the premises and the water system in it, and in
most cases, this will be the landlord themselves.

All water systems require a risk assessment but not all systems require
elaborate control measures. A simple risk assessment may show that there are no
real risks from legionella, but if there are, implementing appropriate measures will
prevent or control these risks. The law requires simple, proportionate and practical
actions to be taken, including identifying and assessing sources of risk, managing
the risk, preventing or controlling the risk; and periodically checking that any control
measures are effective.


For most residential settings, the risk assessment may show the risks are
low, in which case no further action may be necessary, eg housing units with small
domestic-type water systems where water turnover is high. If the assessment
shows the risks are insignificant and are being properly managed to comply with
the law, no further action may be required, but it is important to review the
assessment periodically in case anything changes in the system. However, the
frequency of inspection and maintenance will depend on the system and the risks it
presents.

Simple steps for your property:

• flushing out the system before letting the property;
• avoiding debris getting into the system (eg ensure the cold water tanks, where
  fitted, have a tight-fitting lid); 
• setting control parameters (eg setting the temperature of the calorifier to ensure
  water is stored at 60 °C); 
• making sure any redundant pipework identified is removed;
• advising tenants to regularly clean and disinfect showerheads.

Landlords should inform tenants of the potential risk of exposure to
legionella and its consequences and advise on any actions arising from the findings
of the risk assessment, where appropriate. Tenants should be advised to inform the
landlord if the hot water is not heating properly or if there are any other problems
with the system, so that appropriate action can be taken.

The risk may increase where the property is unoccupied for a short period so vacant property management through your agency is always worth putting in place. It
is important that water is not allowed to stagnate within the water system and so
dwellings that are vacant for extended periods should be managed carefully. As a
general principle, outlets on hot and cold water systems should be used at least
once a week to maintain a degree of water flow and minimise the chances of
stagnation. To manage the risks during non-occupancy, consider implementing a
suitable flushing regime or other measures, such as draining the system if the
dwelling is to remain vacant for long periods.

Legionella is not rife within the lettings world but it does exist and is a very serious consideration. To understand it a little better and follow these simple measures, will ensure the risk continues to remain low.

Call me for more.

Richard

House price predictions 2015

2014 review

The UK housing market saw a spring and summer boom in 2014, particularly in London and the South of England (us!), before activity dropped away a little towards the end of the year although this tends to be normal around Christmas.

The variance of polled opinion

Recently published figures from the Nationwide Building Society - the first to record the annual change over the whole of 2014 - suggest that UK house prices rose 7.2% during the year. You may recall I posted a 4.2% annual increase in the South East. The regional differences are fairly interesting though with London reporting a 17.8% increase, yet Wales showing a 1.4% increase. Differences indeed.

Another survey, by rival lender the Halifax, says that prices rose by 8.5% over the year, although its official house price index data has not yet been published.

Strange as it may sound the rise in prices and activity is reflected in the number of people buying carpets. Wilf Walsh, chief executive of Carpetright, says that the outlook is "mixed", but there are signals of pent-up demand being released.

Ian James, president of the National Institute of Carpet and Floorlayers, says that business is "still a bit slow in the North East" of England, but has been picking up elsewhere.
"The last five years have been pretty poor," he says, explaining that many fitters could not find enough work from independent carpet retailers.

"But we can see the shoots of recovery. We had our biggest trade show in years. There is a trend of [consumers] going back to carpet instead of cheaper laminate flooring."

 
UK housing market saw more activity in 2014 than at any time since 2007
 

As may be expected, these home improvements are lagging slightly behind transaction levels in the housing market, with buyers perhaps waiting a few months in their new home before spending more on laying new carpets.

House sales were consistently above 100,000 a month in 2014 across the UK, according to seasonally adjusted figures from HM revenue and customs. It is the first time this has been the case since 2007 which was of course the last significant property boom.

Year ahead

Activity levels are likely to be positive in 2015 but it is anticipated that the growth will be steady rather than sky rocketing.

The general election is likely to dampen activity in the housing market until the result is known, but that recent changes to stamp duty may have little effect. It is also suggested that the Bank rate - a key factor in determining the level of mortgage interest rates - could end the year at the current, record low level of 0.5%.

London property prices can have a significant effect on the UK average
 

This London lag is most striking in the predictions of the Royal Institution of Chartered Surveyors (RICS).

RICS, and its global residential director Peter Bolton King, say that house prices in London will be unchanged in 2015 compared with 2014. This will restrict UK house price growth to 3% in the year to come, or so they say.

Ed Stansfield, property economist at Capital Economics, says that his prediction of a slowdown in prices in London is partly the result of buyers simply saying "enough is enough" with homes in the capital either overpriced or unaffordable.

Miles Shipside, director of internet property portal Rightmove, says that this will lead to prices picking up further out from London in the South East of England as families look for more affordable homes within commuting distance of the city. A very positive sign for us Oxford folk I am sure you would agree especially when you consider that alot of 'Oxford residents' reguarly commute out to our major cities, most notably London.

Another significant factor in determining housing market activity in 2015 is the level of wage rises.
Martin Ellis, housing economist for the Halifax, says that the first year of consistent above-inflation wage growth for some time could add to demand for homes. However, he too points to the potential effect of the general election and the threat of rising interest rates as keeping that demand in check.
Predictions can always be thrown out by unexpected events, and longer-term estimates must be treated with even more care.

Still, estate agent Savills has predicted that over the next few years house prices will rise no faster than 5% per annum.

It is predicting UK property price growth of 2% in 2015, 5% in 2016, 5% in 2017, 3% in 2018 and 3% in 2019.

Personally I try not to look too far ahead. There are many things that happen during the course of the year that can have a positive or negative effect on the housing market and whilst predictions are never too far away they can never be wholly accurate.

What do you think?

Call me for more.

Best regards

Richard