Recent news items of interest to local landlords, use the search option above to find specific topics.
We know many landlords have lost a room in Portsmouth after applying for a Mandatory HMO licence when the new rules came in last October. This is typically a 5-bed going to a 4 or similar, due to communal space not meeting PCC's very high requirement (compared to every other council in the country).
If this is you – what have you done with that room? For many, we know it is just wasted as a separate 7 or 8 square metre room in a property where the inhabitants do not live as a cohesive group has no value. The individuals often use the communal kitchen but take food to eat in their room and don't use the rest of the house except, obviously, the bath/toilet facilities as required.
One issue we are finding is that unbeknown to the landlord, one or more of the tenants decide it is a 'wasted room' and they let one of their friends live there….
Subject to approval by both Houses of Parliament, landlords and agents will need to ensure electrical installation inspections and testing are carried out for all new tenancies in England from 1 July 2020 or from 1 April 2021 for existing tenancies.
The Government has produced The Electrical Safety Standards in the Private Rented Sector (England) Regulations 2020 which state that landlords must ensure every fixed electrical installation is inspected and tested at least every five years by a qualified person. The Regulations also state that a landlord is required to obtain a report of the results of the inspection and test, supply it to each tenant within 28 days and retain a copy until the next inspection is due.
Obviously, in the current environment, these plans may be delayed but the key point, that many people overlook, is that an electrical inspection checks an installation meets CURRENT standards and these standards change and become more rigorous every year – so if your property has not had a major electrical upgrade in the past 10 years, it will probably need one now and that will mean major disruption for your tenants.
Portsmouth has released a draft of its strategy aimed at achieving an active and well-functioning Private Rental Sector which works fairly for all. Read on for an overview of the strategy and its aims, written by Portsmouth's Cabinet Member for Housing, Councillor Darren Sanders....
iHowz (formerly the Southern Landlords Association) have summarised some very useful advice for landlords on everything from how do you go about Gas Safety inspections when a tenant is self-isolating to what are the new rules on eviction. (Thanks to iHowz for allowing us to share) This has been updated with links to the NRLA webinar and information on this topic.
Later this month, the Homes (Fitness for Human Habitation) Act fully comes into force. What does that mean for landlords? From March 19th tenants will be able to sue for compensation for issues such as mould and damp.
Some years ago, Portsmouth City Council (PCC) enacted an 'Article 4 Direction' requiring planning permission for new HMOs. This overrides the usual permitted development rights a landlord has to use a normal residential property as either a non-HMO, (C3 use class i.e. family type residence) or an HMO occupied by unrelated sharers (C4 use class). There are many HMOs that do not have or require planning permission as they have been in continuous HMO use since November 1st 2011 when the Direction commenced.
The planning enforcement team are currently writing to landlords asking them for proof of continuous use - do you know what you need to do? Have you kept records to show how your property has been used?
At our meetings this month, we had representatives from Portsmouth, Havant and East Hants all keen to find landlords to work with in their efforts to reduce homelessness. Watch the video of the session with Portsmouth and Havant from our February 2020 members meeting and read on for details of the working group that Portsmouth wants to put in place to better understand what is important to us as landlords.
At our January 2020 meeting our main speaker was Andrew Waggott, from Portsmouth City Council (PCC) working with us to help us understand what is available now and trying to work out how we make the PRS in the city greener and more energy efficient. We also discussed the PCC proposals to get more people from the housing list into the PRS and had a discussion on HMO Licensing in the city. We have produced short (and long) videos of the event for those who could not attend.
At this months Housing Cabinet meeting Councillor Darren Sanders and other cabinet members supported proposals to widen their bond scheme and the use of a community bank to provide low cost loans, with the aim of getting people off of the housing waiting list and into homes in the private rented sector.
(This is the topic we discussed at our January member meeting, watch that here)
The 31st January 2020 deadline has been and gone and you have not yet filed your tax return. Time got away from you or maybe you did not realise that you needed to complete one until now? Whatever the reason you need to be aware of the following;
New regulations will soon come into force requiring landlords of all property types to have a current electrical certificate but as seems unfortunately normal of late, the precise requirement, any exemptions and the timing is not yet clear. As a result, there may be a rush as July approaches…
After 18 months gestation, we are pleased to announce the PDPLA website has now been completely renewed. Hopefully members will just notice some style updates and minor improvements but under the covers we have jumped 10 years to modern technology with everything changed from the servers on which it runs right through to the tools used to create the content….
PDPLA members have raised nearly £2,000 over the past 2 Christmas’, all of which has been donated to the Society of St James to help the local homeless. It is debatable whether this type of support can end homelessness, and more on that next month, but there follows a thankyou and Christmas update from SSJ. Thank you to everyone who has donated at one of our events or on our JustGiving page: https://www.justgiving.com/fundraising/pdpla2018
We have many members who are unhappy with PCC’s rules on communal space in HMO’s – the rules seem to have grown over the past 10 years in an attempt to provide a basis to reject HMO’s which are seen as ‘too densely developed’ by councillors and local residents. We are now at a point where PCC ask for more communal space than any other council in the country (and in many cases, 2 or 3 times more than most councils).
It was thus somewhere between shock and amusement that we heard PCC had lost a case where they tried to stop a very small flat from being let.
Portsmouth is consulting on a draft strategy - 'Energy and water at home - a strategy for efficiency and affordability for every household in Portsmouth'. It looks at how the council can work with others to make homes more energy and water efficient and ensure residents can afford their bills - as we own 1 in 4 of the houses in the city, we will be most affected, so do make time to think about how you will make your properties more energy and water efficient and what help you need, then complete the questionnaire - because if you say nothing, you have no reason to complain if in 2 or 3 years time you are faced with significant bills to bring a property up to a new standard or have to replace or upgrade something you only just invested in.
The strategy is pervasive - obvious things like insulation and reduced water usage but also more futuristic options to get us to near zero carbon status, such as time of day energy tariffs and micro-anaerobic digesters - so do read the summary or attend a meeting if nothing else.
A Unique Taxpayer Reference (UTR) number is required by all sole traders, partnerships and limited companies in the UK. It’s unique to that individual or organisation and remains unchanged forever.
You will also need a UTR if you have other forms of income or expenses that require you to file a Self-Assessment tax return.
If you don’t have a UTR, you won’t be able to submit a Self-Assessment tax return, plus, you may open yourself up to heavy penalties.
So, to help reiterate the importance of UTR numbers and how to correctly acquire your own, we’ve asked Mike Parkes from GoSimpleTax to shed some light on their role in tax return submissions.
As we approach the mid-part of the 21st century, is it time to consider providing 21st century properties for our tenants? We know many were built in the time of Queen Victoria, but as landlords each property faces a continual cycle of upgrade, refurbishment and renewal - so as part of that, should we be considering Smart technology, leading edge energy solutions and maybe, even reconfiguring the way people live?
In support of the new strategy for the Private Rented Sector which may justify Selective Licensing for all landlords in the city - Portsmouth City Council are asking for your views and those of your tenants. It is simple, two page survey (for landlords, slightly more for tenants) and we worry that unless enough people make their views clear, too small a sample may lead to conclusions we are not happy with in the months ahead. So do click the link, do complete the survey and do add comments outlining your views on the need for more or less regulation and what challenges or problems concern you most - it will only take a couple of minutes and could help avoid the many hours and £'s that Selective Licensing will cost you if introduced later this year.
At our November member meeting we had a short discussion on the use of Property MoT’s. Is it yet more bureaucracy or might they be useful? It is interesting that the Labour manifesto proposes to mandate Property MoT’s – could this be one area where local landlords agree with an aspect of the Labour Party housing policy?
We actually suggest that we may need to go further and should be thinking about offering Tenancy MoT’s…
As we head toward the final days of the election, the RLA have perfectly summarised the 6 things that every landlord wants from the new government:
In a well articulated statement they demand a more positive approach to the Private Rented Sector, read more here....
After the October PDPLA meeting, I attended the Full Council meeting of Portsmouth City Council and subsequently the Housing Cabinet meeting on 21 October to oppose proposals put forward by Cllr Cal Corkery to introduce selective licensing for all rented properties in the city.
There was a time when every major town introduced licensing schemes to control some perceived problem in the private rented sector, Portsmouth introduced Additional Licensing in 2013 to solve ‘problems’ with HMO’s in the south of the city for example. Now those schemes have come to an end, various councils have tried and failed to introduce follow on or different schemes and many are failing to get the necessary approvals – Brighton, Stoke and Hounslow are the 3 examples we look at here…
The Home Office have updated their guidance to landlords on how to perform checks for nationals of of Australia, Canada, Japan, New Zealand, Singapore, South Korea and the USA who have entered the UK through eGates and do not have an endorsement in their passport to evidence leave to enter the UK.
Whilst the Tory pledge to get rid of Section 21 does not appear likely to be implemented anytime soon, we still worry as both Labour and the LibDems have similar policies. To that end, we have been actively collecting data and participating in consultation activities - for example, this month PDPLA Vice Chairman, Alwin Oliver, submitted a collection of case studies and suggested alternatives such as a new Housing Court styled on the Canadian solution - PDPLA members can see it here in the members area. Highlights follow…
Committee member, Jonie Goldenberg had the following thoughtful piece published in the Portsmouth News this month: "The Corporate Landlords do a hard sell - and I am not surprised at £200 per week per room for student accommodation equating to £10,200 per unit for the 51 weeks in the 256 unit high rise, earning in the region of £2,600,000 per annum for the company Prime Student Living. Multiply that by the number of new Halls that have been built. 'A nice little earner'. By a company who has not come up with the goods on time and sees fit to axe students' contracts without a thought of the associated problems faced by many first year students and their families. They will think twice about coming back to Portsmouth University. This is also not the first year this has happened."
A number of members have complained to us as PCC have asked them to confirm that they test fire alarms weekly. Please note - as a Landlord you DO NOT need to test fire alarms weekly. In fact, it would be an intrusion on the privacy (and the 'entitlement to QUIET enjoyment") of your tenants if you did. Read on for the current situation…
Whilst HMRC are making positive noises about the progress of MTD, those businesses which pay VAT had to start submitting quarterly returns this year. Of the one million businesses affected, nearly one quarter missed the August 7th deadline to submit their 1st return.
With so much demonization of landlords in the press and new regulations and standards being imposed almost daily - you would think rogue landlords had been publicised and regulated out of existence, but we would argue that politicians and journalists are focussing all of their efforts on the wrong landlords, which is why they are not seeing any improvements. We could go further and say that the local council is working with, condoning and encouraging the worst rogue we have come across….
So, let"s start with what, actually, is a rogue landlord? And then, we suggest what needs to be done
We were interested to see BBC coverage of a new website which allows tenants to rate and review their landlord. The site
https://www.marksoutoftenancy.com/ has all the disadvantages of other ratings sites and probably does little to allow customers/providers to make better informed choices. What is also missing is the ability to 'rate and review" tenants.
We have a number of members who are very concerned that conditions are being placed on HMO licences and occupancy numbers are being reduced. There are many 5 bed properties applying for the Mandatory HMO Licence that they need which are being given a 1-year licence on condition they are reduced to 4 bed HMO"s after that - we are told by a PCC employee that this has happened to at least 130 properties in the city - easy money for PCC as they take the licence fee and then change the house such that it does not need a licence. These conditions do not apply elsewhere and this is forcing up rents in Portsmouth in relation to neighbouring areas. It is also leaving rooms empty at a time of housing crisis.
Tony stood in for Alwin as our representative on the Fair Possessions Coalition last Friday. Did he not know there was going to be a train strike? Fortunately, the prospect of a strike had put off regular travellers and the journey was a joy. Anyway, with research showing that 84% of Section 21 repossessions are due to tenant arrears, most of the preconceptions about the need to abolish Section 21 seem to be misplaced. Here is his summary from the meeting in London:
Last week the RLA and the NLA announced that the 2 organisations are to unite to create a single organisation. As a local organisation looking to both organisations in the past for national representation - the new organisation, to be called the National Residential Landlords Association (NRLA) looks compelling. Combined they will have a single voice when representing us and they will have 80,000 members who own and manage half a million properties.
While PDPLA Committee member, Tony Athill, was in London at the Fair Possessions Coalition meeting hosted by the RLA he took the opportunity to discuss Licensing.
It was agreed that landlord representatives need to demonstrate how licensing schemes are not a cure all that will rid the sector of ill-informed and criminal landlords. The representative from ARLA (agents association) is also a Local Councillor and he supported the PDPLA view that we need to educate our local politicians. We have a plan. …….
There was much discussion at our July meeting about the Natural England concerns about new residential development in the Solent area being likely to increase nitrates in the harbours and thus harm wildlife. As a result, almost all new developments are being refused planning permission for fear of prosecution for breaching the Natural England guidance. As mentioned then, we were represented at a meeting with the council to discuss options and have subsequently been copied on a number of documents explaining the situation, sent from PCC to the Secretary of State.
Relevant extracts are included below...
Before Brexit and Donald Trump, there was a belief in the Western world that politicians strived to do the right thing and made decisions in line with their manifesto to improve the lot of their constituents. That all changed in 2010, when no party won a majority of the seats in Parliament and left with a coalition, the workings of government suddenly became clear.
The bad news is that Portsmouth appears to be no different, based on the recent attempt to introduce Selective Licensing….
As reported at our July member meeting, the PDPLA supported a number of members with appeals against licensing decisions of PCC. These properties were all approved for HMO licences under Bruce Lomax's regime but rejected when they requested the same approval for the same number of people under the new Mandatory Licensing regime.
We won appeals on 3 topics, but lost on one and unfortunately that was the one topic with the most cases.
If you are planning to create or change an HMO, one of the biggest challenges can be getting the necessary planning approvals. We increasingly see councillors worrying about potential issues which, if they received correct advice from council officers, they would know were not an issue. In an attempt to help you avoid some of these issues, we have drafted a simple guide to help you - if you have views, comments or additional experience, do please let us know.
After losing so many appeals because they rejected applications for HMO's which met the conditions in Portsmouths existing HMO SPD (Strategic Planning Document), the team at PCC are trying to rewrite the rules to give them grounds to reject more of the HMO applications which come before them.
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There was an article in the Guardian suggesting that landlords are being urged to increase rents by their letting agents in order to make up the shortfall in the letting agents income due to the Tenant Fees Ban and we were asked by Cllr. Sanders (PCC) whether we have seen evidence of this locally.
This article is copied from the RLA news this month in case you missed it -
The RLA believe that Shelter"s claims over the impact of changes affecting the private rental sector in Scotland are misleading.
Scotland has recently abolished so called 'no-fault" evictions and fixed term tenancies, as well as banning fees and introducing rent controls.
In a report out this month Shelter concludes these changes have been a success - and have not had a profoundly negative impact on the PRS north of the border.
However, the RLA has a number of issues with the report.
The recommended suppliers list in the members area of the PDPLA website just added a new cleaning company, recommended by PDPLA member Kiera Lea. The company is Eldraw Cleaning and they cover south hampshire providing both domestic and commercial cleaning services.
It is common across all industries, but the practice of conducting a survey and then publicising the results seems to be the bane of landlords across the country. Wherever we look there is a new survey telling us, and others, what we do or don"t know, whether we are buying or selling - in fact everything except (and I may be wrong), what the typical landlord eats for breakfast. (If you want to answer that one, come along to our next Landlords Breakfast).
The bad news is that the majority of these articles and surveys are just plain wrong. Not just 'bad science" but 'bad journalism too". Let me explain….
Portsmouth based peer-to peer (P2P) lending platform, Lendy, which lends money to property developers has collapsed after intervention from the Financial Conduct Authority. Lendy was setup in 2013 and was one of the bigger P2P property lenders with around 22,000 investors tempted by advertised returns of up to 12% and assurances that they could hand over money with "complete peace of mind".
This is a blow for the city - we create too few new jobs as it is, especially in the high growth areas where the UK has a lead such as FinTech, AI, etc. but unfortunately, it would appear this promising star was badly managed and has paid the price.
Having won our 1st appeal (over an adequately sized room that PCC believed to be too small) last month, this month the next 7 cases came to court. We hope the decision of the 2 judges will be available in the next few weeks and when it is, we will share it.
In the interim, some observations and recommendations for all concerned.
Written & oral information and advice from the Portsmouth & District Private Landlord's Association is given in good faith, but no responsibility whatsoever is accepted by the Association or it's officers for the accuracy of it's information & advice nor shall the Association be held responsible for the consequences of reliance upon such information.