Recent news items of interest to local landlords, use the search option above to find specific topics.
If you are a local landlord, we encourage you to attend some of the training courses we have scheduled this year - many of us became landlords as an investment but those of us who have been doing it for a while will have realised that you either outsource everything to an agent or you treat it as a profession and for that, you need training.
(And even if you outsource, you are still legally responsible for the actions of your agent - so if you are better educated, you can better judge whether the agent is doing what the law requires he/she do for you).
You may have seen the articles in The News this month summarising the dismay (and often unfounded and ill-advised ranting) of those on the Portsmouth Planning committee as HMO"s have been allowed on appeal after the Planning Committee went against the advice of planning officers employed by the council and rejected applications for HMO developments that met all of Portsmouth"s very stringent local rules….
The consultation on Portsmouth"s proposed Homelessness Strategy ended this week - there were some issues as the email address for responses does not exist, but hopefully all those who wished to participate found alternative contact details.
The PDPLA"s response is below.
In the first of the current string of appeals against PCC licensing decisions to come before a Tribunal, PDPLA member Lucy Fryer has won her appeal against PCC"s judgement on what constitutes a small room.
The legal requirement for a bedroom in an HMO is that it be at least 6.51 sq m. That is small, but subject to layout and furnishings it can be quite acceptable and it avoids wasting the small bedroom that was added to many Portsmouth houses when they were built in the 1920"s and 30"s. They are popular, as landlords tend to offer them much more cheaply than larger rooms and when living with a group of friends, having a small room and low rent, but still having access to the rest of the house is often seen as a very desirable solution.
The room in question was larger than required, it had a sloping ceiling, two Velux windows and ensuite facilities. The Council wanted the latter removed. The Tribunal decided this "would be a waste of time, effort and money which would not serve any statutory purpose."
We have at least 7 more appeals coming up starting on the 8th May and will update on those in the next newsletter.
The tribunal made some interesting observations, read on for a summary of their key points.
The PDPLA has input to discussions by the APPG (All Party Parliamentary Group) who have been looking at the impact that poor housing has on health. We have long argued that HHSRS is not fit for purpose - allowing council officers across the country to 'appear to be doing something useful' whilst in reality, having little impact on health or safety.
We are hopeful that this APPG will come up with something better. Read on for an interesting graphic of their findings so far including details of the £2.5Bn cost to the NHS of poor housing and the £18Bn social and economic cost.
The answer is obviously, no - tax is periphery and everyone pays it, so while you should take care to only pay what is due and not overpay, happy tenants, safe houses and stable finances are more important.
If only it were that easy though. Britain's 'tax code' which defines which taxes are due, runs to 17,000 pages - the longest in the world (the average bible is 1,200 pages, Lord of The Rings (all 3 books) is about the same). So in a way, it is not surprising the average landlord seems to spend far too much of their time trying to work out how much tax they need to pay. It also explains why there are 200,000 working accountants in this country - just think of all the useful things 200,000 people could do if they were not wasting their working lives worrying about other peoples taxes...
There follows a summary of current tax changes from the Federation of Small Businesses, a link to one of HMRC's webinars (which are well worth attending as the 'onscreen chat' gets you answers to specific questions far quicker than their telephone helpline) and a reminder of our forthcoming PDPLA tax education sessions running through May and June - do make sure you book your place.
The government have been swayed by pressure from Shelter and others and have decided to stop landlords regaining possession of their property using Section 21 notices. What will replace it is unclear and there will be consultations before anything is finalised, but you can rest assured that the PDPLA will be articulating the impact upon its members of any of the proposed alternatives.
We received extensive coverage in The News when our Vice-Chair, Alwin Oliver focussed on the fact that currently, many mortgage lenders depend on the availability of the Section 21 when offering finance and one unexpected outcome could be that mortgage cover requirements could rise considerably, making funding much harder to acquire.
Have you ever used a Section 21 to get your property back? If you have, we'd like to know why as if the 'Shelter perspective' is inaccurate, we need to be able to show evidence of that. Read on for member comments and our press release explaining more of our concerns
We know many of our members do not trust banks or financial institutions and attempt to fund their pensions by buying and letting property. This may make sense, but with increasing regulation and also, the high cost of maintaining property to a good standard and the significant overhead of either managing your tenants or paying someone else to do so, sometimes we wonder whether it is worth it.
To present a contrarian view, we publish an article originally published in the Financial Times by columnist and Money Week editor, Merryn Somerset Webb.
After our successful campaign over 3 or 4 years, in 2016 Portsmouth City Council finally agreed to stop sharing the names and addresses of HMO landlords. We had hoped that the introduction of GDPR last year would cement our right to privacy and control of our personal data but unfortunately, this has not been the case and PCC have reversed their position and are now sharing our details with all and sundry.
As of 1st April, 2019 anyone managing a property for someone else needs to belong to a recognised property redress scheme.
'Let to let' can be appealing - you avoid all the hassle of letting and managing your property and you don't give away 12-15% of your income to a letting agent, but our advice to members has always been to be very careful, check that you are not breaching your mortgage conditions, planning rules on HMO's or any other regulations and ensure that your contracts give you control not only of your relationship with your tenant, but also any tenants they let your property to.....
There was a question posed to members recently asking for feedback in this area and what follows, is one members experience and recommendations to other members....
In a pre-election newsletter to Portsmouth residents, local labour campaigners talk of introducing landlord registration for all, more HMO licencing, training for landlords, codes of conduct and liaison officers to manage us - among other proposals.
Read on to see how we responded....
People have had the option to buy homes in England and Wales via a commonhold structure since 2004, but since then only 20 developments have been created. By contrast, there are 4.2 million properties owned as leaseholds in England alone. Why is that when the benefits of leasehold are so few and the pain experienced so frequent?
The commonhold property structure allows the purchaser of a property to own a freehold 'unit", usually a flat within a block, without any kind of time limit on that ownership (as opposed to leasehold properties, which are leased for a set period of time from the freeholder). Owners of a commonhold flat then become members of a management company, similar to a residents association, that looks after the shared areas and buildings in the way that a freeholder traditionally would.
In another example that Portsmouth's housing standard documentation is not fit for purpose, one of our members this month pointed out that the way they are currently written, no 3 storey HMO's are allowed in the city except those with kitchens on the middle floor...
Developments in Portsmouth are policed by national planning regulations and local laws and guidelines, managed by the planning department at the council and overseen by a group of elected councillors known as the Planning Committee. That all sounds logical, organised and sensible doesn't itâ€¦
So why does the Planning Committee keep making decisions which are contrary to their own rules and as a result, then have those decisions overturned by the Planning Inspectorate? We reported this issue back in 2017 (more here) yet they have continued blindly trying to misapply their own rules. If the rules (Supplementary Planning Documents) are to stand up to appeals then decisions need to be evidence based, not based on the prejudices of residents and/or Councillors desire to be re-elected.
Last month, the Planning Committee were told of 5 more cases that had been appealed and in which their decisions had been overturned â€“ they themselves complain about the cost of this to the taxpayer, we would argue their behaviour in trying to misuse the process in this way costs the taxpayer and the applicants in each case far more than they estimate when you take in the time spent by officers preparing for the original review, the appeal, etc.
The bad news is that the Planning Committee is now asking PRED (a different councillor group focussed on Regeneration and Economic Development) to rewrite some of the rules so they can force through some of the restrictions that they have consistently failed to be able to do over the past 5 years.
Worse than that though, is that all of these actions are increasing homelessness in the city. Read on for our explanation of why this is true which we sent to every member of the Planning Committee
Last month we reported the case of members whose Portsmouth properties had been ROBBED (Reduced Occupancy By Basic Desktop Evaluation) when they applied for their HMO licences. See the original article here.
The PDPLA are supporting 6 appeals and these have each received their "Directions" from a Tribunal Judge. He has instructed this batch of cases to go to a full hearing and this will include a visit to each of the properties.
Five relate the to PCC officers decisions that the properties have insufficient communal space and therefore occupancy levels must be reduced. One relates to how they measure a small bedroom. We understand a number of other appeals are filed with the First Tier Tribunal (FTT)
At our members meeting in February, we had much discussion about how best to communicate with tenants - it is obvious that while email is tried and trusted, many younger tenants don"t 'do" email very often and it is much better to use SMS text (txt) messages or apps like WhatsApp if you want a quick answer or to know that they have seen your message.
But if, 6 months down the line, you are in dispute with one of the tenancy deposit schemes or worse, have resorted to the courts to resolve an issue, what is the legal status of such communications and what can you do to ensure they are not lost when you change phone or provider?
The simple answer is that as far as we know, it is all admissible in court and as long as you can provide a full and complete transcript of any such conversations, it will support your case and can be used.
The issue is how do you keep it / how do you ensure you don"t lose them? Read on for some hints and tips that may help.
At our meeting this month, our very own Alwin Oliver explained and demonstrated the immense savings of time, effort, paper, printing and postage that can be obtained if we use electronic signatures.
But do you understand the difference between e-signature and 'digital signature' - it is important if you are to streamline your operation and reduce costs without introducing risks or problems. So read on for more details..
There are properties which were OK under additional licensing and some of these were also accredited by PCC, but now they are having their occupancy reduced and only being granted a 1-year licence for the number requested under Mandatory Licensing. (See prior notification to members)
In this case, as many of these decisions appear to have been made simply on a desktop evaluation of the plans submitted for previous inspections, we came up with the ROBBED acronym (Reduced Occupancy By Basic Evaluation on Desktop)
The issue is predominantly whether the property has sufficient communal space. Elsewhere, 12-15 sq m is adequate but Portsmouth are looking for up to 34 sq m. Interesting as one student we spoke to this week said, "The kitchen has one cooker with only one cooking shelf, a 4 ring hob and 3 fridges and 2 freezers which are not sufficient for the 6 students, 2 sinks with draining boards, a microwave and toaster. We have had to provide our own kettle. We eat using a section of work surface where the toaster and microwave are situated which is the only work surface we have for food preparation in our very small kitchen. There is not sufficient room for all 6 to be in the kitchen at one time or indeed to be able to cook at one time. " - diabolical you say, no wonder PCC are rejecting them. Well, actually, this is one they are fine with - it is James Watson House, one of the student halls managed by Unite for the University of Portsmouth and approved by PCC.
We know that at least 10 members are already affected by ROBBED and as a result, we have a virtual 'class action" of 6 of these cases going to the First Tier Tribunal and we hope for a decision in March.
Some of you will have seen the question about a plague of mice which I sent to all members using the questions@ facility - it appears we have an incredible amount of experience in our membership on this particular topic, read on to find out what I learnt plus some observations on how to use questions@.
I was talking to Hayling Island"s oldest resident the other day - no not fellow committee member Julian, he is a mere stripling compared to the old guy I met. He doesn"t say much, if anything at all, but he is a good listener and has been doing it for a long time.
I was complaining about the just announced landlord redress scheme, trying to work out which particular problem it was supposed to solve and complaining about the inevitable extra bureaucracy for no apparent benefit that was the most likely outcome. We already give out 'How To Rent" guides - do tenants ever read them? No. We join tenancy deposit schemes, have they made a jot of difference? No. So why do we now need a redress scheme? He just sat there and listened - as I said, he is a good listener, he has been doing it all his life and he is over 2,000 years old.
Yes, you read that right, 2,000 years old. He has a couple of brothers who are twice his age and a cousin who is believed to be 5,000 years old
OK - you can see why DC Comics went with Superman in 1938. Damp Man probably would not have given DC the success that led them to go on and create Batman, Wonder Woman, Flash and so many others. But Damp Man has one big advantage over all of DC"s superheroes and that is that he is real and can be found in Gosport!
Our suggestion to members is they take advantage of his presence and drop in on him in Gosport or better still, ask him to drop in on you - he may not do so as dramatically as Superman would, but you will be just as pleased when he eradicates the bad guys for you. Read on to hear of one members experience….
As we reported just before Christmas a number of members with licensable HMOs have been told they have insufficient communal space for the number of occupants they have been accommodating. PCC officers are issuing licenses for one year and then expect the landlord to sacrifice one bedroom. Structural alterations may be an alternative. This is despite the same properties having been inspected and licensed previously under additional licensing. So far the properties that have been singled out are those with limited additional communal space than is offered by the kitchen / kitchen-diner.
There are no national standards for communal space but local authorities can produce their own. They should not be too prescriptive as the property must be looked at as a whole. Following the introduction of 'Mandatory Licensing" of all 5 occupant HMOs they are being re-examined using stricter acceptability criteria against PCC local standards. Either the original inspections were lax or officers are now being overzealous.
The 'Fitness For Habitation Bill' just passed into law. We supported it as did most other landlord associations but there are elements of the wording of the final bill which are cause for concern. One of those is the desire to scrap Section 21 evictions.
The bill started as a private members bill championed by MP Karen Buck. See below the letter sent to her on our behalf by committee member, Tony Athill...
Here at the PDPLA we have long argued against the unfair treatment student landlords receive from Portsmouth City Council - we get hounded for every possible penny of council tax whereas student halls, which are directly comparable, pay nothing.
There was some good news last month when a valuation tribunal rejected an appeal from a student letting agency which effectively gave Leicester City Council (and all other councils) the ability to treat each student room as a separate dwelling and to charge council tax on that dwelling in exactly the same way they charge us.
We have raised this with local councillors and the appropriate council officers and whilst councillors are keen to ensure that the we are treated fairly compared to our competitors, we still have some way to go with council staff.
It seems only a month ago that we advised members to cut up their B&Q Tradepoint cards as the discounts were no longer worth having (actually, it was 2 months ago. Last month we reported on another association boycotting B&Q because of their support for Shelter - see an update on that elsewhere in this newsletter). Well, it appears they listened and the new deal offers 5% on everything (small print applies!) and 10% if you spend £500 during a period (current period runs until end of March).
Read on for more details....
Our annual Christmas party was different from usual for a number of reasons. Firstly, the new venue appeared to be much better appreciated than previous ones and also, we normally distribute left over food to the local homeless, but this year there was no left-over food.
The good news is that we raised considerably more for local charities than normal and at the same time, a good time was had by all.
With letting agents demanding hundreds of pounds in payment before prospective tenants are allowed to view properties for rent, changing energy providers in order to get kick backs and charging ever more, what should we be doing as landlords? Maybe more importantly, with the legislative changes that will prevent them charging tenants as they do today, will any survive?
After a challenge from the Southern Landlords Association, Brighton and Hove have shelved their plans to introduce Selective Licensing in February after support for the scheme was withdrawn by the Secretary of State.
The challenge related to the lack of evidence to support the proposal and the flaws in the logic as to why the scheme was needed.
In the past couple of weeks, since the PDPLA decided to withdraw from B&Q"s Tradepoint scheme as the new terms were unfavourable for most landlords, B&Q has been hit by threats of a boycott from various landlord groups because of B&Q"s donations to activist group Shelter.
As landlords we struggle to get a fair hearing, it is easy for the press, media, councillors and politicians to 'win points' by going after 'nasty landlords' when the reality is that a higher percentage of private sector tenants are happy with their homes than social sector tenants, we house more than 1 in 4 of the local population and we do it without subsidy or support while contributing strongly to the local economy. This occasional newsletter item asks members to do their bit to change attitudes and help start changing perceptions.
This month we have a campaign on Universal Credit below plus the item on B&Q and Shelter, elsewhere in the news. Please do your bit to support both as appropriate.
We have acquaintances who have a property they rent in the US. It had been successfully let to a young woman who lived with her partner until earlier this year.
Then the couple split, the partner moved out and then came back and burnt the house down.
A terrible experience for a landlord (and the tenant of course) wherever it happens - so why are we reporting it here? Well, it is different in America...
Portsmouth, like many councils, has outsourced collection of council tax to a private company with a view to maximising their income and thus reduce the impact of cutbacks on the services they provide. This is commendable, but when it comes to student accommodation, we fear it may hurt students, the University and the council itself in the longer term.
There is a Private Members Bill making its way through the Houses of Parliament which has almost universal support - however, some people are expecting it to solve problems that it cannot and we also see statements which do nothing to reduce the bad press landlords get considering the amount of time and effort we expend helping those most in need and most vulnerable. Read on to see our explanation of some of the considerations that we sent to Portsmouth South MP, Stephen Morgan and his positive response.
We have been following the legal battle over HMO licensing between Nottingham City Council and one of their student landlords with some interest. In the latest instalment, the Supreme Court removed conditions applied by the Upper Tribunal in an earlier appeal which confirms our view (and contradicts a view held by PCC during the 5 years of Additional Licensing just ended), that you can take the type of tenant into account.
A simple example, is that gaps between spindles on stairs (balustrades) need to be 4 inches or less to prevent small children falling through, but in a house which will only be let to adults, is this relevant? PCC always argued they could not guarantee the type of tenant or their visitors, so all rules should apply to all properties. The new ruling shows that this is not the case and allowances can and should be made based on the type of tenant.
We often recommend members challenge or appeal decisions by inspectors, partly because they are inconsistent from one house to the next, but also because many of them are inappropriate given the type or usage of the property in question. So if you are asked to do something the benefit of which is not obvious, do consider challenging it before you spend your hard earned cash on what may be unnecessary alterations.
If you have properties in Portsmouth you need to be aware of changes in waste collection as falling foul of them could cost you £5,000 (see our earlier article outlining the fines which can be applied).
Residents will be issued small bins which can only hold 3 compressed bin bags and there will be a £2 charge for every additional bin bag (and only then if they have pre-paid stickers on them). Residents in HMO's can get larger bins but you need to take action now to ensure you get the appropriately sized bin for each of your properties.
PDPLA committee members, Tony Athill and Joannie Goldenberg, attended the RLA Future Renting conference at Imperial Collage, London in September.
The all-day event, hosted by 30-year veteran of radio and presenter of the popular Property Hour on LBC radio, Clive Bull, was attended by more than 200 landlords and letting agents.
Speakers included MP's, senior civil servants and a wealth of experts from across the industry.
Housebuilder Redrow just announced a record year according to Merryn Somerset Webb in MoneyWeek. The number of houses sold is up 9%. Revenues are up 16%. Pre-tax profits are up 21%. And the dividend payment to the firms shareholders is up 65%. The chairman and founder, Steve Morgan is pleased and keen for this fabulous run to continue, so he has an idea. He'd like the Help To Buy scheme under which the government underwites 20% of the purchase cost of a new build home to continue forever. "If it aint broke" he says, "Why fix it?".
He has a point, H2B works brilliantly for housebuilders. 30% of Redrows sales last year relied on it which is typical across the industry. Without it, the sales number would probably be lower. But H2B doesn't just help housebuilders shift stock, it helps them shift it at high prices. After all, anyone effectively getting an extra 20% worth of loan from the state can clearly pay more than someone who isn't. Probably explains why Redrows profits are growing faster than their revenues. This government driven house price inflation is no different to the 'rent inflation' which has been caused by Housing Benefit. That to some extent, stopped when LHA was uncoupled from inflation - but it still underpins the market and sustains higher rents than would otherwise be asked (and thus higher house prices as the yield justifies it). Interesting as H2B was originally setup to solve the problem of high house prices.
The PDPLA was invited to a private reception at the House of Commons, hosted by Sir Christopher Chope MP to mark the 20th anniversary of the RLA. The event heard from Housing Minister, James Brokenshire, MP and also Shadow Housing Minister, John Healey MP and was celebrated by the publication of a series of essays on the future of the private rented sector.
RLA Chair, Alan Ward, made a point of highlighting the positive contribution that private landlords make and how they have struggled as a result of recent legislation. The MPâ€™s present, from all parties, sang the praises of private landlords but we obviously have to wait and see if any of this positive support translates into improvements to the environment in which we operate.
A big achievement by the RLA was in bringing together so many diverse voices in the collection of essays, from the RLA to Crisis and Shelter to the British Property Federation â€“ a collection of organisations not always on the same side.
Read on for a summary of what was discussed....
A member asked what the pro's and con's of joint contracts were compared to individual contracts when you have multiple tenants in one property, this is what we came up with....
Following on from our article highlighting the fact that a landlord or a tenant could be fined up to £5,000 for leaving bin bags in the street on the wrong day or rubbish in a forecourt, it is imperative that you instruct ALL of your tenants on their obligations and be able to prove you have done so, in order to avoid the prospect of being fined for their misdemeanours. We have drafted a document which we recommend that you get all new tenants to read and to sign to show they have read it.
Our friends at Havant Borough Council struggle to find homes for some of their more difficult residents, whether due to their history or just their current circumstances and the shortage of accommodation available. They approached us to help them understand what they could do to improve the situation for these families and individuals. Part of our response follows…
Additional Licensing of HMO"s in Southsea comes to an end this month. Its original objective was to improve the standard of houses offered, to encourage better management of those houses and to reduce issues within the local community. Has it done that? We need to hear your perspective…..
At the July Cabinet meeting for Housing, Portsmouth City Council signed off the new regulations mentioned in last months 'Ensuring we are heard" column, allowing PCC to fine landlords OR TENANTS up to £5,000 if they leave rubbish in forecourts or on the street.
At our June members meeting Gary Jenkins from the Department for Work and Pensions and Mark Sage, the Tackling Poverty Officer at Portsmouth City Council updated attendees on the current status and plans for Universal Credit and gave guidance on how best to handle the rollout locally, what support was available, what landlords should take care with, etc.
After the meeting, Mark produced comprehensive guidance for landlords which we have appended below in full...
The PDPLA was invited to visit Hope House last month, the homeless hostel operated by the Salvation Army after their presentation to us at our April members meeting. Tony Athill and Alwin Oliver were the only members to attend which was sad but no surprise, we have had many such requests from homeless charities in recent months.
The centre provides temporary accommodation and support for homeless people, usually with a local connection, including people with alcohol, drug and mental health problems. They also provide ongoing support for those who they have helped move on.
They have a few residents who have been through a process and have been assessed by staff to be ready to move out into social housing or the PRS. Vacancies in the former are rare. These residents are effectively bed blocking the acceptance of new residents who would benefit from help. The centre would like more private sector landlords to provide homes for these individuals.
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.