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Posted by on in News

Hundreds of thousands of buy-to-let homeowners will have to pay  a “green tax” of up to £5,000 to make their properties more energy efficient, the Telegraph has learnt.

Landlords will have to pay upfront for measures such as insulation, cavity wall filling and new boilers from 2018. Until recently they could apply for loans from the Green Deal scheme for improvements, which are then repaid by tenants who benefit from lower bills. But the new Department for Business, Energy and Industrial Strategy is proposing owners provide the money.

The move will affect 330,000 buy-to-let landlords who own homes that are less energy efficient, often from the Victorian and Edwardian eras.

 

In a briefing to buy-to-let landlords the Government proposed a “hypothetical £5,000 spending cap”. It insisted most landlords will have to pay no more than £1,800 to meet the standards. However many efficiency measures cost much more.

 

Read more from the Telegraph by following

http://www.telegraph.co.uk/news/2016/07/30/green-tax-to-hit-landlords-with-5000-bill-on-buy-to-let-homes/

 

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While confidence remains low among landlords after recent government interventions in the buy-to-let (BTL) market, buyers are slowly returning, according to research from Paragon Mortgages.

Following an increase in the rate of stamp duty payable on BTL purchases, and with a staged reduction in income tax relief available on rental income due to start next year, landlord confidence remained low during the first quarter of 2016.

A survey of more than 1,000 private rental sector landlords undertaken by BDRC Continental revealed 41 per cent rated their prospects as being either ‘good’ or ‘very good’, down from 65 per cent during the same period last year.

Indicating that falling levels of confidence may have stabilised, the figure is just a 2 per cent fall on the fourth quarter of 2015.

The first quarter of this year also saw landlords’ property purchase intentions edge above selling intentions, reversing the situation seen in the fourth quarter, when more landlords were looking to sell property than were looking to buy.

Nearly a fifth indicated that they intended to purchase a property in the coming year, up from 17 per cent in Q4 2015, while 16 per cent stated they intended to sell a property, down from 19 per cent in the previous quarter.

Driving this trend, Q1 2016 saw an increase in tenant demand, with 39 per cent of landlords reporting demand as increasing either slightly or significantly, up from 34 per cent in Q4 2015.

Despite negativity persisting around business expectations over the short term, rental property as an asset class is still viewed favourably by landlords, with 38 per cent of landlords polled believing the private rented sector to be ‘much better’ than other investment options.

“The main driver of this recovery remains, as ever, tenant demand, which has risen in Q1 2016, along with yields. Landlords are clearly taking the view that BTL remains an attractive long-term, demand-driven investment, which continues to outperform other asset classes.”

 

To read more please follow the link: http://www.ftadviser.com/2016/06/08/mortgages/mortgage-data/btl-landlord-confidence-returning-YRc5unk81S6Cd747KxNMHI/article.html 

Posted by on in News

Snagging is a term we use for the reporting of defects in the month following a tenant moving in to a new property. A bit like the good old days when you had to ‘run in’ a new car to ensure that all the components behaved as they should.

The correction of a defect in a property once a tenant has moved in can be more costly than having a clear run at the job whilst the property was empty. It can also cause unrest to your tenant and it can, on occasion, lead to the tenant giving notice at the earliest opportunity.

In the list below I have included what typical snagging events we get informed of by our tenants. Snags and costs that may have been avoided at the pre letting stage.

  • GROUTING – “there is water coming through the ceiling!” is a frequent call. In older properties the grouting of tiles around bath and shower units have often dried out and shrunk. It only takes a few days of regular use of the appliance for the damage to be done. By then it is not just a case of re-grouting. It is drying out of a ceiling and later redecoration. In one case the tenant claimed costs from the landlord for damage to their possessions (this is why landlords insurance is a must as well as tenants insurance)!
  • JUNK – once any restoration work has been done then your tools and equipment need to be moved from the property. For example it is not OK just to leave the old lawnmower in the shed. If you do you will be liable for its upkeep and for its electrical certification PRIOR to the let commencing.
  • WHITE GOODS – you may buy a property with some white goods already in place. Think long and hard as, like the lawnmower, you need to get electrical certification prior to the let but as the tenancy goes on you will be called upon to pay for investigations, repairs and replacements as the appliance slowly wears out. As a rule of thumb it is best to leave the white goods out of the equation. Typically in a kitchen the only appliance regarded as a standard is the cooker/oven.
  • WATER – water coming under roof tiles and sheds leaking. Have a good external look at the roofing of the property and investigate in the loft space for evidence of previous water entry.
  • POOR PLUMBING – the first thing a tenant will want to do is to install their dishwasher or washing machine. Quite often the original plumbing connections to appliances are old and not fully functional. We had to attend at a flat where this was the case and the water leakage had entered another property and the landlord had to pay for the drying out of it and the redecoration.
  • POOR FITTINGS – curtain poles, shower rails, towel rails and anything that is fixed to the walls. Give them all a tug to see if they are up to the purpose for which they are designed

The old adage that you look at a rental property with your head rather than your heart is true to an extent- but do also think of what would make you upset if you were to rent this property in question and then determine what you will do about it?

Posted by on in News

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Call us a one stop shop if you will.

We are a family run business who aim to please and get the best results for our clients as well as being a place to call on in times of trouble. From our 6 days a week opening to our in house mortgage advice from our sister company, Oaktree Mortgages we aim to please.

Our director and Lettings Manager are landlords in their own right which means they have experienced the worries and concerns you may have when letting a property so with that we have designed our service to address all these concerns. As a company with over 30 years presence in the property sales market we are pretty good at that also!

Hancocks are members of NAEA and as such we abide by their code of practice and that extends to the protection and ring fencing of client monies and looking out for the rights of buyers, landlords and sellers alike.

Being an long established agent in Melton it does not mean that we can’t move with the times. Our Social Media presence is being managed by our newest member of staff, Ben Scarborough. This means we have presence on Facebook, Twitter, a blog site and most recently a YouTube account where you can see videos of some of our properties.

 

Something we hear from potential landlords is…“But switching agents is a nightmare”

Not anymore it isn’t…

We only need 3 signatures from you. The rest is all dealt with us whilst you sit back and relax, for example: we will contact your existing agent for contracts, tenancy agreement, inventory and then the deposit to be transferred over! As well as contacting your current tenant to advise of the changes.

Times of changing agents being difficult have moved on, it really is as simple as 1,2,3.

If you would like to find out more then pick up the phone and call me on 01664 563481 or drop me an email at Emma@hancockproperty.co.uk

Posted by on in News

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Speaking on behalf of the apprentice, Ben, who is learning all the small print of renting, it can be a minefield to get things right, let alone if they go wrong!

Arguably the biggest fear a self-managing landlord might have will relate to unpaid rent, complaints from neighbours of loud arguments/parties and loads of mess everywhere.

A ‘traditional’ way to regain possession of your property is to issue a ‘Section 21’ notice to your tenant then after two months you will be able (hopefully) to repossess your property. BUT and it’s a big BUT, with the ever changing world of rental property management it has become harder to evict your tenant. You can’t serve a section 21 until 4 months have passed since starting the tenancy, so you may have to tackle the problem by the issue of a Section 8 notice that will indicate your intention to start eviction proceedings.

If you are asking yourself “what is a Section 21 and a Section 8 notice?” then you really need to be with a Managing Agent.

If it was me as a first time landlord I would say to start with a Managing Agent. I would want the support and guidance that they can offer. I would also say that if you don’t have some form of Rent Guarantee policy then you should do so. Typically, for an annual cost of just under £200,  you can get cover that will include loss of rent, court costs and use of a solicitor should the worst happen.  Well worth it when a full blown eviction can cost in excess of £2000 in fees and lost rent!

This is yet another reason why serious consideration should be taken into having an agent manage your property.

Posted by on in News

What strikes me is that much of it is all about grabbing an audience with headlines that offer a fantastic low cost deal and then when you are hooked you start to see that there are extras if you want things that you would have taken as a given if you were with a high street agent. I have come across For Sale boards as an extra, accompanied viewings as an extra, newspaper adverts as an extra, brochures as an extra money up front even if you don’t sell ….!

A high traditional high street estate agent is a prime example of a one stop shop. As shop where you can call in and talk to an advisor, have discussions about your needs and aspirations and somewhere that you feel you really matter. After all it is about you the seller!

 I have found that at least one of the colourful national online only estate agents does not even offer a means for a potential buyer to call and make an offer! We have an example at our sister company, Oaktree Mortgages, where they had to make an offer on behalf of a client and it took a week on online attempts and ‘helpline’ calls to get the offer placed. If I was the vendor I would not have been well pleased to know that a buyer could not get an offer to me.

 So I ask myself “Is there a place for the online only estate agent?” and in all honesty I can’t really see what I would get for my money. At the end of the day it comes down to trust for me. I want to have the assurance that I have a group of local experts looking out for my interests in what will probably be the most significant financial transaction that I will ever do. I want to be able to see them or talk to them straight away if I have any questions or concerns. I don’t see how entrusting this to a form fill on a website and a DIY approach will help me.

Posted by on in News

b2ap3_thumbnail_stamp-duty_20160224-092158_1.jpgFrom 1 April 2016, anyone who buys additional property, including buy-to-lets and second homes will have to pay an extra 3% of the purchase price in stamp duty. The question is will this have a negative impact on the property market as a whole?

With Buy-to Let investors competing at the lower end of the property market with first time buyers, they may be feeling penalised by the Conservative government with this increase on top of the July 2015 budget  announcement of the tapered reduction in Buy-to let mortgage relief for higher rate tax payers.

After all the Buy-to Let investor provides valuable high quality much needed housing yet the government appears to be determined to make purchasing property for the rental market less of an appealing option.

For example, anyone buying a £250,000 second home or buy to let before April pays stamp duty of £2,500. This is based on paying zero per cent on the first £125,000 of the property value and 2 per cent on the portion between £125,001 and £250,000. But from April, landlords will have to pay 3 per cent for the first £125,000 and 5 per cent instead of 2 per cent on the amount between £125,001 and £250,000, meaning that they will have to pay £10,000 in total.

However, according to Rightmove stats if an investor were to purchase a property £125,000 meaning an additional £3,750 in tax becomes payable. An investor would expect capital growth in 2016 to be similar to that of 2015 (6.2% according to Rightmove) and an income of about 5.38% (Rightmove). So an investor would expect to see a return of around 11.5%.

The additional stamp duty burden should therefore take a little over 3 months to compensate for so quite possibly not impacting on the Buy-to-let market after all.

While affordable new housing is desperately needed, the Buy-to -Let sector will remain a popular sector providing affordable housing, and many savers will continue to invest their capital in rental property.

 

Posted by on in News

 

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At what age do we think about saving for a first home?

With the new help to buy ISA , anyone from the age of 16 can start building a deposit for their future home purchase. You can earn up to 4% interest tax-free and then the state will add 25% free cash, and it could be £1,000s, on top of what you save.

Even with all the hype about the new personal savings allowance, if you're a first-time buyer, putting your cash in a Help to Buy ISA before thinking about any other savings is a no brainer. So at the point you use the ISA to buy your first home, all the money you have put in and the interest will have 25% added to it, with two exceptions:

You need to have at least £1,600 saved to get the bonus (so you'd get £400 extra).

The most you'll get the bonus on is £12,000 (so a £3,000 bonus). If you have more than that you can still use the ISA to save, you just won't get more than £3,000 on top.

Posted by on in News

 

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Photographs are the first impression; we all know you can’t get a second first impression!

 

With today’s economy we are always on the hunt for cheaper prices and offers, but will it always pay off? Pictures can really sell a property which is why we invest time and money into guaranteeing that you as potential customers get the best possible chance of selling. Some agents still charge extraordinary prices for photos yet produce poor quality images. Kerb appeal is essential so achieving a full frontal picture of your property is the first step to getting it right.

Looking at some of the pictures posted by internet based agents below its clear to see a picture tells a thousand words. So it really does pay to use an agent who will make sure you have cleared your breakfast pots from the sink as well as removing your laundry from the bedroom floor before your property is photographed will make the world of difference.

Posted by on in News
Right to Rent Checks - Are You Ready?

 Landlords – the government has done it again and placed another burden on you.  On 1st February 2016 the responsibility for ensuring that tenants have a right to live in the UK was passed from the Home Office to landlords, the so called right to rent checks.  There are four basic steps.

  1. Find out who will live in the property
  2. Check that these people have the correct documentation to stay in the UK
  3. Retain a copy of the documents and record the steps you took to check them
  4. Keep the copies throughout the tenancy period and for at least one year afterwards

Unless you follow these procedures, and if an illegal immigrant is found living in your property, there is a possibility that you will be liable to a civil penalty of up to £3,000. If a tenant sub-lets the property without you knowing, they are responsible for carrying out checks on any sub-tenants. They will be liable for any civil penalties if they don’t do the check correctly.

Landlords letting certain exempt properties will not be affected by the right to rent regulations but the regulations will catch most private landlords.

All professional Letting Agents should by now have procedures in place to ensure the relevant checks are made and certainly we at Hancock Property have been well ahead of the game in ensuring we were ready for the change.

The regulations do throw up some interesting questions on how to deal with prospective tenants who do not have right to reside for a permanent period.  Will the regulations cause landlords to play things safe and only accept UK or EEA Nationals and thereby discriminate inadvertently against non EEA nationals?  Only time will tell. 

One thing is for certain, using a good letting agent who is registered with a professional body is a great step to ensuring you comply not only with this new legislation but all future legislation changes.  A good letting agent always has one eye on the market and one on changing legislation.  Self-managing your property can potentially save you a few pounds each month but if you get it wrong it could cost you dearly.  Are you willing to invest the time to keep up to date yourself or would you rather leave it to the professionals?

If you would like a quote for us to manage your property please call Emma on 01664 563481.  You can switch agents mid tenancy, only 3 signatures required and you will be surprised at the value for money prices Hancock Property charges compared to other letting agents.

 

Posted by on in News
How easy are online estate agents to use?

Our sister company Oaktree Mortgages had cause recently to contact one of the well know online estate agents, who advertise greatly on the TV stressing how easy their service is to use and how much it will save a client. How wrong can they be!

A landlord client had asked Oaktree Mortgages to submit an offer for him on a property he wished to add to his portfolio as he was out of the country. Easy you would think, a simple phone call would do the trick so it wouldn’t take much time out of a busy day.

Surprise Surprise Cilla! – After a 10 minute wait to get through on the phone, they were advised that they couldn’t make an offer over the phone it had to be done online. Do they really want to sell this property?

Problem number 2 – Having been directed to the relevant part of their website and advised all that they had to do was to submit the offer online the adviser hung up. The website gave no indication of how to register as a new user and it certainly wasn’t letting them in!

So this time they used web chat to save time waiting on the phone, as they are clearly busy. This took them even longer than a phone call to get through. The operator still couldn’t log them on and Oaktree are now waiting for a call from one of the online agents “property professionals”. I would not hold my breath as one property adviser covers the whole of the East Midlands. So much for your local property expert.

Given this experience so far I am not impressed with the level of service in terms of helpfulness or speed of response. Not being able to make an offer over the phone seems simply daft. Clearly the company has reduced the level of customer service and automated it to make a profit. Personally I would rather pay a little more and get a better service from a local agent who does know the local market, who can take an offer over the phone and who can adapt to the inevitable problems that arise during any house sale.  

Posted by on in News
New Legislation

From 1st October 2015 it becomes law that at the time a tenancy is created that there must be a working smoke alarm on every habitable level of accommodation and there must also be a working carbon monoxide detector in every room that contains a solid fuel burning appliance*. So if you choose to manage the letting of a property yourself, you need to ensure that you comply as you create new tenancies and give serious consideration to any established letting portfolio that you may have. It is suggested that when you conduct routine inspections of your properties that you upgrade/relocate your alarms as necessary.

Here at Hancocks we have already changed our pre rental property assessments for landlords and will be reviewing every property as part of our inspection program so that we can report to landlords changes they may wish to implement.

1st October also saw the introduction of new documentation to be issued (with proof of issue needed) at the start of a tenancy as well as a new Section 21 notice to bring a tenancy to an end. If you are a self-managing landlord you need to take steps now to ensure that you comply otherwise you may not be able to enforce a notice to quit a premises.

Yet another good reason why it pays to have a managing agent to take care of such matters for you.

*there are some exceptions to these rules but to all intents and purposes if you are letting a standard residential property then the changes will apply to you.

Posted by on in News
House prices on the rise

September 2015 has seen a 0.5% growth in UK house prices, with an annual growth increase of 3.8%.

This is a significant change as the growth had slowed slightly in August 2015 with the monthly change at 0.3% (seasonally adjusted) and annual change at 3.2%.

Robert Gardner, Chief Economist at Nationwide said of the figures:

“UK house prices increased by 0.5% in September, with the annual pace of house price growth picking up modestly to 3.8%, from 3.2% in August. The data in recent months provides some encouragement that the pace of house price increases may be stabilising close to the pace of earnings growth. However, the risk remains that construction activity will lag behind strengthening demand, putting upward pressure on house prices and eventually reducing affordability. Indeed, in recent months surveyors have reported historically low levels of properties for sale and increased new buyer enquiries. Therefore it is unsurprising that most surveyors expect a pickup in house price growth in the months ahead.”

London house prices also continue to grow, causing the gap between London and the rest of the UK to rise to an all time high, with the average price being £443,339 compared to the average price of a home in the East Midlands of £160,525 over the last 12 months.

There is still a shortage of property, particularly at the lower end of the market and demand remains strong from first time buyers and landlords. Now is still a good time to move house as interest rates remain low. There are some very low 5 year fixed rates available and demand for property remains strong.

Source: Nationwide. www.nationwide.co.uk/hpi

Posted by on in News
Are Interest Rates Set to Rise?

All members of the Monetary Policy Committee voted to hold Bank Rate at 0.5% at the most recent meeting.

However the MPC revealed that for a number of members, the balance of risks to medium-term inflation relative to the 2% target was becoming more skewed to the upside at the current level of Bank Rate. For these members, the uncertainty caused by recent developments in Greece was a very material factor in their decisions: absent that uncertainty, the decision between holding Bank Rate at its current level versus a small increase was becoming more finely balanced.

There was a range of views among Committee members on the significance and scale of the news regarding domestic costs, external price pressures and the balance between them. It was evident that domestic cost growth was recovering. But there were questions regarding: whether the increase in wages relative to productivity would be sustained in light of the risks to global and UK activity emanating from developments overseas; and whether or not increases in domestic costs were occurring sufficiently rapidly to offset the probable drag on CPI from the appreciation of sterling and so return inflation to the target within two years.

For most members, even before accounting for the recent increase in uncertainty in the external environment, the current stance of monetary policy remained appropriate to balance the risks of inflation around the target in the medium term.

Chris Whittaker, Director of our sister company Oaktree Mortgages Ltd commented:

"Although the committee voted unanimously against a rise, it is inevitable that interest rates will rise- it is just a question of when. MPC Members have hinted that they are likely to ramp up the pressure to change the base rate in the remainder of the year, as inflation and the wider economy are projected to gain momentum in the coming months."

"The fact that rates have stayed the same for six years may have driven many borrowers into complacency when it comes to seeking the best deal for them. Someone on their lenders SVR with a £150,000 loan and a 40% deposit, for example, could save over £4,000 per year. The savings are even greater the bigger the loan, so savings are there to be had across the whole market. It’s crucial that people with mortgages discuss the options with their mortgage broker so that they can make the most of record low rates and effectively give themselves a pay rise."

Posted by on in News
Is Buy to Let better than stocks and shares?

More investors are opting for property rather than stocks and shares to fund their retirement, according to new research by Nationwide Building Society.

Over two million people are now private landlords, up by 600,000 since the financial crash, as house prices have increased by almost 260% over the past 24 years.

Over the last 15 years, property has given investors excellent returns and since 1991 returns from the FTSE All-Share only narrowly beat those from property.

Many landlords, use their property portfolio as part of their pension provision and in many cases it was their only pension fund.

Many people still prefer property as a sensible way of saving for the future because, unlike pensions, with bricks and mortar your money isn't locked away until you reach the age of 55.

Excellent rental yields and capital growth from buy-to-let is appealing to any investor who is concerned about the volatility of the stock market. 

In 2000, less than 2% of mortgages in Britain were buy-to-let and now there are 900 BTL mortgages available, accounting for 15% of all home loans. 

Despite the additional costs in property such as buying fees, maintenance and void periods, the asset growth and rental income is still very attractive for investors concerned about the volatility of stock markets.

However, as with any investment, there are no guarantees, so investors should be aware of the potential pitfalls.

If you would like to know more about the opportunities available in purchasing a buy to let property give our director, Chris Whittaker a call or drop him an email. Chris is a landlord in his own right, runs an independent mortgage business which specialises in providing finance for buy to let properties and also runs an agency which manages residential property throughout Leicestershire, South Nottinghamshire and parts of Lincolnshire. Chris will ensure you have the facts – warts and all.

You can get in touch by phone: 01664 563481 or by using our contact form by clicking here!

Posted by on in News
Japanese knotweed

Homeowners could be stung with fines of up to £2,500 if they allow invasive plants such as Japanese knotweed or giant hogweed to spread from their properties under anti-social behaviour legislation.

The Home Office has published a briefing document on the reform of anti-social behaviour powers, which normally control drunkenness, drug taking and objectionable conduct.

The legislation will target plants which can cause illness, threaten biodiversity or even damage property.

According to a Home Office briefing document: 'Japanese knotweed, for example can grow through tarmac and can cause structural damage to property, whilst giant hogweed can cause harm to human health.

 

WHAT IS JAPANESE KNOTWEED?

Japanese knotweed - which has the scientific name fallopia japonica - was introduced into Britain by the Victorians. Incredibly invasive, it can grow four inches (ten centimetres) in a day from April to October and a tiny root can establish itself as a plant in just ten days.

Apparently solid structures such as tarmac and flooring in houses are no barrier to its growth and the weed also creates a risk of flooding if leaves clog waterways.

Knotweed is recognised by its shovel-shaped leaves, bamboo-like stem and white flowers produced in autumn.

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A Question...

We at Hancocks take our responsibilities to our landlords seriously and we will keep you promptly informed of updates and amendments to the Law and revisions needed for consideration to enable compliance. Tenants safety is just as important as financial interest and we apply due diligence to protect them and clients from potential harm and prosecution.

This is an area most are unfamiliar with and it is important to have an overall understanding.

A  Legionella risk assessment is required by Law to properly assess the safety of the water system and its control in every rented property.  Areas need to be identified that may influence the build-up and proliferation of Legionella Bacteria. This applies to the most basic of systems where only a simple assessment may be required.

Find out more here

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Not every sale is straight forward, for example we had a vendor wanting to sell their property but not wanting to move until the following year! We of course accepted the challenge and sold the property within a few months to a buyer who fell in love with the property and was willing to wait to complete the purchase.

Another example was when one of our landlords, who had just recently tenanted their property, was forced to sell due to unforeseen circumstances.  We managed to sell the property within a week to another investment buyer with the sitting tenant.

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Halfway House….a beautiful one of a kind property, over 100 years old…and unfortunately with age, there can be problems. First listed for sale in March 2013 with Hancock’s this house has been sold five times in the last two years, 13 different offers put forward with a staggering difference of 40k! However, (unlucky for some,) the 13th offer was accepted and now the property has finally exchanged and completes this month. We have never stopped working on achieving a sale for the vendor at the very best price, and thankfully she has never given up on us due to our constant efforts.

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We recently sold a property within 24 hours of going to market. After sending the property live, we secured 2 viewings the next day. Both were very positive viewings, and on my return to the office I received a message on my desk with an offer for the full amount, just half an hour after they had seen the property! Being a first time buyer with no chain will hopefully give a quick conveyance process.