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February 2024
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Monthly news for landlords brought to you by:
MPs urged to back pragmatic changes to RRB Proposed amendments to the Renters’ Reform Bill have been backed by Sheldon Bosley Knight’s associate director, Nik Kyriacou. The changes, designed to give private rental sector (PRS) landlords more protection, were put forward by Anthony Mangnall MP ahead of the report stage of the Bill. Nik said they represented a “pragmatic approach” and were a “step in the right direction” to strike a balance between the rights of landlords and tenants. One of the most significant issues in the Bill is that of the abolition of fixed term tenancies. Mr Mangnall’s tabled amendment suggests tenants should be prevented from giving
notice to leave a property until they have occupied it for at least four months. Elsewhere he proposes allowing courts to consider evidence from neighbours in cases of antisocial behaviour by tenants and that the government publish a review into the operation of possession proceedings in the courts before Section 21 is abolished. Speaking to Landlord Times, Mr Mangnall, MP for Totnes and South Devon, said: “There has to be a sensible balance between the rights
of the tenant and the landlord. Unfortunately, at present, the Bill will disincentivise many long-term let landlords keeping their properties in the rental market. “Working with industry and tenancy groups, I have tabled a number of amendments which will help to address concerns about the Bill as it currently stands. Through addressing the risk of more long-term lets becoming short term, introducing a minimum notice period and advocating for fixed term
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tenancies, I hope to make the Bill work for tenant and landlord. “We should be in no doubt of the important role played by landlords across the country. They provide housing for those who live and work in our communities, they help to bind our social fabric together and they ensure there are properties available for those who wish or need to rent.
“Working with colleagues from across the political divide, I hope we can use our collective experience and knowledge to make the Bill work for all stakeholders.” Nik said: “It is fantastic to have one of our elected representatives prepared to say out loud what landlords have been saying for a long time. “The Bill as it currently stands
will disincentivise landlords from staying in the sector. “These compromises proposed by Mr Mangnall represent a realistic and pragmatic way forward and are exactly what I and our landlords have been suggesting for months. “I hope Mr Mangnall is successful in his representation and the government reacts positively to his proposals.”
Buy-to-let companies boom as mortgage rates bite A record 50,004 limited buy-to-let companies were set up across the UK last year. The figure surpassed the previous record of 48,540 in 2022 by 3%, according to Hamptons. It also came despite a sharp fall in the number of homes bought by landlords in 2023. The rise is being attributed to investors facing remortgaging at higher rates and more favourable tax rules given to limited companies. It means at the start of this year there were 345,426 active limited companies designed to hold buy-tolet property in the UK, up 11.6% since the beginning of 2023. Of these, 68% had been set up between 2017 and 2023 when the tax changes were phased in. These companies own a total of 615,077 properties in England and Wales, an 82% increase from the end of 2016 when landlords who were higher rate taxpayers started to see the share of mortgage interest they could offset from their tax bill for homes in personal names reduce. However, companies set up after
2016 still only own 38% of all buy-tolets held in a limited company. Of the 615,077 limited company buy-to-let properties, 75% (458,838) have a mortgage charge against them. Although Scotland recorded the biggest growth in the number of limited companies last year, the West Midlands saw a 3.9% uplift. According to Hamptons’ research, most of the growth in buy-to-let incorporations over the past year has come from smaller landlords. Since 2023, there was a 21.9% increase in the number of homes held in companies with a single property. This compares to a 3.8% increase in the number held by companies owning 20 or more homes. Sheldon Bosley Knight’s associate director, Nik Kyriacou said: “The tax changes phased in since 2017 have done nothing to help landlords so this figure is no surprise. “For some reason, landlords are treated differently to other self employed people when it comes to tax. This should not be the case.
“Landlords provide a vital service, that of putting a roof over someone’s head. However these tax changes coupled with all the legislative changes happening, have resulted in many investors leaving the sector. This is good for no one, least of all tenants who are struggling to find homes.” “Landlords provide a vital service, that of putting a roof over someone’s head. However these tax changes coupled with all the legislative changes happening, have resulted in many investors leaving the sector. This is good for no one, least of all tenants who are struggling to find homes. “I wish the government would think about what it has and is doing to the sector and start treating landlords the same as any other self employed person.”
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A million new homes needed to tackle rental crisis A million more rental homes are needed by 2031 to meet the rocketing demand in most parts of the country. According to research, most of the new properties should be suitable for the single family housing market. Estate agency Savills, which made the call in its Future Of Build To Rent Houses report, said it estimates an extra £250 billion of investment is needed to pay for it. More than £3.5 billion has already been spent on this section of the rental market with £1.5 billion last year alone. It comes as official figures from the Office for National Statistics (ONS) showed average rents were 6.2% up in the year to December, unchanged
from November’s figures and the joint highest annual percentage change since 2016. The ONS’s figures are based on a mixture of newly let properties and existing lets rather than just new lets. Sheldon Bosley Knight’s director of lettings, Rebecca Dean said: “That we urgently need more homes for rent is nothing new. However, the numbers of people in this country who have nowhere to live is growing all the time and now the problem is acute. “The government has not kept up with its manifesto pledge to build 300,000 homes a year but even if it had it would not be enough to keep up with demand.
“Until there are enough homes for those who need them within the rental sector as a whole, average rents will continue to rise which will become unsustainable at some point and that will be no good for anyone. “It is interesting to see big organisations such as Aviva and John Lewis Partnership coming forward with Build-To-Rent proposals. This is great but more needs to be done and we can’t keep hoping the private sector will sort things out for the government. “I hope those in power, now and after the expected election this year, step up and address the problem as a matter of urgency.”
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Flat’s your lot for landlords as city living gains momentum Buy-to-let investors are focusing on flats as more people return to city living and working. According to research by Shawbrook Bank, 28% of landlords say urban flats have been the best investment over the past 12 months. Just over a quarter (26%) of the 1,012 landlords questioned, say they would continue to be so over the next year. The bank identified data which suggests an upward trend in office working with 43% of workers now returning to the office. Shawbrook also found other
notable investment opportunities including semi-detached properties in cities and student accommodation.
“This trend whereby more people are moving back to a more regular office-based work pattern is good news for those keen to invest in urban areas.” Sheldon Bosley Knight lettings manager Claire Paginton said: “This trend whereby more people are
moving back to a more regular office-based work pattern is good news for those keen to invest in urban areas. “There are a great number of buy-to-let investments in towns and cities which are waiting to be snapped up by canny landlords. “With interest rates dipping to below 4% and yields and demand strong, now is a great time to jump if you are thinking of expanding your portfolio. “As ever if you would like any advice do get in touch as we’d be happy to help.”
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Urgent action needed to update decent homes standard Urgent action is needed to protect tenants living in poor quality private rented homes. A report published by the all-party Health and Social Care Committee, said the government must act to prevent a “catastrophic impact” on the health of tenants from the effects of poor-quality housing. In setting out a timetable for action, it said the government had “dragged its feet” on updating and expanding the DHS to cover both the private and social rented sectors. There is currently no legal minimum quality standard to protect those in private rentals and the DHS has not been updated since 2006. MPs on the committee said the less well-off and those living in
poor areas are much more likely to develop life-limiting health conditions and to die prematurely as a result. The most serious housing hazards include fire and electrical risks, excess cold, excess heat, damp and mould, and air pollution. The call comes three years after two-year-old Awaab Ishak died from a respiratory condition caused by mould in a housing association property. Committee chairman, and Tory MP, Steve Brine, said: “Poor quality homes can have a catastrophic impact on the health of the those who live in them. “Our report welcomes the government’s plan to introduce Awaab’s law for tenants in the social
sector. We urge swift action on the outcome of the consultation, but the government must also consider safeguards for tenants in the private sector where risks of damp and mould can pose an immediate danger to health.” Sheldon Bosley Knight’s lettings manager Josh Jones said: “This report is welcome as everyone involved in the rental sector wants homes fit for purpose. “Most landlords are responsible and provide good quality accommodation, so this should not worry them. “However if any of our landlords have any concerns or wish to discuss the matter, please do not hesitate to contact us either by phone or popping into one of our offices.”
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Landlord charter given cautious welcome A Good Landlord Charter has the potential to be rolled out nationally but must have mandatory buy-in by all those involved. Sheldon Bosley Knight’s associate director, Nik Kyriacou, said such a scheme would only work if landlords and tenants had to sign up to it. He was responding to a consultation launched by Mayor of Greater Manchester, Andy Burnham on the city’s Good Landlord Charter. The first of its kind in the UK, it wants to improve the standards of homes in both social and private rental housing sectors.
Among its aims are to recognise and develop best practice, boost tenant confidence in the quality of good rental properties and provide an ambitious new voluntary standard for landlord excellence, no matter what kind of housing they let. According to the charter, renting in the city should be: affordable – a tenant should understand how their rent and other charges are set and should not be ripped-off; inclusive – a tenant should not have a worse renting experience because of who they are; private and secure – a tenant should be reasonably free to enjoy their home and make it their own; responsive – a landlord should respond satisfactorily to requests for repairs, correspondence and complaints; safe and decent – a tenant should be able to live free from physical or psychological discomfort in their home; supportive – a tenant should have essential information about renting their home and be helped to access extra support if they need it; and well managed – a landlord should be competent or use a competent managing agent. If landlords refuse to engage with the charter, residents will have the right to request a Greater
Manchester Property Check. This will be “underpinned by stronger, multi-disciplinary inspection and enforcement capability to carry out the checks and issue notices where standards remain unacceptable, with investment of £3.5m to support local authorities to deliver this”. In launching the consultation, Mr Burnham said: “I believe this charter will be good for tenants who currently have no way of knowing whether a landlord is decent or not; and good for the many landlords doing the right thing and struggling to differentiate themselves from the disreputable end of the market.” Nik said: “Most landlords in the private rental sector are responsible, look after their tenants and provide them with homes which are safe and to a decent standard. For them, there is nothing to fear. “This charter therefore has a lot of potential to be a good thing for the private rental sector. However any charter such as this, particularly if it were to be rolled out nationally, really needs to be mandatory for landlords and tenants to sign up for this to work. My only hesitation would if the charter eventually evolved into a vehicle for further red tape and costs for landlords, especially in these fragile times.” The Good Landlord Charter consultation closes at 12pm on February 26, 2024. Visit www.gmconsult.org to respond or download a copy.
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Click on the properties to view further details brought to you by SH
NO OW W AP AV AR AI TM LA EN BL T E
IDEAL BUY-TO-LET OPPORTUNITY A collection of 24 new luxury apartments situated in the heart of the Midlands
Nik Kyriacou ASSOCIATE DIRECTOR For more information, please contact Nik Kyriacou on nkyriacou@sheldonbosleyknight.co.uk | 07542 301093 *All rental values and subsequent yields are only estimates unless tenanted, and subject to market fluctuations.
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Wards Close, Evesham • Current rent value of £725 pcm • One bedroom house • Freehold house • Modern family bathroom • Sizeable garden • EPC - C
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Campion Court, Leamington Spa Gross yield of 5.1%
£170,000
• Current rent of £895 pcm • Two double bedroom apartment • Tenant in situ • Town centre location • Off road parking • EPC - C
Gross yield of 5.7%
• Current rent value of £1,025 pcm
Gross yield of 5.5%
£190,000
Beaconsfield Street, Leamington Spa • Town centre location • Loft space with en-suite • Two bedrooms • Pretty courtyard garden • EPC - D
*All rental values and subsequent yields are only estimates unless tenanted, and subject to market fluctuations.
£195,000
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EXCITING NEW DEVELOPMENT IN BROMSGROVE • Ten luxury apartments in a superb conversion
• Ideal for a buy-to-let investment
• Two and three bedrooms over three floors
• Town centre location
• Three further two-bedroom town houses
• Great access to motorways
• Low maintenance grounds • Gated access
• Lift access For more information, please contact Nik Kyriacou on nkyriacou@sheldonbosleyknight.co.uk | 07542 301093
To follow Sheldon Bosley Knight click here
East Grove, Leamington Spa • Two-bedroom town house
• Current rent value of £975 pcm
• Town centre location
• Currently empty
• On-street parking
• EPC - D
Gross yield of 5.4%
£215,000
• Currently empty
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Warwick New Road, Leamington Spa • Two-bedroom apartment in conversion • Two en-suites • Long lease • Two allocated parking spaces • Sought after North West Leamington location
• Current rent value of £1,100 pcm • Living/dining room • Fitted kitchen
*All rental values and subsequent yields are only estimates unless tenanted, and subject to market fluctuations.
Gross yield of 5.5%
£240,000
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A collection of 13 new luxury apartments situated in the heart of South Wigston
APARTMENT
BEDROOMS
SQ FT
PRICE
RENT (PCM)
YIELD (GROSS)
1
1
464
£119,950.00
£700
7%
2
2
657
£159,950.00
£850
6.40%
3
1
420
£119,950.00
£700
7%
4
2
785
£169,950.00
£850
6%
5
1
464
£129,950.00
£725
6.70%
6
1
624
SSTC
£800
5.60%
7
1
431
£129,950.00
£725
6.70%
8
2
799
£199,950.00
£875
5.30%
9
1
474
SSTC
£750
6.90%
10
1
398
£109,950.00
£700
7.60%
11
2
663
£174,950.00
£900
6.20%
12
1
420
£124,950.00
£750
7.20%
14
1
443
£124,950.00
£750
7.20%
For more information please contact the
Andrew Granger New Homes Team on 0116 242 9922
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Coundon Road, Coventry • Currently managed by Coventry University • Well appointed three-storey town house • Within walking distance of Coventry city centre • Five lettable rooms • Communal lounge, breakfast room and kitchen
• Current rent of £1,700 pcm • Ground floor shower room and first floor bathroom • EPC - D
Gross yield of 6.8%
£300,000
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Gordon Street, Leamington Spa • Six-bedroom HMO
• Recent annual rent of £36,300
Gross yield of 9.9%
• Town centre location
• Walking distance to train station
OIEO
• Three storeys
• Current HMO licence
• Double glazed with central heating
• EPC - C
*All rental values and subsequent yields are only estimates unless tenanted, and subject to market fluctuations.
£365,000
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Melbourne Road, Coventry • Eight double bedrooms
• Tenant in situ, rent of 11 x £400 pcm
Gross yield of 14.3%
• Current HMO licence valid until September 2024
• Off road driveway parking
OIEO
• Three storeys
• Huge scope for further modernisation
• Double glazed with central heating
• EPC - C
£370,000
Earlsdon Avenue North, Coventry • Six-bedroom HMO • Six bathrooms • Immaculate condition • Popular location • Low maintenance rear garden
• Rent starting from £500 pcm per room • Communal kitchen/diner • Traditional double bay window • EPC - D
*All rental values and subsequent yields are only estimates unless tenanted, and subject to market fluctuations.
Gross yield of 9.4% OIEO
£382,500
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18, High Street, Pershore • Prominent high street location • One upper floor apartment • Ground floor commercial premises • Net internal area 383.7m²(4130ft) • Shop - £18,000 per annum
Gross yield of 6.6%
• Apartment £7,200 per annum • Development potenial (STP) • Pershore town centre • Freehold • EPC - TBC
£380,000
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38, Greenhill Street, Stratford-upon-Avon • Town centre freehold
• Rateable value: £16,000
• Potential for residential conversion (STP)
• Three-storey commercial property
• Prominent for passing traffic
• 154.37m (1662ft)
• Vehicular access and parking
• EPC - D
*All rental values and subsequent yields are only estimates unless tenanted, and subject to market fluctuations.
Gross yield of 5.4%
£295,000
Local branches across the Midlands
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OVER 180 YEARS OF LAND AND PROPERTY EXPERTISE
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