The buy-to-let sector is a thriving industry. Becoming involved in the private rented sector is a serious business. Landlords need to ensure that they’re able to find and retain good quality tenants and handle maintenance and repairs issues efficiently. Choosing the right agent to guide, advise and support them in a way that helps them to best manage such situations, and create a profitable property portfolio, is therefore vital.
There are so many inadequate and, at best mediocre, agents out there. They’ll agree to market and manage properties on behalf of landlords but don’t provide the service behind this, which is the most important aspect. Agents will simply put a property on the market with no plan, or even discussion with the landlord, about how it would market better and, essentially, be leased much quicker at a rate the landlord desires. Questions every landlord should ask themselves include:
- Has your property been on the rental market for more than a few weeks?
- Has your agent discussed how your property could be more attractive to potential tenants?
- Have they had an honest discussion with you about the wear and tear of your investment and whether it’s time to make some improvements, so that it can be tenanted quicker and potentially let out at a higher rate?
- Are you an out of area landlord who has rarely or never seen your investment?
Honesty is the best policy
Being honest with landlords and upfront about the improvements they need to make in their properties, to secure tenants and a good return on investment, is something all agents need to do but many simply don’t. A rental property needs some TLC every now and then and we recommend a landlord budgets for allocating 10% of their annual rental income back into the property for its upkeep such as decorating, new flooring, and furnishings where required.
Unsatisfied landlords often get in touch with us to appraise their properties that have been on the market a while. When appraising them, we have discovered some very basic issues that can be fixed easily. For instance, some are dirty, or need painting, or are overpriced for the current market. I recall one visit to an apartment recently which had been on the market for three months with no interest from viewers.
Following our assessment of the property, we advised the landlord to complete a deep clean and carry out some minor decoration work, which all cost less than £200. Within two weeks, after we had put it back on the market, we secured tenants on a 12-month lease. This landlord lost over £2000 due to no occupancy, which could have been avoided if the right agent advice was given from the outset.
If an agent is not honest with you about current market trends, the condition of your property, or the correct rental amount, then they are costing you money in terms of a void period and the monthly outlay of Council Tax on your vacant property.
At George F. White, we are focused on providing a professional, friendly but ultimately honest service, ensuring landlords are given the best advice to let out their property, even if it involves spending some money upfront, so that their property stands out among the rest in a fast moving, highly competitive sector.
For an honest conversation about your property contact Leanne Emerson on 01833 690390 or email firstname.lastname@example.org
Minimum Energy Efficiency Standards (MEES) Changes: what you need to know and why
This month, we are focusing on the changes in MEES legislation, which were effective from April 1 2018. Here, our Residential Lettings Consultant, Simon Harrison and Senior Project Manager, Rob Hamilton answer some key questions…
In a nutshell, what’s changing?
“It’s now law to ensure a property that’s let out, for residential or commercial use, must meet a Minimum Efficiency Standard,” explains Simon. “A sub-standard property is one that fails to meet an Energy Performance Certificate (EPC) rating of E.”
“EPCs have always come with a list of recommendations to help you improve the energy efficiency of your property.” adds Rob. “Until now, there has been no policy to enforce these changes, meaning the EPC was only advisory. However, this is no more. The new MEES regulations mean landlords will be unable to let out a property, or renew an existing tenancy or lease, if the property fails to meet the E rating. Those landlords with properties with an F or G rating will have to carry out improvement works, benefiting the property’s utility costs, the tenant, and the environment.”
How does this affect landlords of residential and commercial property?
“It affects them quite seriously,” says Rob. “A tenanted property cannot be lawfully re-let to new or existing tenants until sufficient measures are taken to improve the performance of the building to an EPC rating E or above. There are instances when the building may be exempt from these regulations; such as if the building is listed, or a temporary structure, but it is always best to check with a qualified assessor.”
“If a landlord does let out a home or business premise that is rated below the minimum standard,” explains Simon, “Then they will face civil and criminal charges for signing a new tenancy or renewing an existing one. Given that one in 10 privately rented properties currently fail to meet the new efficiency rules it’s important that landlords seek advice and are guided through the changes so that it doesn’t negatively impact their investments.”
Putting yourself in the shoes of a North East landlord, what would you be doing now?
“I would be definitely checking my current EPC to make sure it is E rated or above and speaking to my current letting agent to find out how they can help and support me through this change, in the best way for my interests,” said Simon. “Yes, I agree,” states Rob. “I would initially be checking that I have current EPCs available for all of my properties; EPCs are valid for 10 years from issue. You are then able to highlight which of your properties may be affected. In fact, in many cases, ensuring that the original information that was used to carry out the assessment was accurate, can bring the EPC rating up without having to carry out any remedial works to the property.”
If I was a landlord that hadn’t thought about this issue or looked into it, what would you suggest I do as a priority?
“I’d probably speak to a local ARLA letting agent to seek guidance on what I should be doing to ensure that I don’t accidentally fall foul of the new legislation,” explains Simon. “Yes, that’s right, I would contact a qualified property consultant or perhaps an EPC assessor to fully understand my obligations under the new ruling,” said Rob. “Penalties for non-compliance range up to a maximum of £150,000, which is pretty huge, so it’s essential that your property is let in line with the new regulations.”
On the whole, what’s the current situation like with landlords you’re working with about the changes? Are they quite prepared or are you having to do lots of work with them?
“It’s quite worrying, actually, the number of commercial landlords that are not aware that these regulations are being introduced,” expresses Rob, frankly. “George F. White is working with landlords across residential and commercial sectors about the new law, so we’re really well placed to assist landlords in ensuring their compliance, whether that’s carrying out new EPCs, scrutinising their existing EPC, or consulting on necessary remedial works.”
“On the residential side,” explains Simon, “We’ve been speaking to all landlords who are at risk of flouting the new laws and, working very closely and transparently with them, we have developed a tailored plan specific to their portfolio and investments. This has involved either organising a new EPC, arranging a Green Deal Assessor visit, or registering exemptions where applicable. Now really is the time to switch focus to the new energy efficiency laws and ensure you’re not doing anything illegal that can result in a hefty fine.”
If you’d like to discuss this further with Simon or Rob, please do contact them on the details below or visit our EPC information page: