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Estate Agents & Letting Agents in Leeds

Here you will find the latest Hudson Moody Wass and property news.

Paragon's buy-to-let business doubles

Paragon Mortgages’ parent company, The Paragon Group of Companies, has announced its financial results for the quarter ending 30 June 2015.

The group’s operating profits totalled £98 million for the nine months to 30 June 2015, an 11% increase on the same period last year (£88.3 million).

Paragon Mortgages reported completions totalling £370.3 million in the third quarter, a 98% increase on the corresponding quarter last year. In terms of the year to date, buy-to-let completions reached £816.5 million.

The pipeline of new business stood at £864.9 million at the end of the quarter, compared to £352.7 million at the same point in 2014.

John Heron, managing director of Paragon Mortgages, said: “We have seen a substantial increase in market share over the last year as our strategy to diversify funding has started to pay dividends. This is against a background of strong and sustained tenant demand in a private rented sector that has doubled in scale in the last ten years and now accounts for 4.9 million homes. Buy-to-let plays an important role in supporting the sector and making sure the market can respond to this continued increase in demand for rented homes."


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Concern over “closure” of Cambourne letting agent

Mystery surrounds the apparent closure of a Cambridgeshire letting agent.

The Cambridge News has reported that Kirby Property Management in Cambourne appears to have closed its doors.

The firm also has offices in Cambridge and St Neots. Landlord Today tried to call all three branches but, in each case, was diverted to a recorded message saying that no attendants were available.

One landlord told the Cambridge News that rent due on 18 July had not been passed to him and when he went to Kirby’s offices they were closed and locked.

The firm's website says it is “licensed” by the National Approved Letting Scheme but doesn’t display details of redress scheme membership as is required by law.

According to companycheck.co.uk, Kirby Property Management Ltd is dissolved and hasn’t filed accounts since 2009. Director Mark Proctor is also director of Kirby Property Consultants Ltd which was set up in August 2014 and has its registered office at the same address as Kirby Property Management.


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Stalker denied licence for rental property

A local authority has refused to issue a private landlord licence after it was revealed the applicant had a conviction for stalking.

The application from Ryan Maginnes –  who runs two security firms –  was turned down by Dumfries and Galloway Council, according to a report in the Falkirk Herald.

The paper says the council’s licensing panel took the decision after Police Scotland warned it did not consider him a “fit and proper” person because of his criminal record.

The panel also heard that council housing officers were investigating what the paper describes as “a string of complaints” against him from an existing tenant.

Correspondence between the landlord and the authority concerning the licensing registration had been “confrontational”.

Maginnes was told earlier this year he needed to register as a private landlord after the council received a housing benefit claim for an unregistered property in the village of Carsphairn in Kirkcudbrightshire.

He was then issued with a rent penalty notice which meant he could no longer collect rent from his tenant and warned any further attempt to register would incur a late application fee of £110.

His response was to accuse the council of “incompetence” –  and threaten his tenant with eviction.

However, Maginnes paid the fee in May but by that time it had been revealed he had been convicted in June 2014 of stalking and placed on a community payback order with the added condition not to contact his victim for three years.


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Generation Rent appeals for crowdfunding contributions

Campaign group Generation Rent has launched a crowdfunding campaign to raise £60,000 to keep the organisation going.

The crowdfunding push follows an unexpected funding cut which jeopardises the organisation’s future beyond September.

Generation Rent has been funded since January 2014 and launched two months later. Since then it has pushed renters’ rights and rent control up the political agenda and campaigned for a ban on revenge evictions, letting agent regulation and cuts to landlord tax breaks.

The group says its work is “far from over”. The funding was originally due to run out in spring 2016 and the campaign is already applying for grant funding elsewhere.

Generation Rent is trying to raise £60,000 by 31 August on crowdfunding platform People’s Republic. If it fails to do so it will have to lay off all staff and will cease to function. It has been seeking donations from organisational partners and has already received a pledge of £5,000.

The money, if raised, will enable Generation Rent to continue its work putting pressure on Parliament, London Mayoral candidates and local government to improve conditions for renters, while securing grant funding to keep it running beyond next spring.

Betsy Dillner, director of Generation Rent, said: “This cut has come as a shock and our young campaign is now facing oblivion. Without us, private renters will no longer have a national voice in the media and political debate, and their prospect of a rented sector that works for them will ebb away. The housing crisis is not going away anytime soon, but with the generosity of the public, neither will Generation Rent.”


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Half of tenants “do not attend check-out”

Almost half of tenants in England and Wales do not attend a ‘check-out’ at the end of their tenancy, according to figures published by the Deposit Protection Service (DPS).

During checkouts landlords or their representatives record the condition of the property in comparison to when the tenants arrived.

The DPS recommends that tenants attend but 48% of respondents to The DPS’ recent survey of 8,035 tenants said they had not attended.

Almost half (46%) of tenants who did not attend said that they had either not been invited or were not informed of the date or time.

Julian Foster, managing director of The DPS, said: “Checkouts are one of the most important stages of any tenancy. By viewing the property and discussing its condition together, tenants and landlords can resolve problems quickly and help prevent longer disputes, for instance, over the return of the deposit.

“It’s vital that landlords enable tenants to attend – and that tenants go along when invited.”

The DPS has also issued its top ten tips for landlords to help ensure that checkouts are successful.

  • Take along a report from the check-in. The first stage of making sure your check out process is successful is to carry out an inspection that is agreed by the tenant on the state of the property when he or she arrives. Bring the resulting report to the check out as a reference point for both your inspection and the discussions.
  • Make sure you invite tenants in writing and with sufficient notice. It’s important you have a record of the invitation so its existence cannot be disputed afterwards; and tenants should be given a reasonable chance of being able to attend.
  • Make sure the tenant understands the process. Explain that this is his or her chance to put forward their case regarding the state of the property. It’s sensible to include a description of the process in your written invitation, and give them an opportunity to ask questions when it starts.
  • Consider the use of an inventory clerk. These are professionals who understand best what needs to be recorded when tenants arrive – and how best to assess and demonstrate change at the end of the tenancy. If you do use their services, make sure the tenant understands their role.
  • Be safe. It is of course extremely unlikely that a check out will provide a risk to your safety, but make sure someone else knows where and when it is taking place and if you have any concerns, bring someone else along.
  • Take your time and be thorough. Although confrontation can be difficult and it can feel awkward to be touring your property that has acted as someone else’s home –you are making life more difficult for both you and your tenant if you do not cover every aspect of your check in list properly, or later on refer to an issue that wasn’t noticed during check out.
  • Make notes. In particular, record any of your tenant’s admissions or any agreements you reach. Ask your tenant to sign and date the notes. Make sure they receive a copy of these soon after check out takes place. As ever emailing a copy helps demonstrate that you were in touch.
  • Bring a camera and take photos of any damage or anything else contentious. Digital cameras work best because they have a date stamp, which helps demonstrate when the photos were taken. Explain in your invitation that you may take photos during the visit.
  • Use video evidence where appropriate. Demonstrating that equipment is no longer working, for example, may most easily be achieved using a video. However, most often photos provide the best form of evidence, as adjudicators can study the image more easily.
  • Carry out the check-out before any repair works take place. Although it seems obvious that evidence of the damage will help demonstrate your case, unfortunately the rush to overcome problems ready for the next tenant sometimes means opportunities to record them are missed.

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‘Nightmare Tenants, Slum Landlords’ commissioned for second series

Channel Five bosses have agreed the eye-opening first series of ‘Nightmare Tenants, Slum Landlords’ has only scratched the surface of the issues faced when the relationships between landlords and tenants break down.

With the last episode in the current series due to air tonight, a second series featuring eviction specialists Landlord Action has been commissioned and will be broadcast in March 2016.

The final episode in the current series features a case that causes one landlord to take the decision that his buy-to-let dream is over. 

Steve Bull bought his first buy-to-let property four years ago with the intention of his children benefitting from the investment in years to come. Eight months ago a new tenant moved in, has been consistently late paying the rent and has now amassed rent arrears totalling more than £5,000.  

Bull entrusts the help of Paul Shamplina from Landlord Action to evict the tenant but the disruption and worry the incident has caused Bull and his family mean he is ready to sell up and move on.

“As the buy-to-let market grows, with more people expected to rent than own property with a mortgage by 2025, naturally the level of complaints relating to tenancies will follow,” said Shamplina, “No amount of legislation will ever be able to eradicate problematic tenancies, so education is the only way to help reduce this. ‘Nightmare Tenants Slum Landlords’ isn’t aimed at putting people off either letting or renting property but highlights some of the scenarios which can arise so both tenants and landlords can protect themselves in advance.”


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'Housing demand at eleven year high' - NAEA

Housing demand reached an eleven year high in June as property supply levels continued to fall, the National Association of Estate Agents (NAEA) has reported.

The Association's latest Housing Market Report found an average of 439 home hunters registered with the average NAEA member branch, a 15% increase on May's figures and the highest recorded since August 2004.

Despite ever-increasing demand, supply of housing stock has fallen from 46 houses available per branch in May to 44 in June.

The number of sales made by estate agents remained consistent in June, with the average branch making nine transactions – the same figure recorded in May. 

The number of sales made to first-time buyers declined in June, however, with the group accounting for just 24% of sales, compared to 29% the previous month.

“What we’re seeing is a market that lulled over the General Election period, coming back to life in full force. Buyers are feeling more confident and those who put their plans on hold over the Election and political aftermath have kicked off their hunt, causing this massive jump in demand,” comments Mark Hayward, managing director of the NAEA. 

“There’s also an impetus to buy right now in light of the impending interest rate rise as buyers fight to buy and fix mortgage rates. But the fact that demand is at an eleven year high without the housing stock to fuel it, is bad news for the market,” he adds.

Hayward says that despite the lack of supply and heightened demand, it is promising that transaction levels have remained consistent and houses are still being sold. 

“The Election was full of promises to build more houses, but now those promises need to be put into bricks and mortar to respond to demand,” he says.


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Is the market too hot to buy good value buy-to-let?

There’s an argument that the property market in the UK right now is too buoyant for many investors to make money from buy-to-let properties with so much completion from homeowners as well as investors.

So is the market too hot? In some areas, the answer is yes, but there are still some options.

Rental yields in some areas of the country – particularly the south – are as low as 4% for larger properties or 5%-6% for many standard homes. Averaged across the UK you can find yields between 6% and 7% but even that doesn’t leave much margin for the majority of investors to make money over the long-term once you consider financing, maintenance, tenant management and other costs.

When looking at investments that make sense over the longer-term it’s crucial to achieve a certain level of rental return.

As an example, where I’m based in the North West, a property costing more than £100,000 will typically give lower than an 8% rental yield – it’s usually closer to 6.5% to 7.5%.

On the flip side, you can find some properties that on paper that look like absolute no-brainers with rental yields of around 10%, but the reality is that these areas often suffer from more void periods, maintenance issues or arrears.

The magic number I always look for with a rental yield is around the 8% mark. That helps give enough margin to offset any of the inevitable costs an investor would expect to incur.

It also offers a cushion to guard against any rise in mortgage rates. As we’re still in a period of historic low rates, investors playing the long game need to consider an interest rate rise in their figures if using finance.

There’s also capital growth to think about. Many investors – experienced or not – will happily sacrifice some of their rental yield to enable them to purchase in traditionally high growth areas, in a bid to benefit from capital growth.

Short-term, this can and does work in the right situations, but if you want to grow a portfolio that is self-sufficient over the long term this can be a risky strategy, as capital growth isn’t guaranteed.

First and foremost, if you’re thinking of buy-to-lets, the property cash flow should cover all its costs and look after itself. If you have to put money in every month just to cover the mortgage, then it can be a very risky proposition as your relying on the market always rising.

So how do you find the best rental yields?

Adding value has and always will be one of the best methods to ensure you achieve the best return.

As an example, when I look at buy-to-let, I’m looking for properties that I can add some value to through a refurbishment and I’ll often negotiate a lower purchase price to give myself a higher potential yield.

By buying at the right price and in the right location, it’s possible to achieve properties closer to that 8% mark or above.

On top of this, I have seven golden rules I always follow to make sure each property fulfills a certain criteria. Everything from ensuring it’s in the right area to considering an exit strategy, rental yield to the tenant profile.

So what are the options if your looking for ‘long term’ buy-to-let?

There are still pockets of the country where it is possible to make a decent return from buy-to-let properties. For a long-term plan, the key thing any investor needs to remember is to focus on the tangibles that matter – rental income versus the outgoings of owning that property. 

Keeping the rental yield in mind is paramount and I find that 8% is usually right in the sweet spot.

This article was written by Robert Jones, a Manchester-based property investor and director of Property Investments UK.  


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Former Met Police headquarters sold for £110m

An Indian billionaire has purchased Great Scotland Yard – the home of the Metropolitan Police until 1890 – from Galliard Group for £110m. The building is currently in the process of being turned into an exclusive five-star hotel.

Yusuffali Kader, who runs the Abu Dhabi-based conglomerate Lulu Group International, will take ownership of the historic venue once the conversion process is complete.

The site in Whitehall is already 30% complete after Galliard purchased the 125-year lease for the Edwardian, grade II-listed building in 2013.

Previously the headquarters of the Met Police for sixty-one years, it has also been used as the headquarters for the British Army Recruitment Office and Royal Military Police. Up until 2004, it was being used as the Ministry of Defence Library.

One of India’s richest men, Kader oversees the wide array of interests of the Lulu Group, which range from supermarkets to food processing. 

Set to open its doors in the first part of 2017, the 92,000 square foot hotel will be known as The Great Scotland Yard. The most expensive suite could cost as much as £10,000 per night. Steigenberger Hotel Group has been contracted by Lulu to operate the luxury venue once it opens. 

The Great Scotland Yard will include seven storeys and two basement levels. Work on the interior will start in March next year. 

“All that has been retained of the grand original Edwardian Great Scotland Yard building are the outer facades,” Don O’Sullivan, Managing Director at Galliard Homes, said. “The entire insides of the building have been ripped out, and Galliard Homes has dug down two levels underground to create a vast basement complex under the building. The building is also being extended to the rear and increased by several floors. This is a huge redevelopment project.”


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Sales of prime properties set to fall, says Jackson-Stops & Staff

The number of sales for properties over £1.5 million seems set to drop for the first time in two years, according to national estate agent Jackson-Stops & Staff. This is despite growth of 36% year-on-year from 2012-2014.

Jackson-Stops & Staff has 44 offices nationwide, including branches in Mayfair, Pimlico, Chelsea and Wimbledon Village. Nicholas Leeming, chairman of the firm, said: “The wider UK residential property markets are reasonably buoyant now that we have the General Election behind us and the uncertainties that any potential political changes bring.” 

“However, the revision to stamp duty rates late last year has contributed to the widespread stagnation of the higher valued markets in 2015, both in London and the country, where many properties are finding it difficult to attract buyers.” 

He added: “Sale volumes have plateaued across the country in response to high transaction costs, reflecting the fact that the UK has one of the highest taxed property sectors in the world.”

Under the new stamp duty reforms – introduced by Chancellor George Osborne in December last year - people buying homes between £925,001 and £1.5 million have been hit with an additional 10% bill. Those buying property costing above £1.5 million have seen an extra 12% charge.

Leeming said the house owner population is an ageing demographic, with too few younger entrants getting onto the property ladder. “Mortgage funding is difficult to raise for people in their forties, even if they have been previous house owners, irrespective of their credit history,” he went on. “We need to encourage trading down so that larger houses are released to families needing more space.”

The changes to inheritance tax, Leeming believes, will incentivise older house owners to trade down, but he also wants measures to “enable property owners to move without new restrictions to mortgage funding and reduce the top levels of stamp duty to free up the higher value markets at no net loss to the Exchequer.”

Alastair Hancock, Director at Jackson-Stops & Staff in Sevenoaks, says his branch has also seen a downturn in the volume of sales of properties over £1.5 million. 

“Over a third of our available stock is priced in excess of £1.5 million and this is no wonder given what little incentive there is for buyers at the mid to high-end of the market currently. Since the stamp duty hike last December, we have seen a significant decline in volume of sales at this level as the 12% rate continues to penalise the country house market, which is still struggling to recover from the recession.”


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