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industry news
36% see landlord’s role as extremely risky
A new poll is today revealing the
negative perception that the British
public have of becoming a landlord,
with 36% of UK adults saying it's
extremely risky being a buy-tolet landlord, according to a poll
commissioned by a leading student
property investment consultancy,
Emerging Property.
Despite the negative perception, millions
of buy-to-let landlords are reaping the
benefits, with data from HM Revenue &
Customs showing that the number of
buy-to-let investors in the UK is around 1.6
million, after an increase of 120,000 in 2014.
The research asked 2,000 people what
their biggest concerns would be with
investing in buy-to-let property. Making
repairs to toilets (63%), and risking tenants
damaging your property (63%) have been
flagged as the key things that put people
off being a landlord, due to unexpected
and unforeseen costs. Two-thirds (62%)
also said being a landlord means you risk
losing income when the property is vacant.
When looking at confidence in
property investment across the UK, the
key differences that the research has
shown is that in London (39%) and the
West Midlands (38%) the majority of the
public believes the property market will
continue to boom. However, the least
confidence was found in the North East
(21%) and the East Midlands (26%).
It has been predicted that the new
pension reforms that come into effect
in April will lead to people investing in
property and upping the number of
landlords. The poll found that investment
in student property is regarded as the
best choice amongst the public, with
one in eight saying that if they were to
invest in property it would be in student
accommodation. Behind this was
retirement property (10%), and holiday
homes (9%).
According to Emerging Property,
purpose-built student accommodation
(PBSA) is a class of investment that
means you have guaranteed income,
management of tenants, property
resale and outsourced repairs. These
privately owned student halls provide a
high standard of student living and are
expected to be extremely desirable to
those put off by the traditional risks and
hassles of being a buy-to-let landlord.
James
Harrington,
Business
Development Manager at Emerging
Property, said: “Purpose-built student
accommodation is designed to mitigate
the key concerns expressed by investors
in this survey. Not only are they operating
within a market that delivers far greater
yields than traditional buy-to-lets, but
also, as the result of onsite property
management and guaranteed returns,
provide a hassle-free passive income, with
zero costs and complete peace of mind.”
The incentives that are offered through
new property investment structures
oppose the common perception that
the public have of being a landlord.
Harrington went on to explain why: “In
2014, we witnessed record university
intake levels in the UK, with numbers
exceeding half a million for the first
time. With existing supply gaps, this is
resulting in high demand and positive
rental growth, which ultimately leads to
improved yields and enhanced security.
This trend is set to continue, with
legislation, both at the national and local
level, encouraging increased university
intake and exacerbating demand for
purpose-built accommodation.”
Cleaning remains a big problem for landlords
According to a new report, landlords
and
agents
are
increasingly
faced with dirty properties at the
check-out stage and this has led to
cleaning now accounting for 53% of
deposit disputes.
The research, conducted by Imfuna
Let, a leading inventory software
solution, based on statistics from deposit
protection services, reveals that over the
last three years, cleaning disputes have
leapt by 13% from 40% in 2011, whilst
damage has dropped from 60% to 46%
in the same period.
Jax Kneppers, founder and CEO of
Imfuna Let, comments: “Many tenants
fail to leave their property in the same
condition at check-out and are often
very surprised when they are told
that professional cleaning is required.
Deductions made by landlords in relation
to cleaning charges are regularly disputed
by tenants. Many tenants claim that the
cleanliness of the property at the start
of the tenancy was not clear, or that the
tenancy agreement did not make clear
what was expected of them.
“If agents and landlords wish to make
deductions for cleaning costs, they need
to be careful to record the cleanliness of
the property in sufficient detail, at the
start and end of the tenancy. They will
also need to ensure any charges they
claim are a fair reflection of the property’s
condition at the start of the tenancy.
“We know that landlords and agents
using Imfuna Let have seen a 60% drop
in cleaning disputes. We work with many
letting agents and the majority have seen
a vast improvement in the condition of
their properties handed back at the end
of the tenancy. This has driven down the
post-tenancy cleaning bills and reduced
the number of disputes over cleaning.”
Simon Smith, Managing Director of
KS Property Rentals, comments: “Since
we started using Imfuna Let, we have
seen a sharp decrease in the number
12 Landlord & Buy-to-Let Issue 58 • April 2015
of cleaning disputes we experience. I
believe this is down to the very detailed
inventory we carry out using the Imfuna
Let software. We are able to record
the cleanliness of the property with
commentary and photographs and the
digital inventory is shared with tenants
at the start of the tenancy.
“Cleanliness and rubbish removal are
responsible for at least 90% of our deposit
claims; less and less of those claims are
reaching ADR due to the fact that once a
ten