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One would hope so
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
Great set of comments! There is a unified voice that speaks to the government and has for sometime: https://thelettingscouncilcouk.wordpress.com/ We have representatives from all different sectors within lettings - including tenant groups and MHCLG are there too. It's not easy getting messages across, but we are getting there.
With regards to agents, it's estimated around 20% will go under in the next year or so, mainly because they won't be able to get CMP and then will lose their tenant fees, so will either go bust themselves or be forced to close down. I don't think agents will 'disappear'. There are plenty of landlords who work abroad, others who don't want to be 'hands on' and they absolutely need to be looked after by a good agent. And keeping up with the 400+ rules and regulations coupled with increased fines/jail etc is tricky if you work full time, so there will always be those that don't want to take the full responsibility.
Regulation is being worked on for agents and I am very excited that this will make a substantial difference to the sector as although some operate amazing services for landlords and tenants, the consistency isn't there and this is much needed. However, my view is their 'job' needs to change more to an advice and management service on 'putting safe roof over people's heads' ie not just 'letting' and 'selling' property. Again, some already do this quite well, others will need to catch up.
At the moment the government is doing some good things, but there is still not as much 'joined up thinking' as the market needs - landlords are seen as a 'problem'. We won't change this overnight, but I do think things are moving in the right direction and I believe the view that landlords are people who 'add value' rather than being 'part of the housing problem' needs to be changed and given another year or so, this will hopefully happen.
mainly because they won't be able to get CMP
Out of interest why won't they be able to get CMP?
More than a third of landlords are looking to cut their annual spending - and many of them are considering ending their use of letting agents, according to the latest research by Kent Reliance.
The lender, part of OneSavings Bank, says the average landlord now spends £3,571 per property in annual running costs, before tax or mortgage interest – equivalent to 32.9 per cent of rental income.
These costs have risen by 5.6 per cent in the last two years without factoring in increasing taxes. Since the start of 2009, costs have jumped by 28 per cent, a rise of £771.Letting agent fees were in the sights of a quarter of landlords; those that targeted spending here expect to trim their expenditure on agents’ fees by 30 per cent. “If landlords’ fees climb once the Tenant Fees Bill is introduced on 1 June 2019, we may see a greater number shop around, or consider self-managing their portfolio” says Kent Reliance.Full/source article
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
"... says the average landlord now spends £3,571 per property in annual running costs, before tax or mortgage interest – equivalent to 32.9 per cent of rental income. "I was wondering how this could be possible, then I looked at my lowest rent and multiplied by 0.12 for an average of what it would cost if an LA was involved.
£3k+ per year on LA fees = no thanks!
£1800pa without them and me managing = yes please.Year on year the LA fees are by far the biggest ongoing drain on profits.
I think the fig is correct
as a large landlord I spend a lot of cash on repairs
I had a void last month and I redecorates new carpets professional clean and council tax and I spent 3k
it all mounts up traveling cost insurance agent fees ect ect
I set aside one third of all income to cover Costs every year
voids and non payers all add up
I have a schedule of repairs in front of me now for the comming tax year new roofs gutters Windows heating and paths and walls and fencing
and that before I look at Cp12 and general repairs the bigger you get the bigger repairs it’s part of the game
I work on 20% of gross rents to cover all costs ( including mortgage interest, but i’ve very low leverage so its minimal). However i did spend 90k refurbishing the facade of one building, but this was under a grant scheme and effectively cost me nothing.
I average the 20% over a rolling 5 years, so that i’ve reserves for refurbs during voids, however i self manage ( aside from tenant find service, though that’ll be changing dependent on how my agent decides to rejig their fees) and do just about all the work myself ( gas , electrical, alarm tests aside)
but my portfolio is relatively small (9 flats) so quite easily managed, especially as i converted or built all but 1. If i factored my time in at say £20/hour when it comes to physical works on the units then i could well be approaching 35%.
I think a lot of us forget to factor in our time
The government consultation process which fuelled its decision to axe Section 21 eviction powers and move towards longer tenancies received only 129 responses from letting agents.Full/source article
Some good points made here although I do get a little frustrated that all letting agents get tarred with the same stick.
Just like private landlords, there are a number of letting agents and estate agents who just shouldn't be in the business. We regularly take over properties that have been let by some pretty big operators and their lack of compliance is shocking!
As the business environment changes, many letting agents will be left behind, stuck still trying to do business they way they did twenty or thirty years ago.
You do not need high street premises, branded cars and lots of staff to manage a substantial amount of properties. So don't let that influence your decision when choosing a letting agent.
LETS MAKE HOMES by treating landlords as partners, tenants as customers & every property as our own."