How to add value to your Tamworth home without dropping your asking price

If your home is on the market already, and you`re not getting serious interest from buyers, one option most estate agents will suggest to their client is to drop the asking price of your property. However, it`s not always the only option: there are some improvements that can help you sell more effectively without spending a fortune and often can be implemented easily and not that costly:

New flooring in ‘wet` rooms – By ‘wet` rooms, I mean kitchens, utility rooms, cloakrooms and bathrooms. The general rule of thumb with the flooring in these rooms is that it needs to be ‘moppable` – in other words, a hard floor.  It doesn`t need to be expensive, in fact there are some fabulous reasonably priced vinyls available.   The difference in how a buyer will see your home is high. A bathroom that is carpeted will look dated to a modern buyer, regardless of whether it is or not. These are also the rooms buyers expect to be super clean and by having new flooring will immediately confirm to them that they are.

Updating your soft furnishings – Cushions, bedding, even curtains, can radically improve and update your home for a relatively moderate spend. Why not purchase some new cushions and bedding which can be put out just for viewings and then put away after? This way you will always have that brand new showroom look.

New carpets  – Carpets can make a house look dated more than any other area, and they can also give a buyer a reason to make a low offer.  A good quality, neutral carpet throughout the house can add several times its cost in the perception that the house has been kept up to date.  Re-carpeting an average-sized house will not be cheap but it will almost certainly be a very worthwhile investment.

Declutter more – Sometimes it might just be that people cannot see the true potential and space of your property. If you have a lot of furniture or personal items it might be a good idea to see if you can remove some into storage whilst your property is on the market. Remember, the larger you can make your property feel the more appealing it will be to a buyer, not just because they feel they are getting more property for their money but often it also allows them to work out exactly where their own furniture would go if they bought your home.

So, as you can see, giving the buyer what they need is not always about price. A few changes may result in increasing its value and you may even get your home sold for more!. It is also worth noting that if you do decide to drop the price your agent would have to drop it by at least £10,000 to make any real impact, so perhaps trying a few basic changes first could be the best route to try before changing the price.

Is your property on the market and not getting the interest you hoped it would? then why not get in touch and see how we can help 01827 425195 or info@hallandthompson.co.uk

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Tamworth Tenant’s Deposits held total £2,458,500

With the Government preparing to control tenant’s deposits at five weeks rent, Tamworth landlords will soon only be protected in the event of a single month of unpaid rental-arrears, at a time when Universal Credit has seen some rent arrears quadrupling and that’s before you consider damage to the property or solicitor costs.

It can’t be disputed that the deposits Tamworth tenants have to save for, certainly raises the cost of renting, putting another nail in the coffin of the dream of home ownership for many Tamworth renters. At the same time, those same deposits being unable to provide Tamworth landlords with a decent level of protection against unpaid rent or damage to the property.

In fact, the total of all the tenants’ deposits in

Tamworth, deposited or protected, is £2,458,500

When you consider the value of all the privately rented properties in Tamworth total £705,361,800, the need for decent landlord insurance to ensure you are adequately covered as a Tamworth landlord is vital.

However, I want to consider the point of view of the Tamworth tenant.  Several housing charities believe spending more than a third of someone’s salary on rent as exorbitant, yet for the tenants they find themselves in that very position.  I feel especially sorry for the Tamworth youngsters in their 20’s who want to rent a place for themselves, as they face having to pay out the rent and try and save for a deposit for a home.

The average 22 to 29-year-old in Tamworth spends 33% of their typical salary on a one bed rental property

….and 39% of their salary for a 2-bed home in Tamworth.

40 years ago, British people who rented spent an average of 10% of their salary on rent, and only 14% in London.  Looking in even greater detail, according to the ONS, over the past 60 years the proportion of total spending on all housing (renting and mortgages) has doubled from 9% in the late 1950’s to 18% today.  Whilst on the other hand, the proportion of total expenditure on food has halved (33% to 16%), as has the proportion of total spending on clothing (10% to 5%) … it’s a case of swings and roundabouts!

Yet landlords also face costs that need to be covered from rents including mortgages, landlord insurance (especially the need for the often-inadequate deposits to cover the loss of rent and damage), maintenance and licensing.  In fact, rents in the last 10 years have failed to keep up with UK inflation. So in real terms, landlords are worse off when it comes to their rental returns (although they have gained on the increase in Tamworth property values – but that is only realised when a property sells).

There are a small handful of Tamworth landlords selling some/or all of their rental portfolio as their portfolios become less economically viable with the recent tax changes for buy to let landlords, which will result in fewer properties available to rent.

However, this will reduce the supply and availability of Tamworth rental properties, meaning rents will rise (classic textbook supply and demand), thus landlords return and yields will rise.  Yet, because tenants still can’t afford to save the deposit for a home (as we discussed above) and we are all living longer, the demand for rental properties across Tamworth will continue to grow in the next twenty to thirty years as we turn to more European ways where the norm is to rent rather than buy in the 20’s and 30’s age range. This will mean new buy-to-let landlords will be attracted into the market, buy properties for the rental market in Tamworth and enjoy those higher yields and returns … isn’t it interesting that things mostly always go full circle?

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Tamworth House Prices up 31.5% in the last 5 Years

Over the last 5 years, we have seen some interesting subtle changes to the Tamworth property market as buying patterns of landlords have changed ever so slightly.

The background to this story was the recently published set of buy-to-let (BTL) lending statistics. Roll the clock back 12 months and 6,700 BTL mortgages were granted (in the same month) for £900m, meaning the average BTL mortgage was £134,200. Looking at last month’s figures, and as one might expect with the Brexit issue overhanging the property market, the lending figures were down, yet not by the amount I originally thought. Last month, just over 6,100 new buy-to-let mortgages were granted for a total sum of £800m (meaning the average landlord mortgage was a respectable £131,100). Yet, when I looked back to the boom year of the 2014 property market, in the corresponding same month, only £1,030 million was borrowed on 8,300 buy-to-let properties (meaning the average buy-to-let mortgage was £124,100). It seems Brexit is having no effect on landlords buying habits.

Looking closer to home in Tamworth, throughout 2018, I have been regularly chatting to more and more landlords, be they seasoned professional Tamworth BTL landlords or FTL’s (first time landlords) and their attitude is mostly positive. Instead of reading the scare-papers (oops sorry newspapers), those Tamworth landlords that look with their eyes, will see the Tamworth property market is doing reasonably well, with medium term rents and property values rising; as quite obviously from the mortgage figures .. landlords are still buying.

The question I get asked all the time is .. “What type of buy-to-let property should I buy?  You can make money from property through both the rent (expressed as a yield when compared to the value of the property) and how the actual value of the home itself changes.

Since 2014, property values in Tamworth have risen by 31.5%.

We have records of what each type of property (i.e. Detached/Semi/Terraced/Apartments) has achieved per square metre going back 20 years … and looking back over the last 5 years, these are the numbers ..

They all look to have similar percentage uplifts, however as you can see from the table there is in fact some variation throughout and although only slight this can equate to thousands of pounds in monetary terms.

This has proved that semis and terraced houses have performed the best .. although like the £/Sq.M figures, these are just averages. When investing, whilst Tamworth apartments haven’t been the best performers in terms of capital growth, they do tend to generate a slightly better yield than houses, probably because several sharers can afford to pay more than a single family. But houses tend to appreciate in value more rapidly and may well be easier to sell, simply because there are fewer being built.

Now these are of course averages, but it gives you a good place to start from. The bigger picture here though is this – irrespective of what is happening in the world, be it Brexit/no Brexit, China, Trump, whatever, Tamworth people still need a roof over their heads and we as a Country haven’t built enough homes to keep up with the demand since the late 1980’s. This means even if we have a short term wobble in 2019 when it comes to property values ..in the medium term, demand will always outstrip supply and prices and rents will increase – because, I doubt the local authority, let alone Westminster, have the billions of pounds required to build the one hundred thousand Council houses per year nationally for the next decade to fix this issue – meaning as the population increases, the only people who can fulfil the demand for accommodation in the medium term is the private BTL landlord.

Before I go …on average, housing associations and local authorities have built around 26,500 houses each year since 2010. The Labour government had a lower average, building about 19,000 homes per year, yet in the 1960’s, under both administrations, 180,000 councils were built per year!

Many of you reading my blog ask why I say these things. I want to share my thoughts and opinions on the real issues affecting the Tamworth property market, warts and all. If you want rose tinted glasses articles – then my articles are not for you. However, if you want someone to tell you the real story about the Tamworth property market, be it good, bad or indifferent, then maybe you should start reading my blog regularly.

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Tamworth Property Market – Outlook for 2019

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Tamworth property values are unexpectedly 4.8% higher than at the end of 2017, notwithstanding the uncertainty and threats over the potential impact of Brexit in 2019. This has exceeded all the predictions (aka guesses) of all the City of London economists, in an astonishing sign of strength for the local Tamworth and wider national economy.

Nevertheless, the statistics from the Land Registry come after a lethargic year for the number of properties in Tamworth compared to the actual prices achieved for those properties.  All this against a framework of amplified political ambiguity and ensuing years of rising Tamworth property values that have reduced the affordability of homes in the locality.

The average value of a Tamworth property today

Currently stands at £225,400

Looking in finer detail, it isn’t a surprise that 1,216 property sales in Tamworth over the last 12 months is somewhat lower than the long-term average over the last 20 years of 1,550 property sales per year in Tamworth as the long-term trend of people moving less has meant a decline in the number of property transactions.

I believe locally, Tamworth property value growth will be more reserved in 2019 after two decades of weaker wage rises. One of main drivers in the demand (and thus the price people are prepared to pay for a home) is the growth of peoples wage packets. Interestingly, wage inflation over the last six months has risen from 2.4% in the late summer to its current level of 3.3% (which is higher than the average since the Millennium, which has been a modest 2.1%). One of the reasons why wages are growing in the short term is the unemployment rate in the country currently only stands at 4.1%, continuing to stay close to its lowest level since the 1970’s.

However, even though Tamworth salaries and wages are rising comparatively higher than they were last year, looking over the long term, Tamworth property values are 139.61% higher than they were in January 2002, yet average salaries are only 76.1% higher over the same time frame. This means over the last few years, with average property values so high comparative to salary/wages, many Tamworth potential buyers have been priced out of being able to purchase their first home.

At first glance, these stats are actually rather positive during this reported time of political uncertainty and the height of Brexit commotion … because I genuinely believe that to be the case. The press have always looked for the bad news (well they do say it is that that sells newspapers), and whilst I am not entering into the pros and cons of Brexit itself, the numbers do stack up quite well since the Brexit vote took place nearly 3 years ago.

Moving forward, when taken with the recent reduction in short to medium term number of property transactions (i.e. the number of Tamworth properties sold), it should be noted that a lot of the this buoyant house price increase has a lot more to do with a shortage of properties on the market rather than an uplift in the Tamworth housing market generally.

And we can’t forget that Tamworth isn’t in its own little bubble, as there are noteworthy differences across the UK in property value inflation. House prices in London and the South East have hardly risen or even fallen in some places, whilst in the Midlands, North and other parts of the country they have generally increased. 

Looking forward, I would say to the homeowners and buy to let landlords of the locality that I expect Tamworth house price growth to remain stable between 1.3% and 2.1% by the end of this year (although they could dip slightly during the summer) … as long as nothing unexpected happens in the world economically or politically of course.

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Tamworth Homeowners 73% More Likely To Live in a Home with 3+ Bedrooms than those that Privately Rent

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The conventional way of categorising property in Britain is to look at the number of bedrooms rather than its size in square metres (square feet for those of you over 50!). My intuition tells me that homeowners and tenants are happy to pay for more space. It’s quite obvious, the more bedrooms a house or apartment has, the bigger the property is likely to be. And it’s not only the tangible additional bedrooms, but those properties with those additional bedrooms tend to have larger (and more) reception (living) rooms. However, if you think about it, this isn’t so surprising given that properties with more bedrooms would typically accommodate more people and therefore require larger reception rooms.

In todays Tamworth property market, the Tamworth homeowners and Tamworth landlords I talk to are always asking me which attributes and features are likely to make their property comparatively more attractive and which ones may detract from the price. Over time buyers’ and tenants’ wants and needs have changed.

In Tamworth, location is still the No. 1 factor affecting the value of property, and a property in the best neighbourhoods can achieve a price almost 50% higher than a similar house in an ‘average’ area. Nevertheless, after location, the next characteristic that has a significant influence on the desirability, and thus price, of property is the number of bedrooms and the type (i.e. Detached/Semi/Terraced/Flat).

The number of bedrooms for owner-occupiers very much depends on the size of the family and the budget, whilst Tamworth landlords have to consider the investment opportunity. In this article, I have analysed Tamworth’s housing stock into bedrooms and tenure. Initially looking at Tamworth homeowners..

And now the Private rented sector …

It can quite clearly be seen that Tamworth owner-occupiers tend to occupy the larger properties with more bedrooms. This would be expected due to the demographic of homeowners and people that privately rent.

However, this shows there could be opportunities for Tamworth buy to let landlords to purchase larger properties with more bedrooms to attract tenants requiring properties with more bedrooms. However, before you all go buying larger 4 bed and 5 bed mansions to rent them out, a lot of bigger properties in Tamworth don’t make financial sense when it comes to buy to let.

For numerous years Tamworth buy to let landlords have been the lone buyers at the smaller one and two bed starter homes of the market, as they have been lured by elevated tenant demand and eye-catching returns. Some Tamworth landlords believe their window of opportunity has started to close with the new tax regime for landlords, whilst it already appears to be opening wider for first time buyers. This is great news for first time buyers .. but one final note for Tamworth landlords .. all is not lost .. you can still pick up bargains, you just need to be a lot more savvy and do your homework ..one source of such information with articles like this is the Tamworth Property Market Blog https://www.Tamworthpropertyblog.co.uk

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Should you buy a new-build property in Tamworth?

The government has pledged to build 300,000 new build homes to try and tackle the national property shortage, they are even giving incentives when you buy a new build home.

For as little as a deposit of 5% and a government loan of between 15% and 40%, depending on where in the UK you live, using the Help to Buy equity loan scheme  you can get on the property ladder.

The added benefit is, new-build properties should be better insulated than period homes so your energy bills could well be cheaper than buying a period home.

If you’re buying off-plan ( before it’s been built), you may be able to choose certain aspects of the design i.e your kitchen or whether you have a fireplace of not.

However, there are some disadvantages to buying new-build homes, including the fact that it can sometimes be more difficult to get a mortgage. 


What’s included in a new-build property?

Exactly what’s included varies depending on the developer and what they are offering. You may get the white goods – washing machines or dishwashers thrown in, as well as wooden flooring. Others may offer to install flooring or carpet but at an additional cost. 

One of the great advantages of buying a brand-new property is that, often, many of the fixtures and fittings you’d otherwise have to fork out for are included in the price.

Developers often try to upsell you extra items. Be wary here – the price of these could be inflated, and it may be much cheaper for you to source and pay for them yourself.

Today’s building rules and regulations mean that there are standards developers have to meet to make your property as energy efficient as possible. Energy-efficient features could include double or even triple-glazed windows, insulated walls, roofs, and doors, and energy-efficient heating.

Can you negotiate on new-build prices?

Prices for a development’s one, two and three-bedroom properties are often plastered all over the hoardings when properties are being built. 

Of course, the developers will tell you that this is the price you’ll have to pay nethertheless it is only an asking price, and you should be prepared to try and negotiate.

The likelihood of success will depend on a number of things, such as where the property is and the level of demand, as well as how far along the development is.

It pays to do your research, looking at sale prices of similar properties nearby using online sites like Rightmove and Zoopla.

If your attempt at getting a discount fails, there are other ways to potentially reduce your costs. You could ask the developer to cover your stamp duty costs or negotiate ‘extras’, such as flooring or furniture, for free. 

Is there a new-build premium?

You might have heard of the ‘new-build premium’, a term used to describe the fact that new-build properties tend to be pricier than older, but otherwise similar, properties. The reason for this difference is that everything is new and unused, energy efficient and built to  a high-quality specification.

Some people believe that, on top of the standard new-build premium, developers have been charging an even greater ‘Help to Buy premium’ to those using the government’s equity loan scheme.

Try to stay level-headed and don’t be too wowed by a new-build show home. Do your research, find out about similar properties in the area and on developments, and make sure you don’t offer more than you can afford. 

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25.9% of All Tamworth Properties were Bought Without a Mortgage in the Last 7 Years

Tamworth
Tamworth

For most Tamworth people, a mortgage is the only way to buy a property. However, for some, especially Tamworth homeowners who have paid off their mortgage or Tamworth buy to let landlords, many have the choice to pay exclusively with cash. So the question is, should you use all your cash, or could a mortgage be a more suitable option?

Well, looking at the numbers locally…

1,784 of the 6,890 property sales in the last 7 years in Tamworth were made without a mortgage (i.e. 25.9%)

Interesting when compared with the national average of 31.9% cash purchases over the last seven years. Next, I wanted to see that cash percentage figure split down by years. As you can see from the graph, this level of cash purchases vs mortgage purchases has remained reasonably constant over those seven years…

Next, if you are going to go for a mortgage, the next question has to be whether you should fix the rate or have a variable rate mortgage. In the last Quarter, 90.57% of people that took out a mortgage, had a fixed rate mortgage at an average interest rate of 2.27%, although what did surprise me was only 65.79% of the £1.429 trillion mortgages outstanding in the whole of the UK were on a fixed rate.

The level of mortgage debt compared to the value of the home itself (referred to as the Loan to Value rate – LTV) was interesting, as 61.9% of people with a mortgage have a LTV of less than 75%. Although, one number that did jump out at me was only 4.33% of mortgages are 90% and higher LTV – meaning if we do have another property slump, the number of people in negative equity will be relatively small.

Next, looking at the actual number of properties sold, it can be clearly seen the number of house sales has dipped slightly in 2018…

So those are the numbers … let us have a look at the pros and cons of taking a mortgage, with specific focus on Tamworth buy to let landlords.  

Taking a mortgage will help a landlord increase their investment across more properties to maximise the return, rather than putting everything into one Tamworth buy to let property. This will enable the landlord to ensure if there a void in the tenancy, there should still be rent coming from the other properties. The flip side of the coin is that there is a mortgage to pay for, whether or not the property is let.

The other great motivation of taking a mortgage is that landlords can set the mortgage interest against the rental income, although that will only be at the basic rate of tax by 2021 due the recent tax changes. Banks and Building Societies will characteristically want at least a 25% deposit (meaning Tamworth landlords can only borrow up to 75%) and will assess the borrowing level based on the rental income covering the mortgage interest by a definite margin of 125%.

A lot will depend on what you, as a Tamworth landlord, hope to attain from your buy to let investment and how relaxed you would feel in making the mortgage payments when there is a void (interestingly, Direct Line calculated a few months ago that voids cost UK landlords around £3bn a year or an average of £1000 per property per year). You also have to consider that interest rates could also increase, which would eat into your profit … although that can be mitigated with fixing your interest rate (as discussed above).

So, with everything that is happening in the world, does it make sense to buy rental properties? Now we help many newbie and existing landlords work out their budgets, taking into account other costs such as agent’s fees, finance, maintenance and voids
in tenancy.

The bottom line is we as a country aren’t building enough property, so demand will always outstrip supply in the medium to long term, meaning property values will keep rising in the medium to long term. That’s not to say property values might fall back in the short term, like they did in 2009 Credit Crunch, the 1988 Dual MIRAS crash, the recession of the early 1980’s, the 1974 Oil Crisis, the early 1930’s Great Depression … yet every time they have bounced back with vigour. Therefore, it makes sense to focus on getting the best property that will have continuing appeal and strong tenant demand and to conclude, buy to let should be tackled as a medium to long term investment … because the wisest landlords see buy to let investment in terms of decades – not years.

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Tamworth Homeowners Have Made an Annual Profit Of £6,781 Since the Millennium

As we go full steam ahead into 2019, it’s certain that the Tamworth housing market in 2018 was a little more restrained than 2016 and 2017 and I believe this will continue into 2019. Property ownership is a medium to long term investment so, looking at the long-term, the average Tamworth homeowner, having owned their property since the Millennium, has seen its value rise by more than 180%.

This is important, as house prices are a national obsession and tied into the health of the UK economy as a whole. The preponderance of that historical gain in Tamworth property values has come from the growth in Tamworth property values, while some of it will have been enhanced by extending, modernising or developing their Tamworth home.

Taking a look at the different property types in Tamworth, and the profit made by each type, makes interesting reading..

However, we can’t forget there has been just over 60% inflation over those 18 years, which eats into the ‘real’ value (or true spending power of that profit) … so if we take into account inflation since 2000, the true spending power of that profit has been lower.

 So the ‘real’ value of the profit, after inflation, in Tamworth has been £4,140 per year.. still nothing to sniff at.

I wanted to show you that even though we had the 2008/09 Credit Crunch property market crash where, depending on the type of Tamworth property, property values dropped between 15% and 20% in 18 months … Tamworth homeowners over the long term are still better off than those renting.

Moving forward, the question I get asked time and again is what will happen in the future to the Tamworth Property market? Irrespective of what is happening in the World, Europe or even Central London, the biggest factor over the medium to long term to ensure that this level of house price growth is maintained in Tamworth is the building of new homes both locally and in the country as a whole. Whilst we haven’t had the 2018 stats yet, Government sources suggest this will be nearer 180,000 to 190,000, a decrease from the 2017 figure of 217,350 new households being created. When you consider that we need to build 240,000 households to equal demand (immigration, people living longer, higher divorce rates and people co-habiting later in life etc) … demand will outstrip supply and unless the Government start to spend billions building council houses .. this trend will continue for years (and decades to come).

Another factor is that whilst Tamworth landlords have been hit with higher taxes to enable them to actually be a landlord most, in every national survey, still intends to increase their portfolio in the medium to long term. The youngsters of Tamworth see renting as a choice, giving them flexibility and options that being tied to a home cannot give… thus meaning demand will continue to grow and landlords will be able to enjoy increased rents and capital growth, although those very same Tamworth buy to let landlords will have to work smarter in the future to continue to make decent returns (profits) from their buy to let investments. Even with the tempering of house price inflation in Tamworth in 2018, most Tamworth buy to let landlords (and homeowners) are still sitting on a copious amount of growth from previous years.

The question is, how do you, as a Tamworth buy to let landlord, ensure that continues?

Since the 1990’s, making money from investing in buy to let property was as easy as falling off a log. Looking forward though, with all the changes in the tax regime and balance of power, making those similar levels of return in the future won’t be so easy. Over the last ten years, I have seen the role of the forward thinking agents evolve from a person collecting the rent to a more all-inclusive role; I call it, ‘strategic portfolio leadership’. Thankfully, along with myself, there are a handful of agents in Tamworth whom I would consider exemplary at this landlord portfolio strategy where they can give you a balanced structured overview of your short, medium and long-term goals, in relation to your required return on investment, yield and capital growth requirements. If you would like such advice, speak with your current agent – whether you are a landlord of ours or not – without any cost or commitment, feel free to drop me a line.

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Live in Tamworth? About to Retire and Privately Rent? You Could be £4,100 a Year Worse Off!

You read the personal finance pages of the newspapers and it all seems to be the impending pensions crisis … where people aren’t saving enough for their retirement. But it’s not the lack of Tamworth peoples’ future pension incomes that are my immediate concern. The fact is that so many of the future retirees in Tamworth over the coming decade, who never bought their home in the Millennial years of the 1990’s and 2000’s, will have to make some tough decisions regarding what house they live in when they retire anytime between now and 2038.

In Tamworth, there are 488 privately rented households, where the head of the household is between 50 years and 64 years of age (meaning they will be retiring anytime between now and 2038). They are working now and easily paying the rent, yet what happens when they retire?

A Tamworth retired couple, who currently privately rent and who have paid their fully qualifying NI stamp over the last few decades are likely to retire with the couples State Pension of £1,091 per month plus a tiny bit of private pension if they are lucky. Given that the average rent in Tamworth is £741 a month – a lot of that pension will be lost in rent. This means taxpayers will have no alternative but to step in and top up the rent payments with Housing Benefit, yet…

The maximum housing benefit for a couple in Tamworth is currently £393.90 per month … leaving a significant gap when you consider the average rent in Tamworth is £741 per month

It is most people’s opinion that retirees are either council tenants or own their home outright. Looking at these figures though, it looks like both these ‘mature’ private renters could be having to make some decisions on their lifestyle and where they live, possibly looking at downsizing the home they rent to make things more affordable in their old age. Also, the government will be in for a horrible surprise as more of Tamworth people retire and continue to rent from a private landlord. Numerous Tamworth private renters, with little or no savings, will have to rely on Housing Benefit, which will put greater pressure on the public purse.

The average Tamworth retiree will need to find £4,165 pa to stay in their privately rented home after retirement

A recent report from Scottish Widows suggested that 1 in 8 OAP’s will be privately renting by 2032, up from the current one in 15.47 OAP’s whom currently private rent (or 6.47%). In fact, in that report they said the equivalent of more than one-third of the whole annual NHS budget would be spent on Housing Benefit for OAP’s in retirement living in private rented property.

What does this mean for mature Tamworth homeowners? I see many using equity release schemes to stay in their homes to pay for a better retirement and others more open to downsizing, selling their large home to a family that needs it and moving into a smaller apartment or bungalow … yet lets be frank – they aren’t building bungalows in large numbers in Tamworth anymore.

And for the Tamworth landlords? Well with the younger Millennials showing no appetite in jumping onto the homeownership bandwagon anytime soon, it can only result in the demands on the buy to let market from Tamworth tenants rising substantially. Of course, many Millennials will inherit money from their home owning parents in the coming few decades, yet a lot won’t as it will be spent on nursing home care and any leftovers (if any) split between siblings.

The solution to all this is to build more homes, of course. Last year we created/built just over 217,000 households in the UK, up from a post Millennial average of just under 150,000 households a year. We need to get back to the building booms of the late 1960’s and early 1970’s when on average 300,000 households were built … but back to reality … that won’t happen so it looks like we are turning into a nation of renters, which is of course good news for Tamworth buy to let landlords!

For those retiring in post 2050/2060, there is better news as official reports suggest those retirees will enjoy a State Pension approximately similar to today’s pensioners with auto-enrolment into top-up private pensions through their employer.

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The £2,752,893 Ticking Time Bomb for Tamworth Landlords

I just love looking over and keeping up to date the 108 pieces of legislation that govern the rental of residential property in the UK”  

…No Tamworth Landlord, ever

If you are one of the 1,287 Tamworth landlord’s that manages your own property, would it surprise you to know that there are 108 separate pieces of legislation that govern the rental of private houses to tenants. Oh, and on top of the 108 pieces of law, there are further 300+ regulations in the mix. Whilst Tamworth landlords may once have preferred to manage their Tamworth buy-to-let properties themselves to boost their profits, many Tamworth landlords are starting to see this as a false economy.

In the last four years, an additional 495 landlords in Tamworth have converted from self-managed to having their property managed by a letting agent in Tamworth, taking the total number of properties under management in Tamworth to 2,013 (out of a total of 3,300 private rental properties in Tamworth).

Now, don’t get me wrong, self-managing your Tamworth rental property can be a very fulfilling experience, allowing you, as a Tamworth landlord, to build a deep relationship with your tenant and your emergency 24 hour plumber, builder (happy to do small jobs at a drop of a hat), decorators, first name terms with their deposit provider, lawyer and EPC provider to name but a few. (Wow!)

Also, did you know if your tenants deposit isn’t registered, or doesn’t continue to be registered after the end the periodic tenancy upon renewal … you could be fined up to three times your deposit? With the average rental deposit in Tamworth being £713, each self-managed landlord in Tamworth could be fined £2,139 per tenancy if the deposit isn’t currently registered. Therefore…

…if every deposit of every Tamworth self-managed landlord’s property wasn’t registered, the total fines would amount to £2,752,893

Now of course, I am not suggesting for one minute all the self-managed landlords of Tamworth haven’t registered their deposits, yet almost on a daily basis, I come across horror stories to that effect. Another two (but by no means all) hot issues that the Courts are cracking down on, are doing immigration ‘Right To Rent’ checks on all tenants (yes all tenants) and confirmation proving the tenant received the ‘How to Rent’ guide. If that second issue cannot be proved (a ‘sent’ email won’t suffice), the landlord cannot serve the Section 21 Notice, meaning the tenant cannot be served notice to vacate the property.

To many, it’s really a case of DIY or getting a qualified professional in … as those additional Tamworth landlords mentioned above have done since 2014. You might say, “Of course you are going to say all this – you are a Letting Agent”. Well the choice really comes down to your time and your knowledge. If a Tamworth landlord is not equipped, or able, to devote time keeping up-to-date of legislation and law nor doesn’t want to be bothered 24/7/365 about a blown light bulb, dripping taps, have that confrontational conversation with their tenants about missing rental payments, or arbitrate arguments and disagreements between your tenant and the neighbours, it is perhaps better to pass this accountability/responsibility onto a letting agent.

One thing I would say is all letting agents aren’t the same. Would it surprise you to know that letting agents aren’t regulated?

Tamworth landlords that do use a letting agent should not forget that passing over management to a letting agent doesn’t mean they can disregard legislation and they are still responsible for deposit/rent repayment legal directives, civil fines or action if the letting agent makes a mistake. Therefore, it’s important to pick a respectable letting agent from the start.

Nevertheless, for those Tamworth landlords that see their job as a professional landlord and want to be intricately involved in the day to day administration of their rental properties, it can be worthy pursuit.

If you are a self-managed landlord in Tamworth, and want to know if your paperwork is in order please feel free to drop me a line and I am more than happy to do an ‘MOT’ on it to ensure you are the right side of the law.

Contact me on 01827 425195 or lorraine@hallandthompson.co.uk

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