Good Landlording

By: Suzanne Smith and Richard Jackson
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  • A weekly podcast co-hosted by Suzanne Smith and Richard Jackson, who discuss practical tips to help you start, grow and succeed as a landlord in England
    © 2024 Good Landlording
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Management Economics Personal Finance
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Episodes
  • #25: Overview of Labour’s new Renters’ Rights Bill

    #25: Overview of Labour’s new Renters’ Rights Bill
    Sep 12 2024
    Suzanne Smith and Richard Jackson discuss their first impressions of Labour's new Renters' Rights Bill in this special episode of Good Landlording, shortly after Bill was published. They go through the big ticket items in the new Bill, how it compares to the old Renters (Reform) Bill, and what landlords should do to prepare for the new Bill. They'll be discussing the Renters' Rights Bill in more detail in the coming weeks and months, but this episode provides a useful overview of what's in the Bill, and what's not. >> Ask a question: Click here for question form What we cover in this episodeOverview of the Renters' Rights BillThe key parts of the Renters' Rights Bill1. The abolition of Section 212. The abolition of ASTs and fixed term tenancies3. Changes to Section 8 Grounds for Possession4. No rent controls in the Renters' Rights Bill5. Change to rent increase procedure6. No encouragement of rental bidding7. Other provisions in the Renters' Rights BillWhat should landlords do about the Renters' Rights Bill? Overview of the Renters' Rights Bill The Renters' Rights Bill is very similar to the old Renters Reform Bill, but with a fair few Labour "tweaks", notably removing the concessions given to Conservative backbench MPs at the Report Stage of that Bill, banning rental bidding, and giving tenants more rights when it comes to challenging rent increases. There are no dramatic surprises as the main provisions have been well signalled by the Labour government. The amendments that Labour proposed at the Report Stage of the Renters (Reform) bill have been reflected in the new Bill. >> Useful resource: Renters' Rights Bill Hub >> Blog post: How the Renters' Rights Bill compares with the Renters (Reform) Bill The key parts of the Renters' Rights Bill 1. The abolition of Section 21 The Renters' Rights Bill takes the same approach to the abolition of Section 21 no fault evictions as the Renters (Reform) Bill. However, there will be no delay to the implementation for existing tenancies for the Lord Chancellor's review of the operation of the County Court eviction process as there was with the Conservative's Bill. Instead, there will be a "big bang day" when all tenancies will switch to the new regime, without Section 21, whether they are new or existing tenancies. The abolition won't affect notices that are served before the Bill comes into force. >> Blog post: How and when will Labour abolish Section 21 no fault evictions? 2. The abolition of ASTs and fixed term tenancies As per the old Bill, assured shorthold tenancies will be replaced by periodic assured tenancies and landlords won't be able to sign up renters for a minimum period. Renters will be able to serve 2 months' notice to quit at any time. Labour have done this to make tenants flexibility so that they're not tied in and can leave places that are in disrepair. It's part of their aim of giving more power to renters. There is no exception for student landlords, and they won't be able to stop tenants moving out at Easter or after the exams in May. 3. Changes to Section 8 Grounds for Possession Contrary to media reports over the summer, the Renters' Rights Bill does not introduce a hardship test for Mandatory Grounds, which would have effectively turned all Mandatory Grounds into Discretionary Grounds. Landlords will be pleased that the new Bill contains the new Ground 1A from the Renters Reform Bill which entitles them to possession if they can demonstrate they wish to sell the property. 4. No rent controls in the Renters' Rights Bill Despite recent speculation, there are no rent controls in the Bill and no provisions to devolve the power to impose rent controls to local government and the Metro Mayors. 5. Change to rent increase procedure Landlords will only be able to increase the rent by using the Section 13 procedure, and the notice will be doubled from one month to two months.
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    15 mins
  • #24: Labour’s plans for replacing leasehold with commonhold

    #24: Labour’s plans for replacing leasehold with commonhold
    Sep 2 2024
    Almost 40% of the properties in the PRS in England are leasehold, so the chances are that if you're a private landlord listening to this podcast, you'll have at least one leasehold property in your portfolio. If you do own a flat in England or Wales, or are thinking of buying one, you need to listen to this episode of the Good Landlording podcast. This is because the government plans to "take steps to bring the feudal leasehold system to an end", by "reinvigorating commonhold through a comprehensive new legal framework", and replacing leasehold with commonhold. As part of this, the Government say they will ban the sale of new leasehold flats so that commonhold becomes the default tenure. This promises have significant implications for leaseholders, should it see the light of day, and it's something that property investors need to understand. However, abolishing "feudal" leasehold is also a lot easier said than done, and in this episode of Good Landlording, Richard and Suzanne discuss what it all means, and what's likely to happen in practice. They also talk about the implementation of the Leasehold and Freehold Reform Act 2024, and plans to abolish forfeiture and tackle ground rent for existing leases. >> Ask a question: Click here for question form What we cover in this episodeRecap of what's in the Leasehold and Freehold Reform Act 2024What are Labour's proposals for the draft Leasehold and Commonhold Reform Bill1. Labour promises to "tackle" ground rent2. The abolition of forfeiture for leasehold properties3. Labour's promise to replace leasehold with commonholdHow does commonhold differ from leasehold?Why does the Government wish to abolish freeholdThe transition from leasehold to commonhold Recap of what's in the Leasehold and Freehold Reform Act 2024 The Leasehold and Freehold Reform Bill managed to get onto the statute just before the election, becoming the Leasehold and Freehold Reform Act 2024. The Leasehold and Freehold Reform Act 2024 has the following key provisions: Considerably longer lease extensions, ie 990 years instead of 50 for houses or or 90 for flats. A new valuation process that is more favourable to the leaseholder. The banning the sale of new houses as leasehold, making sure that they are sold as freehold. Changes to the valuation methods for collective enfranchisement by leaseholders. Greater transparency over service charges and estate management charges. At the moment the Act has only received Royal Assent, but hasn't yet come into effect. However the Government's July 2024 King's Speech says "The Government will act quickly to provide homeowners with greater rights, powers and protections over their homes by implementing the provisions of the Leasehold and Freehold Reform Act 2024". They also say in the King's Speech that they will "will consult on the best way to bring [...] the injustice of ‘fleecehold’ private estates and unfair costs to an end [...] and implement new protections for homeowners on private estates in the Leasehold and Freehold Reform Act 2024. It's expected that leaseholders will need to wait until 2025 or 2026 before they can exercise their rights to extend leases for up to 990 years, but the Government will be under pressure to do it as soon as possible. What are Labour's proposals for the draft Leasehold and Commonhold Reform Bill The King's Speech refers to publishing a draft Leasehold and Commonhold Reform Bill that will "reinvigorat[e] commonhold by modernising the legal framework". They will also "restrict the sale of new leasehold flats. The Government will consult on the best way to achieve this, so that generations to come will benefit from absolute homeownership". The use of the word "draft" means the Bill itself is unlikely to be presented to parliament in the next year. Instead, they will publish it to enable people to comment on it as commonhold is very complex.
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    22 mins
  • #23: What makes a successful HMO business, with Wendy Whittaker-Large

    #23: What makes a successful HMO business, with Wendy Whittaker-Large
    Aug 28 2024
    In this summer special episode of Good Landlording, Richard Jackson and Suzanne Smith pick the brain of Wendy Whittaker-Large about what makes a successful, systemised HMO business. The episode a fantastic source of information for anyone who has HMOs, is thinking of converting a property into an HMO or is just "HMO-curious". Wendy gives an insider's view of how to make HMOs a success, and build an efficient systemised HMO business. >> Ask a question: Click here for question form What we cover in this episodeAbout Wendy Whittaker-LargeWhy invest in HMOs?Why do renters like HMOs?Which locations are good for HMOs?How tenancy agreements differ for HMOsWhy 6 Bedroom HMOs are the sweet spotWhat Article 4 means for HMO landlordsTips for developing an successful HMOTips for managing HMO tenantsThe importance of having a systemised business for HMOs About Wendy Whittaker-Large Wendy Whittaker-Large is the multi award winning founder of BestNest, a property development and lettings business, and HMO Success, a specialist HMO training and mentoring company. She's also the chair of the HMO Council Tax Reform Group which successfully overturned the single banding of HMO rooms for council tax in 2023. Wendy is a landlord who's grown a large property portfolio since 2012, mostly focused on HMOs. She has also published two books about HMOs: 101 Essential Tips for Running a Professional HMO and Extraordinary Profits from Ordinary Properties (Amazon links). Wendy is a regular on the speaking circuit, and has a successful podcast called the HMO Success Podcast which is available on Apple, Spotify and Podbean). Why invest in HMOs? An HMO is a house in multiple occupation, in other words, a building in which three or more households live together It's a cross between a hotel and a house, with people living there, or a family home where you might have you know four or five adults living. Whatever happens in the market, there is always a need for good quality, dense housing. Wendy believes HMOs offer tremendous benefits both for the people who live there and also, of course, for landlords investing in this type of housing. Buying an HMO allows one property to generate more revenue than renting it out as one single family let. Wendy says that an average yardstick would be £1,200 - £1,400 pcm net profit across the country. On the other hand, there is more work, more investment and more management time. HMOs cost more to refurbish, as they need to have better fire doors and fire protection, and amenities. The HMO is likely to need a licence, and they are subject to more legislation, such as the HMO Management Regulations. >> Blog post: Property investor guide to the successful management of HMOs Why do renters like HMOs? Renters like HMOs as usually they only pay one amount which includes the rent and the bills. In an age of uncertainty over fuel bills and the cost of living, tenants like only paying one amount per month which covers everything. Living in an HMO is very flexible as there is usually no long term commitment. Tenancies are usually for 6 months and are suitable for those on contracts, who are maybe working across the country, who don't know where they're going to be in the future. Which locations are good for HMOs? Wendy recommends cities and large towns with more than 80,000 people, as they are likely to have the demand from HMO renters. How tenancy agreements differ for HMOs HMO landlords should use a specialist tenancy agreements for HMOs, as opposed to ones for where the property is let to one household or two sharers. This is because professional HMOs tend to be let by the room, and not as a joint tenancy. The renters have exclusive possession with quiet possession of their room (and perhaps an en suite), and share the common parts. The landlord is able to enter the common parts for inspections, and often include a cleaner in the rent.
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    33 mins

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