Landlord group blames Selective Licensing for steep rent rises

Posted On May 7 2021 by

first_imgHome » News » Housing Market » Landlord group blames Selective Licensing for steep rent rises previous nextHousing MarketLandlord group blames Selective Licensing for steep rent risesLandlords in Nottingham say costs of up to £780 per property are being passed on directly to tenants, as many had predicted.Nigel Lewis18th October 20190859 Views A recently-introduced Selective Licensing scheme has been blamed for fast-rising rents in one of the UK’s busiest property markets.Using data from Zoopla, which this week identified Nottingham (pictured, above) as one of the hottest private rental markets in the UK, a leading property owners’ group in the city has said the property licensing scheme is a key reason for a 5.4% rise in rents, a greater increase than in Leeds, Bristol, Leicester, Derby, York, Brighton, Liverpool or Sheffield.Giles Inman, a business development manager at East Midlands Property Owners Group, has told local media that the 14-month old Selective Licensing scheme introduced in Nottingham covering 32,000 rented properties was having its predicted effect.When the scheme went live in August 2018 many local landlords said the extra bureaucracy and costs would persuade many landlords to put up their rents.Rogue landlordsLandlords also said they were worried that good ones would sign up to the scheme, which costs either £480 or £780 per property depending on a landlord’s accreditation status, while rogue landlords would ignore the regulations.This appears to be coming to fruition too; half of the 32,000 properties in the city are unlicensed, it is claimed.“There are lots of factors that are driving rent up and Selective Licensing is one of them,” says Inman (left).“It has been a costly exercise for landlords across the city and they said additional costs would be passed on.“Every landlord, and I speak to hundreds of them, they have all put their rents up since August last year. They have gone up because the costs have gone up. We are a business.”Read more about Selective Licensing schemes. East Midlands Property Owners Group Giles Inman Selective Licensing scheme Nottingham October 18, 2019Nigel LewisWhat’s your opinion? Cancel replyYou must be logged in to post a comment.Please note: This is a site for professional discussion. Comments will carry your full name and company.This site uses Akismet to reduce spam. Learn how your comment data is processed.Related articles Letting agent fined £11,500 over unlicenced rent-to-rent HMO3rd May 2021 BREAKING: Evictions paperwork must now include ‘breathing space’ scheme details30th April 2021 City dwellers most satisfied with where they live30th April 2021last_img read more

To fix or not to fix your home loan, that is the question

Posted On Oct 6 2020 by

first_imgCEO of McGrath Estate Agents, John McGrathIN recent times, most lenders have moved independently of the Reserve Bank and raised their fixed rates.Some have raised variable rates, too. There’s also a difference in the rates offered to investors versus owner occupiers, with owner occupiers tending to receive more favourable treatment.I had a chat with Alan Hemmings, General Manager of McGrath’s mortgage broking division, Oxygen Home Loans, and asked him if borrowers should consider fixing now.Here’s what he had to say:“The average three-year fixed rate over the past three years has been 4.69 per cent, so with fixed rates available today below this figure it is still an opportune time to fix now. There are still fixed rates available below 4 per cent, too.“Lenders have been increasing their fixed rates mainly due to the increasing cost of funding these particular loans.“Fixed rates are funded from several sources including other banks, customers’ deposit funds and overseas markets. Recently, we have seen the cost of funds from overseas markets increase, therefore the banks are passing this on to the customer.“At present, there is very little difference between fixed and variable rates, particularly when comparing some of the specials being offered by lenders across both variable and fixed loans of up to three years.“If you’re considering fixing, you need to have a clear understanding of your circumstances over the next period of time. For example, do you want certainty with your repayments? Are you planning on adding to your family? Would you possibly want to sell in the near future?“Working with a broker will assist in making the best decision to suit your needs. That might be fixing your entire loan, or perhaps only a portion of it to give you flexibility.”I also asked Alan what he expects in terms of Reserve Bank decisions on official rates this year.More from news01:21Buyer demand explodes in Townsville’s 2019 flood-affected suburbs12 Sep 202001:21‘Giant surge’ in new home sales lifts Townsville property market10 Sep 2020“Given the moves by banks to increase fixed rate loans, this probably means the next official interest rate movement will be an increase. Most economists are now predicting this, the debate is about when.“Irrespective of what the RBA does, we continue to see banks move on interest rates and not just in the fixed rate area. Recently, we have seen some lenders increase variable rates for investors.”Personally, when I’ve borrowed money to buy property, I’ve consistently used variable interest rate finance. But if I did sense that an upswing in interest rates was likely, or that I might have some issues with my cash flow in the medium term, I’d be locking in a fixed rate straight away.Determining what is best for you comes down to your individual goals and circumstances but to help you make the decision, Alan has provided his top pros and cons to fixing your loan.Advan tages of fixing your home loanKnowing what your home loan repayments will be for the term of the fixed period. If the Reserve Bank or your lender increases interest rates you are protected for the term of the fixed loanDisadvantages of fixing your home loanBreak costs might be payable if you repay your loan before the end of the fixed term. If the RBA or your lender decides to reduce rates, your rate will not decreaseJOHN MCGRATHlast_img read more