What happened in the Dunstable and UK property market in 2016 and what did the self-manage landlord miss that could come back to haunt him ?
There have been a number of legal requirement introduced this year a number of which have been missed by some self-managing landlords I have met this year. It is important to make sure you keep abreast of all new legislation and not just the rent that arrives in your account each month.
Have a coffee with a local agent and discuss your properties with him, changes in any legal obligations or ask him for a rental assessment. Some would say you are just using him, but an agent who is experienced will happily discuss and advise a landlord or investor. After all, at the end of the day that conversation could lead to future business or recommendations.
Here are some changes you should be aware of. The one covering smoke alarms and CO2 alarms was introduced towards the end of last year but I regularly see internet searches to my Belvoir website by tenants asking if they should have smoke alarms.
I started off the year looking at derelict buildings in Dunstable’s High Street, West St and Church St. The old Woolworths building was highlighted as a future development and has now completed demolition and is awaiting further archealology digs before more work starts on 24 new apartments and retail on the ground floor High Street South frontage. I also looked at a number of disused offices that have been brought into residential use.
At the beginning of the year we saw the forthcoming increase in stamp duty resulting in a number of investors from London looking to buy in the area and there was a rush or purchasing before the end of March deadline.
Prices of property in Dunstable continued to rise and the figures available from Zoopla confirmed my observations showing that the house prices in Dunstable and Houghton Regis rose by 7.31% in the last 6 months of 2015 compared to 4.88% for Luton, 5.91% for Leighton Buzzard and even outstripping London which only saw a 5.83% rise in house prices during that time.
In February I looked at the impact of the new Junction 11a on the M1 and the Woodside link which is attracting companies such as Amazon to the area with the improved access to the M1 whilst allowing Dunstable Town Centre to be freed of congestion when they open in June 2017.
On April 17th The Sunday Times listed the 10 areas of Britain with the highest proportion of homes sold to first-timers. Who would have thought that Dunstable with no train station would be on that list ?
A number of housing projects have received planning or started on site this year including a large development behind the new Priory View building on Church St and the site opposite the Market Cross pub close to the Sainsbury’s garage which has been derelict for years. Work has now started on housing and a Lidl supermarket.
Stamp duty changes arrived at the end of March which saw the number of sales transactions plummet briefly as purchases had been rushed through to beat the deadline.
In May I looked at the possible effect on the housing market if we voted for a Brexit. I felt that there would be little impact in our local areas but overseas investors who have bought property in London might decide to invest elsewhere. Also the London market was already showing signs of a slowdown.
In July it was announced that more than 400 jobs would be created in Dunstable after a Chinese company signed on the dotted line for premises in Prologis Park Dunstable.
The Bank of England continued to hold Interest rates at a historically low figure and Post Brexit the message from local businesses was ‘Business as usual’. The message at networking groups of local
In August I highlighted how a number of new shops had opened in Dunstable in recent months and more were coming despite the best efforts of Mary Portas and the Daily Mail who had previously delivered a gloomy verdict on Dunstable
In September I looked at why Dunstable had seen a huge growth in rental prices compared to Luton and Leighton Buzzard which both have train stations.
Demolition of the old Woolworths store also started in September and in November planning was submitted for housing on part of the old AC Delco opposite the Fire Station and The Incuba.
In the Autumn Statement the Chancellor announced a ban on Letting Agent fees expected to come into force in 2018. This was not unexpected and is likely to see some Estate Agents leave the letting market and concentrate solely on sales.
Next year sees the start of the reduction of the mortgage interest tax relief starting in April 2017 and phased in over 4 years. If you are currently offsetting mortgage interest against income tax and you haven’t spoken to your accountant or financial advisor about the changes you should do so now.
Have a Merry Christmas and a Happy New Year and remember I’m always open to a cup of coffee and a chat about the property market and your own property investments
Who is the Letting Agent acting for when arranging a tenancy and managing a property and could the ban on Letting Fees change this?
We are still waiting for confirmation from the government on the timescale for the ban on letting fees charged to tenants with some quoting 12 – 18 months and others saying it could be added to other legislation next year to speed the process.
Although the client of a Letting Agent is the landlord the fact that a tenant is paying them admin fees towards the arrangement of the tenancy I feel, and hopefully other agents also feel that they have some responsibility towards the tenants as they are also paying for a service.
I do hear from tenants that the letting agent they have or have had in the past hasn’t acted in their interest maybe in regards to repairs on a property or when it comes to the deposit being returned at the end of a tenancy. I feel that as we are paid by both the landlord and tenant we have a duty to both to work out the best outcome for both parties.
If it is the situation now that some agents currently act in the landlords best interest only and don’t represent the tenant who has paid them a fee, I fear that when the time comes and only the landlords are paying a fee to the letting agent many agents might decide to only represent the landlords interests.
The main argument about the fees charged relates to the extortionate fees and the hidden fees sometime charged by agents. I was surprised when carrying out a viewing yesterday at a property we are about to advertise that the tenants had been charged a fee by their current agent for something that wasn’t required. They have just finished a fixed term tenancy and the owner of the property wanted the tenancy to be a monthly rolling tenancy and not another 6 or 12 month fixed term. The agent who is based in Dunstable charged the tenants £30 each to do this, but as I explained to the tenants the fixed term tenancy automatically becomes a rolling monthly periodic tenancy when the fixed term ends. There is no need for a new tenancy and this is a case of an agent charging fees on tenants that are not required. Needless to say the tenants are going back to the agent to insist they have their money returned to them.
Daniel Bourke is the owner of Belvoir Lettings Dunstable and in his previous career in Architecture he was an Associate in a leading London Architectural practice