Superstrike V Rodrigues

On the 14th June 2013 the Lord Justice Lloyd handled the appeal on the Superstrike v Rodriguez case. The outcome of this appeal has put the lettings world in turmoil for private landlords and letting agents, as well as all the Deposit Schemes who are still seeking legal advice. Online property forums are in full discussion as well as landlord governing bodies.

This particular case is because a tenant entered an Assured Shorthold Tenancy(AST) prior to April 2007, which meant the deposit did not have to be protected. The tenancy was for twelve months and expired in January 2008, it then proceeded into a statutory periodic tenancy(SPT). Now up to this point, this has been the procedure we have all been advised to do, the rules stated that only when you entered a new AST did you need to protect the deposit.

The case however, brings up rightly that when a tenancy is allowed to go into a SPT this is deemed as a new distinct tenancy and not a continuation and therefore the deposit should have been protected. And, because of this when the landlords took the tenants to court on a Section 21 notice, the court refused to recognise it.

The majority of landlords will have tenants in AST’s that started after April 2007, but if you have a tenant prior to this date and thought there was no need to protect, then my advice is to protect it now, as it would show your good intentions.

However, the dilemma now falls with periodic tenancies now being classed as new distinct tenancies and this is where problems may arise and why the deposit schemes are seeking legal advice because their own website clearly say you do not need to protect a deposit again if in a monthly rollover. And if each new month is a new distinct tenancy are we to renew monthly? What about guarantors who were on the original tenancy, do they not continue?

This is likely to go to the Supreme Court, so you can watch this space or put your tenants in a new tenancy and be covered.

Posted in Buy to Let Properties, Financing, Franchise, Investment Property, Landlord Events / Exhibitions, Legislations, Property Investment, Second Homes, The Property Market, Uncategorized | Leave a comment


The HMRC have given a deadline to all property owners who received a rental income either here in the UK or abroad. This applies to any property that is not a main residence, including holiday homes. They have pledged to crack down on any buy-to-let property owners who are trying to get away with capital gains tax avoidance.
Marian Wilson, head of HMRC campaigns, said: “Some people will not understand that selling a second home, a holiday home or a property disposed of as a gift could attract Capital Gains Tax”.

HMRC can find out about sales of property from land registry records, advertising, changes in reporting of rental income, stamp duty land tax (SDLT) returns, capital gains tax (CGT) returns, bank transfers and other ways.
People have until August 9 to tell HMRC about any unpaid capital gains tax on property sales and must pay any tax owed by September 6. Until this date, fines will be smaller for those who haven’t paid their tax. It is hoped this will encourage more landlords to come clean.
Marian Wilson advises: “It is better to come to us before we come to you. After the opportunity closes on 6 September, HMRC will use information it holds about property sales in the UK and abroad to identify people who have not paid what they owe. Penalties or even criminal prosecution could follow.”
People don’t need to be concerned about the sale of their main home, which is usually exempt from CGT.

Posted in Buy to Let Properties, Financing, Investment Property, Landlord Events / Exhibitions, Legislations, Property Investment, Second Homes, The Property Market | 2 Comments

Landlord Update on Inspection hatches for Gas Safety Certificates

As of 1st January 2013, all rented properties that have a gas central heating boiler flue that has either been fitted hidden in the ceiling space or fitted away from an external wall must now be fitted with an inspection hatch. If your boiler is situated on an outside wall it is unlikely that you have this type of flue and if you can see the entire flue it will not affect you, your gas engineer will be able to tell you.

All gas engineers must now be able to inspect the whole length of the flue, in line with industry guidance. If they are unable to fully inspect the flue it must be deemed at ‘At Risk’ (recommending to not use)and the engineer will ask for consent to turn it off. You are within your rights to refuse permission for it to be turned off; however you will be asked to sign paperwork to confirm you accept responsibility for those defects identified in the system – which would be the possible leak of carbon monoxide escaping unnoticed from the concealed flue into the property.

You may be able to go back to the builder if it is less than two years and look to the home warrantee if less than 10 years.

What it does mean is the gas engineer will not be able to provide a Gas Safety Certificate until an inspection hatch has been fitted and they have inspected the whole flue and as a landlord you must by law have a Gas Safety Certificate in place to rent a property out and this must be renewed every year.

Posted in Buy to Let Properties, Financing, Franchise, Investment Property, Landlord Events / Exhibitions, Legislations, Property Investment, Second Homes, The Property Market, Uncategorized | 2 Comments

Warning on electrical appliances

Landlords and Letting Agents are being advised to look at the electrical products in their properties after a number of fires have been attributed to white goods. Only last week, Dorset fire and rescue were called to a serious house fire caused by the tumble dryer.

Appliances to look out for are fridge freezers, cookers, tumble dryers and washing machines (existing or recently new)

The warning comes after a continuing spate of safety alerts and product recalls. However, despite this, a large number are not registered with the manufacturer when bought by the landlords (or their agent, if they are buying on their behalf), so cannot be contacted.

The fact is that electricity is a major cause of fires in UK homes, and that includes rental properties. In one recent insurance claim, a landlord suffered over £100,000 worth of damage to his property and loss of rent following a fire from a faulty fridge freezer.

One manufacturer, Beko, has been repeatedly at the centre of stories about domestic fires caused by their appliances, with fire brigade claims that they have caused at least 20 blazes at homes since 2010.

You can find out further information by going to the following sites;

Electrical Safety Council (ESC): You will need to enter a model number, brand name or description of a particular item. If the product has been recalled, the website will advise on your next steps.

Recall UK is the primary product recall site that lists all UK product recalls, for all product types, announced in the last few weeks:

Posted in Buy to Let Properties, Financing, Franchise, Investment Property, Landlord Events / Exhibitions, Legislations, Property Investment, Second Homes, The Property Market, Uncategorized | 2 Comments

Dorset Landlord left counting the costs

A Dorset landlord is counting the costs of his futility and refusal to play by the rules.

The Landlord had originally protected a deposit given to him by a tenant through MyDeposits; however the Landlord did not renew his membership the following year and despite MyDeposits writing to him and advising of the consequences, the landlord neither renewed nor joined another scheme.

Failure to protect a deposit within 30 days of receiving it will result in a ‘Section 21 Notice to Quit’ not being recognised in a Court of Law and the tenant being entitled to up to three times the original amount paid as a deposit.

When the tenants vacated the property and requested their deposit back, the Landlord refused, leaving the tenant with no option other than to take the Landlord to court.

Although the landlord cited dilapidations’ in the property, he was ill equipped with a hand written Inventory and photographs that were undated. The court sided with the tenant and awarded £350 costs, the original deposit of £700 and three times the deposit of £2100, bringing the total to £3,150.

The courts are coming down heavy on Landlords not protecting deposits. The ruling to protect deposits originally came in to force in April 2007, when all deposits had to be protected within 14 days, however since April 2012 an amendment in the Localism Bill changed this to 30 days with no exceptions.

The legislations are changing all the time and it is becoming more vital for a landlord to belong to a Landlord Scheme to keep up to date with news or a good reputable Letting Agent.

Posted in Buy to Let Properties, Financing, Investment Property, Landlord Events / Exhibitions, Legislations, Property Investment, Second Homes, The Property Market, Uncategorized | Leave a comment

TAXMAN to target Buy To Let Landlords

HMRC have launched 12 task forces aimed at targeting landlords with 3 or more properties in 2011/12 and more in 2012/13.
The buy-to-let taskforce will specifically target tax evasion among buy-to-let landlords who own or rent out more than three properties. HMRC taskforces form part of the government’s aim to raise an additional £7bn a year by 2014/15 through tacklingtax evasion, avoidance and fraud.
Mike Wells director of risk and intelligenceat HM Revenue and Customs (HMRC), is quite clear –“ if you deliberately seek to evade tax we can and will track you down and you’ll face not only a heavy fine, but possibly a criminal prosecution as well.”

The Task forces will gain information from;

Banks Mortgage applications
Land registry Electoral rolls
Council tax records Letting agents

It is thought the HMRC have identified 80,000 landlords who may have claimed too much tax relief or who have failed todeclare all the rent received.
Property investors who sold homes several years ago have also been pinpointed as well as overseas landlords.
Of course, if you keep accurate records and declare everything you have nothing to worry about.

Posted in Financing, Property Investment, The Property Market | 1 Comment

Continued demand for rental properties

A recent survey conducted by mortgage organisation ‘Paragon Group’ reports an ongoing growth in demand for rental properties, with demand being at its highest for two years in the last quarter of 2010.

First time buyers have always struggled to get access to mortgage finance from lenders however it appears that now more than ever tenants are struggling to get onto the property ladder. This suggests a correlation between the increase in demand for rental properties and the decrease in the number of mortgages being accepted.

With the increase in demand for landlords, confidence should be booming yet not all buy to let property owners have this attitude. The monthly Upad Landlord Confidence survey recently found that confidence in the buy to let property market fell from 63% in January to 61% in February.

It appears to be the rising rent rates that are giving the 61% of landlord’s confidence in the market, and these rates won’t begin to fall until the banks relax their mortgage lending criteria.  For the remaining landlords, it’s the worry of insufficient funds from the tenants and their reluctance to commit that is causing their lack in confidence.

Whatever landlords are feeling over the current buy to let market, according to Upad’s CEO James Davis, letting a property isn’t just about finding a tenant and raking in the rent; it’s about finding the right tenant and being as sure as you can be that they’ll look after both your property and your income.

Posted in The Property Market | 1 Comment

Housing shortage will increase rents

The third quarter in 2010 saw the development of new homes at its lowest in 5 years, the second lowest of the past 19 quarters and the lowest since 1923. The country has an estimated one million housing shortage and the New Housing Pipeline shows there was a steady fall in planning permission being granted.

Although property prices are predicted to fall again in 2011, London and the South are expected to remain resilient.  This coupled with the housing shortage does make buying Buy To Let (BTL) properties still a positive return and current yields are still bringing in a more favourable return than savings accounts.  New BTL mortgages are starting to slowly come back, Coventry recently released a 3 years deal at 4.99%.

Good news for Landlords – because of the housing shortage, we will see a rise in rental prices, however due to the economic climate a rent guarantee insurance of some kind will be advisable.  2009 saw a 50% increase in rent arrears nationally and although this decreased slightly in 2010, there is concern we will see this coming back again in 2011.  This makes it more vital to use a good reputable agent who can limit this with good referencing techniques.

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