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Buy-to-let beginners

Buy-to-lets are an attractive investment because they have the potential to provide additional monthly income while also representing a long-term commitment.

If you’re considering buying a buy-to-let property and becoming a landlord, then you’re in good company. Buy-to-let property purchases are on the increase, and house prices in the UK have been rising for years. There is currently a shortage of rental properties in the UK, and demand for them is high.

While buying to let can be lucrative, investing in property is a big financial commitment, and it’s important to know both the risks and the benefits before you begin searching for investment property for sale.

In this guide, we will explain the basics of how buy-to-let mortgages work and the advantages and risks involved with investing in one.

What is a buy-to-let property?

A buy-to-let is a property that the owner rents out to tenants to earn an income rather than living in it themselves.

Many people invest in buy-to-let properties to start earning an additional income on top of their day job, although some people manage multiple buy-to-let properties full-time.

Any property type can be a buy-to-let, from small city flats to large family homes.

Unless you have a big ol’ pile of cash saved up, you’re going to need a mortgage to finance your buy-to-let venture. If you plan to buy a property to rent, rather than applying for a standard residential mortgage, you’ll need to apply for a buy-to-let mortgage.

Can I live in my buy-to-let property?

No, buy-to-let properties require specialist buy-to-let mortgages. One of the conditions of a buy-to-let mortgage is that you rent the property out to tenants and do not live in it yourself. If you want to live on the property, you need to apply for a standard mortgage.

What are the differences between a residential mortgage and a buy-to-let mortgage?

Buy-to-let mortgages work a little differently from standard mortgages. Here’s a rundown of the key differences you should know before applying for one:

Interest-only – Most buy-to-let mortgages are interest-only mortgages. This means that you are only required to pay the interest on the mortgage each month, not repay any of the loans. At the end of the mortgage, you will need to either pay back the loan in full or re-mortgage. Many people pay off the loan using savings from the rental income they have earned by letting the property, or by selling it.

The amount you can borrow – When assessing how much to lend you, most lenders will consider the property’s potential rental income as well as your personal income.

Higher rates – Usually, buy-to-let mortgage rates are a little higher than standard residential mortgage rates because lenders deem them to be riskier.

Larger deposit – You will usually require a significantly larger deposit for a buy-to-let mortgage than you would for a standard residential mortgage. Most lenders require a deposit of between 20% and 25% of the property value.

Higher fees – Most lenders charge higher arrangement fees on buy-to-let mortgages. While you are usually charged a flat fee for taking out a standard mortgage, buy-to-let arrangement fees are usually charged at a percentage of the mortgage value.

Can anyone get a buy-to-let mortgage?

Taking out a buy-to-let mortgage can be more challenging than taking out a standard residential mortgage.

Lenders tend to view buy-to-let mortgages as riskier, so there can be more hoops to jump through, criteria to meet, and money to be paid to secure one.

The rules and criteria for getting a buy-to-let mortgage vary depending on which lender you choose and which property you wish to buy to let.

Common requirements for a buy-to-let mortgage include:

  • A deposit of at least 25% of the property value
  • A good credit history
  • You must be under the lender’s age limit (usually 70-75 years old) when the mortgage ends
  • You must earn enough to afford to invest in property (usually upwards of £25,000 p/a)
  • Sometimes you may also need to be a homeowner (either owned outright or with a mortgage).

If you don’t meet all the criteria above, you may still be able to get a buy-to-let mortgage, depending on your circumstances. The best way to find out if you are eligible for one is to speak to a trusted mortgage advisor.

Can a first-time buyer buy to let?

While many lenders expect you to already own your own home before you apply for a buy-to-let mortgage, it may still be possible for first-time buyers to get a buy-to-let mortgage if they meet the lender’s criteria.

There are, however, some important things to know before you take the plunge as a first-time buyer.

No first-time buyer benefits. You won’t get the same first-time buyer benefits on a buy-to-let as you would on buying a home to live in yourself. Neither stamp duty nor first-time buyer’s relief is available on buy-to-let properties.

If you also want to buy a house to live in yourself. If you buy to let before buying your own home, it could make buying your own property a little tricker later down the line. This is because when assessing your suitability for a mortgage, lenders will take into account the debt you have outstanding on your buy-to-let mortgage. You would also need to pay the full buy-to-let surcharge if you buy another property when you already have a buy-to-let.

How to choose a buy-to-let mortgage

Just like a standard mortgage, buy-to-let mortgages are available in all different shapes and sizes, including fixed-rate, variable-rate, tracker, and discounted variable. The appropriate buy-to-let mortgage for you will depend on several different factors, including your financial situation, the size of the deposit you put down, the property that you are buying to let, and the property’s rental value.

What are the advantages of a buy-to-let?

According to an article published by the BuyAssociation, the appetite to invest in property in the UK is rising, with buy-to-let landlords more active with property purchases in the first quarter of 2022 than they have been since 2016.

Let’s find out a few key reasons why so many people are choosing to invest in property and become landlords now.

Rising house prices

Whilst buy-to-lets are by no means a foolproof investment, investing in property in the UK is a pretty safe bet as house prices have been rising reliably for a long time. You can maximise your return on investment by carefully researching which areas are most in-demand and the type of rental properties that people are looking for there.

Capital growth

Capital growth is the amount by which your property goes up in value during the time you own it. As UK house prices have been increasing for some time, the outlook for long-term capital growth on buy-to-lets currently looks good.

Extra income

The rental that you charge on your property should cover your mortgage interest payments by at least 125%, meaning that once you’ve covered your buy-to-let’s monthly mortgage payment, you should still have some additional profit leftover to do with as you please.

Potential to own a property at the end

Many people save the additional income that they earn from their buy-to-let to pay off the mortgage on the property. If you do this and the property also undergoes capital growth, you could gain a very valuable asset in the long term.

Opportunity to expand

Why stop at one buy-to-let? If your first venture into property letting is a success, you could save the profits from your first to invest in a deposit for another. Who knows, you may even end up with your own buy-to-let investment portfolio, investing in different property types in different locations.

High demand

As mortgage rates rise, so does the demand for rental properties. According to Rightmove, total tenant demand is up by 6% on last year, but available properties are down by a whopping 50%. There is currently a shortage of rental properties available in the UK, making competition for rental properties high and reducing the risk for those looking to break into the buy-to-let sector.

High rental value

As demand for rental properties soars, so do rental values, which are currently at their highest on record. According to Rightmove, in 2022, the national average asking rent has increased by 10.8% since last year.

Can provide passive income

Once you’ve found your property, got your mortgage, and welcomed your tenants, buy-to-let properties can quietly tick over in the background providing a passive income with little input from you for months on end. Of course, things won’t always be like that, you may experience other months where everything seems to be going wrong with the property, or your tenants are causing you a headache, so be prepared to take the rough with the smooth.

What are the disadvantages of a buy-to-let?

Buy-to-lets can be lucrative investments, but they’re not a guaranteed way to make money and do come with their challenges and risks.

If you’re planning on buying your first buy-to-let, it’s important to know the risks involved and make sure you’re going into the venture with your eyes wide open.

House prices could go down

While house prices have, generally, been rising for many years, they could go down, and then your buy-to-let could lose value.

Costs when the property is empty

It can be very difficult to keep a buy-to-let property occupied at all times, especially if a tenant leaves unexpectedly. You will need to have the financial means to pay the mortgage on your buy-to-let out of your own pocket during any periods where it is not occupied by tenants.

Property maintenance

Unless you invest in a property maintenance service, you will need to be on-call for your tenants 24/7 to maintain the buy-to-let property and carry out repairs.

Finding tenants

Finding tenants to fill a rental property can be very time-consuming unless you enlist the help of letting agents like our professional team here at Mistoria Estate Agents Liverpool.

If you decide to go it alone, you will need to make sure you are aware of all the relevant laws and regulations. At a minimum, you will need to advertise your property, arrange, and carry out property viewings, check references, use an appropriate deposit scheme, and fill out all relevant paperwork.

Extra stamp duty

If you already own another property, then when you buy a buy-to-let it counts as an ‘additional property’, and you will need to pay a stamp duty surcharge. This means that you are required to pay an extra 3% in stamp duty land tax (SDLT) on top of your usual stamp duty rate.

How much deposit do you need for a buy-to-let?

The deposit required for a buy-to-let mortgage is typically more than that for a standard mortgage.

According to Barclays, you usually require a deposit of 25% of the property’s value for a buy-to-let mortgage.

The amount you need to put down as a deposit can vary depending on the deal that you choose. Generally, you won’t find a buy-to-let mortgage that requires a deposit lower than 20% of the property’s value, but you could be required to pay a deposit of up to 40%.

Should I use a letting agent?

Whether or not you choose to use a letting agent is a personal choice and depends on how much time you have available to spend on the day-to-day running of your buy-to-let and how confident you are at doing it all yourself.

If you are a buy-to-let beginner with little or no experience in property investment, buy-to-let legislation, or acting as a landlord, then you may benefit from teaming up with a letting agent.

Many buy-to-let Liverpool landlords trust our team of experienced Liverpool letting agents to manage their investment property in Liverpool or buy-to-let properties in the UK for the following reasons:

  • We will advertise your property – Providing you with more exposure to prospective tenants
  • We will carry out viewings – Saving you time and inconvenience.
  • We perform extensive reference checks – Ensuring we find the “right” tenants for your property.
  • We offer an inventory service – Inventory video/photographic evidence to provide you with property protection.
  • We provide business knowledge and expertise – A qualified team of accountants and marketing, advertising, and PR professionals.
  • We provide a trusted and regulated service – We are members of the National Landlords Association (NLA) and are regulated by the Association of Residential Letting Agents (ARLA).

For further help or advice about buy-to-let properties in the UK, buy-to-let in Liverpool, or to find out more about our letting agent services, get in touch with our friendly and knowledgeable team here at Mistoria Estate Agents, by calling us on 0151 317 5383.

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Buy-to-let explained: How to become a landlord

liverpool estate agents

Those looking for ways to break into property investment have likely come across the term ‘buy-to-let’.

A buy-to-let mortgage offers a great opportunity for prospective landlords and a route for them to get a foot on the property ladder.

A mortgage is not an agreement that many take lightly, and naturally there will be a lot of questions before undertaking one.

Here we explain what a buy-to-let mortgage is and what you can get out of one when looking for buy-to-let properties in Liverpool.

What is a buy-to-let mortgage?

Like a standard homebuyer’s mortgage, a buy-to-let mortgage involves a lender helping you to purchase a property, subject to rather stringent checks and requirements, with a sum that you pay back.

However, there is some choice in how you repay your borrowing that you don’t normally get in a standard mortgage, and the means of securing a buy-to-let are slightly different.

The amount your lender will offer you depends on the projected rental income from the property in question, and you’ll need a higher deposit than for a standard mortgage.

Many buy-to-let mortgages need at least a 25 per cent deposit to get started, and some demand as high as 40 per cent.

Buy-to-let mortgages can be fixed rate or variable, like standard mortgages.

Fixed-rate mortgages keep interest out of the equation for the agreed term and your repayments will stay the same. Variable-rate mortgages can take advantage of low interest rates but similarly fall victim to higher ones, so repayment amounts can fluctuate over time.

What does interest-only mortgage mean?

Many buy-to-let mortgages are interest-only, meaning you don’t pay back the actual amount borrowed like in a normal mortgage. Instead, you pay back the interest accrued on the mortgage each month until the end of your term.

At the end of the mortgage term, you’ll owe the full amount originally borrowed. You’ll also still need to pay interest on this full amount until it’s repaid.

Interest-only mortgages can be an attractive idea as they’re more affordable than repaying your borrowed amount, and many investors plan to sell the property off at the end of the mortgage to pay off the borrowed sum.

However, there is an element of risk in that the value of your property could drop during the term of the mortgage. Selling the property at a loss after borrowing on a higher amount means an overall loss as you will still need to pay back the original amount lent to you.

What is a repayment buy-to-let mortgage?

A repayment structure is closer to what you’ll likely recognise on a mortgage, wherein you pay back the borrowed amount plus interest in instalments. This means higher repayments each month, especially considering the higher interest rates on buy-to-let mortgages in general, but it also means that you’ve repaid your borrowing at the end of your term.

This may be a better choice for investors who have more capital available and want to own their property long-term, though repayment buy-to-let mortgages are less common than the interest-only kind.

Where can I get a buy-to-let mortgage?

Many of the same lenders that offer standard mortgages for homebuyers will also offer buy-to-let mortgages. These will come with the lender’s own specific set of requirements and terms, as with any other mortgage.

Some lenders will want more detail about your financial circumstances than is normal for a standard mortgage. Due to the aforementioned risk of a property dropping in value during the interest-only payment term, lenders may want to know what your plan is if the sale value of the property becomes insufficient to cover the original sum borrowed.

When would you want a buy-to-let mortgage?

There are a number of reasons why someone might take out a buy-to-let mortgage for a property, including:

  • Wanting to move into property investment with a structured, organised way of borrowing
  • You don’t have a massive amount of upfront capital but you have reliable income streams to afford monthly repayments
  • You want a property that you aren’t specifically relying on a resell to afford
  • You want an investment that effectively pays for itself (at least in part)

Additionally, some of the costs of running your rental property can be offset against tax when the time comes to fill out your self-assessment tax returns.

When do you become a landlord?

As soon as you own a property to let, whether it’s an outright purchase or through a buy-to-let mortgage, you’re a landlord.

Unfortunately, you’re still the landlord of a property even if there’s nobody in it. As such, you need to repay your mortgage even if there’s no rental income to speak of. This means having a reliable fallback for harder times, whether that’s paying out of your own savings or using the income from another property to cover it until you can find new tenants.

Becoming a landlord means a host of other financial responsibilities such as paying a three per cent Stamp Duty surcharge, maintaining the property with services and safety checks, and paying for repairs when things go wrong. This might mean emergency callout fees if essential facilities should break at the worst time, so simply covering mortgage repayments won’t be enough to effectively manage your investment.

Circumstances can change quickly between tenants, the housing market, and the overall health of the financial sector, but sound planning with the right knowledge and advice can help navigate many of these issues before they should ever occur.

Property investment with Mistoria Estate Agents Liverpool

We know where landlords go wrong and we can help you avoid costly mistakes. Whether you’re looking for buy-to-let properties in Liverpool or simply to get some advice on buy-to-let mortgages, our team can give you all the answers you need to take your first steps towards becoming a landlord.

To ask us for advice or get more information on our services, don’t hesitate to contact us today.

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Managing HMOs for landlords

Managing HMOs for landlords

HMOs – or houses in multiple occupation – can be fantastic investments when managed wisely.

They can demand many times the attention of a typical rented property, and for that reason it’s not uncommon for landlords to seek help managing them.

But what actually goes into the management of an HMO, and why might a landlord want to seek this help rather than simply doing it themselves?

What is HMO management?

HMO management is, quite simply, the management of an HMO property. In the context of HMO management as a service, this is done on behalf of a landlord to save the time and attention they would otherwise need to dedicate to the HMO and its tenants.

This can sound like an impersonal or dismissive stance on the surface, but HMO management is often a wise and well-placed decision for a landlord to take. Landlords who have many other properties to manage, or other demands such as a full-time job, often cannot dedicate the appropriate time to an HMO.

Since an HMO is partly defined by the presence of at least three occupants who aren’t from the same household, any HMO property is going to involve a minimum of three separate tenancy agreements. That is in addition to managing the tenants themselves – for example, their needs as residents and the necessary admin – and the all the usual business of letting a property responsibly such as organising gas safety checks and ensuring good maintenance.

HMOs can be seen as a greater fire risk than standard residential properties, meaning there will be more cost to sink into safety measures like smoke alarms, fire safety doors (for the increased number of rooms), and other equipment like fire extinguishers.

HMO management can also involve needing to manage disputes within the HMO itself if problems arise between tenants. This can be common for any group of people sharing a living space, so landlords may find their skills in diplomacy and mediation being tested in situations that don’t have clear answers or resolutions.

More tenants mean greater use of facilities, which can lead to more frequent and costly maintenance of appliances, communal areas, and gardens. While there is some responsibility on tenants to keep the property clean and in good condition, that ultimately extends only as far as their agreement states, and in situations where every tenant leaves at once – such as may be the case in student HMOs – this leaves you, the landlord, with the task of tidying up in their wake.

HMO management is undoubtedly much more complex than standard property management due to the number of involved parties. Dealing with multiple tenants within a single property means many more opportunities for challenges and complications to arise, which can quickly tax a landlord’s energy when they compete with other demands for time and attention.

Do estate agents manage HMOs?

Yes. Estate agents are a great option for landlords who need help managing their HMO properties. In fact, estate agents can lend their services from the very first day, sourcing tenants and dealing with the necessary referencing to get an HMO filled as smoothly as possible.

Once tenanted, estate agents can provide ongoing HMO management to ensure that resident queries are answered and dealt with promptly. This can be vital in the case of emergency situations like boiler failure or serious property damage that needs fast repair. In such cases, a quick conversation between landlord and agent can set up the resolution and lead to fast action.

Left solely in a landlord’s hands, this would leave one person to ascertain the issue, seek out tradesperson quotes, and book the work for as fast as possible. Estate agents have the advantage of working closely with local traders like plumbers and builders, forming strong and reliable working relationships that mean situations are resolved quickly.

Estate agents can also provide landlords with advice to build their experience and fill in knowledge gaps. This means that while property investors have their burdens lightened with active help in the management, they are also building a strong base of knowledge and experience to help them make future investments wisely.

For those unsure if property management for an HMO would be a good choice, it’s always best to open a dialogue with a local estate agent and talk to them about their services. Find out what they already manage and what their chosen approach to property management entails.

HMO Property Management in Liverpool

The property market in Liverpool is more competitive than it’s ever been. Mistoria Estate Agents’ Liverpool team can help manage the demand of sourcing the right tenants for your student property, carrying out the necessary referencing, and ensuring that every last detail is compliant and to the very best standards.

As a cultural hotspot and a Northern Powerhouse city for the UK, Liverpool faces high rental demands that make student HMOs a truly worthwhile investment – with the right management behind them. HMO properties need more attention than others, but their returns are far greater in exchange.

Our services provide peace of mind to landlords, freeing up your time and focus for other demands. As members of the National Landlords Association (NLA) and under regulation by the Association of Residential Letting Agents (ARLA), you can rest assured that your HMO is left in safe hands.

To find out more about HMO management with Mistoria Estate Agents Liverpool, call us on 0151 317 5383 today or fill our online contact form.

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Should parents invest in buy-to-let to help their children with university?

student properties in Liverpool

A recent survey found a massive two thirds of parents are considering investing in buy-to-let student properties in Liverpool to assist their child through university as fees and costs of living become more and more daunting.

The rising price of rent as well as high fees is making university a harder and harder prospect for many students who can often struggle to make ends meet with just their maintenance loan and a part time job.

The online mortgage broker Trussle found 66% of parents believe helping their child via purchasing a buy-to-let student property was a smart idea.

The idea is to let their child live in the property while they were at university for whatever in-house rent the family agreed, hopefully lowering their living costs.

Once their child had finished their course and were ready to move onto the next stage of their life the parents would then be able to rent out their house to other students and begin making returns on their investment.

The survey of 2,000 homeowners even found 53% of parents would consider downsizing their family home to help support their child through university.

Parents are not wrong that student buy-to-lets are a sound investment at the moment for the past few years they have outpaced the rest of the rental sector, with yields growing by as much as 17.86% larger than the rest of the rental sector.

The value of the private rental sector as a whole has also soared recently.

According to the Shawbrook Bank the total value of the private rental sector rose by 5.8% between August 2020 and August 2021 to a total of £1.4 trillion.

This is lower than the general rise of all properties which increased by almost 10% in the same period.

Shawbrook bank also found demand for rent was soaring with 42% of landlords saying they had more people than ever looking for a property, with a third of landlords adding they are looking to add another property to their portfolio in the next year.

Trussle did note in their survey that tax changes had skewed against landlords in recent years making buy-to-let investments not the super lucrative investments they used to be.

However, Miles Robinson, head of mortgages at Trussle said their data showed “that property is still seen as a safe and reliable way of generating extra income.”

The investments also make sense in the medium term through rental income and in the long term through the rise in property prices.

So, although the cost of entry may be higher than before, and the returns may not be as massive, there is still a huge demand for rental properties plenty of room to grow and huge amounts of confidence the rental market will remain strong.

One way to maximise your returns is to get the best advice on where to invest and how to manage the property.

The multitude of taxes and regulations that come with managing a buy-to-let student property can be mind boggling at first and this is where Mistoria can help.

Mistoria manages 1000 properties in the private and student rental sector and is a specialist in helping investors interested in getting involved in the market.

On top of this Mistoria can also give advice on where to invest, the dozens of university towns and cities across the UK present plenty of options but some offer vastly higher returns than others.

Rents may be high in London but property prices are even higher.

Whereas student properties in Liverpool and places like Manchester, Bolton and Salford, property prices are low but the ever-increasing student population means yields are only going to increase over time.

Call us on 0800 500 3015 or email info@mistoria.co.uk.

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State of the market: Is now the time to invest in Liverpool property?

invest in Liverpool property

With lockdowns now firmly behind us and no prospect of them returning in full force any time soon the property market has come roaring back – could now be time to invest in Liverpool property?

There is certainly plenty of evidence the housing market is booming –although figures have been inflated by the rush to take advantage of the stamp duty holiday which came to an end in October.

According to HM Revenue and Customs, in the UK in last month an estimated 160,950 homes changed hands, which was almost 70% higher than in August and 68% higher than the previous September.

Compared to the 50% drop in sales which occurred in April and May 2020 due to the pandemic, it is clear the market has put Covid behind it.

Zoopla has predicted 2021 will be the strongest year in the housing market since 2007, with around £500bn in sales.

Now that the stamp duty holiday has come to an end it is expected the residential sales market will slow and price growth is set to stall making now a perfect time to invest in Liverpool property.

Sensing opportunity of a market lull before further growth, investors are out in force cash buying property left right and centre after laying low throughout the pandemic.

Property is on the verge of flipping from a seller’s market to a buyer’s market.

What does this mean for rental?

Research from Zoopla found rents were rising at their fastest pace in over a decade in all places in the UK except London.

They found rent would be on average £500 more per year by the end of 2021 compared to 2020.

Demand for rental properties across the country is expected to rise in the coming months.

As people decided to stay put during lockdowns, and with evictions made temporarily very difficult, tenants very rarely moved.

But now the economy is looking increasingly strong and lockdowns fading into memory more and more tenants will start looking for a place to move.

With a rise in demand, it could be the perfect opportunity for House in Multiple Occupation (HMO) property investment.

With the ability of being able to house multiple separate tenants into a single property, HMOs can easily absorb any rise in demand.

Combined with a rise in rents and the reproductive growth HMOs offer, they could be a wise investment.

If you are thinking of investing in property for rental and would like help and advice on how to manage a successful tenancy, please contact our experienced team or visit our contact page to find your local branch.

We manage 1000 properties and 3000 tenancies in the private and student rental sector and can help you with all aspects of rental property management.

Call us on 0800 500 3015 or email info@mistoria.co.uk

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Right To Rent changes from 30th June 2021

right to rent changes

Changes to Right to Rent legislation in the UK come into effect from 1st July 2021, ending the grace period put into place following the country’s exit from the EU. The change means that letting agents will move from checking nationality to checking the UK immigration status of all adult tenancy applicants.

Right to Rent is the legislation that requires landlords and agents to check the immigration status of prospective tenants to ensure they have the right to rent in the UK. The temporary changes meant that citizens of European Economic Area (EEA) countries and Switzerland only needed to prove their citizenship while applying for settled status in the UK. When the interim measures lift, it will mean that these people need to provide evidence of their UK immigration status too.

New guidance has been issued by the Home Office for agents and landlords to follow from 1st July 2021. The Home Office has been working with ARLA Propertymark, who says that “From this point, if someone is an EEA, EU, or Swiss national, you will need to see evidence of their UK immigration status rather than their national identification”. Anyone who has applied for and been granted settled status will have digital evidence of their application, and this should be shared digitally using the online Right to Rent services from the Home Office on the Gov.uk website.

Digital checks have been an option since December 2020 and involve the prospective tenant sharing a time code and their date of birth, which landlords use to check their immigration status online. However, not all applicants will use the digital service and may have other evidence of their immigration status, including physical documents.

Another change to Right to Rent checks is related to Covid-19. The way that checks were carried out was temporarily readjusted to make them safer during the pandemic. From 1st September, landlords and letting agents will be returning to face-to-face and physical document checks. This is in accordance with the easing of lockdown rules and social distancing measures, aligning with the roadmap for England set out by the Government. This change has been postponed twice, first set for 16th May, then 20th June.

Currently, Right to Rent checks can be made over video calls and tenants can send scanned documents or photos of documents using email or a mobile app. The online Right to Rent service can also be used during a video call if the prospective tenant has a current Biometric Residence Permit or Biometric Residence Card or has been granted status under the EU Settlement Scheme or the points-based immigration system. When these temporary changes end on 1st September, landlords and their agents must either check the applicant’s original documents or check their right to rent online if given their share code for the service.

Both landlords and EEA/EU/Swiss citizens applying for tenancies should be aware of these changes related to Brexit and to Covid-19. The situation regarding Covid-19 could also be subject to change, so it’s a good idea to keep an eye on what’s happening.

Mistoria Estate Agents Liverpool are Liverpool property experts and can help guide both landlords and tenants through any property related matter. If you need help and advice on the new Right to Rent changes and what is means for you, please contact our team on 0161 707 6106 or use our contact form.

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End of Stamp Duty Holiday: first deadline fast approaching

stamp duty holiday

The Stamp Duty holiday in England will end on 30th June 2021, lowering the nil rate band from £500,000 to £250,000 for all but first-time buyers, who have a threshold of £300,000 before stamp duty is due. The rates will then change again in October to return to the standard amount pre-Covid-19.

The temporary nil rate for Stamp Duty Land Tax (SDLT) was introduced in 2020 when the UK went into lockdown amid the global Covid-19 pandemic, allowing anyone to purchase a primary residential property up to the value of £500,000 without paying Stamp Duty. From 1st July to 30th September 2021, the nil rate band will be reduced to £250,000 and then will be reduced again to return to the standard threshold of £125,000, again, except for first-time buyers who have a threshold of £300,000.

The rate of SDLT that applies to a purchase depends on the date that the purchase is completed and not the date that contracts are exchanged. This means that many people who are in the process of buying a house now could miss out on the extra relief but still have the opportunity to benefit from the £250,000 nil rate if they complete by October. The rate above £250,000 will be 5% on the next £675,000 (up to £925,000), 10% on the next £575,000 (up to £1.5 million), and 12% on the value above £1.5 million.

The adjustments to the Stamp Duty nil rate apply to main residences. Additional properties, for which there is no nil rate unless they are bought for less than £40,000, incur a 3% tax up to £500,000 until 30th June. This then changes to 3% up to £250,000 until October.

Anyone hoping to take advantage of the lower Stamp Duty rates, whether buying a main residence or an investment property, should think about moving quickly. Property purchases can take a number of months, and there are just over three months left until the SDLT rates revert to the standard amounts.

June 30th is the first Stamp Duty holiday deadline to pay attention to if you’re currently in the process of buying a property. Now is the time to try and speed things up and perhaps try to set a completion date before this deadline. If you miss this first deadline, you can still benefit from the Stamp Duty holiday, with a further three months to take advantage of the £250,000 nil rate. To check how much you’re going to pay, you can use the Stamp Duty Land Tax calculator.

If you have yet to find the perfect property, Mistoria Estate Agents can help you to speed up your search. Our estate agents will listen to your wants and needs and suggest properties for your shortlist. Please contact us on 0161 707 6106 or use our contact form. If you’re currently viewing properties, you can also speed things up by getting other necessities out of the way, such as lining up a solicitor and talking to a mortgage broker. This will put you in a good position to move quickly once you find the right property.

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Two Views on the Ending of the Evictions Ban in the UK

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For the pandemic period, a “new normal” has been in place. This new normal has included an unprecedented financial package from the government to help individuals who have lost their incomes to support themselves and find new work. One helpful measure has been the “eviction ban” that prevents landlords from evicting tenants who can’t pay their rent. But as the pandemic nears its end this ban has been lifted prompting concerns on both sides of the divide. In this article our Liverpool letting agents look at the views of both landlords and tenants, each of whom has equally valid views on the government’s latest pandemic decision.

The view of tenants

As the Covid-19 pandemic draws to a close the government has decided to curtail the ban on evictions put in place during the pandemic to protect the homes of tenants. Under this law, tenants are not able to pay the rent due to pandemic circumstances – job loss or furlough – we’re not legally obliged to leave the property – that is no longer the case.

As of May 2021 landlords with tenants who do not pay rent or are in substantial arrears can be evicted from the property. This means that those who have suffered a loss of income as a result of the Covid-19 pandemic and were not able to pay rent, as a result, might now find themselves homeless.

Who is affected?

According to recent reports, the lifting of the eviction ban could affect up to one million people in the coming weeks and months. It’s estimated that 400,000 people have already been served with an eviction notice by their landlords as a result of unpaid rent or rental arrears. This could precipice a housing crisis.

The pandemic has rocked the country as a whole and uncertain times lay ahead, but for renters, with low paying work or zero-hours contracts, their position was already precarious. The eviction ban was a lifesaver for many people as it allowed them some breathing space after losing a job and going onto benefits. While many of those people now have paid work again, rent arrears still put them at risk of eviction.

A housing crisis

Those same people who are only now getting back on their feet now have to stress about whether they will have a bed to sleep in after their shift or if they have to find a way of securing a new property on a low-income wage. Up to a million people are expected to be affected by the lifting of the eviction ban, raising the thorny question of where they are expected to go.

The view of landlords

When the pandemic struck it is fair to say it affected everyone. It’s also fair to say that the response to the pandemic was fair to governments, individuals, businesses, and landlords. It’s hard to imagine a landlord objecting to the eviction ban in the first few months of the pandemic. But now things are different.

As the pandemic grinds on and things appear to be looking more promising with the rollout of several vaccines, the government has decided to lift the eviction ban and give landlords the power to demand their rent from tenants once again. This has not been easy for tenants with high arrears but there are good reasons for it.

The counter-argument

It’s easy to take the side of tenants who have been affected by the pandemic and can’t pay rent temporarily, it’s even easier to take their side when the landlords in question are portfolio landlords with many properties on their books. But that isn’t always the case, and in fact, the majority are single property owners.

Single property owners use the rent from their tenants to pay for their own mortgage, so when this isn’t coming in their mortgage stops. With the eviction ban in place, landlords were finding that tenants didn’t respond to letters asking for rent because they knew they were safe from eviction – some even told their landlords to take mortgage holidays.

The future

As we leave the pandemic and the eviction ban is lifted it would seem to spell the end of a difficult financial time for landlords – but that isn’t necessarily the case. If tenants don’t pay their rent the landlord will be forced to evict them and shoulder the weight of arrears there are owed. Under present circumstances, there is no guarantee of a new reliable tenant either. What is needed is a benefits package from the government to help tenants pay landlords in the short term.

Liverpool letting agents

Liverpool letting agents, Mistoria Estate Agents, understands the property industry in detail. We specialise in student accommodation but can offer expert help and advice on all forms of property letting. For more information on what we do, contact us on 0161 707 6106 or use the details on our contact page.

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Landlords: are you prepared for the EICR deadline?

student lettings liverpool

In July 2020, the Government introduced new Regulations on electrical safety standards in the private rented sector. They require landlords to have the electrical installations in their properties inspected and tested at least once every 5 years. Currently, this applies to all properties that were let from 1 July 2020, but from 1 April 2021 it will also apply to pre-existing tenancies. With coronavirus restrictions ongoing, arranging the electrical safety inspection will require extra preparation, so it’s important you begin the work as soon as possible. Specialising in student lettings Liverpool letting agents, Mistoria Estate Agents has put together some useful information to help you understand and navigate the process.

The Electrical Inspection Condition Report (EICR)

The electrical safety inspection must be carried out by a qualified and competent electrician. For help finding one in your area, you can use the Registered Competent Person Electrical single mark and register, a Government-approved tool. From the inspection, you will obtain a report, known as the Electrical Inspection Condition Report (EICR). This will detail the results and set a date for the next inspection and test. As a landlord, you must supply a copy of this to:

  • the existing tenant within 28 days of the inspection and test
  • a new tenant before they move in
  • any prospective tenant within 28 days of receiving a request for the report
  • the local authority within 7 days of receiving a request.

You should also keep a copy of the report to give the inspector when the next test is due. If the inspection reveals that further investigation or repairs are needed, you must ensure these works are completed within 28 days of receiving the report. You are then required to obtain written confirmation from the electrician stating that repairs have been completed, and supply this to the tenant and local authority within 28 days of completion.

Conducting electrical safety inspections under coronavirus restrictions

The inspection requires an electrician to enter the property to assess all electrical appliances – it cannot be done remotely. With stringent coronavirus restrictions still in place, landlords will need to take additional steps to ensure the inspection runs safely and smoothly.

If you have tenants moving out before the April deadline, you should leave a gap before new tenants move in, so that the inspection can be completed whilst the property is empty. For long-term tenants, you must inform them about the inspection and arrange a time and date that is most suitable for both of you. For example, the inspection could be completed whilst the tenant is out at work, or during a time when they are able to remain in one room for the duration, thus minimising any risk of possible infection. It’s also important to listen to any other concerns the tenant may have about the inspection and consider how they can be addressed.

How we can help with your student lettings Liverpool

Specialising in student lettings Liverpool letting agents, Mistoria Estate Agents understands the property industry regulations in detail. We can help you ensure your property meets these, including preparing for an electrical safety inspection. We specialise in student accommodation but can offer expert help and advice on all forms of property letting. For more information on what we do, contact us on 0800 500 3015 or use the details on our contact page.

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Now is the time to switch to a smart meter

student landlord liverpool

Smart meters use wireless networks to send data about your energy usage straight to the supplier, and they are becoming increasingly common in homes as a replacement to existing gas and electricity meters. There are many benefits to using a smart meter, and changes resulting from the pandemic have added to these. Because of this, more landlords are opting for them, particularly those who own student properties. If you’re a student landlord Liverpool based Mistoria Estate Agents explain here why switching to a smart meter is the smart choice.

What are the benefits of switching to a smart meter?

The overarching advantage to using a smart meter, as opposed to a standard one, is that it allows energy usage to be accurately measured. This is particularly useful right now, as most people are spending more time at home due to lockdown, and as a result are using more electricity and heating than usual. However, the pandemic has created a culture of working from home that is here to stay, and therefore the changes to our energy consumption habits will be lasting. This means that being able to accurately assess energy usage will continue to be important after restrictions ease.

Smart meters are also more convenient for landlords and tenants alike. They produce statements and bills more efficiently and accurately, so tenants should only pay for what they use. In addition to this, readings can automatically be sent straight to the supplier. This removes the hassle of physical meter readings, which are especially difficult in the current circumstances, and of estimated usage, which is often difficult to get right and can lead to landlord-tenant disputes.

Alongside this, smart meters enable tenants to easily track their energy consumption in real-time, through the option to link up to an ‘in-home display’. This is a gadget that communicates wirelessly with the smart meter to show tenants how much energy they’re using in kilowatt hours (kWh), and how much this costs in pounds and pence. As a result, over-usage can be addressed before it becomes an issue, both in the form of high bills and the harmful effect excessive energy usage has on the environment.

How we can help if you’re a student landlord Liverpool 

If you’re a student landlord Liverpool based Mistoria Estate offers a variety of highly sophisticated, professional and tailored property management solutions to effectively manage your student accommodation. If you would like to know more about smart meters and making the switch, or about the services we offer, we would be happy to talk it through with you. To get in touch, please use our contact page or call 0161 707 6106.

We are members of ARLA and NAEA Propertymark, which means we meet higher industry standards than the law demands. Our experts undertake regular training to ensure they are up to date with best practice and complex legislative changes so they can offer you the best advice. We are also backed by a Client Money Protection scheme which guarantees your money is protected.