Mark Blakeway, Head of Lettings, discusses the key issues facing buy-to-let owners this year.
The property market in the UK remains as high on the news agenda as ever, with Theresa May continuing to push for more new homes, more quickly, across the country. This ongoing ambition to ‘get Britain building’ is already having an effect on lettings locally – since the start of the year we’ve seen an oversupply of town centre properties, giving tenants more choice, which has meant that landlords of existing properties are having to price competitively.
There’s more to this than meeting the housing need in numbers, however, with some significant changes in the pipeline this year and next that landlords should be aware of:
1. Energy Performance Certificates: ‘E’ Ratings Required
The most immediate change affecting landlords relates to Energy Performance Certificates (EPCs); from 1st April, a property cannot be rented out or a tenancy renewed in England or Wales with an energy efficiency rating of less than ‘E’. With just a couple of weeks to go, there is still some confusion around the exemptions available, and where upfront costs lie.
2. Compulsory Electrical Checks
Compulsory electrical checks are also on the horizon, a move which I believe is long overdue that will again raise the bar for minimum safety standards in all rental properties. I’ve always advised landlords to get a fixed wiring test, also known as a periodic inspection, to make sure that they are meeting their duty of care to their tenants. The checks themselves can be costly, but the real expense will lie in any work needed to bring a property up to standard.
3. A Ban on Agent Fees
Probably the most hotly-contested change to buy-to-let rules is the ban on letting agents’ fees, which will be implemented from April 2019. While we’re still waiting for details, this could affect landlords as some agents pass on their losses – either by increasing their charges directly or by other means.
Despite all this, we’re seeing tenants staying on for longer periods, more people moving out of London and a ‘try before you buy’ culture continuing to grow as people relocate. While we might see some landlords looking to offload their properties ahead of the tax changes – raising rents in the medium-term – I believe the local lettings market will stay strong.
To find out how Grantley can help with your buy-to-let property, contact the team on 01483 407600.