This has been a challenging year for all involved in the property industry. Confusion and a lack of specific information on the future of a Brexit agreement is blamed for many of the current ills, but there is certainly a lack of confidence generally in the short-term future of the property industry. Prices are quoted variously as rising, static, and falling depending on the report’s author, and the area under consideration. However the one factor which remains is that property has always been seen as a long term investment, and we must therefore assume that this is simply a blip in the longer term strategy. We are fortunate that the Highlands do not see the peaks and troughs which occur in some other areas. Sectors of the sales market remain strong, and this will no doubt fuel increased activity across the range of values.
Although the rental market has come under considerable scrutiny recently, (more of which to follow!) there is no doubt that there is an increasing demand for accommodation, caused by the remaining relatively high purchase prices, combined with the local authorities’ lack of supply. Regardless of what the politicians may say, this can only result in rental values rising, unless basic economic laws have changed since I was at school! (Admittedly a while ago!)
Unless you have been hiding on a desert island for the last year, you will have seen that new regulations regarding property letting have reached record levels recently. I have attached a resume of the more relevant bodies and issues requiring our attention on your behalf. Thankfully we are in a position to deflect most of these from you by dealing with them at source, but some will inevitably require direct input, where the authorities will not accept agent involvement.
New Tenancy Agreements came into force at the beginning of this year, and although the basic premise remains the same, there are some important changes. There is now no fixed minimum term for a tenancy, but given current levels of demand, this is not an issue at this time. The notice period required to be given by a landlord has increased and rent increases are restricted. The new complaints procedure, although not yet fully tested, appears to be an improvement in that the Tribunal Panel dealing with these matters will contain genuine property professionals who can use their personal experience to resolve issues which were previously dealt with by the general legal courts. This should speed up these matters, cost significantly less, and ensure that practical solutions may be found. There will however still be a requirement for these details to be handled in a correct and professional manner.
EPC minimum level requirements are being increased. From April 2019, a rating of ‘E’ is required, but this will rise to a ‘D’ from April 2022. Generally the largest expense involved in these upgrades are labour costs, and it therefore makes sense to aim for the higher level when attending to these works, even if a sale is being considered, as home report valuations will take these standards into account. (If you are considering selling your property in the future, please do not hesitate to contact us, to discuss our new fee structure).
GDPR (Data Protection Regulations) have now come into force, and obviously we are required to hold information on our tenants, and landlords, to allow us to carry out our contracted duties. To meet our responsibilities under this legislation we have registered with the ICO (Information Commissioners Office), and are prepared for this new bureaucracy. An example of what is required under these rules includes deleting information which is no longer required, but apparently we have to keep a list of what has been deleted!!
Other on-going upgrades include changes to Fire, and Gas Safety Certification, and Legionella Risk Assessments. New qualification requirements under Propertymark, the training arm of ARLA and the NAEA are now in force, as are new reporting practices and requirements from the HMRC for both Non-Resident, and UK Resident Landlords. We can also deal with unoccupied property insurance when needed if your property is empty.
We have encountered the normal variety of unusual issues this year, including happy and sad outcomes. Last summer, a property under our management sadly suffered a catastrophic fire which destroyed the property, and badly damaged the neighbouring house. All of the safety features were in place and although they did not save the house, they alerted the tenant and neighbours who all escaped without injury. (We believe the blaze may have been caused by a mobile telephone charger!) The properties were rebuilt, the landlord receiving rental income throughout the process, and on completion the property was successfully sold. Without the correct insurance this could have been a very different story. A precis of the landlord’s testimonial is below
Thank you for your involvement through the Rental, Re-build & Sale of “my property”, including pursuing the final payment for the Supervision Certificate – duly received today.
Many Thanks & Best Wishes for the Future”
Whilst all of these changes are intended to improve the standard of rented property in Scotland and the UK, (some rules differ) it remains a shame that a small minority of unscrupulous landlords continue to flout the law and therefore cause these actions to be necessary. We have always been proud to maintain the highest standards achievable and hope that our service continues to meet your requirements. If you have any queries on any of the matters raised above or indeed any matters pertaining to your property requirements, please do not hesitate to contact this office. Most things are possible, but the costs may vary!
I have attached a list of acronyms, with their full titles, and in some cases a web site location for further details, if required. I trust that you find this to be of interest, but rest assured, we will continue to deal with these matters on your behalf.
INDUSTRY BODIES AND THEIR ACROYNM’S
NAEA National Association of Estate Agents
ARLA Association of Rental Letting Agents
NFOPP National Federation of Property Professionals
FSB Federation of Small Businesses
OFT Office of Fair Trading
GDPR General Data Protection Regulation
ICO Information Commissioners Office
EPC Energy Performance Certificate
EICR Electrical Installation Condition Report
TDS Tenancy Deposit Scheme
HMRC Her Majesty’s Revenue & Customs
HRC Highland Regional Council (Landlord Registration)
SAT Short Assured Tenancies (Old Leases)
PRT Private Residential Tenancy (New Leases)
HMO’s Houses of Multiple Occupancy
FSMA Financial Services and Markets Act
MLR2017 Money Laundering Regulations 2017
LBTT Land & Buildings Transfer Tax
TPO The Property Ombudsman
CMP Client Money Protection Scheme
Money Laundering Regulations 2017
Changes to acceptable levels of EPC. (Anything less than an E is likely to be unacceptable)
GDPR (Data Protection Regulations)
Paragraph 1, Schedule 23 to the Finance Act 2011 – Section 18 Report1
Private Landlord’s Registration