More than one in ten can’t pay rent or mortgage if one pay check is missed

The charity Shelter has warned that more than one in then people are only one paycheck away from facing homelessness their report shows.

The report stated that 8.6 million working people, or 35% of those in employment are currently battling to make ends meet and don’t have enough saved to pay their rent or mortgage for more than a month if they lose their job.

Shelter said 4.4 million people, or 18% of working adults, wouldn’t be able to pay their rent or mortgage even for the first month if they lost their job and were incapable of finding another job immediately after, putting them at risk of losing their home.

43% of those with children said they don’t have enough money saved to pay their home for more than a month. 23% of those families said they would be in danger of losing their home as soon as they became unemployed.

The report comes as the Government’s cuts begin to sting with a £26,000 limit on total benefits a family is allowed to receive per year, as well as the ‘bedroom tax’ (a cut in benefits for those living in social housing with a spare bedroom) and the changes of disability living allowance.

Shelter advised that as the cuts take effect and squeeze on family budgets becomes evening tighter saving money will become very difficult. The charity are preparing themselves for an increase in demand from people at risk of becoming homeless.

Campbell Robb, chief executive of Shelter, said, ‘These figures paint an alarming picture of a nation where the buffer between having a home and potentially becoming homeless is a single pay cheque.

‘The depth of the financial pressure and insecurity felt by people across the country means that millions are living on the edge of a crisis, only secure in their homes for a matter of weeks.

‘More and more people are coming to Shelter desperate for advice on how they can stay in their homes and our services are straining to meet the demand. Anyone who can't meet the payments on their home should seek advice as a matter of urgency.’

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New research shows, in the UK the number of tenants in severe arrears has risen

Research shows, over the last 12 months severe arrears in the UK’s private rented sector has reached 20% above the long term average and eviction are also up.

According to the latest Tenant Arrears Tracker by LSL Property Services, the number of tenants in arrears have increased, backtracking much of an improvement in the previous quarter.

In the first quarter of 2013 the number of tenants more than two months behind on their rent increased by 4.8%. This topples much of the improvement in severe arrears seen in the final quarter of last year, when the number of most severe cases had decreased by 14.5%.

In complete terms, the number of tenants in severe arrears increased by 4,000 to 94,000 in the first 3 months. Leaving the quarterly figure the fourth highest on record, only 10% below the record set in the third quarter of 2012.

On a yearly basis, the number of tenants in severe arrears stays down slightly, by 2.9%. Yet, over the past 12 months the level of arrears is now 20% above the long term average. In
England and Wales such tenants represent 2.3%, up from 2.2% the previous quarter.

The figures also show the extent of strained tenant finances which are shown in a rise in evictions, with court orders up 5.7% in the fourth quarter of 2012.

In the last three months of 2012, some 25,286 tenants faced eviction notices, which places evictions at the highest level ever recorded in an individual quarter, and 10.2% higher than a year before.

While severe arrears cases have got worse, there was a broader improvement in tenant finance. According to LSL’s latest Buy to Let Index, generally tenant arrears dropped in February, to levels not seen since November 2012, with 7.4% of all rent late or unpaid. In comparison with 8.1% in the previous month, and 10.1% in December.

Paul Jardine, director and receiver at Templeton LPA said, ‘Household finances are feeling the impact of spiralling costs, particularly energy bills, which were recently predicted to grow by an average £214 this year. And wallets are under pressure from the other side. According to the ONS wages are creeping along at 1.2% annual growth, well behind a rebounding rate of inflation. Many tenants have finally pulled their finances back together after the strain of the festive period. But for a significant minority the situation is actually much worse than three months ago, and this is reflected in the most severe tenant arrears.’

Landlords to check immigration status of prospective tenants

To ensure new tenants are not illegal immigrants private landlords to are to be required to make checks.

In the wake of Prime Minister David Cameron’s ‘new measures’ for dealing with immigrants, the Department of Communities and Local Government made the announcement.

These are to include a crackdown on rogue landlords who accommodate illegal immigrants by providing ‘bed in sheds.’

The Department said, ministers want to make certain that tenants living in private rented housing are not living in the UK illegally. ‘The Government is already working with councils to tackle rogue landlords who exploit immigrants by housing them.

‘Many private landlords already make checks on tenants’ identity and credit status, making it difficult for illegal migrants to rent properties from them. But not all landlords do that, and a small minority of rogue landlords knowingly target illegal migrants who are not in a position to complain about sub-standard accommodation.

‘In future private landlords would be required to make simple checks on new tenants to make sure that they are entitled to be in this country’.

However, the department pledged that ‘the Government will ensure that UK nationals are not adversely affected and avoid red tape on honest landlords in the private rented sector.’

The Department of Communities and Local Government is to confer on the proposals which, they said ‘will be straightforward, quick and inexpensive for law abiding landlords and tenants to comply with.’

Action could be targeted at particular high risk sectors, such as houses in multiple occupation.

Eric Pickles, Secretary of State for Communities and Local Government said, the new checks will assist the Government’s work on ‘beds in sheds.’

Other components of the plans announced by David Cameron comprise of new statutory guidance for councils requiring them to update their allocation policies to make sure that only those with well established local residency and local connections go on housing waiting lists and qualify for social housing.

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Budget boost for home ownership could affect private rented sector

In the budget last week the Chancellor delivered new measures aimed at boosting home ownership.

The benefits include the new homes, secondhand homes and mortgage markets, as well as the ‘build to rent’ sector.

The extensive accessibility of 95% mortgages could have radical implications for the private rented sector, with more tenants encouraged from January to buy their own homes.

Under the ‘Help to Buy Scheme,’ described by George Osborne as a dramatic intervention in the housing market, the NewBuy mortgage guarantee scheme will be stretched across the whole housing market to include secondhand homes.

The scheme will start next January and will run for three years. Over this period, buyers of both new and secondhand homes will be able to purchase a property worth up to £600,000 with a deposit as low as 5% underwritten by a £130 billion government mortgage guarantee scheme.

For the time being, next month, there will be a continuation of the the FirstBuy shared equity scheme to all buyers, not just first time buyers of new homes.

Buyers of new homes up to £600,000 with just a 5% deposit will be able to gain from £3.5 billion ‘pot’ to assist shared equity loans. This means they will be able to get a 20% loan interest free for the first five years, and repaid when the house is sold.

Also announced in the budget, an investment in 15,000 new affordable homes plus a five-fold increase in the Build to Rent fund, which backs institutional investment in new homes built for the private rented sector.

George Osborne is also considering prolonging the “successful” Funding for Lending scheme. He told the Commons that he is currently discussing this with the Bank of England.

The Party Wall Act

The Party Wall etc Act 1996 provides a structure for the prevention and resolution of disputes in relation to party walls, boundary walls and excavations near neighbouring buildings.

A building owner planning to start work covered by the Act must give adjoining owners notice of their proposition set down in the Act. Adjoining owners can agree or disagree with what is planned. Where they disagree, the Act provides a procedure for resolving disputes.

The Act is separate from acquiring planning permission or building regulations approval.

What is a party wall?

The main types of party walls are:

• A wall that stands on the lands of 2 (or more) owners and forms part of building - this wall can be part of one building only or separate buildings belonging to different owners.
• A wall that stands on the lands of 2 owners but does not form part of a building, such as a garden wall but not including timber fences.
• A wall that is on one owner’s land but it is used by 2 (or more) owners to separate their buildings.

What the Act Covers

The Act covers:

• New building on or at the boundary of 2 properties.
• Work to an existing party wall or party structure.
• Excavation near to and below the foundation level of neighbouring buildings.

This may include:

• Building a new wall on or at the boundary or two properties.
• Cutting into a party wall.
• Making a party wall taller, shorter or deeper.
• Removing chimney breasts from a party wall.
• Knocking down and rebuilding a party wall.
• Digging below the foundation level of a neighbour's property.

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SAFEagent Saturday!

SAFEagent Saturday is tomorrow! It is a chance to open our doors to the public and landlords to spread the importance of Client Money Protection Schemes.

SAFE (Safe Agent Fully Endorsed) is a mark that shows a firm protects landlords and tenants money through client money protection schemes.

There are various schemes in the sector governed by ARLA/NAEA, the Law Society, NALS and RICS to which agents voluntarily belong. The capacity of these schemes vary and you should contact your agent for full details of the scheme of which they are a part of.

Landlords and tenants frequently make decisions based on cost but it is important to make sure you ask your agent for details of the organisation they are regulated by an whether or not they are covered by a client money protection scheme. All agents who are a part of ARLA/NAEA, the Law Society, NALS and RICS preserve and manage separate designated client accounts where your money is held completely separate from the operating funds of the firm.

If the agent you are using can’t provide you with the certainty of knowing they are covered by a client money protection scheme the question you need to ask is why not?

For more information please feel free to contact us at:

http://www.thelettingangel.co.uk

Divide of house prices widens

Welcome to The Letting Angel Blog! We will be providing you with the latest property and housing industry news. Bringing you weekly round ups and updates on all things property related.

Last month the divide of house prices between the south-east and the rest of England and Wales widened along with a seasonal increase in sales in London and a slight decline in parts of the north, according to a monthly national housing survey by property analysts Hometrack.

14.8% of postcodes across England and Wales registered price rises, of which 74% were in London and the south east. Almost half of London postcodes (48%) registered an increase in values on average of 0.3%, with Southwark, Ealing, Merton and Bexley all achieving an above-average house price rise.

The regions with an average overall drop included the north-east of England (-0.2%), north-west, and Yorkshire and Humberside (-0.1%).

Overall prices increased 0.1%, the first time values have gone up in nine months since May 2012.

The strongest price rise was in areas with shortage of supply and growing demand. Hometrack said it predicts both demand and supply to grow. Nevertheless, higher stamp duty costs in southern England would be a deterrent to sell, creating scarcity and supporting headline prices they said.

The quickest to sell was property across London; the average time being 5.2 weeks, in comparison with 9.7 weeks overall. The slowest selling was east Midlands with 13.6 weeks.

In the south-east on average sellers were able to obtain 94.9% of their asking price, in comparison with 93.4% overall, and just 91.9% in Wales.

For more information please feel free to visit our website at:

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