So…. We’re deregulated now!

Tenancy deposits, and the adherence to the rules thereof, remains a headline topic these days. It can be a minefield! Anyone who’s heard someone talk sensibly will have heard of the “Superstrike vs Rodrigues” Case. What? Ah yes, that one…

In a nutshell if the tenancy started before April 2007 (when all these laws came into force) so the deposit wasn't protected. What happened was the court ruled the deposit should have been protected when the tenancy renewed. The court had, at the time, interpreted this as a new tenancy. Rightly or wrongly at the time, this had massive implications on every tenancy that was holding over or renewed by means of fixed term extension in the whole country! Every landlord for every running tenancy would have had to reserve the “prescribed information” (set of particulars to confirm certain details like who the landlord is and where the deposit is kept etc) upon each renewal. So every 6 or 12 months, however long the extension was for, or upon the fixed term lapsing and it becoming a statutory periodic tenancy.

“So what?” I hear you thinking… well here’s what – if you didn’t comply with these regulations to reserve the prescribed information bits and pieces you wouldn’t be able to serve S21 notice on the tenants (so you can’t make them move out). What’s worse is the tenants could sue mr. landlord for 3x the deposit amount because, even if it was registered correctly at the time of the tenancy starting, if the prescribed information wasn’t reserved it all went out the window…

"NIGHTMARE" I hear you say... Thank goodness for the Deregulation Act 2015 which fixes all these things, and then some. Read all 250plus pages of glory here if you like: http://www.legislation.gov.uk/ukpga/2015/20/pdfs/ukpga_20150020_en.pdf. To be fair only 20 points out of the 116 relate to property, but that’s still a lot to take in.

Or allow me to summarise:

• New Section 21 Notice - There will be a new prescribed notice available from this date onwards.  You will be able to download it from the Court website.
• If there is no Energy Performance Certificate or valid Gas Safety Certificate on the property, a landlord will not be able to serve a Section 21 Notice until this is rectified.  
• To prevent a landlord evicting a tenant who has complained about the condition/disrepair of the property, a landlord will no longer be able to serve a section 21 notice if the tenant has previously complained about the state of repair.
• Landlords are not under obligation to re-serve the PI nor re-register the deposit upon every renewal of tenancy or change from fixed term to statutory periodic at present.

So, all in all good changes for good landlords!

Remember if you want to talk property or run a new purchase by me please do so: I’m on 020 3637 4474 or email: jeroen@claphampropertyblog.com. 

BTS, BTL, Single Let, Multi-let, HMO, BMV, LTV - what?

If you're new to the investment arena you will have more acronyms thrown at you than you can count. Difficult of course to make sense of it all. The acronyms you'll be dealing with will be largely related to your strategy - Buy to Sell or Buy to let. Single let (letting as one unit to one (set of) tenant(s)) or multi-let (letting individual rooms), which can be classed as a House in multiple Occupation (think lots of bedsits - but realistically these have drastically improved now). Buying Below Market Value is always preferred but difficult in London of course where demand is so high. And ultimately your leverage will determine your Loan to Value %. Banks reward lower LTVs with a better interest rate, although the flipside is that "leaving a lot of money in a property" means you aren't investing it elsewhere. You are paying 4% interest - can you get a better return if you borrow that money and invest in another project? I would hope so!

So... have you thought about your investment strategy? Are you looking to buy for the long term gain or hoping to flip things around quickly? Do drop me a line if you fancy a chat or give me a call in the office on 020 3367 4474. I'd love to talk to you about your next investment. I'm on jeroen@claphampropertyblog.com. If you need advice or if you would like to run a deal or scenario past me please do so. I'm all ears.

Listen up, I'm talking about Clapham & Brixton Property at the Property Masterclass!

For those of you who follow the blog closely will have notice that more and more topics are being addressed thanks to the beauty of interaction. Those not keen to comment publicly can always reply to me via email and receive a personal response. After all, why not make use of my years of knowledge to help you build your property portfolio? Which leads me to the next thing which is even better – a meeting in person. You may be an aspiring landlord, you may be a seasoned developer. All the same you will value the face to face contact. So let’s meet!

An old colleague and good friend of mine Suzanne Vincent has asked me to speak at her Property Masterclass at the end of this month and I'd like to invite you to come along. There will be a free drink on arrival and a reduced table menu. Whether you are a seasoned investor looking to network with local professionals or whether you just want to find out more about investing in property and saving on inheritance tax for your children, there will be something for everybody. A good chance to meet local people, network with like-minded professionals and ask questions relevant to your circumstances. So please join me on Tuesday June 30^th 8pm at the Cambria - lovely pub off the beaten track and tucked away in a lovely residential area on the Camberwell/Brixton borders. Loughborough Junction and Brixton are your closest stations and no more than 5/10 mins from those respectively. The food is fantastic and the company will be too for sure.

The topics we'll be covering are:

• Property Finance
• Lease extension and freehold enfranchisement
• How to present for a sale or let
• Investing in Property

Please RSVP directly to Suzanne so she can organise accordingly on suzannelvincent@gmail.com.

If you are looking for a friendly chat about property or the weather by all means give me a call in the office on 020 3397 2099 or drop me a line on jeroen@claphampropertyblog.com. 

Invest more in Clapham & Brixton - with no more of your own money. And here's how.

So, when was the last time you did a portfolio review? I’ll bet it’s been a while. Landlords are long-term strategists after all. I spoke to a landlord who lets properties in Brixton over the weekend and he was keen to hear more about my thoughts on the market. He had read an article or two on the blog in which I mention that it’s “trendy” to live further from the station and cycle to work or get a bus to the station. Train station of course, tubes are so passé…

I had found a few properties which would suit his newly found love for Outer Brixton (Or Streatham Hill – sorry I still speak like an estate agent!) but he said they’d be too expensive as the deposit he had saved up wasn’t enough. Property prices had gone up more than he thought. I said “that’s a good thing!” and he looked at me curiously.

You see here’s the thing: if property prices are going up and you already have a portfolio it means the loan amounts you have stay static whilst the value of your assets is going up. So the “Loan to Value” percentage is lower. Imagine if you had a 300k property (5 years ago) and you put in 20% deposit the loan would be 240k. Over 5 years thought the value of the property would have gone up about 5% year on year (roughly speaking, valuation is a bit more of a science than simply a calculation, but bear with me). Today this property would be worth about 380k, in which case your 240k loan only represents 63% of the property’s value. So you could do one of two things:

a) Remortgage to a better rate (lenders are keen to lend to people that represent low risk – 63% exposure is better than 80% so they will lower their borrowing rates for you)

b) Remortgage and RELEASE SOME EQUITY AND INVEST MORE!

Nothing says savvy investor like taking out your gains and reinvesting – if you remortgage up to 80% LTV again you can borrow 304k, leaving 64k to play with after you've paid off the first mortgage. This particular landlord had 5 properties that he could do this with, so essentially giving him enough cash in the bank to purchase a further 5 properties. With which he was yielding 5.5% per annum. You do the sums!

In essence buy to let is a balancing act. Never have all your eggs in one basket of course. Buy a few further from the station, a few close to the station, look for a few high-yielding investments, play the long game on a few and so forth. If you are just starting your BTL journey you will love the gains – if you are close to retiring you may be looking to sell. Take advice of course, wherever you are on your journey.

If you are looking for a friendly chat about property, weather, or Wiggo’s latest triumph on the track by all means give me a call in the office on 020 3397 2099 or drop me a line on jeroen@claphampropertyblog.com.