News
Landlords needing to evict a tenant face rising UK court costs
Rising court fees in the UK could tempt law abiding landlords to cut corners when it comes to tenant evictions, it is claimed. For the second year running, the Ministry of Justice is increasing fees for landlords who want to evict tenants who have fallen into rent arrears. The cost for filing a paper application will rise by £75 to £355. Online applications will rise from £250 to £325. This comes on top of increases last year of £100 for online applications and £175 for paper claims. According to Legal 4 Landlords the spiralling court costs could lead to landlords being tempted to evict problem tenants without following official procedures, risking prosecution and a criminal record. ‘The spiralling costs are unfair and are hitting landlords in the pocket yet again. However, the law is complex and too many landlords serve invalid notices delaying the process and waste their money,’ said Sim Sekhon, managing director of Legal 4 Landlords. ‘Landlords must follow the correct procedure and expert guidance is paramount. Evicting a tenant is stressful enough but many landlords are concerned about rising court costs so it’s not surprising some are tempted to take the law into their own hands,’ he added. The firm explained that there are several routes that can be taken to evict a tenant and every case is different. The court expects landlords to follow procedures to the letter so they should always seek expert guidance. Legal 4 Landlords offers a range of services for landlords and letting agents with a network of offices across the UK. This includes advanced tenant referencing and general insurances products. It offers a free eviction case review and recently launched a rent and legal protection insurance product. This safeguards landlords from future hikes in court costs at the legal stage for landlords who may need it for their next tenants. The number of people evicted from rented properties hit record levels in 2014, with 42,000 homes repossessed by landlords, according to the Ministry of Justice. Continue reading
New home sales in Australia reach new peak
Total seasonally adjusted new home sales increased by 1.1% in Australia in February following a gain of 1.8% in January, according to the latest data. It means that sales volumes are now just above the previous peak of April 2014 and a breakdown of the figures show that apartments are selling more than detached homes with flat sales up 11.1% and houses down 1.3%. But there are considerable regional variations. Detached house sales are easing in New South Wales and Western Australia, previously key drivers of growth, and have fallen significantly in South Australia. According to Harley Dale, chief economist of the Housing Industry Association (HIA), the modest growth in new house sales in Queensland and Victoria is not enough to offset these declines. The data shows that in February detached house sales increased by 1.5% in Victoria and by 0.2% in Queensland. Detached house sales fell 4.8% in New South Wales, 2% in South Australia and 2.9% in Western Australia. The level of sales in the three months to February 2015 compared with the previous three months was down 6.9% in New South Wales, down 2.8% in South Australia, and down 1.3% in Western Australia. Sales increased by 3.8% in Victoria and by 9% in Queensland. ‘This is another very strong result for Australia’s national new home building sector. In January, new dwelling approvals reached their highest level on record and now in February that activity remains at exceptionally high levels, with a solid pipeline of activity set to remain in play over the coming months,’ said HIA senior economist, Shane Garrett. Data also shows that new home approvals in February were 3.2% lower than the previous month but still recorded their second highest level since figures began 32 years ago. Detached house approvals inched up by 0.2% while there was a 6.6% fall in multi-unit approvals and according to Garrett at a time of weak overall domestic demand, new residential construction is acting as a welcome pillar of support. ‘A steady pipeline of new homes represents the most effective solution to alleviating housing affordability pressures. Governments at all levels must work to ensure supply constraints do not impede the continuation of elevated levels of new home construction,’ he explained. A breakdown of the figures shows that new home approvals increased most strongly in Victoria with a rise of 20.5%, followed by New South Wales up 13.5%, and Tasmania up 4%. But they fell by 8% in Western Australia, were down by 30.6% in Queensland and by 41.4% in South Australia. Garrett said that action to turn around new home building conditions in South Australia are urgently required. New home approvals declined in trend terms in both the Northern Territory with a fall of 2.7% and the Australian Capital Territory with a decline of 16.2%. Continue reading
Call for lettings agent fees to be banned in England
Letting agents’ fees in England should be banned to protect tenants in the private residential rental sector, a hard hitting new report has urged. According to new evidence uncovered by a charity, Citizens Advice, tenants are frequently ripped-off by fees often hidden by letting agents to the tune of £337 on average. These charges come on top of advertised rent prices and deposits and in some cases can force people into debt, the report says, adding that letting agents have refused to adopt measures that were supposed to bring transparency and competition to the market. Most agents charge for checking references, but costs range from as little as £6 to £300, according to the study. Renters can also be hit by charges ranging from between £15 to £300 for simply renewing their tenancies. Some agents charged £300 for credit checks that are widely available for £25. Even when moving out of a property, almost half of the 353 agencies polled by Citizens Advice said they charge an average ‘check out’ fee of £76. Despite an Advertising Standards Authority (ASA) requirement introduced in 2013 that agents should give clear information about fees, this study found that only a third provided full written details. The requirement will become law later this year which will mean agents have to publish fees on their websites and in their offices. But Citizens Advice is concerned this will have little impact. The report says people face a lot of pressures when looking for a property and the main priorities amongst tenants is location and the price of rent. Fees often do not get disclosed until later in the process and only 25% of tenants told this study that they took fees into account when leasing a property. The charity says it does not call for a fees ban ‘lightly’, but said alternative measures have not worked. It adds that if charges are to be made, they should fall on landlords as they are in a better position to shop around and pick the best agency. A fees ban was introduced in Scotland in 2012 and there is no clear evidence to suggest it has led to an increase in rental prices, the report adds. Almost 90% of renters told the report that the charges caused them problems. A fifth said they went overdrawn on their bank accounts as a result and 42% had to borrow from friends and family. ‘Letting agents hold all the cards meaning tenants are open to abuse. Renters are regularly stung by arbitrary fees which can range from modest amounts to hundreds of pounds,’ said Gillian Guy, chief executive of Citizens Advice. ‘Our research confirms renters don’t shop around for letting agents, they shop around for properties so the idea that transparent fees will solve these problems is misguided. Landlords can hold agencies to account so it is right that they should shoulder the responsibility of fees. That would end once and for all the situation in which letting… Continue reading
