Wednesday, 2 April 2014

Bits and Pieces from Rentguard Insurance March 14 Property Eye

Just received the March edition of Rentguard Insurance Property Eye.

It is full of useful facts and figures starting with their "Market Watch" report. A much simpler report than HomeLet's Rental Index, this does at least given a general snapshot of the market.

According to their report and Countrywide source figures - 56% of Landlords in the UK live within 10 miles of their rental property.

The number of new tenancies increased by 15% in the UK last year.

Then for Buying (info for Rentguard Insurance sourced from Ocean Finance - One in three people with a repayment mortgage in the UK won't repay it until they are aged 60 or over.

Landlord's Frequently Asked Questions;

Q: I want to let out my property, do I need to tell my mortgage provider?
A: Yes, if you have a residential mortgage you must obtain the permission of your mortgage provider before looking to rent out the property.

Q: How do I improve the chances of letting out my property?
A: Your properties should be clean, well-maintained, and well decorated to increase your chances of finding a tenant.

Q: Should I use a managing agent?
A: Managing agents create a professional distance between you and your tenants. They can also help take the strain out of dealing with un-pleasantries such as deposit disputes or rent arrears. If you decide to use a managing agent, then you should choose one which is a member of the Property Ombudsman (TPO) as this way you can be sure they will be up to date with current legislation, and provide an independent arbitrator should you be unhappy with their service. (More of these here)

Estate and letting agent fees under the spotlight

One sure sign of the recovery in the property market is that estate agents fees are once again a hot topic.

Some interesting – albeit sure to be controversial – research from suggests that estate agents charge some of the highest hourly fees of all professionals. 
Whilst online estate agent eMoove clearly has a vested interest in encouraging people away from traditional high street agents, the figures are nevertheless interesting.

eMoove claims that high street estate agents charge up to £774 an hour to sell a property which is more than 50% more than a lawyer (£500) and several times higher than a private doctor (£250), psychologist (£165) or plumber (£90).

The figures were calculated on the basis of it taking between 5 and 15 hours to sell a property.  An average agent fee of £3,872 was calculated using the 1.6% average fee charged and the average UK property value of £242,000.

eMoove founder Russell Quirk said: “Typical high street estate agents are charging vendors extortionate fees for a service that is relatively straightforward. “
Estate Agents have been quick to respond explaining that the traditional business model includes a number of fixed costs such as professional photography, floor plans, portal and online advertising, not to mention staff time, apply to all of the properties they list. 

However as they only sell a proportion of what is listed; the fees of the others have to be absorbed. Alternative business models such as charging upfront fees to vendors or a fixed fee to vendors withdrawing their property from the market unsold have been tried but UK consumers seem unwilling to accept a change from the status quo in sufficient numbers to make this work.

In a separate piece of research; a BBC investigation claims to have uncovered widespread evidence of letting agents charging holding deposits or other administration fees but then not letting prospective tenants move in and refusing to refund their money to them.

The investigation, which was carried out by Newsbeat said that a Freedom of Information request found that 71 of the 200 trading standards teams in England had received at least one complaint about this issue. It also reported that there could be many more victims due to the way in which information was recorded and a lack of reporting by tenants. Source Rentguard Insurance - March 14

Why not visit Rentguard Insurance Here and access their website for property insurance requirements

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