| Hello and a warm welcome to our first newsletter of 2011.
I trust that you had an enjoyable Christmas break and would like to take this opportunity of wishing you a Happy, Healthy and Prosperous New Year.
The last few weeks of 2010 certainly proved challenging due to the extreme weather conditions we encountered. The number of emergency call outs that our property managers handled was understandably higher than usual and later in this newsletter we repeat the advice we gave in our December copy to both landlords and tenants in respect of minimising and mitigating risk through some simple preventative actions.
As we enter 2011 the weather may still present some challenges ahead but I know that the team at Lenwell is well equipped and motivated to ensure that our clients and customers continue to receive first class service and assistance at all times.
In this edition we look at the positive signs for the Buy To Let market and the Government's announcement of the Affordable Rent Scheme which it is hoped will allow Housing Associations to offer more flexible tenancies and bring more affordable property to the market.
Lucinda Newell is back refreshed from her Christmas break and takes a look at the year ahead with the hope of a greater "feel good" factor being created as a result of some of the younger members of the Royal family!"
Buy To Let Mortgage Specialist Positive About Market For 2011
Commenting on the prospects for the sector over the next 12 months, Nigel Terrington, Chief Executive of Buy-to-let mortgage specialist Paragon Group, said: "2010 has provided a solid base for the buy-to-let market on which to build over the next 12 months. Both the number of lenders and products has increased and gross advances are expected to be up at least 10% on 2009 numbers.
"I expect that positive sentiment to continue into the New Year. Gross lending will rise steadily during 2011 and, in the absence of any major economic downturn, should finish between 10% to 15% higher than 2010 levels. However, it will be some time before we see levels of lending that are consistent with 'normal' market conditions.
"Strong levels of tenant demand will continue into 2011, particularly given the Government's planned changes to social housing, and this will provide the continued stimulus for the growth of buy-to-let lending.
"There will be strong opportunities for commercial brokers to meet the more complex needs of buy-to-let borrowers, especially for Houses in Multiple Occupation style property, where we see a growing market. As the Council of Mortgage Lenders recently stated, low levels of activity in the owner-occupier market will remain a feature in 2011 due to ongoing funding constraints, regulatory pressures and uncertain economic conditions, and this will create further pressure on the private rented sector.
"Landlords should profit from lower void periods and strengthening yields given rising rental levels and a flat housing market. I expect the buy-to-let mortgage arrears level to be flat to falling as landlords benefit from excellent levels of tenant demand and low borrowing costs, although landlords must be cautious of tenant unemployment and arrears.
"There will be a dislocation between the job losses caused by public sector spending cuts being ironed out by growth in the private sector and we are likely to see unemployment rise during the year. Landlords need to ensure that they have adequate rent guarantee insurance in place to protect themselves against defaulting tenants.
"Another key issue for landlords next year will be access to buy-to-let finance and I expect an improvement in this area. It is expected that we will see a number of new lenders enter the buy-to-let market in 2011; however, the recent trend has been to focus on smaller-scale landlords and there is a risk that we could end up with too many lenders concentrating on this end of the market at the expense of professional landlords.
"There are more and more lenders squeezing into the same space competing on price, but with little product innovation. The buy-to-let market is crying out for product innovation and diversity and we will not get that if too many lenders are chasing after the same customer.
Rob Wellstead, Managing Director of multi award winning Lenwell added: "New lenders entering the market must do so with a valuation process that recognises that buy-to-let is a very different proposition than the owner-occupier market. That sounds like a simple task but valuing a buy-to-let property as if it were an owner-occupier property doesn't work, it requires specific expertise and experience.
Lenders must also be sensible on affordability. Risk and affordability are not the same thing and the industry must be conscious of this as it underwrites new business."
Looking to Buy To Let - Get an edge at The Edge in Dunstable
Lenwell are delighted to be working with respected new homes developer Bloor Homes in respect of their exciting new development in the heart of Dunstable.
The development is ideal for the Buy To Let investor with a choice of properties including one and two bedroom apartments and two and three bedroom houses. Prices range between £109,950 and £264,950. (Availabilty and prices were correct at the time of going to press but should be checked by any prospective purchaser by speaking with our Dunstable office)
Dunstable is a historic market town in the county of Bedfordshire, situated at the eastern end of the Chiltern hills. The area has an impressive history surrounding Dunstable Priory which was not only the place of Henry VIII's divorce from Catherine of Aragon but also where the first ever play to be seen in England was performed, written by Geoffrey de Gorham in the 12th Century.
Today the area offers residents a variety of leisure activities, shops and nightlife to keep an active lifestyle. The town has five main shopping areas within walking distance of the central crossroads. From high street names to traditional markets, Dunstable has something for everyone. The long-established Outdoor Market takes place every Wednesday, Friday and Saturday in the Market Square and town centre car park.
For those who love the outdoors, Dunstable offers more than 180 acres of parks, gardens and open spaces, not to mention football pitches, Dunstable Downs golf club, cricket grounds, a bowling green and tennis courts. The town also boasts its own football club-Dunstable Town FC. Further afield, Dunstable Downs is a chalk escarpment ideal for walking, kite flying and, for the more adventurous, paragliding and hang-gliding.
Other areas of interest include the ZSL Whipsnade Zoo on the outskirts of Dunstable, the beautiful Grade II listed Priory House and the Grove Theatre, a multi-million pound theatre complex, which regularly stages both local and national productions.
Our Dunstable office in West Street will be pleased to advise on options and opportunities and can be contacted on 01582 543680 or by email at email@example.com
Government announce new "Affordable Rent Scheme" enabling Housing Associations to grant more flexible tenancies
Housing Minister, Grant Shapps has announced further details about the new scheme that will allow housing associations to offer flexible tenancies and deliver more affordable homes.
From 2011, housing associations will have an additional Affordable Rent option to offer households who need support. Affordable Rent properties will give housing associations the flexibility to offer fixed term tenancies to some new tenants at a rent level higher than social rent - with landlords able to set rents at up to 80 per cent of local market rents.
Landlords will be able to offer the new tenancies in return for investment agreements, which will enable them to raise funds to build more affordable housing. The flexible tenancies will be for new tenants only - the lifetime tenancies and succession rights of existing council and housing association tenants will not be affected.
The Affordable Rent model is the first step towards delivering these wider reforms announced last month and to be included as part of the forthcoming Localism Bill. The Government is investing £4.5bn to deliver up to 150,000 new affordable homes over the next four years, with around £2bn of this funding to support the delivery of new Affordable Rent homes. Ministers intend to make the payment of grant funding conditional on transparency.
Ministers believe the current centrally-determined system for social housing has led to the number of people on waiting lists over the past 13 years to almost double to five million. Affordable Rent is part of a package of measures that will affect all areas of social housing policy, giving councils and housing associations more flexibility to use their social housing stock to the maximum effect and drive down waiting lists.
Mr Shapps set out how the Affordable Rent scheme will work. Early next year, the Homes and Communities Agency will publish a full framework document that will form the basis for bids from housing associations who are interested in offering Affordable Rent.
Housing associations will have the flexibility to convert vacant social rent properties to the new flexible tenancies at a rent level of up to 80 per cent of market rent - but only after they have reached an investment agreement with the Homes and Communities Agency about how additional rental income will be reinvested in delivering new affordable housing.
Shapps said: "With five million people languishing on waiting lists, it's clear we need to act quickly to completely overhaul the system for social housing. That's why today I am setting out the next steps towards a smarter system - one that ensures housing associations have the flexibility they need to target help at the people who really need it, for as long as they need it.
"While we will not change the arrangements for existing tenants, it's senseless to pretend, especially in times of economic hardship, that everyone accessing social housing is in the same boat, and needs a lifetime tenancy. Being able to offer a fixed-term Affordable Rent option will mean housing associations become even more effective in helping people get back on their feet, and ensure more affordable homes are built for every pound of taxpayers' money that is spent."
Rob Wellstead, Managing Director at multi award winning Lenwell said: "We naturally welcome any initiatives and actions that will lead to a wider range of tenures and more property being available across the social rental sector. The private rental and home ownership sectors are simply not able to cater for all housing needs and there is a need for greater availability of accommodation in the market."
The Lucinda Newell Column
To be seen pottering along the highways and byways of Luton in her Mini Clubman, her trusted Scottie Malcolm at her side, our super sleuthing property rental expert Ms Lucinda Newell is on the case on your behalf!
I spent an enjoyable Christmas and New Year with my young nephews and nieces in the Cotswolds. They loved the winter wonderland scenery and had great fun tobogganing down the local hills. It took me back to my own childhood when everything seemed more magical and innocent than it sometimes does today. I was however brought back to reality when I noticed that one or two of the local village children were using estate agents boards as sleds. Naughty but very effective! Overall though, I was excited by a feeling of great joy and happiness.
The Christmas and New Year break is always a good time to both reflect but also to look forward to the year ahead. In her Christmas Day speech, the Queen spoke about the influence of sport but I was left thinking about the still important influence of the Royal family on our everyday lives, despite the now multicultural and multi denominational nature of our society.
In November, William announced his engagement to Kate Middleton and a wedding date of 29th April 2011 was set. The wedding will be a grand affair at Westminster Abbey and a national holiday has been declared by the Government. This was followed shortly before Christmas by the announcement that William's Auntie the Princess Royal's daughter Zara Phillips would be marrying rugby player Mike Tindall. Like buses, it seems that you can go for years without a Royal Wedding and then two come along at once.
This outbreak of royal weddings in 2011 will undoubtedly prove a massive boost for the nation's morale and, of course, to the commemorative china industry!
There is no doubt that events like Royal Weddings can have enormous uplifts on the "feel good" factor of the nation and I must admit to wondering whether Prime Minister David Cameron had known about the announcements when he announced that his Government were going to put in place a system to measure the nation's happiness?
With difficult economic times which we cannot ignore, it would be easy for a general malaise to engulf everyone but, whilst we may all have to "tighten our belts" and make some sacrifices, we all undoubtedly feel better if we can find events, actions and activities that make us feel more positive and if we then share that positivity with others.
There is actually therefore much to be said for finding the things that create a "feel good" factor. All of the world's markets are largely built on sentiment and how positive people feel about things. The UK stock market finished just before Christmas at over 6000 points, over 10% up on the year with most analysists predicting further growth in 2011 as the US and UK economies improve and grow. This is great news for anyone with a pension plan and many savers as so much of all of our futures is tied up in stocks and shares.
England retaining the Ashes in Australia over Christmas restored a feeling of pride and if you look around either nationally or in your own community, you will find many things of which to feel proud and positive.
I was speaking with Rob Wellstead at Lenwell over the Christmas break and he told me that his multi award winning company was celebrating twenty years in business. That is certainly something to be proud of.
My New Year resolution for 2011 is therefore a simple one. Look for the positive in everything and everyone and try and create as much of a "feel good" factor in those around me that I can. I wish you all the very best for a happy, healthy and successful 2011.
Come on Malcolm - Walkies!
I love to hear from my readers so let me know your thoughts - email me at firstname.lastname@example.org
With more extreme winter conditions affecting everyone, we felt it might be useful to repeat some of the simple actions that homeowners and tenants should undertake in order to avoid potential problems.
With temperatures reaching very low levels it is advisable to ensure that properties are kept warm, even if vacant, in order to avoid issues such as frozen pipes. Water in frozen pipes expands and can cause flooding when a thaw takes place. Thermostats on heating systems should be set low but at a level to avoid freezing. Insulation of pipes will also help avoid problems.
If a property is set to be empty for some time over the winter period, consider draining down water and heating systems completely in order to avoid freezing.
Condensation can be a problem during the colder months as people tend to close windows and therefore reduce the amount of ventilation available within a property. Proper insulation coupled with ventilation and heating are the best cures for condensation.
Externally, ensure that gutters, downpipes and drains are regularly cleared. Blocked gutters, downpipes and drains can cause flooding and other water related problems. Large volumes of snow can also cause flooding problems when thawing and so be careful about where one piles up snow from cleared paths and driveways in particular.
A few minutes of preventative action can save a lot of time, inconvenience and cost later on.