Development potential

The classic development options available to a landlord are those that allow them to go up into the loft or down into the basement or out at the back or side. Occasionally, you might be able to spot an opportunity to get permission to squeeze an additional dwelling in; however forget you are under malevolent influence of the town planners!

This is a national average and for Tooting this figure would be closer to a months rent for a three bedroom house of £1350:00 pounds.

If as a landlord you are facing rent arrears or have a problem in the future, Tooting landlords offer the following points to bear in mind.

• Prevention is better than cure. Maintain a good relationship with your tenants letting them know that they can and should approach you ahead of any problems. Often it is better to keep a good tenant that is having a temporary problem or that will be able to claim Local Lousing Allowance “housing benefit” than have the cost and risk of voids, finding a new tenant and not knowing the new tenants character. (Tooting Landlords is not your usual lettings agency we don’t make our income by having tenants move every 6-12 months, because we lease your property and guarantee your rent and take on the maintenance it is in our interest to secure good quality long term tenants that look after your property.)    
•  A stitch in time saves nine! Act promptly. Ensure tenants see that you are not prepared to let the issue slide. Be fair and reasonable you want to build a long lasting relationship but they need to play by the rules (there is always the off-chance that ‘the bank messed up again’ turns out to be true!).
• Have a system and follow it! Through our systems and great management of properties and tenants Tooting Landlords achieved a brilliant rate of 97% rental payment in the last year. Thats an average of 11 days rent lost in the past 365days. (Tooting Landlords runs a warning, yellow card, red card policy with our tenants. A simple, policy that our tenants understand and we stick to. It works!)   
• Have the proper agreements and processes in place, so that if you need to file a section 21 or section 8 notice for possession, or chase a guarantor to recover any lost rent, you are able to.
• Watch out for the reasons given for late or non-payment. Having to visit a relative in Grimsby doesn’t preclude paying the rent. There is a big difference between ‘can’t pay’ and ‘trying not to pay’.
• Be willing to find a solution but only if they are willing to work with you, agree a payment plan: Set dates and times etc. Be sure to stick to it, it is no good saying ‘I’ll come for the arrears next Wednesday at 7pm’ and then not turning up.

 You can remove the worry associated with rent arrears, bad tenant’s, voids, serving notice for possession and setting up new tenancy by using our private sector leasing scheme.

 Tooting landlords private sector leasing scheme offers £1200 pcm Guaranteed Rent on a  3 bed house in Tooting.

Our simple and transparent process is easy to understand. We become your tenant; pay you a guaranteed rent of at £1200:00 pcm and take care of all the maintenance.

• Guaranteed rent
• long-term lease on you property (1-5 years)
• No more maintenance worries*
• No Commission, Fees or Management costs
• An ethical investment in the local community and social housing
• A secure return for your property

*we will, at our cost repair and maintain fixtures and fittings within the property but where an item is worn out through wear and tear the cost of the replacement will be at the expense of the Landlord

Tooting Landlords is not a run of the mill letting agent. We are a specialist letting agency for long term property lettings, because by becoming your tenant we are responsible to you and It’s in our interests to maintain your property long term to the highest standards and ensure there are quality long term tenants in your property.

Our letting agency urgently require 3 and 4 bedroom houses in Tooting and surrounding areas. Properties must be clean and well decorated. The building must be in a good state of repair, fit for human habitation and safe. You will still be responsible for the buildings insurance.

Call Robert now for Tooting Landlords best offer on

 0208 8200 790

This is even apparent in London when I compare the market price increase between my rental properties based in lesser affluent areas vs Tooting and surrounding South London property prices that are back to or above the peak values pre the 2008 market crash. Although the UK economy is struggling I believe it is on the way up and good areas of London including Tooting are and will continue to recover ahead of the rest of London and the country.

I believe that the coming 2-3 year period offers a window to invest in property at the start of the property cycle as the market crash has taken place and the recovery is slowly but steadily building.  

However when investing in property my # 1 rule is Value

• Buy at Value
• Add Value
• Manage the property to earn your best rent Value
• Mitigate you tax (Value)
• Sell at Value

I have spoken to lots of my clients and fellow investors over the last few months and there seems to be an attitude that real opportunities are starting to come to market. I have found this year to be full of genuine opportunities, and they seem to coming thick and fast. The truth however we are bouncing around the bottom of the property market with very little capital appreciation to be expected for the coming 2 years. However many properties offer great rental yields and are available at large discounts, especially at auction, with the opportunity to Add Value.

So today I am going write about Adding Value. The easiest way to do this is to look for “Hidden Value” which other investors completely miss.

I have listed 4 examples. To help you see the hidden value in many properties.

Example 1

A semi had been split into two flats all very nicely done but without planning permission, most investors run a mile. Importantly, the conversion was carried out over four years ago (There was proof of this) so after a bit of to and fro with the local council, a certificate of lawful use was applied for and the properties were granted planning with the following figures.

Semi purchased for £310,000 Paint up, legal’s for legal split plus odds & ends £25,000 total £335,000 New value each flat £220,000×2=£440,000  Total uplift in value £105,000.

However due to mortgage restriction you would struggle to get a mortgage on the property ahead of getting the legal’s done. Tooting Landlords / Property Helpline is working with investors to Joint venture and pool financial resource and access this type of investment.

Example 2

Many council houses and blocks of terraces in certain areas, have the same footprint or floor area whether they are 2 bed or 3. In this case to add value, simply change a 2 bedder into a 3 bedder.

All it takes is for the odd wall to be rearranged and possibly a bit of stud partition put up. The costs of this type of work could cost as little as £2-3,000. This can put £15,000-20,000 on to some houses.

Before you do this make sure you have good look at where the windows are positioned, as this can make or break the uplift in value.

Example 3

Add a room to a 1 bed flat. How? The kitchen was put into the living room as is the fashion with many flats these days, and the old kitchen turned into another bedroom making it a 2 bedder. Some thinking is needed around this to use the available space to best effect, as often old flats were badly laid out.

Purchase price £150,000 costs £20,000 end value £220,000 total uplift £50,000.

Example 4

A friend of mine purchased a property in a 1 acre plot value £199,000 -25% net £150,000 (cost him £9,999 total purchase costs, no deposit).

Turns out the next door neighbour has an identical property with planning permission for a single dwelling in the garden, which my client can also get permission for.

This means as well as the property with £49,000 discount he has a building  plot worth around £60,000 .

In summary always, look beyond the obvious look for Value. It might be hidden value but it could be there in your existing portfolio or properties you are considering to purchase when sourcing to expand your portfolio. Hopefully these examples will help you and bring you closer to your goals.

Remember Tooting Landlords / Property Helpline offers a number of bespoke Joint Venture Investment opportunities that allow you to benefit from our Property Investment and Management experience ands systems. If you are interested in discussing a Joint Venture investment with us please call Robert on 0208 8200 790

Northern Rock is the latest company to prefer landlords to first-time buyers, with Santander set to follow suit. Nationwide have said they would actively rather loan to landlords. Banks are now offering improved terms on buy-to-let mortgages, prompting hints of a new buy-to-let bubble.

The money being made available for buy-to-let mortgages has increased by 100% over the last year according to Moneyfacts.

Read the rest of the article >>> here.

Surely this shows that the lenders have more confidence in BTL now and believe that the rental market is strengthening. This combined with regulatory straight jacked imposed upon lenders that to lend to first time buyers with low deposits, they need to hold larger multiples of capital reserves compared to a BTL mortgages with lower loan to value ratios, so it is not a surprise that they would rather lend their limited funds multiple times to landlords, rather than to first time buyers.

Personally I think there is a strong pull from investors back to lettings. I am desperately looking for more stock because savings are earning near zilch. Houses are safer than shares, despite uncertainty. I also think any other corrections here on in will be minor (maybe 10% nominal) and further price corrections will be masked by inflation.

Tooting and the surrounding areas offer a great opportunity to invest as properties in Tooting have many of the fundamentals to make great investments.

When issuing a claim for possession under section 21 or section 8 notice your Court Fees for issuing proceedings for Possession have risen from £150 to £175 from April 2011.

However it is worth noting that fees remains at £100 if your proceedings are initiated through Possession Claim Online. Remember Possession Claim Online can only be used for possessions via Section 8 route, where money is owed (Ground Eight) and you must also serve on the defendant a full, up to date arrears history within a week (7 days) after submitting your Possession Claim Online.

All the details to the changes in court fees can be found here.

Remember by using Tooting Landlords Guaranteed Rent scheme you will never have to worry about a section 8 or section 21 notice again or having to go to court for possession of your property as we become your tenant through our private sector leasing scheme, and offer:

• Guaranteed rent
• long-term lease on you property (1-5 years)
• No more maintenance worries*
• No Commission, Fees or Management costs
• An ethical investment in the local comunity and social housing
• A secure return for your property

However there are many esstential facts that many landlords are not aware of when it comes to tenancy agreements

1.     Granting a tenancy does not need to be a formally undertaken in writing.

It can be done verbally providing

• It is for a term not exceeding 3 years
• it takes effect on the day it is granted
• it is at the best rent which can reasonably be obtained without a premium being taken (one off capital payment for the beneficial interest of the lease)

  However as there is no real record of terms and conditions you could have all sorts of problems proving them if there was ever a dispute.

2. You do not I need a witness for your tenancy agreement? 

Unless your tenancy is is for more than 3 years in length, you do not require a witness to your tenancy agreement.  This is because section 54 of the Law of Property Act 1925 excludes an AST from being a deed provided that the tenant is paying a market rent, the term is less than 3 years and the term starts immediately. 

3. You can grant a tenancy for less then 6 Months.

However the practicality of this is that if the tenant decides that they are not prepared to get out after say a couple of months as was originally agreed, there is very little in practice a landlord can do.  They could try to gain possession using one of the 17 grounds for possession under a section 8 notice. However, by the time that a possession order is in place it is very likely that 6 months of the tenancy would have already elapsed.  So as a landlord you might as well issue a 6 month tenancy and then use a section 21 notice and the accelerated possession route.  Possession through a section 21 notice cannot  be granted by the court until 6 months after the tenancy has begun.

4. Is it possible to let out my property whilst I’m abroad?

Many of Tooting Landlords and Property Helpline clients live abroad either temporarily or as non-residents.  It’s perfectly legal to let your property out from outside the UK.  In which case a landlord can use a CO ( care of) address at our offices or even a PO BOX on the tenancy agreement to avoid revealing their home address to a tenant. However, if they do this then a landlord will need to ensure that the address given is in England or Wales.?If they don’t, according to S.48 of the Housing Act the rent is not legally due to the landlord.?

5. Often landlords want to alter a standard tenancy agreement. 

It’s perfectly legal to alter the standard terms to suite an individual tenancy.  The danger comes for a landlord when these terms are altered and become un-enforceable. The law allows the tenant to do what they like with the property. Hence why it is so important that if any activity is to be prohibited, the landlord ensures it is written into the tenancy agreement. However you can not contract out of (or write into the agreement) your clauses the remove your responsibilities as a landlord this  to act is limited by the European Union directive on Unfair Terms in Consumer Contracts Regulations.  This states that whilst the rest of the tenancy agreement remains valid, the terms which are ‘unfair’ to the tenant will be void.

To take specific legal advice on all tenancy matters consult a legal expert on tenancy law.

Under Tooting Landlords Guaranteed Rental scheme as we lease the property from you we take over these responsibilities

With the economy struggling, I think this is a problem that is going to grow and it is going to have a massive impact on those that do not have sufficient funds to cover voids, or the systems to manage their tenants being unable to maintain their rent. This will result in Landlords then struggling to meet their mortgage payments especially as interest rates increase.

Tooting Landlords run by Robert Jardine a local Landlord and letting agent in Tooting South London, recognizes that combining it’s appreciation of the challenges facing landlords renting in Tooting and surrounding areas, with their detailed knowledge of the social housing sector, the relevant legislation and how the various departments within local authorities operate; Tooting Landlord’s is able to offer “armchair landlords” – an extremely attractive guaranteed rental solution whilst also helping the local community in Tooting.

Call Robert now for our best offer on

 0208 8200 790

My understanding is that Inflation has two separate causes:

• Demand pull – surplus money chasing goods this in turn pulls up prices. Easy credit for mortgages resulted in the property boom.
• Cost push – external factors like food (the price of wheat has risen 30% in the past year due to the poor harvest last year), oil etc and VAT (external factors), which due to their higher price, pushes up prices.

Rising interest rates removes money and works well on demand pull – but not on cost push.

The problem is disposable incomes are dropping – and an increase in the BOE interest rate will not help. The only reason I think they might increase BOE interest rates in the short term would be psychological, so the Bank of England can appear to be taking action to fight inflation and ease wage pressures. So a 25 point increase might just be a symbolic shot across the bows in the short term to let people know that they are doing something.

However this is in the short term, eventually rates will need to go up!

A great debate is taking place on property tribes on the topic

5.99% The overall cost for comparison is 6.2% APR*

2 year Fixed thereafter Libor + 5.00%

2.50% Arrangement fee

85% LTV

Rental Cover 120% at Payrate

A 5% early repayment charge will apply for the first two years.

Ok the reversionary rate of Libor + 5% may not float your boat but this is great news! New lenders are entering the market and lenders see buy to let as the mortgage cash cow over the next few years.

I don’t think this is a very good product and it is in line with my previous article on the interest rate time bomb, but no ones being forced to take it. However it will create competition and lead to others mortgage lenders following suit offering 85% LTV and more competitve products. That is a good thing!

A great debate is taking place on property tribes  on this very subject and Lisa Orme of Keys-mortgages said “Within an hour of the announcement I had my BDMs from two other B2L lenders on the phone to me asking my opinion; lenders are in this to make money and if that means keeping up with the Jones’s they will!”

This product could also work well for a mid term buy to sell stratigy where if you use a good product now and adding value, get a good cashflow and then sell in a couple of years could be a great use of this product as the incleased LTV will lower the amount of cash you will have tied into the deal.