Welcome to our weekly Newsround, where we give you all the housing news that has been trending in the media this week.
Fraudulent tenancy applications on the rise
It appears that tenants are getting more creative with their earnings in order to secure tenanted properties.
Goodlord, a lettings platform has stated that there has been a clear increase in tenants lying about their income in order to afford higher rents. This is due to both the chronic lack of houses on the letting market and the high cost of living.
Out of some 300,000 tenancy applications it was found that one in 1,000 were fraudulent of which 54% involved payslip fraud. This causes landlords to have rent voids and agents loose out on commission.
Furthermore, guarantors on tenancies has also increase from 12% in November 2021 to just under 15% in November 2022, improved technology has also made it harder for fraudsters to fake documents.
But lying about income is alot harder. Blake Richmond of Goodlord said
It’s a growing problem as tenants are competing hard with other renters and want to show landlords they are in the best financial position possible.
It seems a landlord or agent can no longer rely on just instinct. You can read more here.
London sees highest exodus of landlords
New stats show according to a report by Property Industry Eye that renters are leaving London at the highest rate in a decade. This is due to being priced out of the lack of decent affordable rental houses and the cost of living. In 2022 40% of tenants left London whereas 10 years ago it was only 28%. Experts do not expert this trend stop anytime soon.
Working remotely can enable tenants to move out further into the outer counties.
Hamptons have said that landlords are exiting the private rented sector at the highest rate in three years resulting in 66 fewer properties up for rent per day. David Fell of Hamptons predicted that landlords are likely to continue selling more properties than they buy in the year ahead. This is due to much new legislation and soaring mortgage rates.
The Government has been urged to do more are the rental supply continues to dry up.
Government needs to take action
Despite strong demand for rented properties 30% of landlords have said that they are planning on cutting their portfolios in 2023, which is at its highest level in over six years, and only 9% planning to increase their portfolio which is down from 14% in 2021.
Coupled with this, the NRLA has found that 63% of landlords have buy-to-let mortgages on at least one property and face significantly higher costs now and in the immediate future.
NRLA argues that the mismatch between the demand for, and supply of rented housing, is, in part, a consequence of higher borrowing costs. Ben Beadle, chief executive, said
It is time the government stepped in and accepted calls by the NRLA, the Select Committee and others for tax measures to encourage the supply of homes to rent. Without this, renters face a bleak future as finding somewhere to live becomes increasingly harder.
You can read more here.
Landlords are acting on energy efficiency
Many landlords are now making energy efficiency improvements to their rented properties, according to new research carried out by Shawbrook. 21% of tenants have asked landlords to improve their properties.
Shawbrook have found that landlords are spending, on average £8,900 on improvements which is more than they had expected to spend. There are still some landlords out there who do not have any idea where to start making energy-efficient measures.
Under current regulations, landlords have to meet an EPC rating of C by April 2025 and do not have to spend any more than £3,500 on upgrade work to meet an EPC rating of E. New changes could see all rental properties at an EPC rating of C by 2028, with an increased spend capped at £10,000.
Emma Cox, managing director of real estate at Shawbrook, says
It’s likely that efficiency standards will become tougher in the future, which is just one of the reasons that landlords should take note of tenant’s requests and start making a plan. As trends now point towards tenants favouring more energy efficient properties, these changes should not just be seen as a tick-box requirement by landlords, but also a worthwhile investment.
If tenants feel their accommodation is more cost efficient and sustainable, they will be more likely to stay, which in turn will benefit landlords.
Energy efficiency remains high on everyone’s agenda, and decisions from the Government are required sooner rather than later.
Snippets
Renting ‘ruins retirement for single people and self-employed’ – claim
Home Office says landlords do not ‘systematically discriminate’ against
Tax shock for holiday let owners when rates kicks in
Tax and Compulsory Purchase threats to private landlords – new report
Latest: Official ‘property portal’ being tested by landlords prior to launch
Landlords set to pass on mortgage rate hikes to tenants
Foxtons reveals how many renters compete for each property
Newsround will be back next week.