RENTERS REFORM BILL IS FINALLY HERE

If you’re a landlord, or thinking about becoming one this year, you may be wondering “is it still worth it?”

The answer is still an unequivocal “yes”, but there are things that you need to be aware of. Here’s your ultimate state-of-the-union guide to the rental sector in Brighton and Hove, as why quality is King, each and every time.

Happy New Year to all, and best wishes from everyone at Brighton Homes.

Highs…and Lows

As specialists in the property sector, our experienced team has witnessed a great many changes within the industry. And, not to put too fine a point on it, a fair amount of;waxing and waning, inevitably in line with the current state of our economy, and the housing marketing in general.

Right now, as we move into 2023, the rental sector is still buoyant, but it would be madness to declare that everything is rosy in the garden. It clearly isn’t. Why would you rent out your property when you could sell it for a healthy profit? Why indeed. Well, Brighton Homes has some answers for you.

Here’s your lowdown to where we are now, and what the coming year could bring. It’s candid, straightforward and sincere – just what you need right now, we think.

Rental Prices in and Around Brighton and Hove – Still good, and getting better

Presently, it’s possible to achieve superior, if not excellent rents in the local area.

Data from Numbeo (a large online cost of living statistical database) in 2022, reveals that the average rent for a one-bedroom apartment in the city centre is £1,159, rising to as much as £2,287 for a three-bedroom property.; Anecdotally, these are on the rise.

There are several reasons for these robust rents:

• Brighton is a popular place to live;– it’s London-by-the-Sea in the minds of many, with the added benefit of a good standard of living within easy reach. Thus, there are more people looking for places to rent than there are properties available, creating a squeeze. There is a “snooze and you lose” situation; fail to secure your property with a holding deposit, and it’s gone to the applicant who’s fastest out of the starting blocks.

• Another critical explanation is that;legitimate, professional property agencies;– of which we are most definitely a prime example – are securing;higher rents;because they (and we);do things properly,;and with great care. More of this later, but the right tenants are more likely to pay slightly more for the right house or apartment, take extra care, and remain in situ for much longer. And, it’s;all about;the right tenants.

• Finally, our remit and property portfolio increasingly;extend beyond Brighton & Hove, with “Down from Londons” accepting properties further afield in East and West Sussex, and out of the local area. WFH (working from Home) is a near-normal situation for many, not least because commuting has shall we say, become somewhat;challenging.

However.

Simply put, it’s harder, and potentially more expensive to be a landlord than it used to be.

It goes without saying that these are also testing times for tenants. Bills are on an upwards trajectory, with no guaranteed future support.;

1. Property Portfolio Pitfalls

The government has gradually clamped down on the buy-to-let market.

As long-standing rental experts, we can see that the pendulum has swung in the direction of your tenants – protecting them legally, financially, and from a health and safety point of view. Whilst the latter is commendable, the first two may test your landlord mettle.

2. Mortgage Interest Relief

Since 2017, HM Gov has been reducing mortgage interest relief. Previously, you could deduct the interest paid on your mortgage before you paid any tax. Effectively, if you were a higher-rate taxpayer you benefited from 40% tax relief on your mortgage payments.

Now, you are given a flat-rate tax credit based on 20% of your mortgage interest.

Also, you have to declare the income that pays the mortgage on your rental property. If you’re a basic rate taxpayer, this puts you into a higher tax bracket. And hence, a higher tax bill.

3. Stamp Duty

It’s now an extra three per cent on top for second homes, even if you don’t live in it, which as a landlord you most likely won’t. Plus, if you sell the property you will have to pay capital gains tax if the property has increased in value – which, knowing the property sector in East Sussex, it will do.

The rates for landlords are 3% on the portion of the property up to £500,00, then 8%, 13% and 15% on the increasing price tiers.

At the risk of stating the extremely obvious, this adds up to a higher tax bill.

4. Abolition of the Section 21 Notice

It is to be expected that this legislation will be going onto the statute books.

As the law currently stands, you may evict your tenants under Section 21 by giving them two months’ notice at the end of a fixed-term contract.

Soon (but we’re not exactly sure when) landlords will have to move all tenancies to periodic – meaning that your tenancy will end;only if the tenant choses to leave, or if you have a valid reason, as defined the new laws – Section 8. Section 8 could be a bit tricky. Why? Because you have to prove that they have broken the terms of their tenancy agreement.

Get in touch;with Brighton Homes for more information on this, as this point goes into more depth than we have space for here.

In a nutshell, legal action could become more frequent, costly (at least £3,000), and take much longer to resolve.

And Now for The Good News

Here is where quality wins out every single time; doing the right thing, following precise and exact legislation and proving minute attention to detail.

And by that, we mean choosing the right agency to find your tenants and to manage your portfolio on your behalf. Modesty aide, an agency such as Brighton Homes has the credentials, experience and approach that you need now, and in the months to come. They do exist, and we can help you find them.;Let us explain.

Our Vetting Process

We carry out extensive credit and reference checks. To swerve void periods, you need hardworking, dependable professionals who are looking to put down roots, who will pay on time and who will keep on paying in the months and years to come.

Therefore, we always ask for proof that his or her;net;monthly salary is;three times the rental amount;(as opposed to the industry standard of twice the gross amount).

Marketing Further Afield

When it comes to finding good tenants for your property in Brighton and Hove, we don’t restrict ourselves. Our marketing net spreads further than the City limits. Properties to rent via Brighton Homes are advertised and marketed beyond the local area, including into key areas in Sussex.

Taking Care of the Paperwork

Our knowledgeable team will take care of everything, with a strong “checks and balances” philosophy that misses nothing. We’ve put procedures in place, and can reassure you that if it needs to be done, we will do it.

Local Knowledge

The staff are local. Their knowledge of this area is your gain. Understanding where the good schools are, as well as transport links, shops and local amenities means that we can offer you best-in-class advice on all aspects of renting your property.

Yearly Rent Reviews

You’ll know that your income is as lucrative as it can be, within reasonable parameters. Why? Because we review rents annually. Whilst we would never price you out of the market – nobody wins in that scenario – we’re always on your side and will negotiate for the best outcome.

Finally…

We’ve been here before. Our economy is cyclical. What goes up, comes down and markets fluctuate. Tough times ten years ago, and in the years before that always loosen their grip.

Hold fast.

Work with the best of the best.

Better times are ahead.

In the meantime,;get in touch;for more information about how Brighton Homes can support you in 2023.

If you’re a landlord, or thinking about becoming one this year, you may be wondering “is it still worth it?”

The answer is still an unequivocal “yes”, but there are things that you need to be aware of. Here’s your ultimate state-of-the-union guide to the rental sector in Brighton and Hove, as why quality is King, each and every time.

Happy New Year to all, and best wishes from everyone at Brighton Homes.

Highs…and Lows

As specialists in the property sector, our experienced team has witnessed a great many changes within the industry. And, not to put too fine a point on it, a fair amount of;waxing and waning, inevitably in line with the current state of our economy, and the housing marketing in general.

Right now, as we move into 2023, the rental sector is still buoyant, but it would be madness to declare that everything is rosy in the garden. It clearly isn’t. Why would you rent out your property when you could sell it for a healthy profit? Why indeed. Well, Brighton Homes has some answers for you.

Here’s your lowdown to where we are now, and what the coming year could bring. It’s candid, straightforward and sincere – just what you need right now, we think.

Rental Prices in and Around Brighton and Hove – Still good, and getting better

Presently, it’s possible to achieve superior, if not excellent rents in the local area.

Data from Numbeo (a large online cost of living statistical database) in 2022, reveals that the average rent for a one-bedroom apartment in the city centre is £1,159, rising to as much as £2,287 for a three-bedroom property.; Anecdotally, these are on the rise.

There are several reasons for these robust rents:

• Brighton is a popular place to live;– it’s London-by-the-Sea in the minds of many, with the added benefit of a good standard of living within easy reach. Thus, there are more people looking for places to rent than there are properties available, creating a squeeze. There is a “snooze and you lose” situation; fail to secure your property with a holding deposit, and it’s gone to the applicant who’s fastest out of the starting blocks.

• Another critical explanation is that;legitimate, professional property agencies;– of which we are most definitely a prime example – are securing;higher rents;because they (and we);do things properly,;and with great care. More of this later, but the right tenants are more likely to pay slightly more for the right house or apartment, take extra care, and remain in situ for much longer. And, it’s;all about;the right tenants.

• Finally, our remit and property portfolio increasingly;extend beyond Brighton & Hove, with “Down from Londons” accepting properties further afield in East and West Sussex, and out of the local area. WFH (working from Home) is a near-normal situation for many, not least because commuting has shall we say, become somewhat;challenging.

However.

Simply put, it’s harder, and potentially more expensive to be a landlord than it used to be.

It goes without saying that these are also testing times for tenants. Bills are on an upwards trajectory, with no guaranteed future support.;

1. Property Portfolio Pitfalls

The government has gradually clamped down on the buy-to-let market.

As long-standing rental experts, we can see that the pendulum has swung in the direction of your tenants – protecting them legally, financially, and from a health and safety point of view. Whilst the latter is commendable, the first two may test your landlord mettle.

2. Mortgage Interest Relief

Since 2017, HM Gov has been reducing mortgage interest relief. Previously, you could deduct the interest paid on your mortgage before you paid any tax. Effectively, if you were a higher-rate taxpayer you benefited from 40% tax relief on your mortgage payments.

Now, you are given a flat-rate tax credit based on 20% of your mortgage interest.

Also, you have to declare the income that pays the mortgage on your rental property. If you’re a basic rate taxpayer, this puts you into a higher tax bracket. And hence, a higher tax bill.

3. Stamp Duty

It’s now an extra three per cent on top for second homes, even if you don’t live in it, which as a landlord you most likely won’t. Plus, if you sell the property you will have to pay capital gains tax if the property has increased in value – which, knowing the property sector in East Sussex, it will do.

The rates for landlords are 3% on the portion of the property up to £500,00, then 8%, 13% and 15% on the increasing price tiers.

At the risk of stating the extremely obvious, this adds up to a higher tax bill.

4. Abolition of the Section 21 Notice

It is to be expected that this legislation will be going onto the statute books.

As the law currently stands, you may evict your tenants under Section 21 by giving them two months’ notice at the end of a fixed-term contract.

Soon (but we’re not exactly sure when) landlords will have to move all tenancies to periodic – meaning that your tenancy will end;only if the tenant choses to leave, or if you have a valid reason, as defined the new laws – Section 8. Section 8 could be a bit tricky. Why? Because you have to prove that they have broken the terms of their tenancy agreement.

Get in touch with Brighton Homes for more information on this, as this point goes into more depth than we have space for here.

In a nutshell, legal action could become more frequent, costly (at least £3,000), and take much longer to resolve.

And Now for The Good News

Here is where quality wins out every single time; doing the right thing, following precise and exact legislation and proving minute attention to detail.

And by that, we mean choosing the right agency to find your tenants and to manage your portfolio on your behalf. Modesty aide, an agency such as Brighton Homes has the credentials, experience and approach that you need now, and in the months to come. They do exist, and we can help you find them.

Let us explain.

Our Vetting Process

We carry out extensive credit and reference checks. To swerve void periods, you need hardworking, dependable professionals who are looking to put down roots, who will pay on time and who will keep on paying in the months and years to come.

Therefore, we always ask for proof that his or her;net;monthly salary is;three times the rental amount;(as opposed to the industry standard of twice the gross amount).

Marketing Further Afield

When it comes to finding good tenants for your property in Brighton and Hove, we don’t restrict ourselves. Our marketing net spreads further than the City limits. Properties to rent via Brighton Homes are advertised and marketed beyond the local area, including into key areas in Sussex.

Taking Care of the Paperwork

Our knowledgeable team will take care of everything, with a strong “checks and balances” philosophy that misses nothing. We’ve put procedures in place, and can reassure you that if it needs to be done, we will do it.

Local Knowledge

The staff are local. Their knowledge of this area is your gain. Understanding where the good schools are, as well as transport links, shops and local amenities means that we can offer you best-in-class advice on all aspects of renting your property.

Yearly Rent Reviews

You’ll know that your income is as lucrative as it can be, within reasonable parameters. Why? Because we review rents annually. Whilst we would never price you out of the market – nobody wins in that scenario – we’re always on your side and will negotiate for the best outcome.

Finally…

We’ve been here before. Our economy is cyclical. What goes up, comes down and markets fluctuate. Tough times ten years ago, and in the years before that always loosen their grip.

Hold fast.

Work with the best of the best.

Better times are ahead.

In the meantime get in touch for more information about how Brighton Homes can support you in 2023.