Being A Landlord

Being a landlord is easy if you know the rules and regulations.  Twenty years ago if you owned a rental property it was simple to let it.  The landlord checked the roof didn’t leak, that it had four solid walls and a floor, set the rent level and found a tenant for life.  Then sat back and watched the money roll in but today the world of the landlord is changing.  Successive UK and EU governments have introduced so much legislation the landlord doesn’t know from one day to the next if the let on his property is legal or illegal.  Fines can be hefty.  Prison is a possibility.  Landlords can even lose the right to evict a tenant.  Here we look at some of the important legislation a landlord needs to comply with

Energy Performance Certificates (EPC) – before any property can be advertised for rent it must have an EPC report.  The report must be shown in full to the prospective tenants before they make a decision about the property.  Fixed penalties of £200 are applied if the landlord fails to obtain one.

Gas Safety Certificates – All properties must have a current gas safety certificate which has to be updated every 12 months.  The Health and Safety Executive are able to prosecute or imprison any landlord found not having a valid certificate. 

Information Commissioners Office (ICO) – it seems reasonable enough that the landlord will want to know as much as possible about the person they will be letting the property to.  They will want to be sure the prospective tenant can afford to rent the property, will look after it and does not have a poor credit history.  But did you know as soon as the landlord starts asking this information under the data protection act they need to be registered with the ICO.  Fines can vary from 3000 euros to 500,000 euros for breaches of the data protection act.

Houses of Multiple Occupation (HMO) – if a landlord has a property that is classed as an HMO they will need to be licensed with the local council to be able to let the property.  Each council has it’s own licensing requirements and fees. Failure to register with the council can result in prosecution and fines up to £20,000.  If more people than the license approves live in the property another £20,000 fine, a further £5,000 fine for each breach of the license and the right to evict the tenant.  The landlord could also have to repay any rent collected.

 

Landlord Accreditation – many councils in the UK require the landlord to be accredited if they want to rent a property.  Accreditation is a test that ensures the landlord is up to date with current rules and regulations and continues to keep themselves up to date through continuous learning.  In Wales landlords are required to attend a one day seminar and pass a test.  In England accreditation depends on the local council.  Landlord Associations also run their own accreditation schemes.

Health and Safety – every property needs to be assessed to ensure it complies with Health and Safety rules.  This is an assessment the landlord can do themselves.  It ensures tenants cannot come to any harm while they occupy the property.  Follow up checks should be done to ensure the tenant does not cause any potential harm while renting the property.

Green Deal – with effect from October 2012 (in England) and January 2013 (in Wales) landlords need to demonstrate they are continually improving the energy efficiency of the property they are letting.  Green Deal is a scheme aimed at helping landlords fund improvements to their properties.  From 2014 any property with an energy efficiency report of G will no longer be allowed to be let.  The plan is that over the coming years only properties with a rating of A to D will be able to be let.

The world of the landlord is continually changing.  Keeping up to date with current legislation has never been more important.  But, if you know your rules and regulations letting a property in the UK is easy.

 

Do I or Don't I?....

Do I or Don’t I?…


It was a dilemma, do I or don’t I cancel the training for Wednesday? It was a small crowd of 15 people coming from around Wales and England. Was it fair to let them down by cancelling at the last minute?

My step-dad died on Sunday after being in hospital and care since Christmas. It was unexpected. He had a temperature Saturday night and was taken into hospital. Seemed fine but within a couple of hours was gone.

In addition, we are still reeling from the burglary and all the repercussions that involves with the police and insurance companies. The thought of trying to put on a smiley happy persona in front of 15 people was the last thing I wanted to do.

I decided to go ahead and turned up with my folders and pen in hand. It didn’t take long to realise what a great, motivated and enthused crowd we had.

I’m really pleased I made the decision not to cancel. The session started quietly, as they always do, as people wary of one an other at the start begin to relax. Within 40 minutes there was a buzz around the room which grew for the remainder of the session. It was a good crowd and fun and the energy was so infectious I thoroughly enjoyed the training.

So I have to say a big thank you to everyone who turned up. I hope you got something from the training. I know you gave me a lot.

October Book Review - Surviving 2012

Four years ago in 2007, in unprecedented scenes, Northern Rock had a run on it's branches which saw Northern Rock Bank become nationalised. It was the forerunner to the 2008 Credit Crunch.  Now four years later banks are still in financial difficulty. The almost daily notification of downgrades in credit worthiness of banks comes as no surprise. Countries which printed or borrowed endless money used to bail out their banks are themselves on the brink of bankruptcy.  The implementation of severe austerity measures as countries try and reduce their debt and GDP ratios has only contributed to high inflation, high unemployment and low economic growth. The world is on the brink of a depression unlike anything we have ever seen. Worse than the 1930's Great Depression.  Governments don't know how to solve the problems. They keep fighting with the same old tools that got us into the situation we currently find ourselves in. Instead of improving things it makes them worse. We are facing an enormous disaster and very few people are aware it is coming.

In my fifth book, Surviving 2012, due for release in January 2012, I discuss ways of improving your financial education and preparing for the biggest economic disaster of our lifetime. If you are looking for a know it all answers for everything type of book then this is not for you.  This book has been written as a basic financial book for beginners giving some fundamental information that could can help you survive 2012 and beyond.  The greatest financial disaster of a lifetime is almost upon us. Those with financial education will make it through the coming storm, not unscathed, but in a better position than those not prepared for it. 

As the financial world we know changes forever a great transfer of wealth is beginning and Surviving 2012 can help you share in it.

Surviving 2012 by Karen Newton due for release in January 2012.

Being an investor .....

1999 was a new beginning.  It began quite simply with a colleague suggesting I read a book.  The book has now gone down in history as one of the great financial books of its time. 'Rich Dad, Poor Dad,' by Robert Kiyosaki.  I read the book, promptly went out and got the second one in the series. I was hooked. My husband wasn't convinced. 

About a month later the same colleague asked if we would like see Robert Kiyosaki in Auckland, NZ in January 2000. The answer was a resounding yes.  At the end of the seminar my husband suggested we buy the third book in the series. The five and a half hours trip from home from Auckland flew by as we discussed all the possible opportunities we had gained from the seminar.  We took a couple of days off work and read book three from cover to cover twice.  Our life as investors was about to begin or so we thought.

New Zealand has a high home ownership population and we decided the best thing for us was to move to Australia and start our new lives as investors. Unfortunately, it wasn't meant to be and within a week we were on our way to the UK following the death of several family members.

Our plans were on hold for about a year while we dealt with the family tragedies.  We didn't lose sight of what we wanted to do and by 2001 we bought our first house. Run down and needing repairs. We lived in it for 3 years but always with the intention that it was going to be a rental property.  In September 2001, on my husbands birthday we bought another property at auction.  Two houses within 3 months.  From there we set ourselves the target of doubling our portfolio every year.  A strategy we kept going until Northern Rock (one of our major lenders) got into trouble in September 2007, at which stage we had 60 properties and we ground to a halt. The next two years were spent, trying in vain, to raise financing to purchase more properties.

Late August 2009, we were invited to another Robert Kiyosaki seminar.  We again bought some more books, sat down and read them together and hatched the next plan of attack.  At this stage we had a healthy property portfolio but little else in investments. So we decided now was the time to start building other income producing assets. Remembering the advice from the books.  An asset is something that puts money in your pocket. Just keep building the asset column.

We had for twenty odd years dabbled in shares but never in a major way.  That was about to change.  We devised a two level share strategy. We would buy shares that produced a good dividend yield preferably over 7%.  We would also invest in penny shares with the aim to double our money. Sell the shares and put half back into high dividend yield and the other half back into penny shares.  We are still operating that strategy with good results.

We also set ourselves a goal of doubling our income from investments other than property every year.  2010 was a real learning curve as we tried different strategies until we found one that worked well for us.  We didn't quite make our goal of doubling income that year.  But the goal has already been achieved in 2011 and we expect it to be one of our best years for a long time.

We've continued our learning and our investments are now very diversified.  We still hold our property portfolio, we have our penny shares and our high yield dividend shares. We operate a lending portfolio where we provide loans to other people through a third party and receive monthly interest in return. We hold gold, silver, copper and other commodities all of which provide capital growth. 

We've worked hard to become investors in the real sense of the word.  Every day we do something to increase our wealth and our income. We always remember Robert Kiyosaki's advice. The definition of an asset is something that puts money in your pocket.  Keep building the asset column.