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Month: August 2024

Why do I need a property inventory as a landlord?

Posted on by Sophie Winter

Why is a property inventory essential?

Before the introduction of deposit protection laws in 2007, many landlords overlooked the importance of having a detailed property inventory. Those who did create one often produced a basic list of items included in the property, lacking in detail. However, in today’s rental market, having a comprehensive property inventory at the start and end of every tenancy is crucial. It serves as the only concrete evidence a landlord can use to prove that any damage to the property was caused by the tenant.

In the event of a deposit dispute, it’s important to understand that deposit scheme adjudicators operate on the principle that the deposit belongs to the tenant. Landlords can only make deductions if they meet the following criteria:

  • The tenancy agreement contains the proper clauses
  • They can show, on the ‘balance of probabilities’ that the tenant is liable, and
  • The sum claimed is reasonable.

Without clear evidence showing the condition of the property at the start and end of the tenancy, your claim is unlikely to be upheld. Therefore, a detailed inventory protects you from bearing the full cost of repairs, while also ensuring that the tenant is not unfairly charged.

If you choose to let or fully manage your property through us, we’ll take care of the entire inventory process, so you won’t have to worry about arranging it yourself. If you’re not using our full management service, we can still conduct a thorough inventory for you.

What should a property inventory include?

A thorough check-in inventory should include the following:

  • A detailed list of every room and area in the property, including all fittings and contents.
  • A description of the condition of each item, from ceilings and carpets to light switches and bathroom fixtures, with a rating system. This could range from ‘brand new’ to ‘poor’ or use a ‘traffic light’ system (green/amber/red).
  • An assessment of the property’s overall cleanliness.
  • The condition of outdoor spaces like the garden, driveway, gates, and fencing.
  • Documentation of any garden furniture or fixtures, and confirmation that garages and sheds are empty and tidy.
  • Dated and time-stamped photographs or videos showing the general condition of each room, with close-ups of any existing wear or damage.
  • Verification that electrical appliances, fixtures, and lights are functioning.
  • Results from smoke and CO2 alarm tests.
  • Meter readings.
  • A list of keys provided to the tenant.

The more detailed the inventory, the easier it will be to identify any changes in the property’s condition over time. When the tenant moves out, the original inventory should be updated to reflect any changes in contents, condition, and cleanliness.

Can I do the property inventory myself?

Although it is possible to carry out the property inventory yourself, we recommend using a professional. They have the expertise to complete the report efficiently and impartially, offering reassurance to both you and the tenant.

At CR Real Estate, we offer inventories as an optional extra within our Fully Managed service. If you have any questions about inventories or are interested in our property management services, please get in touch with our office, and one of our team members will be happy to help.

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August property market update

Posted on by Sophie Winter

The average asking price for properties entering the market has seen a typical seasonal decline this month, dropping by 1.5% (-£5,708) to £367,785. For the past 18 years, August has consistently witnessed a dip in asking prices, and this year’s decrease aligns with the long-term trend. The summer holiday period often distracts buyers, causing them to delay moving plans, which in turn leads some sellers to price more competitively, especially if they need to sell quickly. However, unlike last summer’s peak-mortgage-rate market, this year’s sellers might benefit from renewed buyer interest.

As noted in our July update, the recent Bank of England rate cut—the first in four years—has accelerated mortgage rate reductions, boosting buyer demand and setting the stage for a promising autumn market. As a result, Rightmove have adjusted their 2024 forecast, now expecting a 1% increase in new seller asking prices instead of the previously anticipated 1% decline.

Tim Bannister, Rightmove’s Director of Property Science, says:

“The recent Bank Rate cut, the first since 2020, has sparked a late summer surge in buyer activity. While mortgage rates haven’t dropped significantly yet, the fact that the long-awaited rate cut has finally arrived, with rates trending downwards, is encouraging for those looking to move. As summer ends, the conditions are favorable for a more active autumn market. This positive response from home-movers, coupled with other encouraging trends, has led us to revise our 2024 forecast. We now predict a slight 1% rise in new seller prices over the year, a modest change from our original 1% decrease forecast, which had anticipated only a minor decline in prices.”

What’s happened since the rate cut?

Since the Bank Rate cut on August 1st, the number of potential buyers contacting estate agents has increased by 19% compared to the same period last year. This is a significant improvement over the subdued market of 2023, which nationally struggled with high inflation and peak mortgage rates. The rise in buyer demand, which was up 11% in July, highlights the immediate and significant impact of the Bank Rate cut.

What about house prices?

This positive shift, combined with other favourable market data, has prompted Rightmove to revise its end-of-year forecast upward, now expecting a 1% rise in new seller asking prices for 2024, instead of the previously predicted 1% decline. The market is likely to see small price increases in autumn, followed by the usual seasonal decreases at year’s end. While uncertainties remain—such as the October Budget, the timing of a second rate cut — the outlook for the rest of the year appears positive. Sales agreements between buyers and sellers are up 16% from last year, and the number of new sellers entering the market is 5% higher than this time last year.

Image from Rightmove August House Price Index

Mortgages

Mortgage rates have also been declining, with the average five-year fixed rate now at 4.80%, a noticeable improvement from 5.82% in 2023, though still high compared to three years ago. Rightmove’s weekly mortgage tracker shows that the best available five-year fixed rate is currently 3.83% for buyers with a 40% deposit, the lowest rate since the period before the mini-Budget in September 2022.

While it may take a few more Bank Rate cuts for home-movers to see a significant reduction in mortgage rates, the immediate boost in buyer sentiment is clear. Both buyers and sellers are more optimistic, as shown by the recent increase in activity.

Curious about your property’s value?

Find out with our free online property valuation.

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What’s happening with mortgage and interest rates?

Posted on by Sophie Winter

If you’re considering buying a home, you may be curious about the current mortgage rates in the UK.

What’s the latest on mortgage and interest rates?

There’s been a lot of attention on the Bank of England’s (BoE) Base Rate increases and their potential effect on mortgage rates. The BoE meets roughly every six weeks to decide whether the Base Rate should rise, fall, or remain unchanged.

In early August, the Base Rate was reduced to 5%, the first cut in over four years. This was after being held steady at 5.25% since August 2023. This followed inflation reaching the Bank of England’s 2% target in May for the first time since 2021, and remaining at that level in June.

When could mortgage rates start to decline?

Another Base Rate cut is anticipated by the end of the year, with projections suggesting it could drop to around 3.25% by December 2028, though this will depend on broader economic conditions.

However, predicting significant drops in mortgage rates remains challenging due to various influencing factors. These include inflation trends, declining swap rates, and the absence of unexpected economic shocks.

How much can you borrow with a mortgage?

The amount you can borrow with a mortgage is determined by an affordability assessment, and your interest rate depends on the size of your deposit, referred to as loan-to-value (LTV).

LTV is expressed as a percentage, representing the size of the mortgage relative to the value of the home you intend to buy. The larger your deposit, the lower the LTV, and vice versa.

To get an estimate of how much you could borrow, you can use a Mortgage Calculator. For a more tailored result, applying for a Mortgage in Principle can bring you closer to securing a mortgage offer.

Want to speak to a mortgage adviser?

CR Real Estate work in partnership with The Residential Mortgage Hub to offer trusted advice that’s tailored to your needs.

Book your FREE appointment with their mortgage and protection advisors online. They have access to over 12,000 products from 90+ lenders on the mortgage market. Their team will handle the whole of the application process for you and deal with any challenges that may arise.

Please note: CR Real Estate is not authorised to provide financial advice. The information and opinions in this article is not intended as financial advice and should not be relied upon for financial decisions. Please consult a regulated mortgage adviser for guidance.

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Key ways to enhance your property’s appeal to buyers

Posted on by Sophie Winter

When selling your property, it’s essential to view it from a potential buyer’s perspective. Buyers will try to envision themselves living in your home, and immaculate presentation can help you find a buyer quicker.

Presenting to buyers

Professional photography plays a crucial role; listings with high-quality photos can generate 93% more viewing enquiries than those with less attractive photos. Therefore, preparing your property for photos is well worth the effort. First impressions are critical, and poor photography or staging can quickly turn buyers away.

Reduce clutter

A cluttered and disorganised home can feel cramped and uninviting, which is shown in photos, virtual tours, and in-person viewings.

While personal items can add character to your home, potential buyers may see them as clutter, making your property appear crowded. You should aim to make your home feel spacious and airy.

Consider the functionality of each item in your rooms. If an item doesn’t serve a purpose or hasn’t been used recently, it likely won’t contribute positively to a buyer’s first impression. Store nonessential items out of sight in baskets or cupboards for photos and viewings. Your goal is to present a lived-in space that still feels like a blank canvas for potential buyers to make their own.

Colour and lighting

Maximise natural light by booking photos and viewings during peak daylight hours, typically around midday.

For colour schemes and artificial lighting, consider your target audience. A colder palette with white LED lighting, metallic fixtures, and white walls may suit a younger buyer, while a warmer palette with soft yellow and orange tones and natural materials like wood and bamboo might appeal to families.

Staging

You should aim for openness and simplicity when staging your home. Think about what your potential buyer may want. Make sure entrances and exits are clear and paths between them are open; and position furniture so that it doesn’t obstruct movement.

Keep furniture against walls to maximise central space in each room, and experiment with different arrangements to find the best layout. A key and cheap item to include is plants as they can add life and texture to your space.

Curious about your property’s value?

Find out with our free online property valuation.

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The challenges of managing rent collection on your own

Posted on by Sophie Winter

Making sure that rent collection payments are on time and paid in full each month is an important task for any landlord managing a rental property. Rental income is the lifeblood of your investment, covering mortgage payments and regular maintenance, and providing a profit margin.

Many landlords face financial strain if rent is missed even briefly, as they may rely on rental income for personal expenses or need to cover mortgage payments themselves. This highlights the importance of:

  1. Conducting thorough referencing and credit checks before accepting a tenant to confirm they can afford the rent.
  2. Monitoring rent collection payments on the due date.
  3. Contacting the tenant immediately if payment is missed to determine the cause and take appropriate steps:
    • Resolve bank issues or forgotten payments promptly.
    • Arrange a payment plan if the tenant has short-term financial difficulties.
    • Consider eviction if the tenant cannot afford the rent or is deliberately not paying.

Challenges for DIY Landlords

DIY landlords often face specific challenges in rent collection:

  • Forgetting to check the rent due date, especially when busy or on holiday.
  • Handling repeated non-payment legally and appropriately to enable potential eviction.
  • Avoiding harassment and knowing legal limits in rent collection.
  • Risking legal claims if tenant rights are violated or the collection process is mishandled.

Benefits of working with professional rent collection services

Working with a property management company like CR Real Estate can alleviate these issues:

  • We ensure timely and full rent payments with established procedures.
  • We will notify and follow up with tenants on late payments.
  • We have expert property managers who effectively communicate and negotiate with tenants, detecting any issues early.
  • We assist in evictions if necessary, ensuring the process is legally sound and efficient.
  • We help end tenancies quickly to bring in new paying tenants.

While most tenants pay rent on time, the odd occasional issue requires immediate attention to avoid financial loss.

How to make sure tenants rental payments are on time

To help tenants make timely payments:

  • Provide your bank details and request tenants set up a standing order for rent.
  • Mark the due date to check payments with your bank.
  • If rent is missed, contact the tenant and confirm the conversation in writing.
  • For short-term affordability issues, consider a written and signed payment plan with the tenant.
  • If persistent non-payment occurs, consider starting the eviction process:
    • Serve a section 8 notice for rent arrears after two months and pursue a possession order if necessary.
    • Alternatively, issue a section 21 notice with two months’ notice, potentially using an accelerated possession order.

After eviction, you may pursue overdue rent, though it might be more practical to focus on finding a new tenant quickly.

Contact us for professional property management

Managing property rentals, especially rent collection, can be challenging. Let our team at CR Real Estate handle it for you. We work hard to ensure timely rent collection payments and hassle-free property management, giving you peace of mind.

Call us today on 01634 570057 and experience stress-free property management.

Looking to rent out a property as a holiday let?

If you want to know more information about holiday lets please contact our local lettings experts on 01634 570057 or book a free online property valuation.

Recent Articles

Top tips for finding your perfect home this summer

Posted on by Sophie Winter

Moving home is becoming more streamlined and less stressful, especially during the summer months. The relaxing vibe, longer days, and better weather make it an ideal time to find your perfect home.

What do you want from your next move?

Consider what you want in your next home. A larger garden might be on your priority list, so as you browse the wide range of properties available in summer, create your own list of must-haves. This might include location, the number of rooms, or the type of property. Stay open to new ideas and possibilities—sometimes the perfect property is one you hadn’t initially envisioned.

Talk to a local property expert to find your perfect home

The UK property market is highly varied, with conditions changing from one street to the next. Local knowledge is important for a successful move. The market you are leaving will be different from the one you are entering, and your needs are as unique as the properties available. Spend time with a local property expert to discuss your requirements; this is a key step in finding your perfect home.

Book a valuation

Planning your moving budget starts with a home valuation. Your property’s value may have increased more than you expect, opening up possibilities for better properties. Ensure you get a thorough, in-person valuation to determine the true value of your home without unrealistic pricing, which can negatively impact your sale.

Look at recently sold prices

Don’t rely solely on your agent for market insights. Looking at the selling prices of recently sold properties or similar homes can help you understand the market better. This summer is marked by stability, offering good equity growth for sellers and reasonable pricing for buyers.

Maximise viewings with longer days

Summer brings an abundance of properties to the market, so book as many viewings as possible. With quieter roads during school holidays and better weather, you can take more time to view properties. A good agent can help you find that special “I’m home” feeling.

Curious about your property’s value?

If you’re ready to find your perfect home this summer, contact our local experts or find out what your home could be worth with our free online property valuation.

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