LETTINGSnews
INSURANCE
Deacon’s new campaign
Deacon, the blocks of flats insurance broker, is targeting 30,000 lettings agents, property management
companies, managing agents and leaseholders across the UK in a bid to generate 2000 new business enquiries by the end of 2011. Project 2000, a direct mail/
digital marketing campaign is promoting same-day comparative quotes from up to five major blue chip insurers, faster than ever claims settlement times (up to 50 per cent quicker than dealing directly with an insurer), access to both insurance and property specialists, and a wide range of competitive cover with bespoke policy wordings. Clients also benefit from an
average saving of 16 per cent on blocks of flats policies. Penny Jepson, Deacon’s Head
of Business comments, “Our renewal/retention rates continue to be high, but it is essential that we attract new business to ensure long-term success and improved market share. As a result, Project 2000 is a very significant move for Deacon. “Our strengthened service
proposition and high quality, competitively priced blocks of flats insurance products are a winning combination, and we can guarantee that those prospects who take the opportunity to give Deacon a try will not be disappointed.”
PROPERTY PRICES Property – a good investment?
More of us need to rent rather than buy, so Buy to Let should be thriving; the mortgage lenders are busily
promoting their BTL products and attractive rates, agents constantly seek more homes, encouraging landlords to invest in further properties, tenants are queuing up to rent, sometimes gazumping previous applicants. Then along comes Grant
Shapps, one time ‘big white hope’ for the property industry (when he
58 OCTOBER 2011 PROPERTYdrum
was in opposition, he seemed very interested in the property market’s success) and says that UK homeowners (yes, that includes landlord investors) shouldn’t count on making money from their property as the pace of price gains slows. “Gone are the days where you buy a house for capital appreciation,” Mr Shapps said. “House prices can still go up, but they need to go up in line with or less than increases in average earnings for the long term.” On average, house prices rose 147 per cent from 2000 to the
market’s peak in October 2007, according to Nationwide Building Society. That was 11 times faster than consumer-price inflation of 13.2 per cent. Values then slumped 21 per cent by February 2009. The shortage of homes, which
may reach 1 million by 2015, is helping to support prices, according Savills, while record-low interest rates have also bolstered demand, and prices. But the future doesn’t look all that orange for landlord investors, who may wonder where else they can put their money.
TENANCY DEPOSITS The colourful world of deposits
From smashed antique vases to missing washing machines, the Tenancy Deposit Scheme, TDS, has heard it all and has published some of the stories behind deposit disputes in a new set of case studies. These are to show how independent adjudicators approach a deposit dispute when landlords and tenants cannot reach an amicable agreement. It is part of a continuing campaign to make deposit resolution open and easy to understand. This latest examples also
cover redecoration problems at the end of a tenancy; one was a case of betterment, where the tenant had done a better decorating job than the landlord. Guidance notes point out that a deposit cannot be treated like a new for old insurance policy – if landlords could replace items like that, it would amount to being betterment at the tenants’ expense. Allowances must be made for fair wear and tear. The length of a tenancy and the age of the missing or damaged item need to be
considered as do its quality, condition and life expectancy at the beginning of the tenancy. This emphasises the need for a good condition report at the outset. TDS guidance notes stress
that an adjudicator cannot assume that a property was in good condition at the outset. The publication of these
guidance notes and case histories follows consultation with the Members’ Forum of the TDS as well incorporating the views from organisations such as the National Union of Students, NACAB and Shelter. “Although disputes cannot always be avoided, by publishing the experience we have gained, we can help landlords and tenants and their letting agents to find an amicable solution without going through the process of Alternative Dispute Resolution,” said Steve Harriott, Chief Executive of the Tenancy Deposit Scheme. The full (made anonymous)
studies and the guidance notes to go with them can be found on
www.tds.gb.com.
REFERENCING
Guaranteeing the guarantor
PropertyRisks says that landlords letting to students and other first time tenants need to be sure that reference
the potential tenant and any guarantor that they may name. Nigel Atkinson of PropertyRisks says, “The latest research specifically on student rentals indicates that this year rents have risen by three per cent. Not surprisingly London has reached an all-time high, but unexpected locations such as Leamington Spa and Newcastle-under-Lyme have experienced double-digit rises. “This situation is reflected on the broader rental scene where there is strong demand that will push rentals higher. At the same time, the economic situation means that more people are likely to be renting for the first time, and, like students may not have any rental history to base a reference on. In such circumstances it is common practice to have a guarantor for the rent, but it is essential that the referencing process also includes validation of that guarantor and verification that they are in a financial position to fulfil their obligations under the rental contract. Landlords can, of course, protect themselves with legal expenses and rent guarantee cover, but this will be dependent on satisfactory referencing of both tenant and guarantor.” According to PropertyRisks,
referencing should include authentication to ensure that the tenant is who they say they are, checking of linked addresses, validation of employer references and tenant history. This verification should also extend to any guarantor involved. Nigel Atkinson: “A guarantor should be as carefully referenced as the tenant themselves, after all, they will be the party that needs to be pursued if the tenant defaults. As with employer references, it is important to be sure of the source of the information. Guarantors using personal email addresses, such as Hotmail, or mobile telephone numbers should only be accepted if they have been verified and authenticated with a full audit trail to support.”
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