Third of landlords falling into a borrowing trap

Recent research has shown that as many as a third of landlords are falling into a borrowing trap.

Without realising, or remembering, they are not remortgaging before their existing product expires and so ending up on the Standard Variable Rate (SVR) from their lender. This costs them on average £371, which means quite a dent in some yields.

Calculated by tracking how many people ended up on SVR in 2017 and how many days they were on that rate for, researchers found the average 42 days on SVR costs those who renewed too late as much as £61.83 on average.

Linda Wale, Independent Mortgage Advisor, reminded us that there are other traps landlords fall into with regards to their finances, like sitting on old loans. With better financial management, things like unchecked insurances and old mortgages will be picked up on and prevent jeopardising the viability of their investments.

Linda estimated that as many as one in three landlords are overpaying on their mortgage. Because of the many changes in the last couple of years, being a landlord has become more complicated and many people do not realise the impact these things are having on the bottom line. “Cost reduction can be done at most stages and level of investment but landlords need to be made aware of these figures so they can ensure they’re not at risk themselves. Costs are rising across the UK so profitability will be affected but this can be mitigated with the correct advice and management.”

Ensure you're maximising the return on your investments further with regular rental amount assessments with up to date comparables and ensure you're producing or receiving full colour, in depth inspection reports so any problems can be dealt with swiftly before they get worse.

For a quick chat over a coffee and some expert advice, please do get in touch. 

First time home seller

Q. I’m looking at selling my first property - can you give me some tips on how to go about it with minimal stress?


A. Choosing the right agent is the best place to start. Don’t automatically go for the one who values your home highest as they could just be trying to buy your business, or the one who quotes the lowest fees as in most things, cheap rarely equals quality.


You want an agent who knows the local market and will give you reliable, professional advice and a quality service at all times. Personal recommendation is always good but failing that, your best bet is to go for a well-established, owner-operated local agent – one whose whole business depends on delivering quality service, rather than hitting targets set by a head office. If you really want to keep stress levels to the minimum, it would also help to choose an agent who can offer a complete service, including things like conveyancing.


Your asking price is obviously hugely important in determining how quickly and smoothly your sale proceeds. You naturally want the highest possible price but you don’t want to scare away any potential buyers so my best advice here is to listen to your agent.


You yourself can make a difference by ensuring that your home is presented in the best, most saleable condition and take the time to gather together any planning consents, building regulation approvals and relevant guarantee certificates for things like gas and electrical installations, woodworm, damp-proofing, double glazing and so on – it’s much less stressful to do it in advance than in a last-minute panic!

What's your financial position



Q. The estate agent I am buying through wants to see proof of my financial position, but I don’t want to disclose that until my offer is accepted. Do I need to give this information in advance?

A. The agent you are dealing with is absolutely right in asking to see proof of your financial position. The relevant section of The Property Ombudsman’s Code of Conduct states that the agent must take all reasonable steps to establish the source and availability of a prospective buyer’s funds - and pass this information to the seller - so if he didn’t, he would actually be in breach of the Code and if the sale subsequently fell through over money matters, his client would have legitimate grounds for complaint. 

You are under no obligation to disclose this information if you don’t want to. However, the agent would then have no choice but to tell his client that as a result of your unwillingness to co-operate, your financial position couldn’t be confirmed. Ultimately, it is the seller’s decision whether or not to accept any offers but the agent would be doing less than his duty if he didn’t recommend an appropriate course of action. If the seller wanted to accept your offer, the agent might well suggest for example, that he continues to actively market the property until appropriate reassurance was established.   

Of course, your reluctance to reveal such details at such an early stage of negotiations is perfectly understandable. However, the sale is unlikely to go anywhere until you do – except on the kind of conditional basis above.

building their own property is the ultimate dream

The best piece of advice where land is concerned is - think very carefully about it!


For many people, building their own property is the ultimate dream and it can be extremely satisfying. It can even be relatively cost effective; however there are a number of potential pitfalls.


Employing an architect and project manager to handle the whole thing on your behalf can be pretty expensive. Alternatively, you could tackle things all on your own but do bear in mind that dealing with planning and building control departments and coordinating builders, suppliers and public utilities has the potential to turn into a real-life nightmare.


If you are one who thrives on this sort of challenge, your first step is to track down a suitable piece of land. That in itself is no easy task - after all, we live on a fairly small, crowded island.


Some estate agents – although by no means all – do deal in land. Alternatively, there are a number of websites these days that specialise in this area. Nevertheless, you need to bear in mind that buying land without planning permission can be a huge gamble – while conversely, land which already has planning permission is obviously going to come with a higher price tag.

Generation Rent is a popular term used to describe young adults, normally between the ages of 18 – 35, who live in rented accommodation because of high house prices. They are generally regarded as having little chance of becoming homeowners. However, how do the UK’s Generation Rent compare to others around Europe?

In November 2017, Countrywide data showed that an average of 7.6% of homes listed to let had previously been listed for sale, which in turn has led to an increase in people renting in the United Kingdom. However, in Europe, Germany leads the way when it comes to the percentage of the population living in a rented dwelling, with a huge 54.3%.

We’ve recently seen dynamic changes on the residential property market across Europe, with the average square metre cost of a property varying significantly. The United Kingdom still has the highest per square metre average transaction price in Europe of €4,628, despite a decrease of 9.0% due to the pound’s depreciation. This in turn has made it hard for new buyers to get onto the property ladder.

Comparing the average cost of 4,628 EUR/m2 in the UK to other nations in Europe, you can get more space for the equivalent value elsewhere. This leads to higher rental costs, once the properties find there way onto the rental market.

Back in the UK, we saw the average rental cost increase by 2.55% between August 2016 and 2017, with the South East being the only region to become more affordable with a percentage decrease of -0.2% in rental costs.

In the previous 10 years, the increase in house prices has outpaced the rise in average salaries. This has led to first time buyers not being able to raise a deposit to purchase a property, which has led them to rent.

However, research from the Yorkshire Building Society has shown that buying a home in Britain has become more affordable across 54% of the country over the past decade (07-17).

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