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Six tips to help save for a house deposit

Posted by: Adam Male on 25 October 2016
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With the average property in the UK costing £206,145 and with the average deposit equating to 17%, it comes as no surprise that more and more people are struggling to take their first steps onto the property ladder.

Coupled with ONS reporting median gross annual earnings of £27,600 within the UK, saving a deposit for a house is no mean feat. Even if a first time buyer was earning £27,600 a year and able to save 10% of their wage each annually, they would be looking at 12.7 years of saving.

But cutting luxuries, such as daily coffees and online subscriptions can really make a difference! Here are some clever ways that first time buyers can give their savings a boost and get on the property ladder faster:

1. Cash in on your cappuccino

With the average UK worker spending a substantial £608.84 per year on daily take-away coffee, it seems that a coffee cutback could speed up the process. If Brits were to brew their own, this money could go towards their dream home, rather than milky foam!

Potential annual saving: £608.84

2. Set menu savings

Brits have developed a taste for meals out, chomping their way through £4,100 worth of restaurant meals per year. Cutting back on this luxury could help keep waistlines trim and bank balances bulging, as well as contributing towards that all-important deposit.

Potential annual saving: £4,100

3. Box-set bargain

Whilst staying in could be considered a cheaper option than going out, research reveals that it can be just as expensive to have a night in on the sofa. With Sky, a TV, phone and Internet package can cost the average household £592.80, with an additional £71.88 on Netflix, £119.88 for Spotify and £79 for Amazon Prime, each year – and that’s without a TV license.

Potential annual saving: £863.56

4. Budget-busting beach breaks

Saving for a deposit can be hard work, which is why many Brits treat themselves to some well-deserved rest and relaxation on holiday. However, with the average family spending a hefty £2,328 on a sunny summer break, other cheaper means of relaxation could be considered.

Potential annual saving: £2,328

5. Work-out your finances

It comes as no surprise that one of the UK’s favourite ways to splash the cash is on gym membership. With thousands of gyms in the UK offering weighty monthly packages, first time buyers could be looking at spending up to £1,092 per year on keeping fit.

Potential annual saving: £1,092

6. Rev up your revenue

There’s no doubt that a car is a necessity for many, however, if it is not used very often there is a big potential saving to be made. A vehicle could be costing over £3,450 a year, when taking fuel, insurance, tax and maintenance into account. By considering carpool schemes, Brits could save in the region of £3,000 per annum.

Potential annual saving: £3,453

By making sacrifices and giving up certain luxuries, Brits could generate a huge saving of £12,445.40 each year, which they could put towards a deposit. We don’t realise how much the little things add up, but it is clear to see that the things we take for granted in our day-to-day lives are really putting the brakes on our ability to save for our dream homes.

If people are able to make small changes to their everyday routines, they will soon see the savings build up, and in no time at all there will be a comfortable amount ready to be invested in bricks and mortar. Q&A: My tenant does not seem to be living in my property anymore. They haven’t answered my calls and I’m not sure what to do?

Posted by: Adam Male on 19 October 2016
Comments: 0


My tenant does not seem to be living in my property anymore. They haven’t answered my calls and I’m not sure what to do?


It sounds like your tenant may have abandoned the property. Taking over the abandoned property is fraught with difficulties and there is ambiguity around it. You need to be very cautious and you should seek professional advice. Also, take a look at the Prevention from Eviction Act 1997 and Section 5 of the Housing Act 1988.

Cases of genuine abandonment are rare, fewer than 2000 a year, so you have been unlucky.

What is abandonment?

Abandonment is when a tenant leaves the property (usually without notifying the landlord or agent) before the tenancy has ended. Very often this occurs when the tenant owes rent and the tenant may or may not leave possessions in the property.

Abandonment is a major problem for landlords: although the tenant is in the wrong for many reasons, they still have a legal tenancy and can return and demand to take up residence at any time, even if they haven’t paid the rent.

An empty property has implications for insurance as most insurance companies request to be informed if a property is empty for lengthy periods of time. There’s also a risk of squatters.

There are four ways forward:

1.     Find the tenant and get them to surrender the tenancy

  • Find out what you can: ask the neighbours – get witness statements if you can. There may be perfectly logical explanations for why a tenant appears to abandon eg. a long holiday or a spell in hospital

  • Don’t be tempted to gain access to the property or to change the locks and remove tenants’ possessions. The landlord has a responsibility to his tenant to safeguard any belongings left in the property but it doesn’t mean that the landlord can just let themselves in

  • If you have handled the tenancy application correctly you should have sufficient information to contact the tenant or a relative
  •  Once you’ve located the tenant, get their agreement that they have actually abandoned their tenancy rights, preferably in writing in the form of a letter or ideally deed of surrender.

  •  They need to return the keys – this is an important point as returning the keys is a clear indication of the tenant’s intent. Get a witness to this.

2.     Wait until the end of the tenancy

  •  Even if the tenant has stopped paying the rent they are liable for it up until the end of the fixed term.

  •  How appealing this option is may depend on the stage of the tenancy

  •  If may involve court proceedings to retrospectively get the rent if indeed the tenant is eventually located.

3.     Get a court possession order

  • This is the safest and most advisable route  
  •  However, it can be costly and time-consuming. 

4.     Get to the point you can issue an Abandonment Notice

There is a fourth option but it is a risky one leaving you open to prosecution. However some landlords choose to go down this route if the tenant has stopped paying rent and they need to re-let the property as fast as possible.

There are no legal rights attached to abandonment so what a landlord must seek to do is be able to prove to a court in the unlikely event that a tenant returns that they took every step possible to safeguard the rights of the tenant. This may be accepted as a defence by a Jury should an unlawful eviction case be bought by the tenant but there is no guarantee.

If the tenant appears to have abandoned the property, but you can’t locate them and have no written confirmation, important points are: Is the rent still being paid? Has the tenant left the keys to the property? Can you contact the tenant or a relative? Do neighbours have any knowledge? Can you see through the windows if the tenant’s possessions are still in the accommodation?

If the above points indicate abandonment and the property has been left in an insecure state, or you suspect internal appliances could present a danger to the property and/or neighbours, then, and only then, may you have a case for entering the premises and possibly fitting a secure lock. In this case you should have a reliable independent witness willing to confirm the circumstances in writing. You may consider contacting the local authority’s Tenant Relations Officer.

You can then leave a clear notice (Abandonment Notice) on the door (but subtly so as not to alert squatters) informing the tenant that the lock has been changed and that if they require access they must contact you at the address supplied to obtain a replacement key. Notices are often for 14 days.

Inform your locally authority Rent Officer (Local Authority Housing Department) of your actions in writing so there is independent official verification of your actions 

Changes to the law and abandonment

The government is seeking to reduce the time it takes for landlords to gain possession of their property, where a tenant has abandoned it. This is in response to landlord’s concerns that eviction through the courts takes too long and would prefer another route to evict tenants in these circumstances.

The government’s Housing and Planning Bill 2016 contains measures to tackle abandonment in a more timely manner and without the need of a court order. Key features of it are that the rent must be deemed ‘unpaid’ and 3 notices have to be issued within a timeframe of 8 weeks before the landlord can take possession of the property. The relevant information can be found in Part 3: Sections 57-63.

The Bill received royal ascent in May and is currently being debated in the House of Lords. At a recent housing conference a government official suggested it may be law by December.



*This article is not legal advice and is not intended to be relied on as such. You should always seek professional advice.



Who does more evictions - Social housing or private rented sector?

Posted by: Adam Male on 19 October 2016
Comments: 0

A recent study found that the percentage of repossessions in the social housing sector were much higher than in the private rented sector. 57% social housing and only 15% private rented.

It is the private rented sector which is seen to be the unstable option for tenants, but the figures indicate that this is now a misconception.

How is the letting landscape transforming?

The study, by Simple Landlords Insurance, took into account the Ministry of Justice figures for first quarter of 2016. Other research by the insurance company revealed the proportion of repossessions in social housing has fallen over time while in the private rented sector they have increased, but only marginally.

In 1999, social housing repossessions stood at 83% and in 2015 were down to 62%. In the private rented sector repossessions increased from 9% to 13% in the same period.

But it is not only the eviction statistics which are changing. The Private Rented Sector has overtaken social housing in its size and scope and accounts for 19% of households – a massive 4.3 million – against social housing’s 17%. According to the English Housing Survey, the private rented sector has increased by 82% since 2004/5 when 11% were private renters (2.3 million). It grew by 3 million between 2012-13 and 2014-15.

So in this landscape, why do most tenancies end?

Generally, private landlords encourage tenants to stay as long as possible. According to figures from the Landlord’s Association, only 1% of tenants said their landlord terminated their last tenancy – with half (51%) saying their tenancy continued after the end of the fixed term and a third (33%) reporting their landlord renewed their tenancy once it had ended.

The English Housing Survey found that 78% of tenants reported that their last tenancy ended, because they simply wanted to move!

Buy-to-Let post Brexit – a rosier picture than expected?

Posted by: Adam Male on 17 October 2016
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Research by Rightmove the property website, reveals the rental and buy-to-let market is looking rosier than expected.

Listings of properties for let rise

The results of the increase stamp duty for buy-to-let has shown itself in a positive light for tenants in the number of available properties for let in the three months ending in September.

Rightmove found rental listings had risen by 6% in the three months to the end of September compared to the same period last year. The rise in supply was even more pronounced in London, where it climbed 15% year on year.

Buy-to-Let purchases recovered

Rightmove said the appetite for new buy-to-let purchases had also recovered strongly, with purchasing inquiries by investors on the site up 30% since May.

Sam Mitchell, Rightmove’s head of lettings said: “The changes starting in 2017 to lessen mortgage interest tax relief may see some seriously review their businesses and [they] could scale back, though there appear to be no signs yet of landlords exiting the market.”

Some agents report that many investors are looking to knock sellers down on their asking prices to make up for the additional stamp duty they now need to pay.

Changes to rent

Researchers also looked at more than 387,000 asking rents to assess changes in tenants’ costs. It found they were slightly higher — 0.5% — in the three months to September, but this concealed wide regional variations: rents in the north-west were up 2% annually and in Scotland by 1.5%, but down in London by 1.5%t over the year.

So what does this mean for the future of Buy-to-Let?

Brian Murphy, head of lending for broker Mortgage Advice Bureau, said the Rightmove data would make “reassuring reading” for property investors and those considering going into buy-to-let, since it was one of the first pieces of analysis to cover the three-month period after the Brexit vote.

“[The data] would suggest that the buy-to-let sector will remain stable, and providing that the current levels of stock and supply continues, for many landlords and investors both capital growth and rental incomes would appear to be maintaining strong momentum.”

The resurgence comes in spite of other government and regulatory measures which were expected to mute the growth of the landlord market. 

Get ready for buy-to-let tax changes

Posted by: Adam Male on 16 October 2016
Comments: 0

Last week Buy-to-let landlords Steve Bolton and Chris Cooper failed in their legal battle against the planned government tax increase on buy-to-let properties.

Although their campaign to axe the Tenant Tax will continue to lobby the government a successful outcome can’t be guaranteed, and landlords need to be sure they understand what the proposed changes are for next April - just over five months away.

Calculation of profit and tax

At the moment, landlords can claim tax relief on their mortgage interest payments. In other words, they can offset the cost of the mortgage interest from the rental income when they calculate their profits. 

So, if a landlord collects rental income of £10,000 a year, but pays mortgage interest of £9,000, ‘the profit’ is the difference between the two, or £1,000. And landlords pay tax on their profits according to their income tax band.

So, in this simplified example, a basic-rate taxpayer would pay 20% tax on £1,000, or £200, and keep £800. The tax bill for a 40% taxpayer would be £400, leaving £600, or £450 for a taxpayer at the 45% additional rate, leaving £550. 

The new rules change the way that profit is calculated for landlords. Finance costs will no longer be taken into account to work out taxable property profits. Instead, mortgage interest tax relief will gradually be cut back to 20% between 2017 and 2020. 

So, our landlord with rental income of £10,000 and who pays mortgage interest of £9,000 will in future have to pay tax on the full amount of £10,000, now considered to be ‘the profit’, less a 20% credit on the mortgage interest of £9,000. 

It is really an amendment – for landlords – of the generally accepted accounting principles used for businesses. The government is no longer considering ‘borrowing or finance’ as an ‘expense’ and this has an effect on how it determines ‘profit’.

The tax bill for a higher rate taxpayer would therefore work out at £4,000 (40% of £10,000 profit) minus £1,800 (20% of £9,000 interest), which equals £2,200, up from £400 under the current tax regime. That’s a large increase of £1,800. A landlord who pays 45% tax could expect a tax bill of £2,700, compared with £450. 


(credit: figures,

Effect on profits

If you are a higher-rate taxpayer, the new tax will wipe out your returns if your mortgage interest is 75% or more of your rental income. 

The threshold for additional-rate taxpayers is when mortgage interest reaches 68% of rental income, according to accountant Smith & Williamson. 

The tax liability of a basic-rate taxpayer is unchanged. However, the new profit calculation could push a basic-rate taxpayer into a higher tax band. 

Passing these extra costs onto tenants in rents is currently a contentious issue but there is evidence to suggest this is what many landlords will do. For example two thirds of 2,883 landlords surveyed by the Residential Landlord’s Association said they would increase their rents to offset the tax changes.


So who will be affected?

According to the government only one in five landlords are expected to pay more tax when new section 24 rules, under the Finance Act 2015, are implemented, but a number of industry experts dispute this.

  • These changes will affect you if you let out residential properties as an individual, or in a partnership or trust.
  • UK resident individual that lets residential properties in the UK or overseas

  • Non-UK resident individual that lets residential properties in the UK

  • Individual who lets such properties in partnership

  • Trustee or beneficiary of trusts liable for income tax on property profits

Who won’t be affected?

  •  UK resident company

  • Non-UK resident company

  • Landlord of furnished holiday lets

If you operate as any of the above, you will continue to receive relief for interest and other finance costs as usual. Recent research suggests that some landlords are buying as limited companies in order to avoid the tax.

How is it to be phased in?

The changes will be phased in gradually from 6April 2017 and will be fully in place from 6 April 2020.

As of April next year, you will still be able to deduct some of your finance costs when working out your taxable property profits during the transitional period. These deductions will be gradually withdrawn. They will be replaced with a basic rate tax relief reduction.

The percentage of finance costs deductible from rental income will firstly be reduced by 25%, then 50%, then 75%, then 100% at the end of the rollout.




Percentage of finance costs

deductible from rental income

Percentage of basic

rate tax reduction














*This article is not legal advice and is not intended to be relied on as such. You should always seek professional advice.