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Tales from the Front Line

Sarah Daly

As early as it may seem, I have just received the first information for a short letting near to Dorney Lake in preparation for the 2012 Olympics. It has long since been the case that local property owners have rented their houses for large tournaments or events such as Wimbledon but I do not recall, as a local resident myself, events in Windsor and Maidenhead which would encourage inventive short-term Landlords to rent. If my prediction is correct, competition will be fierce to achieve the best rental prices for a short-term letting in the summer of 2012 and agents will be overrun with properties to be considered by potential Tenants and possibly competitors. The race is on.....

Sarah Daly

From time to time in the rentals industry we see different conditions which favour either Landlords or Tenants. However, having been in the business nearly 20 years, I don't ever recall a market like this. In the Country particularly we are experiencing such a severe lack of rental stock that all good properties are receiving two or more bids to let and competition to secure the right house is fierce. With the scarcity factor now being a key component to the bidding process, we have recently been invited on all of our higher value transactions to submit "best and final” bids....... Where has this come from? This is not rental terminology and yet, time after time, we are finding this bull-market mechanism being used in the lettings market and a common theme has been that some agents have been a little behind the curve in their valuations and have not taken into account the simple economics of supply and demand.

Watch this space to see if rental values increase significantly should stock levels not improve - it's definitely a Landlord's market.

Joanna Bishop

accidentallandlords.jpgOver the last year, we have seen an increase in what we call ‘accidental landlords’ – those who prefer to sell their house, but will put it on the rental market for the time being. The effect of this has been to distort the statistics about how many rental properties there are on the market – they may be for rent but because they are tired family houses, they probably won’t let, particularly when they are contrasted with properties that are waiting for a tenant owned by a professional landlord.

The number of potential properties for rent is back to ‘normal’ levels, but this is not because these properties have been let, but because they have been sold – which is what those ‘landlords’ always wanted anyway.

Emma Bennett

Premium Leases have historically been a very tax efficient way for a company to pay for an employee’s housing.

The basic principal of a Premium Lease is simply that the Company ‘leases’ rather than ‘rents’ a property from the Owner for the period of time of the Lease (a period of at least one full year with no break clause).

The level of the Premium would be agreed between the parties along with a ‘peppercorn rent’. This figure would be paid, in full, on or before the first day of the term. The tax savings come as a result of the Rent being the taxable figure, rather than the Premium.

Darling announced at this year’s budget that legislation will be introduced in the Finance Bill 2009, relating to Leases entered into or extended on or after 22 April 2009, to put an end to these tax savings via a Premium Lease and claimed that the same tax regulations will apply as if the monies paid in respect of the Premium Lease was actually Rent paid.

This will undoubtedly impact those hoping to achieve significant tax savings by entering into a Premium Lease. With the rentals market as it is today, this change in legislation makes the argument for full, professional representation in the market place an even more valuable one.


 
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