Chris is the owner of Proudhouse Property Management and Lettings based in Yeovil. Proudhouse provide dedicated lettings and property mangement services in South Somerset and Dorset. Proudhouse are based at Park House, The Park, Yeovil and are your alternative to the typical High Street Lettings service that many landlords have become used to.
Chris is a landlord himself and has rental properties (flats, houses and HMOs) in Cardiff and Yeovil.
This text was originally written and sent to all my landlord clients - I have now published it for general interest. Please don't plagiarise but feel free to repost and share (or reference this text with the line "Chris Chambers, Proudhouse Property Management").
Dear Landlords,I thought I would take this opportunity to give you our thoughts on Brexit and some considerations for your rental properties. I am not an economist nor do I have any crystal balls! I simply want to pass on some industry advice and also provide a brief opinion of my own.
Brexit could be a storm in a tea cup... or a cataclysmic demise of the UK... but probably somewhere in between. It will affect many areas and many people will be concerned about the housing market.
Interest Rates
Interest rates are unlikely to increase for the time being. This means that the cost of your borrowing should not dramatically alter in the short term - in fact, consumer wariness combined with recent tax changes might even generate better deals among mortgage providers to entice new business - so re-mortgaging might be an option. We're more than happy to arrange access for valuers if your property is managed by us.
Rental Demand
ARLA expect demand to remain the same or initially increase in the short-term. There is a shortage of homes (and slow rate of supply) in the UK and this will not change significantly in the near future. So rentals will be a safe investment. Furthermore, tenants planning to buy this year may now be put off and wish to remain renting as tenants.
Rental Values
These are almost certainly going to increase. This is not good news for tenants - let us not underestimate the effect this will have on the national mood. There are 5.7 million homes in the Private Rented Sector - increased costs to landlords (tax etc) are almost certainly going to cause an increase in rental prices. However, from a landlord's perspective, rental yields could increase slightly.
House Prices
Probably not a good outlook - but Proudhouse does not do sales and I don't want to speculate on this subject too much.
Tenant Fees
These continue to be a contentious subject and there are some legal cases taking place against some high-profile agents in the South East. Capped, or a ban on, tenant fees in the future is not unforeseeable - this could have a major impact on and knock-on for agents nationally - agents who have built their businesses around these revenue streams could feel the pinch and would be left with no alternative but to increase and transfer costs to landlords. Our fees are low (we've foreseen this issue since we started trading) and we operate with lean overheads. I don't see our management fees increasing for the foreseeable future.
How is Proudhouse affected?
So far it is very much business as usual - we have lost one potential client who was acquiring a rental property (and also in the early stages of using our services) but has now withdrawn their offer - they cited Brexit as their reason. Otherwise we've had 2 new clients this week and continue very much as normal so far.
What am I doing with my own personal portfolio?
I have rentals and HMOs in Cardiff and Yeovil and I own these with a business partner. Our aim is to secure good quality tenants on a long-term basis. To that end I am considering renewing tenancy agreements and considering 12 month fixed terms in order to help generate stable rental income and cash-flow. As with my advice to Proudhouse clients, I'm keeping rental asking prices "middle of the road" and reasonable and keeping tenant application fees low - this generates high levels of interest/enquiries and greatest choice of tenants. I'm building good relationships with tenants and aiming to provide them with a good service and stability - in return, I believe this builds loyalty and cooperation which is crucial when needing to inspect and maintain the properties. Voids (vacant periods) are expensive and avoiding these are a priority - the property ladder may become more accessible for some tenants if house prices stagnate, alternatively, tenants might be wary of buying in a falling market... either way, keeping my best tenants happy and in my properties is my aim!
Summary.
Keep calm and carry on.
I hope this is useful. If you have any queries then please do not hesitate to contact me.
Good luck and best regards
Chris
This email has been sent to every landlord who has enquired about our services at any time. If you have received this by mistake of if you would like to be removed from our list or if this is irrelevant to you then let us know and we will update out records.
This email has been sent to every landlord who has enquired about our services. If you would like is to remove you from our list or if this is irrelevant to you then let us know and we will update out records.
