Property tools browser extension v1.7 released

The latest PaTMa Property Tools browser extension has been released.

This is v1.7 of the free PaTMa property tools plugin and it’s available for Chrome and Firefox directly from the relevant stores.

Property Tools browser plugin screenshot

Improved Interface

This version provides a completely reworked user interface. Getting the important information to you faster and with fewer clicks.

While you’re viewing a property on Rightmove or Zoopla you can click on the PaTMa icon in your browser and immediately see the properties price history. Pricing history is now available for everyone immediately, even without logging in first.

Login for more

You can also register for a free PaTMa account and explore more advanced features of the property tools plugin though.

Property Tools browser extension advanced features screenshot

Once you’ve logged in you’ll be able to view local comparisons and easily save properties in your personal prospects list in Property Prospector.

Email Alerts

When you save a property as a Prospect, PaTMa will automatically keep an eye on it for you and email if the price changes or it becomes unavailable.

All of this is available for free after creating a PaTMa account and installing the PaTMa Property Tools browser plugin.

Facelift for buy-to-let profit calculator

Our excellent and completely free buy-to-let profit calculator has had a facelift. It’s now even easier to see your ROI, yield, investment and monthly profit at a glance.

If you’ve seen it before (or even if you haven’t), give it a try now to see how your next property investment could work out.

Quick and simple to use

You only need to enter three numbers to get started:

  • your expected purchase price
  • your forecast repair cost
  • the monthly rent you expect

After you’ve entered those numbers you can either scroll down and click “Calculate” or wait a moment to see your results automatically appear.

Set your cash

If you leave the “Cash Available” field empty the calculator will work out the minimum investment you could put in to make the deal satisfy the mortgage requirements.

You might want to put in a bit more to improve your cash flow or perhaps ask for a calculation with a bit less, to see how far away from your target that would leave things.

Tune the mortgage

The calculator comes with some “reasonable” mortgage criteria pre-set but the chances are they wont fit your exact situation. So you can scroll down a bit on the calculator to customise the interest rate, fees, LTV and rental cover details. See the results instantly update as you make changes.

Save, Download or Share

With your results on the screen you’ll also see buttons to:

  • Save & Compare – create a free account and store this calculation, you can then add others to compare different properties you’re considering.
  • Share – get a unique URL for your calculation and send it to anyone you like, they’ll be able to see the exact numbers you entered and full results.
  • Download – we’ll email you a PDF with all your input figures and calculated results so you can keep them for easy reference in the future or to send on.

Profit calculator results

Displayed results

The results don’t just give headline numbers, there’s also a complete table with calculated figures for yield, ROI, profit, required investment, stamp duty, available mortgage and more. There’s even a table giving an outline of how the Section 24 (mortgage interest relief) tax changes will affect the resulting income.

Try out the buy-to-let profit calculator for your next property deal.

Base rate up 0.25% – the cost to your portfolio

Today the Bank of England announced an increase to the base rate of 0.25%, making the new rate 0.75%.

The last base rate increase was in November 2017, nine months ago.

What will this increase mean for your buy-to-let portfolio?

For most investors, using fixed rate mortgages, the effect of this change won’t be felt for a while. (You can record fixed rate mortgage expiry dates in PaTMa to make sure you don’t miss them.)

If you’ve got properties on a standard variable or tracker rate though you’ll likely see the result of this base rate increase quite rapidly.

For every £100,000 of interest only mortgage, a rate increase of 0.25% will cost you an extra £21 per month (£250 per year).

You can use our free re-mortgage buy-to-let profit calculator to see what the effect will be in your particular scenario – enter your own mortgage borrowing and the new interest rate.

The dwindling tax reduction effect

As a property investor you currently still get to claim some of your mortgage interest expense against tax. Thanks to the Section 24, mortgage interest relief changes, this is now rapidly reducing though.

Right now, in the 2018/2019 tax year, if you pay 40% tax on your buy-to-let profits then a 0.25% interest rate rise will actually cost you 0.175% of your mortgage balance. That’s £175 of extra annual cost for every £100,000 of mortgage borrowing you have.

In 2020/2021 the effect will be the same for everyone as there will only be 20% tax relief on all buy-to-let mortgage interest. At that point, a 0.25% interest rate rise will actually cost you, after tax, 0.2% of your mortgage balance per year.

Does this change your next buy-to-let deal?

You can use our free buy-to-let profit calculator and adjust the mortgage interest rate to see what effect this will have on your next projects profit.

HMO licensing changes from October 2018

From the 1st October 2018 the national rules on HMO licensing are changing so that they cover a lot more properties. If you own or manage an House is Multiple Occupation (HMO), your must apply for a licence before October 1st 2018.

New HMO licences

There are already mandatory (nation-wide) licensing requirements for HMOs and some councils have additional HMO licensing beyond the mandatory rules.

Thousands of additional properties will required an HMO licence from the 1st October 2018 as the rules are changed to capture smaller HMO properties. The regulations that all HMO properties must meet are also changing from October.

What’s an HMO for licensing purposes?

From the 1st October 2018 any dwelling, regardless of the number of floors is an HMO if the tenants consist of 5 or more people from 2 or more households (which roughly equates to them not being related).

Previously smaller HMOs – those with only one or two floors were not included in the mandatory licensing requirements, but from October these smaller HMOs also require a licence.

The licensing process

A licence application means you must complete a form and provide supporting documents. Some authorities use an online process, others provide an application form that must be printed and filled in.

Details needed for an application will generally include:

  • Applicant information
  • Licence holder information
  • Manager and owner contact details (including mortgage provider and the freeholder)
  • Details to confirm the licence holder is a “fit and proper person”
  • Planning permission (if more than six tenants)
  • Building regulations approval, if there have been significant changes, refurbishment, etc (including just internal work)
  • A floor plan showing rooms, sizes, smoke detectors, etc
  • An example tenancy agreement

Building safety requirements

To pass the licensing process the building will need to meet a number of safety requirements. You’ll need to consult the guidance from the relevant council but some common key points are:

  • Three storey buildings require emergency lighting, occasionally two storey buildings will too if the exit route is “complicated”.
  • 30 minute fire doors (three storey), with self closers.
  • 20 minute fire doors (two storey), with self closers.
  • Multi purpose fire extinguisher on each floor.
  • Fire blanket in the kitchen (away from the cooker).
  • No key should be required to get out of rooms. Multiple types of lock/mechanism are available to support this.
  • HMO noticeboard required in a common area with contact details, EPC, gas safety and a copy of the HMO licence.
  • PAT testing for all electrical appliances must be done every year.

Door closers should be on all habitable rooms on the escape route plus “at risk” rooms, ie kitchens. Bathrooms and toilets likely do not require door closers.

Room sizes

Another big change in the mandatory HMO requirements from 1st October are the new minimum bedroom sizes. Some councils have already included these in their additional licensing but for many they will be new.

The raw size requirements are:

  • Single adult bedroom: 6.51 m2
  • Double adult bedroom: 10.32 m2
  • Child (under 10) bedroom: 4.64 m2

Things to be aware of when measuring your room sizes:

  • En-suite bathrooms do not count
  • You cannot combine multiple rooms (regardless of whether the tenant has exclusive access to them)
  • Areas with a ceiling under 1.5m high do not count
  • The *floor* space must be usable as an actual floor

Licence cost and duration

The cost of a licence varies for each council, ranging from a few hundred pounds to over one thousand pounds. The cost is also dependant on the type and size of the HMO being licensed.

An HMO licence will generally last for five years.

The council may choose to issue a licence that’s valid for less than five years in some circumstances, eg if they feel any details about the landlord or property may need early review.

Issuing process

Be aware that the council will issue a draft licence to everyone involved in the property, including any mortgage company and the freeholder. This means a property cannot be licensed without their knowledge.

The mortgage company may object, although it shouldn’t be grounds for the council to refuse a licence. However it may trigger an issue with the mortgage provider!

Timing – new licences and renewals

All properties that fall under the new mandatory HMO definition must apply for a licence before 1st October 2018. It’s quite likely that not all licences will be issued before October 1st though.

The new room sizes will not apply to existing (ie larger, 3 floor HMO) licences until that licence is due for renewal.

Finding unlicensed properties

Once the good landlords have all applied to new HMO licences, how will councils find the bad landlords who haven’t?

Councils can collect tips about an HMO from a number of sources, such as:

  • deposit protection schemes
  • council benefits team
  • planning applications
  • social workers
  • health workers
  • neighbours

Penalties

Failing to license an HMO when it’s required can result in prosecution and fines of up to £20,000. This can apply whether you’re the owner or manager of such a property.

Source and Video

These details are based on a presentation I attended by the person responsible for HMO licensing in Crawley. You can read some more details about the event, presentation and Crawley specific information here.

Keep track of your licences

You can keep track of all your licences, safety certificates and other HMO property details in Property and Tenant Manager. You’ll receive automatic reminders when renewals are due and your documents will always be available at a moments notice.

New How to Rent Guide – July 2018

It wasn’t long ago that the Government issued their last update to the How to Rent Guide but it seems there were a couple of minor issues that warranted an urgent fixing release.

Officially announced on the 9th July, but actually sneaked out a few days before, you can find the latest release of the Governments How to Rent guide here.

All tenants must be provided with a copy of this guide at the start of a new tenancy. Given that it seems the version issued on June 26th may have been incorrect (it didn’t use the legally recognised document title), we recommend re-issuing the latest version for any tenancies that started on or after the 26th of June.

If you’re using Property and Tenant Manager, re-issuing the latest guide is as simple as:

  • Visit the recently started tenancy
  • Open the tenancy start checklist
  • Click the link to send “required tenant documents”

That’s it, your tenants will receive the latest guide by email.

The latest cover now looks like this:

How to Rent Jul 2018 Cover

 

 

The How to Rent guide is issued by the Ministry of Housing, Communities and Local Government. You can download the PDF directly here.

How to issue the guide to tenants

So what’s the best way to legally issue the How to Rent guide to your new tenants?

Well the simplest method is to use the automated tenancy start process in PaTMa. Just enter the basic information for your new tenancy and tenants, click to generate the AST and send it straight to your tenants for online signing. The default AST template includes provision for serving the How to Rent guide (and other documents) by email. So once your tenants have signed up, it’s just another click to send them a complete welcome pack – including the How to Rent guide, the property’s EPC, your latest gas safety certificate and your chosen deposit scheme terms.

We’ll always make sure the latest How to Rent guide is included – you’ll never have to worry about checking with the Ministry of Housing and downloading the latest guide again.

If you prefer the manual approach you can always email the guide yourself – just make sure your tenancy contract allows for it.

Or for those few who’d really rather collect bits of paper, the guide can be printed out and physically handed to your tenants. However the electronic version of the guide does include lots of links to extra information so I really recommend issuing the PDF version if you can.