It has been a great start to 2023 with lettings seeing a significant increase on this time last year.
Figures from Rightmove for East Anglia below show an 8% increase in rents compared to 2022 and David Burr saw an average rent of £1,502 compared to the £1,418 regional average.\
We continue to see a steady stream of good quality applicants and have some fantastic properties coming onto the market over the coming weeks.
Only a month into the year, there is already plenty of lettings news that landlords will need to keep an eye on in the coming months including the results of an ongoing court case appeal that will have implications for defining who is legally responsible for property compliance in a rent-to-rent contract and a petition to reinstate tax relief for finance costs under section 24 is gaining signatures by the day.
Debate around who’s liable in a rent-to-rent agreement
An appeal in the Rakusen v Jepson case was raised to address who is the liable landlord in a rent-to-rent agreement. In this instance, the property under a rent-to-rent agreement needed an HMO licence from the local council, but a licence wasn’t obtained.
The question now being debated in the Supreme Court is whether the property-owning landlord or the intermediate landlord renting to the occupying tenant should be liable for the offence. The results of this appeal, when announced, will have lasting implications on liability in rent-to-rent contracts going forward.
Petition to reinstate finance cost tax relief
A petition asking the government to reconsider its stance on tax relief relating to finance costs such as mortgage interest rates has received over 30,000 signatures. This tax relief was restricted under Section 24 of the Finance Act 2015, to make sure that top-earning landlords don’t receive “the most generous tax treatment”.
The government has responded to the petition, saying that it will “continue to set mortgage interest relief against rental income at the basic rate of tax” to make sure that the tax system is “fair”. However, if the petition reaches 100,000 signatures, the issue will be debated in parliament.
Increase in minimum EPC rating for commercial lets
From 1 April 2023, all commercially rented properties must have a minimum energy performance rating of ‘E’ or above.
The Minimum Energy Efficiency Standards increased the rating requirement for private rentals back in 2018. At the moment, only new commercial leases and renewals must have a rating of ‘E’, but this will apply to all commercial lets from April 2023.
The government have plans to raise the minimum to ‘C’ from December 2025 for new tenancies, and all tenancies from 2028.
The management team at David Burr are on hand to answer any queries in relation to concerns about the energy rating of your property.
Petition to reinstate finance cost tax relief
A petition asking the government to reconsider its stance on tax relief relating to finance costs such as mortgage interest rates has received over 30,000 signatures. This tax relief was restricted under Section 24 of the Finance Act 2015, to make sure that top-earning landlords don’t receive “the most generous tax treatment”.
The government has responded to the petition, saying that it will “continue to set mortgage interest relief against rental income at the basic rate of tax” to make sure that the tax system is “fair”. However, if the petition reaches 100,000 signatures, the issue will be debated in parliament.
