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ARLA Propertymark submits evidence to the Scottish Parliament’s Social Security Committee

19 March 2019

The Committee sought views on its inquiry into Social Security support for Housing in Scotland. Read More...

Homes Act comes into force on 20 March 2019

19 March 2019

The Home (Fitness for Human Habitation) Act 2018 finished its parliamentary journey in December 2018. From tomorrow all social and private landlords, including letting agents, in England will be required to comply. Read More...

Continue to carry out Right to Rent checks

18 March 2019

In a letter from Rt Hon Caroline Nokes MP, Minister of State for Immigration, to ARLA Propertymark dated 15 March 2019 the Government has confirmed that there are no immediate changes to the operation of the Right to Rent policy and landlords and letting agents are still obliged to conduct checks as required in legislation. Read More...

60,000 tenancies could be terminated in Scotland

Monday 17 December 2018

With an ever increasing amount of legislation, changes in tax and the introduction of the PRT in Scotland, it’s fair to say that landlords have a lot to deal with. Many are questioning their long-term future within the sector and to consider selling their rental properties. Chris Wood of Propertymark Protected agency, Portolio, asks 'is there another way?'

Recent research by the National Landlords Association (NLA) reported that 19 per cent of landlords intend to offload property into the sales market within the next 12 months. According to the latest Scottish Household Survey (2017) there are 320,000 households in the PRS in Scotland, a loss of 19 per cent could equate to around 60,000. 

Selling usually means ending the tenancy, which obviously is bad news for many tenants as they will be forced to move out of their home. On a broader note, it must lead to further increased demand for fewer properties and thus potentially an increase in rents.

The time taken to sell a property in Scotland from the moment the tenant leaves, through the marketing process, to the exchange of ownership, can be around 12 weeks. The Citylets market report lists the average rental in Scotland at £799 per month, resulting in the average landlord missing out on at least £2,000 rental. In addition, it’s likely they’ll have to pay furniture removal costs and refurbishment costs to get the property ready for the open market.

However, does a landlord need to terminate a tenancy before selling a property?

Portolio, who specialise in working for landlords, is witnessing an increase in the number if properties being sold with the tenant in situ.

Founder, Chris Wood said: “Selling with a tenant in place isn’t the answer for every landlord but for many it’s a terrific solution that’s less time consuming, is without delays and benefits from continued rental income. We’re experts in this field and use our experience to ensure our clients choose the option that’s right for them and that they get the best result possible ”

Despite the projected number of landlords leaving the sector, the Scottish buy-to-let market is still very attractive, with investors looking to buy properties in cities such as Edinburgh, Glasgow and Dundee, as opposed to London. Also, buying a tenanted property is extremely attractive to a buy-to-let investor as it provides a fully package investment.

Jonathan Gordon (MARLA) of ARLA Propertymark Protected firm, Clan Gordon, has recently had a managed property exchange ownership with a sitting tenant. Jonathan commented: “Not every landlord is able to wait until a tenancy ends to sell their property. Therefore, being able to sell a property with a sitting tenant is a win-win situation for my client, the tenant and the investor.

Dan Cookson, a freelance housing specialist thinks the number of property transactions which involve sitting tenants is likely to rise over the next few years. “Many landlords will need to think very hard about foregoing three to four months of rental income while trying to sell a property. That’s why selling with a sitting tenant can make sense. I expect the volume of tenanted property sales to grow in coming years and look forward to seeing how the market responds to this type of transaction.