We are in the midst of securing a site in Luton. Luton seems to have completely been turned on its head. I used to purchase properties there, with no money in my pocket; the properties were bought for £28,000 and then refinanced for £40,000 at 85% loan to value, which meant straight away the deal popped out £34,000 which would cover expenses and allow for some pocket money. The rents was £350 per month and the mortgage only £140 per month. In short you would get £4,000 cash back and then £200 every month.
I did it once and it worked. This wasn’t a good thing, as it’s like a gambler who has his first lucky win, as then five more properties came up on the market as part of a bulk sale, and off the back of the first one I completed on five more again with no funds in the deal, and only cash back out.
The kind of tenants we got for these properties left much to be desired to say the least. One time, as we had heard nothing from one of the tenants after numerous attempts at contact, and no rent was being paid, we drove to Luton and entered the property. There were holes in the walls, cigarette butts had been put out on the carpets and the furniture. And this type of tenant was the typical ‘customer’ these properties would attract. The block itself was poorly looked after as the management company was none existent.
The hassle factor associated with these types of tenants far outweighed what little we were getting in return. One incident wiped out the little profit gained, in terms of the work costs, loss of rent and sheer hassle.
In the end we handed the keys back for all of these properties and moved on. In 2004 Luton was voted as the worst place to live in the UK, it even eclipsed Hull to be in first place. The headline in the Telegrapgh read “Ugly, grey, depressing: why Luton really is the worst place in Britain.”
Fast forward to 2017 and we have a completely different song being sung about the same location.
This Is Money 16th August 2016 reads “Slough and Luton are the new property hotspots as homes rise almost a quarter in a year”.
The Daily Telegraph headlined Luton as “Britain’s most desirable location” on 30th December 2016.
My prejudice, which I held staunchly against Luton for several years, was challenged. I refused to see the transformation from an ugly grey caterpillar to an attractive butterfly.
So why the massive turnaround? One fundamental reason is the death of the £300,000 property in London. This figure is important because it represents the level of purchasing power for an average home.
This has led to people looking outside of London, and Luton has an enviable position, being only 22 minutes away from Kings Cross.
The growth rates in property shows the attraction. Average prices in Luton stand at £256,636 and they have gained a massive £41,702 in just a single year.
It is with this backdrop we have secured a development deal in Luton on a prime site and off market.
Resales and rentals are probably the strongest you will find in the UK.
We are currently seeking an investor for this exciting project. Call the office to find out more.
Agony Agent
Each week, we answer a reader’s rental property question, from first-time landlords needing pointers about contracts to experienced owners. Agony Agent, is here to help!
This week, I have picked a simple yet complicated question that was asked by one of our readers.
Q. How do I evict my tenants?
A. Steps for evicting tenants:
STEP 1 – ASK NICELY
Before going in all guns blazing, it’s always worth trying the diplomatic approach. Simply ask the tenant to leave and explain your reasons for your request.
You might be surprised, your tenant may be willing to vacate your property willingly. If your tenant agrees, make sure he/she signs a document clarifying the agreement.
STEP 2 – CONSIDER YOUR OPTIONS
There are several ways of ending a tenancy, some methods are more elegant and straight forward than others - it doesn’t need to be a messy or an aggressive affair.
STEP 3 – SERVE A VALID POSSESSION NOTICE
Failing the diplomatic approach, you may now want to consider serving a possession notice, either a Section 21 notice or a Section 8 notice. It may make sense to serve one over the other, but it will entirely depend on your circumstances.
A Section notice is typically enough to force the tenant to surrender the tenancy, so court action is not required. Approximately 80% of tenants leave after being served notice.
Please note, failure to serve this notice correctly may delay the repossession and it is wise to consult a professional to advise you or do this for you.
STEP 4 – GETTING A COURT ORDER
Once the relevant Section notice has expired and if the tenant has not paid you the rent due or moved out of your property, you may apply for a hearing at a County Court. For more information on arranging a hearing at a county court, please go to the County Court HMCS page.
STEP 5 – GET THE BAILIFFS INVOLVED
Having won the repossession order in court, most tenants will vacate your property as instructed. However, if they do not, you must arrange for Court Bailiffs to remove your tenant.
If in doubt, or if all of this sounds like too much hard work for you, please contact the office as we offer tailor made services to help you.
Keep your questions coming in!
Richard Bond Lettings Manager
