Welcome to the December newsletter!

It's been a very busy month here at McCartan Lettings - we've just moved to a new cloud-based property management system, and at the same time have welcomed a new member of staff to the McCartan team, plus I've been making progress on my sponsored swim! 

This month we're encouraging landlords to take a little time over the festive break to review their property portfolios and I've compiled some tips on areas to focus on to help with that. I've also got a case study for you on a successful buy-to-let renovation in Uplands.

Hope you have a relaxing break, and we'll see you in the new year!

- Hannah, Managing Director

With all the excitement and anticipation of the New Year ahead, we’re encouraging landlords to look to and plan for 2019 with their rental properties in mind. We firmly believe that planning is the key to success - and to avoiding costly surprises!

Taking some time over the festive break to review your portfolio and to plan for incoming tax changes could save you hundreds of pounds (and headaches!) in 2019.

Mortgages

Lending rules in the buy-to-let sector became more stringent a couple of years ago, with many lenders increasing their lending criteria to deal with the possibility of rising interest rates or other economic uncertainty. Interest rates did rise this year, and there is continuing uncertainty as the Government tries to negotiate the Brexit deal and the Opposition call for a General Election or the People’s Vote. 

That said, many mortgage advisors are saying that buy-to-let mortgage rates have never been better, so now’s the time to see if you could make some substantial savings to your mortgage repayments.

The Mortgage Advice Bureau Swansea have just published their latest BTL guide. You can click here to read it, or click here to speak to Bethan Thomas for a quick review of your mortgage.

Tax

By law, all income received (rent or otherwise) must be declared to HMRC. The way in which landlords are taxed will be increasing for some landlords again in April 2019. Understanding how the tax changes will affect you is essential for financial planning.

From this coming April, too, the third reduction in the amount of interest able to be off-set against tax will be implemented, meaning any interest on a buy-to-let mortgage will be taxed at a standard rate of 20%.

Stamp duty remains at an additional 3% on top of the standard stamp duty rates for second properties, so if you are planning on expanding your portfolio in 2019, you need to factor this in as an additional cost.

We are urging all of our landlords to take independent tax advice from a qualified accountant such as Tracy Jones from Fergusons & Peters Chartered Accountants in Swansea. 

Insurance

Having the right Landlord Insurance is essential for any landlord, and reviewing your cover could save thousands should the worst occur.

Make sure you are covered for prolonged void periods, review your excess amounts and understand what exactly your Policy covers to ensure you have the peace of mind that in the event of an emergency, you are fully aware of how your insurance will help you.

You can get a free review of your landlords buildings and contents insurance with Ian Bateman, from local Swansea-based insurers Eastside Insurance who provide specialist landlords cover. Click here to email him. 

Maintenance

Maintaining your property is a necessary part of being a landlord. Planning your maintenance in advance should help to minimise any unexpected costly repairs.

Get your boiler serviced at the same time as the landlord’s gas safety certificate is carried out. A regular service will reduce the likelihood of a breakdown and prolong the life of your boiler. Having them both carried out at the same time can reduce the costs and the time associated with multiple visits. We wrote a guide this year on how to tell if your certificate is valid – click here to take a look. 

Clearing gutters at this time of the year will help prevent them getting blocked and causing issues with damp, which can be costly and take a long time to rectify.

If you self-manage, plan when you are going to visit your tenants next year and make sure they know how to contact you or your nominated contractors over the festive break. The last thing you want to start your new year off is a huge bill from your tenant for an ‘out of hours’ plumber they were forced to us when they couldn't get hold of you!

Get Registered with Rent Smart Wales

It has been a legal requirement for all landlords with a property in Wales to be registered with Rent Smart Wales since 2015. Landlords and agents who manage a property must also have a licence, or face prosecution.

Enforcement officers are now in place and taking action against landlords and agents who have not yet complied, so we urge all landlords to start the process if you haven't already.

Penalties include fines, rent stopping orders, and the inability to serve a section 21 notice for possession.

For more information, check out our latest blog article here.

At McCartan, we are always keeping our landlords and tenants up to date with the latest changes and we have no doubt that 2019 will see many more changes coming our way.

Make sure your friends and family are kept up to date too by sharing our newsletter with them - or even better, tell them to subscribe!

Wishing you all a very prosperous 2019,

Hannah

I’ve been working in the buy-to-let market in Swansea for over 15 years, and it’s my aim now to use my knowledge and lettings expertise to help Swansea landlords and investors find property that matches their long term financial goals.

I became a Swansea property investor aged 24, and set up my letting agency business at the age of 26. At the start of 2018, I began offering a formal project management service. 

The Problem

One of my first projects since making the service more formal was for a relatively new landlord with a property in Uplands.

The landlord had bought the 2 bedroom terraced house (on what has become one of our favourite streets in Uplands) on the advice of a friend. Before he bought it, it was being let through another agent at a price of &500pcm. When that tenancy ended, the interior was outdated and looked tired.

After reading our blog and hearing of our service, he came to us looking for advice. We had a chat with him, went to take a look at the property, and recommended the property underwent some refurbishment including installation of a new bathroom, new carpets, redecoration, as well as a deep clean.

I discussed with the landlord the long term benefits of undertaking this work and offered to manage the project. He agreed!

The Solution

At McCartan, we work with a really good group of local, expert contractors.  I organised them to attend to quote for the work I’d proposed, and altogether the quotes came under the &10,000 budget I had been set.

We also needed to ensure the property was legally compliant for let, and so I ordered a full sweep of compliance certificates including Gas and Electrical Safety Certificates to be conducted.

The work was then completed on time, and I was able to deliver it &1,000 under budget. The standard of finish was high, so even through the market was seasonably slow, the property let very quickly to a professional couple looking for a long term tenancy.

With this refurbishment, we were able to achieve a rental price of &695pcm – a 25% increase on what it has achieved previously. The work also increased the value of the property overall to &150,000, representing a &25,000 capital equity for the landlord!

Specific Local Knowledge

Uplands is a hugely popular area with Swansea’s single professionals, couples, and young families all being attracted to the area. We’ve blogged about it on a number of occasions now. Its location makes it ideal for easy access to the City Centre and major employers Swansea University and Singleton Hospital. It’s not far from the beach or the parks, and Uplands Crescent has become a hotspot for new restaurants, clubs, and wine bars, as well as shops and amenities. Major transport links run through the area, so if you do need to travel a little further afield, it’s not difficult.

In April this year, Uplands made a list of the top 20 “hippest” areas to live in the UK according to Travel Supermarket. The aim of the list was to provide an index of new places to discover, and points were awarded based on markers such as independent coffee shops, vintage fashion outlets, vegan cafes, art galleries, and the potential savings travellers could make by staying there instead of in the city centre.

At the time, I wrote an article on the area and how the rental prices had increased drastically there. Between April 2017 and April 2018, we saw properties in Uplands increasing in price from &550pcm to &750pcm, which is a stunning 36% increase. 

On Cambridge Street specifically, we know rents can range from &650pcm up to &850pcm depending on décor, size, and whether the property has sea views. They do tend to be older properties, so can have issues you need to keep a keen eye out for when purchasing, such as damp.

Advice and Project Management by McCartan

If you’re a first time buy-to-let landlord, or if you’re looking to grow your portfolio in Swansea, I’d love the opportunity to discuss your investment needs with you and suggest the best areas to buy to let to help you meet those.

Part of that includes bearing in mind things like damp in older properties, and any renovation work that may need to be done. If you’d like to appoint a project manager to undertake that work for you, I’d love the opportunity to discuss that with you, too.

You can reach me either by calling the McCartan office on 01792 430100, or clicking here to drop me an email.

Disclaimer: The information contained in this newsletter is of a general nature and no assurance of accuracy can be given. It is not a substitute for specific professional advice in your own circumstances. No action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a consequence of the material can be accepted by the authors or the firm.

Related: Guide to BTL for New Investors / Buy to Let Deal of the Month

I am swimming the length of the English Channel from Calais to Dover – a whopping 22 miles, in 12 weeks! – to raise funds for the construction and installation of a fence for Dunvant Park Playground.

The playground is desperately in need of a fence. The park is a wonderful community space, but the playground isn’t enclosed, and so isn’t as safe for young children as it could be.

There are no grants available for this kind of project, and so the Friends of Dunvant Park Charity are raising money from the community.

As a member of that community and someone who uses the park and the playground, I want to do my part, too.

Anything you can give would be greatly appreciated. I will be posting updates both here and on social media as I go, so you are welcome to track my progress to Calais! Friends of Dunvant Park are aiming to raise &5,000 for the cause.

If you are able to help by sponsoring my swim, I'd be really grateful. Click here to donate.

If you aren't able to donate, you can still help by sharing this article or my sponsorship page.

So far, I've swam 10 miles. Just 12 miles to go! 

Average Asking Rents, December 2018