You can listen again by clicking here (Frank Webster was on around 1 hour and 10 minutes into the show), or see below:

Today is the day that landlords in Oxford have to register if they want to let their property out as a house share. The city council have introduced new licences for Houses of Multiple Occupancy (HMOs). Last year they started the roll-out and asked landlords of larger properties to register and over 900 have done that. Today everyone else must register and the city council think that will include another 4000 properties. Frank Webster is from the letting specialists Finders Keepers and joins me now. 

What exactly is involved in these HMO Licences?

Basically, landlords need to meet a certain set of strict criteria in order for their house to be acceptable to let now, and henceforth, in multi-occupation. The council now want it to apply to three or more persons, so three nurses sharing a rental property would now be an HMO. What landlords now need to do is to get an inter-linked fire alarm system, such as a smoke detection system, to have a fire-door in the kitchen, and possibly elsewhere, and some protection under the stair area. That in itself doesn’t sound too Draconian, but actually it is causing quite a problem for a fair few landlords in Oxford.

But it sounds like the planned improvements which have now come into force will make a good difference.

Yes, it’s a difficult one this one, because clearly all of us want houses to be safe so we don’t have a problem in making sure that renting is safe, and nor do the vast majority of landlords across Oxford, I’m sure. That’s not the problem. It’s where you draw the line really. Three people renting in, say,  a normal, semi-detached property with two storeys…it seems to be taking things to the extreme to be introducing lots of extra legislation for that sort of classification.

I think it all stems back to the fact that Oxford has a lot of HMOs. It has two universities, we have a lot of shared letting in Oxford, and originally the legislation was drawn up quite clearly for the larger properties – five people or more in a property – and that makes sense, but when you get down to three sharers, you have to ask “Where is it going to stop?”

Are we really going to see people losing their homes?

No, what you’re going to see is fewer properties available to sharers because a lot of landlords are saying “I don’t want to go through this procedure, to spend £1400 on getting the licence” so there will be less choice for people wanting to share together and that worries me – where are these people going to live?

So presumably if you live in an HMO at the moment and the landlord thinks “that’s just going to cost me too much” then from today effectively he’s either breaking the law or you’re going to have to move out.

I think there has been a bit of over-dramatisation about this eviction side of things, around the word ‘eviction’ – that can only happen if a landlord goes to court to actually get a tenant out. So no landlord can go into a property and start throwing people out, let’s be clear about that. But yes, at the end of that tenancy if the landlord is not prepared to do the things that the local authority wants then they won’t take the three sharers, they’ll go down to a couple or a family.

Where would you put the limits, out of interest? Three is too small a number for you, so four? Five?

I would stay at five really, but that’s another argument!

Councillor Joe McManners, in charge of the scheme at Oxford City Council, appeared on the same show (1 hour 43 minutes).

That sounds like a fairly persuasive argument from Frank Webster. These plans are too extreme, aren’t they?

No, this is all about trying to improve the quality of housing for tenants. We know that because supply is so limited and demand is so high, people don’t really have a choice of where they go, so it’s too easy for bad landlords to get away with dropping standards down. Really what we need to do is make sure that everyone can live in decent housing.

Hasn’t the way you’ve handled this meant that perhaps you haven’t foreseen some of the circumstances that will now develop, that some landlords will take properties off the market  – effectively we’re going to see a shortage of these houses that we desperately need in Oxford.

I don’t agree with that. The standards that we’re talking about are fairly basic standards. We’re talking fire safety, a decent amount of space for people to live, that the landlord is a fit and proper landlord without a criminal record, these are all fairly standard things. All we’re doing really is making sure they’re consistently applied across the whole of the city. Economically, it doesn’t make any sense for landlords to take their house off the market. The HMO market is still very lucrative.

We’re talking about taking it off the market for HMOs, we’re talking about those kinds of properties. There is a cost to landlords, isn’t there, which is in excess of £350 – that would just be passed on to the tenant wouldn’t it?

There is no reason why it should be. If you look at how much a landlord would get from a year renting out a house, they probably get around £20,000. We’re talking about £300 for the first year and then £150 the year after that, so we’re talking about pretty small amounts, and really that will give landlords the ability to say “Our house is a decent house to let” and it also gives tenant the peace of mind that they know they’re renting a safe house.

Of course. Now, it’s fair to say that there is somewhere in the region of 4000 of these properties, so that’s quite a lot of money that the council is going to cash in on. What will you be spending that on?

It’s a purely self-financing scheme. We’re not allowed legally to make any money from it, but equally we don’t want the tax payers to be paying for it either, so the whole thing self-finances. The extra money that we get in from the landlords is spent on the people who do the work and do the inspections.

If you find this subject confusing or worrying, please have a look at our calm and rational guide to HMOs: www.finders.co.uk/HMO

One tenant has a faulty Rayburn which needs a new part. We sent someone to look at it as quickly as we could, but unfortunately the part which is on order means a delay to the repair (one which is out of our hands). We wish we could speed things up for the tenant who is very frustrated, but some things are out of our control despite our best efforts.

An elderly neighbour of a newly started tenancy has been in touch to report that he thinks our new tenant is causing a fire risk as he has stored his moving boxes in the garage! He wishes to remain anonymous…

Last week we also met with a happy Landlord of a substantial period property in town. He visited on Friday for the first time in several years and we are glad to report he is delighted with the condition of the house.

These issues, and more besides, have been dealt with along with our property maintenance inspections, check-ins for new tenancies starting and check-outs for tenancies ending….it makes such a difference being local to the property you’re managing.

We look forward to a new week and wonder what’s in store!

Our free bus tour around Oxford

Inviting tenants to something free as a way of saying ‘thank you'

On a Monday morning in early September, we sent an invitation to our tenants, asking them if they wanted to join us on a free bus tour at the end of that month. We had a whole double-decker bus to fill, and we were slightly nervous – would anyone want to take a tour of Oxford with their letting agent?The response was great: within the hour nearly half of the spaces had been reserved, and all 70 spaces were reserved within six hours. It was a real mix of tenants, from single people to families and from people who have been meaning to take the tour for a while now to those who had only arrived in Oxford the previous month!Suitably sign-posted…

So on 24th September a couple of members of the FK team waited – suitably signposted – for our tenants to arrive. With the bus loaded up, we set off on the hour-long tour, learning about the deep history of the city we live in. It was interesting to learn about the city as well as the colleges, and seeing buildings that you ‘see’ everyday from a different viewpoint (the top deck of a bus!) certainly makes you see them differently!

Everyone was very happy as they disembarked

Finders Keepers Movies

Orange Wednesdays…Finders Keepers Tuesdays!

Spurred on by the great buzz of giving away something for nothing, we then hired out a screen at the Phoenix Picturehouse for a night in November and offered the tickets to our tenants FOR FREE. The response to this invitation was phenomenal: all 90 seats reserved within 45 minutes!

The film? The new George Clooney flick, The Ides of March – possibly going some way to explaining the exceptional response to the invitation. Based on a play by Beau Willimon, the story follows an idealistic staffer for a newbie presidential candidate who gets a crash course on dirty politics during his stint on the campaign trail.

Orange Wednesdays…Finders Keepers Tuesdays!

On a chilly Tuesday evening at the end of November a bunch of our tenants met in Jericho for the inaugural Finders Keepers Movies Night. Frank Webster, Director, said: “This evening has all been about giving back to the community. It was a bit of an experiment really, but I think everybody enjoyed it and hopefully we’ve made some people happy this evening.”

So it turns out giving something away for free is perhaps a little selfish, but we are going to relish this happy feeling while we dream up some new ideas for 2012. Watch this space…and your inbox.

Meeting the Air Ambulance team

A shocking fact to start: the Air Ambulance receives no Central Government or National Lottery funding. Everything they need to meet the annual running costs of £2.8m (for equipment, fuel, salaries, insurance etc.) comes from the public in the form of donations, fundraising, legacies and sponsorship.

Perhaps this was why it won our internal competition for our 2011 Charity of the Year, and over the 12 months we have taken part in a range of events:

Volunteering

Fundraising at Sainsbury's Heyford Hill

 

Throughout the year people from all of our offices have volunteered at various Air  Ambulance events to help the teams of volunteers raise as much as possible.

Fundraising at the Biker's Bash

We had staff at The Thame Show, the Motorcycle Safety Day in Dorchester, the Banbury Four Shires Show, the Thame craft and gift fair, the Heli Bikes day in Dorchester, the Sainsbury’s Heyford Hill relaunch, and at bucket collections at The Oracle in Reading in September and December.

Our Banbury team manning the Four Shires stall Our volunteers helped in raising a total of £11,209.71.Charity shootThe Finders Keepers Charity Clay Pigeon Shoot

The inaugural Finders Keepers charity shoot was held on Saturday 24^th September at Edgehill Shooting Ground near Banbury. We had a target to raise at least £500 for the charity and for those who hadn’t shot before it was a fun and safe way to try it out for the first time.

The more experienced shooters could take part in a challenging 25-target sporting layout. We had over 60 people attend the event, and as a result of everyone’s effort (and possibly the good weather) we raised over £800 for the Air Ambulance charity.

Bicester Christmas Lights

The winner of our Bicester team's competition

On Thursday 1st December our Bicester team ran a stall at the Christmas light switch-on, selling Air Ambulance merchandise. They also ran a fun “Guess how many balloons are in the car” game, with the chance to win a signed Oxford United First Team football shirt. They raised over £110.00, and the shirt was won by Alfie Howes, who happened to be a massive Oxford United fan!

The amazing Mrs Lee

The indomitable Mrs Lee, a landlord, with Mo Farah, World Champion

One of our landlords spent a lot of 2011 running. Mrs Lee ran the Great Manchester run in May, the Otmoor Challenge Half Marathon in June, the Birmingham & Black Country Half Marathon in July, the Chester Marathon in October and the Great Ethiopia Run in November….all this from someone who claims to hate running!

We are very grateful that she chose to run these events in aid of our charity of the year and raised an incredible £3,250. She has kept us up to date with her challenges and sent us photos of the various people she met along the way. Read more on www.finders.co.uk/charity

Who would choose to enter the buy-to-let investment market under such circumstances?

Well, actually, rather a lot of canny investors seem to be doing just this, according to Finders Keepers managers across Oxfordshire. Some new landlords are simply turning up out of the blue, asking us to let a property that they have just bought. Others are using the Finders Keepers Search and Acquisition service to provide balanced advice, sift the market, avoid the pitfalls, and buy the right letting property to exactly suit their portfolio and needs.

The Fair Mile Hospital in Cholsey has been re-built, offering 130 units “Risk-averse inheritors” are another type of client we are seeing more of at the moment. A large inheritance in a bank will provide very little return ‘whilst being eroded by rising inflation – sophisticated “financial products” look equally unappetising – what to do?There is a comforting solidity and permanence to bricks and mortar that cannot be denied. You can see and touch it. It cannot be stolen. You will not awake one morning to find that it has diminished overnight to a tiny fraction of its former size. You have the rental income while you keep the capital. And over time, house prices have an excellent track record.We have bought two units for clients in this Abingdon development recently In Oxford city we are seeing some very high-powered investment buying indeed. Some clients are quite happy to spend £1 to £3 million on a substantial North Oxford house, confident of a safe haven for their capital. These purchases are being justified by excellent rents, with up to 5% yields on capital – unheard of a few years ago, at this price level.These purchases, and those rents, both seem to stem from the “London Exodus”. The purchase money coming from the sale of a London property, and the rent from someone else, fresh from the city – perhaps spending a year or two renting, while they find the ideal place to settle down.Buy-to-let investors have bought four 1 and 2 bedroom apartments in this new block

Other investors are racing to beat impending changes in the planning laws, which will make multiple occupancy letting (to students etc.) a far more difficult business than it is now. Once again, yields are very attractive, with 5% to 6%  achievable.

Outside Oxford in the market towns there is a more traditional pattern, with investors following a proven strategy of buying mainly 2 or small 3 bedroom houses at £150,000 to £200,000 which are then let straight away to waiting applicants, once again, at yields in the 5% to 6% range.

3 bedroom Witney home bought off-plan for investment

None of this looks likely to change in the coming year or so. Given the continuing uncertainties in the markets, this “dash for bricks” seems set to continue. But, a word of warning…

Good advice throughout the process is essential. It is surprisingly easy to buy the wrong property. It will probably let – but the difference in rent, void periods, and  tenant quality will be costly over time.

1. The case for change

Like a property which had seen a lot of tenants but little investment, our logo looked tired, if not exhausted. The 3-dimensional design was a relic of the late 1990s. The dark green colour lacked the energy which we feel we embody. Quite simply, our business had become far more cutting edge than our brand identity.  All systems go…

2. The workshops

A professional ‘re-brand’ involves a company’s people and customers; hence we  ran a series of internal workshops on the business today and the market of tomorrow. We analysed our market positioning and values. A key finding was that staff felt the external skin of the business (logo, office fascias, window displays) was dated. People also felt that our values (Expert, Proactive, Human, High Standards) were correct in meaning but the words could be improved. 

3. The research

Landlords were chosen via random sampling techniques and interviewed by a 3rd party. The feedback was encouraging: every client interviewed would recommend us. The landlords felt our greatest strength was “finding high quality tenants” and that an interesting differentiator was “thinking ahead and planning ahead to keep a portfolio in good condition”. A number of points were made about how we can evolve our service. Three of the interviewees ‘won’ £100 from us to give to a charity of their choice. The chosen charities were BOB Air  Ambulance, Abaana (a charity for the children of Africa), and Helen & Douglas House.

4. The brief

We wanted something dramatic. We distilled the workshop and research insight into one image.

The doctor represents our bedrock: professional advice, integrity, honesty, reliability, high standards – doing a proper job. The razor blade represents the ‘edge’ we have and covet, for example, winning awards for innovation, launching a stunning website, campaigning to delay the flawed onset of HMO legislation in Oxford etc.

We also said “No lozenge shape, no dark green and no clichés.” This is bold and perhaps a risk. Normally you would evolve a logo over time and just tweak it. However, we felt that the dark green colour looks too tired in 2012 and that the lozenge had run its course after 39.5 years.

5. The breakthrough

Colours, colours, colours. We wanted grey / mauve and white as our main  colours, but we knew that grey / mauve would be too anonymous as a board on the streets. Then a breakthrough: why assume that an agent can only have one board colour? Why not do something more interesting and have several colours? Use these colours in subtle ways at times (eg, letterhead, logo) and overt ways at other times (eg, boards, cars). 

6. The final identity

Helvetica font with some bespoke sculpting. The ‘Keepers’ is now on the same line as ‘Finders’. The leaf was inspired by the illustration we already use on finders.co.uk, giving us movement and energy amidst our rural roots. And the heart? It might polarise people but it is born from the fact we care and we are not ashamed in saying so, as old-fashioned as that notion might be.

7. The launch film

Click to watch the full video

Playing Spielberg, we made a little film in 2.5 hours at breakneck pace. Take a look at finders.co.uk/film: it is only 60 seconds long.

8. The roll-out

We went live with the new identity on Thursday 12th January. We hope you like it. Please send any feedback to marketing@finders.co.uk (logo, cards, boards)

Our brand identity may be different but our Quarterly Review stays the same: insightful and spin-free. We believe that ‘telling it as it is’ pays off in the long-term and according to your feedback this is appreciated. These 13 views on 2012 are a mix of trends and predictions from our senior staff across our offices. Of course we can help you take action to avoid and exploit these trends.

1. The ‘psychologically poor’ vs rent increase paradox to continue…

In the blue corner we have the gloom: Euro uncertainty; only 0.7% GDP growth (a); the worst jobs market in 20 years with unemployment rising to 8.8% nationally (b); and more public sector job cuts to be felt. In the red corner we have the defence: good demand from young professionals, academics and young couples; a relatively strong local economy where unemployment rates are under 50% of the national average; and continued reduction of mortgage affordability.

The results: reduction in supply as gloom breeds inertia and people stay put; peak demand for well-presented 1- and 2-bedroom properties (Photo 1 shows a Witney development of such homes) leading to rent increases; confusion among those who feel poorer as inflation outguns earnings growth while they face rent increases upon tenancy renewal.

2. .…although tired properties will struggle…

Lack of investment will be a false economy in 2012. The supply / demand balance is not so strong that tired properties will command good rents. Continued investment is needed in the presentation and fabric of much rental stock to maximise income. ‘Wow’ rents are difficult if the property has no ‘Wow factor.’

3. …running costs will increase as an issue for applicants…

More applicants in 2012 will be worried about utility costs and ask for the EPC (c) as a proxy. Hence energy efficiency becomes more of an issue for landlords wishing to be successful. For some people utilities are a deal breaker – one Banbury house was rejected as its electric heating was perceived to be expensive. Estimating running costs is not advised: an ‘average cost’ will by definition – over a large sample – mislead 50% of prospective tenants. Action point: ask your agent for pragmatic energy efficiency measures – they need not cost a fortune.

4. …and the ‘Rent Rung’ will be slippery for many young people

We talk about first-time buyers getting on the ‘property ladder’, but the first rung is actually now the ‘Rent Rung’. With unemployment at record levels among 18-24 year olds (d) and graduate recruitment not back to pre-recession levels, providing a rental deposit and moving into a rental property will be difficult for many people in 2012. Living with Mum and Dad can be tricky for both parties. You might call this “paRenting”.

5. ‘Vanity-rents’ for top-end properties will be ill-advised

Photos 2 and 3 are high-quality houses which let in Q4 2011 for solid rents amid a flaky top-end of the market. This ‘flakiness’ will continue in 2012 due to fewer high-value sales, flat corporate transactions and decreased ‘weekender’ second-home tenants. Lovely homes with inflated ‘vanity rents’ (whether dictated by the landlord or proposed by the agent to seduce the landlord) will remain empty, irrespective of how gorgeous they look online.

A hot market can validate top-down pricing (‘What I want’) but a flaky market works best with a bottom up approach (What people will pay).

6. Keener sales rather than bargains

Outside the golden triangle of Central North Oxford, which attracts motivated parents, London exiles and overseas purchasers, there seems little evidence for house prices rising in Oxfordshire in 2012. The usual dominant voices (e) are predicting mean national sales prices to stay relatively flat. Opportunistic buyers in OX postcodes can take advantage of low volumes to gain keener prices. However, ‘bargains’ might be a step too far.

7. Local schemes moving forward from 2008/9

The recession froze funding for many local mixed-use schemes. In 2012 the financial thaw is a positive sign for the county: the £4m development of Abbey Shopping Centre, Abingdon, starts in February; the £70m scheme in central Bicester should finish this year; Science Vale will start moving towards its planned 200,000 sq metres of development and 8040 jobs. Many of the 1585 houses at Kingsmere, Bicester, will also come on-stream.

8. Tuition fees will not sabotage student rents

The initial reaction to our student property launch in December, 44 lets in 3 days, (Photo 4 shows the first group through the door) makes us cautiously optimistic that the student market can withstand the new £9000 fees at Oxford and Brookes Universities, which start in September. The private rental sector offers 2nd and 3rd year students the independence and camaraderie which bedsit blocks often lack. However, as their costs rise, students’ propensity to challenge deposit deductions and quality expectations will also rise. Poorly presented student homes will still struggle: just because a property passes HMO regulations does not guarantee that it is an enticing home.

9. More experienced developers will build-and-rent…

Attitudes do change. We are working with some very sharp developers who now build-and-rent rather than sell. What would have been unthinkable ten years ago is now a boon for the rental sector, which needs high-quality stock. The product mix will and should vary according to the target market.

10. …individual investors will increase in number…

Expert and novice investors grew in 2011 (30% of our Witney office’s instructions in Q4 2011 were bought-to-let) and this will continue. Equity market volatility is one cause as gross yields of 5% appeal to long-term investors. Two units in Photo 5 have been bought for clients recently and let swiftly at a 5% yield.

11. …but the City’s focus on residential property will lag behind

Institutional investment in the private rental sector is coming, but slowly. The Government claims to be stimulating action. Yet while November’s Housing Strategy contained one world-class sound bite, (“We have lenders who can’t lend, builders who can’t build and buyers who can’t buy (f)”) it has little of substance to stimulate Real Estate Investment Trusts to include more residential property in their asset allocations in 2012. The Strategy is going to analyse “the drivers for and barriers to investment (g)” in the private rental sector, but no timetable is given.

12. Tired Britain to down tools during the Olympics

Just as Kate and Will’s wedding turned into a 3-week hiatus for Brits bored of recession blues, applicant demand will drop in July and August as the Olympics become the perfect excuse to go-slow. Action point: change letting lead-times accordingly.

13. Your tenants and buyers will be mobile

The revolution has landed. The ‘Smartphone’ term will disappear as all phones will be smart. Apple, Microsoft, Google (who now own Motorola Mobile), Samsung, Nokia and Blackberry are in the mother of all battles and innovation is phenomenal. If your property is not viewable on mobile devices in 2012 – both via apps and optimised mobile sites (h) – you will be seriously disadvantaged.

(a) Office of Budget Responsibility, December 2011

(b) Chartered -Institute of Personnel and Development predictions for 2012, 28/12/11

(c) Energy Performance Certificate, which is compulsory for all sales and rental Properties

(d) Chartered -Institute of Personnel and Development report, 28/12/11

(e) Nationwide, Rightmove, Halifax, National Association of Estate Agents; all quoted in The Guardian, 20/12/11

(f) Said by Cameron and Clegg across numerous media outlets, 21/11/11

(g) ‘Laying the Foundations: A Housing Strategy for England”, HM Government 21/11/11

(h) A website which displays a bespoke site on a mobile device. See finders.co.uk on your phone.

We split into two teams, with two standing by the John Lewis exit and two by the Boots exit (we tell you the locations so that next time you visit The Oracle you can make sure you look out for Air Ambulance volunteers)! The cynic in us anticipated being ignored by almost everyone, and raising only a few pounds. However, we were pleasantly surprised by the generosity of the shoppers. Without having to say much more than ‘Good morning’, donations started being dropped in to our tins almost immediately.

It was so lovely to hear comments such as “I do take part in the Air Ambulance lottery too” and “You never know when you’ll need them, such a worthy cause” as people dropped their money in. The Air Ambulance receive no Central Government funding nor do they receive any National Lottery funding – it all comes from donations, and so they (and we) are so grateful to all those shoppers who stopped to chat, pick up a sticker, and just donate their small change (and to those who donated big change)! At the end of the day, our team of four had raised a total of £471.49, which we are really happy with.

The Air Ambulance are greatly indebted to all who support them, and help to raise the £2.8 million per annum necessary to maintain the service across Berkshire, Oxfordshire and Buckinghamshire.

Merry Christmas to you all.