The Welsh rental market is set to change on September 1, 2019, but what does that mean for landlords?
In general, the Renting Homes Fees Welsh Act will make it so that fees for certain services cannot be charged to tenants by landlords and letting agents. Specifically, the law only allows fees to be charged for the following:
- Security Deposits
- Rent
- Holding Deposits
- Communication Services
- Utilities
- Default Fees
- Council Tax
Any agent or landlord found charging fees for anything other than the above can be subject to a £1,000 fine. Those that ignore a fixed penalty notice will liable for prosecution through the Magistrates Court. For Welsh landlords, the law coming into force will almost certainly have an impact on their income. However, for the tech-savvy, the legal change doesn’t have to be a huge blow to their bottom line.
Modern methods can save landlords money
By using an online mortgage broker to find the best deal, landlords could make savings on their monthly payments and offset any losses that occur through the ban on fees. What’s interesting about modern brokers is that they don’t just provide answers. In an age where information is not only readily available but expected, sites have to provide a comprehensive overview of lenders. In other words, they have to explain the ‘why’ as well as the ‘what’.
At Trussle, borrowers can gain insights into a lender’s credentials. For example, by having their experts review the Royal Bank of Scotland, readers can see exactly what type of lender the bank is. As well as market data (i.e., RBS was responsible for 12% of all mortgage lending in 2017) and customer service scores, the reviews from Trussle provide an insight into various RBS mortgage rates.
Weighing up all the variables, borrowers can determine whether the products and, moreover, the lender are right for them. In many ways, it’s a buyers’ market. Yes, banks and building societies still hold the majority of the power; however, with brokers breaking down what the market really has to offer, consumers are more informed.
Any time the buyer has more information, they gain power, and Welsh landlords can put themselves in this preferred position by using the resources at their disposal. Even a few minutes spent reading through the material available online can give them enough knowledge to get a better mortgage rate.
Legal changes don’t have to hurt
The Welsh rental market is still buoyant. According to government statistics, the lowest median rental income for a single room property is £325 per month, and the highest median income for a larger four-bedroom house was £750. However, even though the market is strong, the ban on fees will have an impact. Landlords don’t need to act immediately but those that want to offset any potential losses should.
Short of increasing rental prices, the best way to recoup some cash is to save it. By getting a better mortgage deal, landlords can ensure their business remains profitable in spite of legal changes. While there’s no doubt the ban on fees will be great for tenants, it doesn’t mean landlords have to suffer. With the right mortgage deal gained through knowledge provided by online brokers, everyone can enjoy a harmonious, mutually beneficial relationship.
