At Rocket Lawyer, we want to change things by making legal services affordable, simple and available to more people than ever before. I’m proud to say that we’ve been able to build a service that millions of people rely upon. Every day we spend our time and resources making it easier for people to get the legal help they need, so they can focus on what’s really important.
Student property has long been a popular investment for many, but will harsh tax changes start to outweigh the attractive yields that the market has to offer?
Landlords across the UK now are faced with the implications of the national extension of HMO licensing.
In recent years the popularity of the private rented sector has rocketed with student buy-to-let properties now accounting for 20% of households in the UK. The increasing popularity of universities has resulted in students now accounting for an enormous proportion of the private rental sector through the high demand for rented student accommodation. Statistics show that 46% of 25-34 year olds are now privately renting compared to only 24% in 2006. The increase in buy-to-let and renting has however left the first time buyer and mortgage market bearing the brunt with statistics showing only 35% of 25-34 year olds now buying a home with a mortgage, an 18% decrease compared to previous years.
In October 2018, the government extended mandatory HMO licensing requirements. The alteration to the legislation included a number of changes, one being the removal of the ‘three storey rule’. The changes to the legislation also redefine the allowed minimum size of bedrooms. Double bedrooms must now be 10.22sqm, a single bedroom must be a minimum of 6.51sqm and a room for a single child under the age of 10 must be a minimum of 4.64sqm. Any rooms smaller than the requirements listed above therefore cannot be used as a room in which to sleep.
The national extension of HMO licensing proposes to introduce a three-year tenancy agreement. Essentially this will ensure that landlords offer all tenants a minimum three year contract – tenants are however able to opt out of the agreement by leaving before the three year marker should they choose to. This proposal does pose problems for the market regarding student accommodation due to the academic year and the period of time students realistically reside in a property for. This is why the government are considering making student accommodation exempt from these specific regulations.
Experts have warned that the extensions to mandatory HMO licensing may actually result in a decline in the student buy-to-let market if the government fails to make student accommodation exempt from these regulations. The potential enforcement of the three-year tenancy agreement goes against many of the attributes of the student buy-to-let market that renters find so compelling. The flexibility that the private rented sector offers to student tenants makes it unparalleled in the ever-changing, competitive housing market.
The national extension of the HMO licensing has its pros and cons, aiming to protect both parties involved. However the scheme itself does not include a repossession clause, making it more difficult for landlords to secure a lender for a property with such added risks.
Meet Pickled Pepper Books, a business Rocket Lawyer helped with a legal issue . Pickled Pepper Books is a specialist children’s bookshop, cafe and events space in Crouch End, North London. Alongside children’s books, they offer a variety of different activities for parents and children alike, organise author and illustrator visits, and host theatre companies in their new, interactive book based theatre space.
What did you use Rocket Lawyer for?
We used Rocket Lawyer for a variety of different reasons. We used Rocket Lawyer to develop policies for our website and for our business.
What does your business do?
Pickled Pepper Books is a specialist children’s bookshop, cafe and events space. We offer a variety of different activities for parents and children.
Every Monday we run after school book clubs for 8 to 12 year-olds and for teenagers. It is for any keen readers eager to discuss and review the newest (and sometimes the oldest) books on offer. Titles chosen for the group are bought directly from our shop.
On Wednesdays and Thursdays we run Young Illustrators art classes, open for those aged between 5 and 12. They encourage children to let their imagination and creativity run wild through illustration workshops. These workshops range from pop up books, designing comic strips, layered landscapes, character design, and typography.
During the week, we also runs a variety of baby and toddler events. These include creative drama classes, story related craft activities, a baby massage and yoga class, French and Spanish preschool sessions combining play, word games, stories and singing for carers, their babies and toddlers.
At weekends the emphasis is on family downtime. We invite authors and illustrators into the shop to bring their books to life and host touring theatre companies running small scale children’s shows. These shows offer everything from baby sensory theatre to spoken word for older children.
Lastly Pickled Pepper Books runs story-based birthday parties, ideal for children between the age of 4 and 9. These parties are available in a multitude of themes. Science-themed parties, ideal for children between the age of 5 and 11, run in partnership with Kids with Brains.
We also work with a variety of schools, to provide school supplies (including reading lists for classrooms, Accelerated Readers and Guided Reading selections, and book surgeries at parents evenings), and organise author visits for all ages.
Tell us about your experience using Rocket Lawyer.
Rocket Lawyer helped us develop different policies that were fit for our business. It saved us much time and money, and we can only recommend this service.
You can follow Pickled Pepper Books to find out about upcoming events or to drop in for general recommendations.
September and January are the busiest months for landlords across the UK with an average of over 500,000 students going to university each year. Students are often looking to start a brand new life upon their decision to go to university, starting with their new student accommodation that is in such high demand.
As a landlord investing in buy-to-let student property, the risks can often be significantly higher than when renting to the general public – this is because your tenants are going to be young, vulnerable, inexperienced in the property market and they can unfortunately sometimes be untrustworthy. So follow this comprehensive guide to all the questions you may need answering as a student property buy-to-let landlord.
Tip 1: Contracts
University isn’t for everyone, but sometimes students won’t realise that until a few months in, by which time you have already both signed a legally binding contract. So what do you do if your tenant decides to drop out of university and vacate your property?
Legal precautions (such as a tenancy agreement) taken out prior to the start of the tenancy ensures that the tenant must give notice to the landlord and continue to pay the rent until they leave or until a replacement tenant is found. If the tenant is unable to pay the rent due or if they refuse, it becomes the responsibility of the guarantor (if there is one) to carry out any further payments.
Tip 2: Tax regulations as a student landlord
As a student property buy-to-let landlord, you are exempt from paying council tax for the student property provided that it is all occupied by full-time students in higher education.
You should obtain proof of education such as an official stamped certificate from the university admissions department.
Tip 3: Responsibilities to overseas students
When privately renting to international students you have certain responsibilities that extend beyond the ordinary duties of a student property buy-to-let landlord.
making a copy of the students passport
making a copy of the students visa documents
making a note of the visa expiry date, ensuring that the visa doesn’t expire before the tenancy end date
Before entering any verbal or written agreement regarding privately rented accommodation you must make sure that any prospective tenant has the legal right to live in the UK. For further information read Right to rent.
Tip 4: How to keep tenants safe
In order to keep your tenants as safe as possible it is important that you take precautionary measures that will maximise safety and minimise any risks.
Some things you can do to keep your tenants safe include:
installing a burglar alarm
making sure the outdoor area surrounding the property is well lit at all times
ensuring all locks are working and in good quality
having timers on both outdoor and indoor lights to make the property appear in use, no matter what time of the day
installing a gate with a working lock
Tip 5: Keeping the environment clean and tidy
Students have gained a reputation as messy and untidy and while this isn’t always the case, they do sometimes struggle to keep a property in the best condition when living with a group of new and different people.
Creating a schedule of bin collection times and a guide to which rubbish goes in which bin will help students keep the area as clean as possible. You can make various copies of such guides and place them in communal areas and on notice boards, giving your tenants no excuse to not play their part and keep the property and its surrounding area clean and tidy.
You can also provide a cleaning service for the tenants on a fortnightly or monthly basis to help with keeping the property tidy.
Tip 6: Manual guides and contact numbers
For many students, moving into student accommodation will be their first time away from home and away from their parents – meaning appliances such as an oven or washing machine can often seem foreign. Creating handy guides on how to work the appliances provided ensures that they are used correctly and minimises the risk of any breakage. Creating a guide for the fire alarm installed and any fire equipment is also essential for the safety of both the property and your tenants.
Making a list of contact numbers is also a helpful resource for tenants. This can include your own number as the landlord, the contact number of the letting agent and any details of emergency services in the local area.
To wrap up…
Like all property investment, student property buy-to-let has its pros and cons. Although you don’t have to pay council tax and your assets are covered by your independent insurance company, you are solely responsible for the welfare of young adults whilst they reside in your property. As a trusted investor and landlord it is crucial that you do the utmost to keep your tenants safe and secure during their stay.
First comes love, then comes marriage, then comes…buying a house? Not necessarily in that order.
It’s fair to say that times have changed dramatically over the years when it comes to UK living habits. The once societal “norm” to get married as a young adult and move into your marital home before bringing up children has fallen by the wayside.
The reasons for this are numerous, but in general, we are busier, we work harder, and many modern relationships are functioning just fine without the sound of wedding bells. And so came the alternative route, which was cohabitation.
What exactly does cohabitation mean?
To cohabit means to live with your partner without the formalities of being married. Unlike living with a housemate, cohabiting couples are generally in a long-term relationship and live exactly like a married couple. While this includes more freedom than a marriage, it can bring about some confusion when it comes to a couple’s rights, or the rights of an individual in the case of cohabitation disputes.
What are the risks of cohabiting?
As with any big decision in life, cohabitation comes with potential consequences. Choosing to live with your partner can be an exciting concept, but it is worth taking the time to go through all potential outcomes. The more you know, the better off you’ll be.
As obvious as it sounds, you should remind yourself that you have less rights when cohabiting than you do in a marriage. In the event of a failed relationship (as much as you don’t want to foresee such an event), you could be left with the short straw if your name is not on the property, for example. Many couples believe they have some sort of automatic rights if they have lived there for a long time, and this is not always the case.
Things to consider before cohabiting
Common sense goes a long way when it comes to cohabitation. Plan ahead as opposed to jumping in with both feet. Learn the facts, ask the questions, consider the unconsidered, and most importantly, sit down with your partner and talk everything through. It could be that you’re not ready for cohabiting, or that one partner has different expectations to the other. Communication in the very beginning will iron things out and increase your chances of success further down the line.
A good example of this forward planning is your finances as a couple. Who will pay the council tax? Who is responsible for paying the broadband bill? Has this been highlighted in a cohabitation agreement? It may sound insignificant, but as so many disputes are around money and finances, it’s wise to have this all as black and white as possible.
Living together successfully
Cohabitation is an increasingly popular living option for couples in the UK. You can live together successfully, so long as you are wise about your decision and consider all options. It is worth looking into an cohabitation agreement and reading up on cohabitation disputes.
The number of individuals choosing to hand over control of their assets and affairs to a trusted attorney using a lasting power of attorney (LPA) has substantially risen in recent years. The Office for National Statistics revealed that between 2015 and 2016 more than 700,000 people registered for an LPA and recent figures report than there were more than 16,000 LPA registrations in the September 2018 alone. But why the dramatic increase?
Accidents and illnesses can happen at any time in our lives and it is important that we all have a comprehensive plan in place if anything were to happen. Contrary to popular belief, an LPA isn’t just for the older generation, anyone over the age of 18 can register for an LPA.
In a time of crisis, the attorney you have appointed will make decisions regarding your finances, healthcare and living arrangements if you do not have the ability to communicate your wishes or make such decisions yourself.
There are two types of lasting power of attorneys you can choose from: an LPA for property and financial affairs or an LPA for health and welfare.
Lasting power of attorney for property and financial affairs – This gives your attorney the ability to manage your property, pensions, bank accounts and any other financial assets. These attorneys can help you make decisions and manage your finances prior to any life-changing or life-threatening injuries, accidents or illnesses as well as being able to control and manage your assets once you lose the ability to do so yourself.
Lasting power of attorney for health and welfare – This gives your attorney the ability to make decisions regarding your health and welfare should you be unfit to do so yourself.
There are many reasons as to why you should have a lasting power of attorney, one being that unlike an ordinary power of attorney, a lasting power of attorney cannot be revoked due to mental incapacity.
Furthermore, you can have complete peace of mind when it comes to your finances and life savings. A court order must be obtained and a judge must approve any large sums of money being spent in your name, ensuring that your attorney spends your money in an honest and sensible way. The fundamental overriding reason for having a lasting power of attorney is simply peace of mind. Your attorney will have your best interests at heart and this gives you the ability to handover control with ease, knowing that the decisions made on your behalf are for the best.
You never know what’s around the corner and registering a lasting power of attorney is the best way to prepare for whatever the future may hold. Rather than a dishonest family member being granted access by the court, with an LPA you can be sure that your financial assets and decisions regarding your health are in the trusted hands of your chosen relatives or friends.
More than half of the UK adult population either choose to not have a will or simply don’t recognise the importance of one – but few realise the negative consequences that loved ones face as a result. Not only do families have to go through a tedious process of estate division, but they may also become responsible for footing all the high legal costs. There is now a rising number of couples that have decided to make mirror wills. But what is a mirror will and should you make one?
What is a mirror will?
A mirror will typically leaves the estate of the deceased to the surviving partner. It’s usually married couples, those in civil partnerships or those in long-term relationships that opt for a mirror will as it allows for individuals to state what they wish to happen should the surviving partner pass away. These wills are largely reflective of the other parties will and are therefore seen as the most beneficial option for the vast majority of couples and families.
Making a will is the first step, however it is equally important to keep your will up-to-date. Regarding mirror wills, if a change is made to one individual testament, the same must also be ‘mirrored’ in the will of the second party. Just as you would for any simple will, you must also ensure that old mirror wills are destroyed properly and effectively to avoid any misunderstandings or confusion in the future.
Advantages of mirror wills
There are many different benefits to having a mirror will, the major advantages being cost-effectiveness, timeliness and the ability to avoid inheritance tax.
On average, a solicitor can charge from £250 up to £300 per hour when settling matters regarding the deceased’s estate – compare this to the £200 it costs for a solicitor to make a mirror will or for free on Rocket Lawyer; you can evidently see which is the cheaper option.
Furthermore, mirror wills allow you to protect your loved ones should something unfortunate happen. Mirror wills leave the deceased’s estate and possessions to the surviving party; this ensures that this individual will be financially protected and stable in the future. Mirror wills also protect the child or children should something happen to both parties. While children under the age of 18 cannot solely control the estate of the deceased, a mirror will gives the child complete control after they turn 18, guaranteeing that any surviving heirs will be financially protected in the following years.
UK law allows you to leave your estate to whomever you wish and with this freedom, it is important for both parties involved to review their testaments on a regular basis and make changes accordingly. When changing a mirrored will, it is important to adapt both wills in order for them to remain reflective of each other. It is however possible for an individual to change their own part of the will and provided this change is updated across both testaments; the wills continue to work in harmony. Changes to mirrored wills may occur due to marital breakdown, the death of an individual or simply just a change in heart.
Those who opt for a mirror will have the added benefit of being able to transfer inheritance tax to the surviving partner. There is no inheritance tax on any assets when passing them from the deceased partner to the living partner. The first of the pair to pass away will not have used up any of their inheritance tax and upon the death of the second party; the deceased is granted £650,000 before payable tax.
Something to remember…
It is important to have a will – whether that is a simple, mutual, living or mirror will. Mirror wills are great for those couples who have similar wishes and want to protect each other and any children in the event of a tragedy. However, mirror wills do not come without their problems – the main complication that comes with this particular type of will is the ability to change the testament with ease.
If an individual decides to change elements of the will, including the beneficiary, they are not required to inform the other party of such updates and as a result you could end up leaving your entire estate to someone who doesn’t plan to leave theirs to you. Trust is the most important factor within a mirror will and without it, there could be devastating consequences. Luckily, there are many different options for you to choose from when deciding which will is best for you.
Perhaps the most expensive cake in recent times is not Prince Harry and Meghan’s wedding cake, or Prince William and Kate’s wedding cake back in 2014 (which reportedly cost £60,000). The most expensive cake is the ‘gay cake’ which has been at centre of a heated legal battle since 2014 and has costed £500,000 in legal fees. So why was it so controversial? Why did it cost so much?
The UK’s highest court, the Supreme Court, recently gave a unanimous judgment which ruled that a Northern Irish bakery, Ashers Baking Company, was not guilty of discrimination when it refused to make a cake with a slogan supporting same-sex marriage.
In 2014, gay rights activist Gareth Lee ordered a custom cake for £36.50 with a slogan saying “Support Gay Marriage”. The order was initially accepted, but two days later, the bakery contacted Mr Lee and refused to make the cake and issued a refund. The bakery refused to make the cake based on their religious beliefs. The Christian owners of the bakery points out that the issue was with the slogan and not Mr Lee’s sexuality. As Lady Hale said, “Their objection was to the message on the cake, not the personal characteristics of Mr Lee”.
Mr Lee initially sued the bakers and won in the county court and Court of Appeal. However the bakers then appealed to the Supreme Court and won, overturning all previous decisions. The case has costed around £500,000 in legal fees, with some of it being borne by the taxpayers.
But what implications does this case have?
A fight for freedom of speech?
Some view the decision as a victory for free speech but is condemned by gay rights activists and the Equality Commission. Freedom of expression, as guaranteed by article 10 of the European convention on human rights, includes the right ‘not to express an opinion which one does not hold’, Lady Hale said. She added that ‘nobody should be forced to have or express a political opinion in which he does not believe’.
Supporters of free speech, including gay rights activist Peter Tatchell, have said that this ruling protects everyone and equally protects a gay baker who could be forced to make a cake with homophobic rhetoric, if the case had gone the other way.
Whilst this is a valid point, I have to disagree with the core reasoning behind the judgment and the free speech reasoning. The assumption from this case is that being required to convey opinions which you do not follow or believe in, is a breach of the freedom of expression or belief. However you have to question the implications of this and where the ‘line’ can be drawn. The same could be said for other service providers. Can post office workers refuse to deliver mail or publications with which they disagree with? Can journalists and authors reporting news refuse to declare or deliver articles on issues which they fundamentally do not believe in? Can a baker now refuse a cake for a bar mitzvah because the baker disagreed with the fundamentals of the Jewish religion?
The case protects the right to free speech and freedom of expression. But how far are we willing to go to protect free speech? We live in a society where free speech has limitations. We certainly wouldn’t allow a cake with racist, anti-semitic or homophobic slogans. But at the heart of this case is the message. I argue that a slogan stating “Support Gay Marriage” is one of love and acceptance (and perfectly lawful), not of hate or discrimination.
The decision is not an easy one to make. The Supreme Court had to undertake a balance between equal rights and freedom of speech.
Have your cake and eat it
But allowing providers of goods and services the discretion to choose what lawful messages they are willing to deliver or for the purposes of it, has enabled them to have their cake and eat it.
What are your thoughts? Share your thoughts on social media, we’d love to hear from you.