Revenge is not so sweet – new law bans ‘revenge evictions’

By Rachel Haymes, head of conveyancing at Ratio Law

Over the last year or so, there has been growing pressure on the government to protect tenants in rented properties from so-called ‘revenge evictions’. And now, after much discussion and lobbying, a law has been passed by the House of Lords to put a stop to them.

But what was the problem in the first place? In November 2014, Citizens Advice revealed one in three private rented properties in England failed to meet the government’s decent home minimum standard. It reported a 14 per cent increase in people asking for help with repairs and maintenance problems between July and September 2014, compared to the same period for the previous year.

There have been a number of cases identified by Citizens Advice where renters who had complained about repairs, damage, damp and other issues found themselves facing eviction for no apparent reason. In fact, the charity’s Advice Trends report revealed a 15 per cent increase in the number of cases where people were harassed or illegally evicted by landlords.

According to the homeless charity Shelter, in 2014 200,000 people faced eviction because they had asked their landlord to fix a problem in their home. The charity campaigned heavily to fight revenge evictions, calling on people to sign a petition to demand better rights for renters.

The worry from some campaigners was that rogue landlords may take advantage of a ‘loop hole’ in the law. Previously, Section 21 of the Housing Act 1988 enabled landlords to apply for a court order requiring tenants to vacate, without providing specific reasons. Now, under the new law, which was passed as part of the Deregulation Bill, it will no longer be possible to evict tenants by relying upon the a Section 21 notice procedure following a complaint about the condition of their home. The courts will now strike out any application to evict in such cases.

For the majority of landlords who look after their properties and tenants, this change will be nothing to worry about. To help protect themselves, landlords should clearly outline how they go about repairs and maintenance in their properties in their contracts and make sure this is pointed out to their tenants on signing the paper work. It’s also important to keep a record of any problems reported by tenants, along with how these were resolved.

If you are a landlord and you have any concerns about how the law affects you, contact Ratio Law.

Buy-to-let: An easy money-maker?

By Rachel Haymes, head of conveyancing at Ratio Law

Since 6 April 2015, people aged 55 and over have been able to access as much of their savings from their defined contributions pensions as they want. The new pension freedom reforms mean people can now take a lump sum payment and there are estimates that more than one in ten intends on cashing in their entire pension pot, with 16 per cent planning on reinvesting the cash into property.

Property may seem like a safe investment and an easy way to make money, but there are a number of points to consider. Firstly, it’s been suggested that many people fail to think about the costs associated with renting out properties. A recent study estimates that when you add up all the costs such as maintenance and repairs, marketing, mortgage interest and letting agent fees, you’re looking at an average of £8,359 a year – a figure which will make a serious dent in most buy-to-let landlords’ profits.

And the financial considerations don’t stop there. There are significant tax and financial consequences for people cashing in their pensions to become a buy-to-let landlord and you should also consider taking financial advice if you will need amortgage to fund the purchase. There have been reports of some mortgage lenders offering anyone up to the age of 70 a 35-year-old loan – meaning they wouldn’t pay it off until they were 105-years-old!

Secondly, landlords have a lot of legal responsibilities – and these are changing all the time. Adhering to the Energy Act 2011, ensuring properties meet new safety legislation and making sure you treat tenants fairly and legally [insert link to revenge evictions blog] are just some of the points landlords need to consider.

Despite the potential drawbacks, the life of an ‘amateur’ landlord is appealing to many. In July last year, the National Landlords Association released figures which showed part-time landlords made up more than 70 per cent of the sector – its highest ever level.

Like with any business venture and investment, if you research the market well, understand your legal obligations, appreciate you will have to invest time and money in making it a success and have professional help at hand to provide reliable and trustworthy advice, then it can be a profitable venture. But remember – house prices can fall and interest rates can rise, so investing in buy-to-let is never a completely safe bet.

If you’re considering becoming a buy-to-let landlord and want some advice, contact Ratio Law.

Ratio Law loves Manchester

Ratio Law has been located in Manchester city centre for over five years, with its latest home on Charlotte Street. With Manchester Day on 14 June, two of Ratio’s partners – Joanna Norris and Gisella Alberici – give an insight into what they love about the city.

Joanna Norris

“I first came to Manchester as a student in 1993 until 1996 – it was a great place to be during the 90s – and I moved back in 2003 as a solicitor. The weather definitely isn’t the best thing about living in the city (although we do have some sunny days, promise!). Manchester is a really nice size with lots of different areas with their own personalities; I lived in London for a bit and I found it was too big to handle. For anyone visiting Manchester, I would suggest they spend some time simply wandering around the city centre and see where it takes them. My favourite restaurant is Rosso at the top of Kings Street and when it comes to football, I support Bury FC!”

Gisella Alberici

“I’ve lived in Manchester for 15 years. It was the music that first attracted me here – I loved bands like New Order and the whole ‘Madchester’ scene and used to come here to go to gigs and clubs. There is a great atmosphere in Manchester and there’s always so much going on. It’s an attractive city with really nice surrounding areas too. If someone was visiting Manchester for the weekend I’d recommend going to a football match – I personally support Manchester City and Bury FC, but of course there’s Manchester United at Old Trafford too – followed by a meal at one of the many excellent restaurants we now have in the city centre. My favourite restaurant is Sam’s Chop House. The next day they could go for a lovely walk in the Peak District with a pub lunch to finish off.”

The Ratio team would love to hear what your favourite things about Manchester are – tweet us @RatioLaw!

Bury FC – we’re going up!

By Gisella Alberici, partner, Ratio Law

It’s been a weekend of celebrations as Bury FC was promoted to League One! Anyone who knows me will be well aware of how much of a Bury FC fan I am, so it’s unsurprising that I’m absolutely delighted at the news – it’s a brilliant result for the club and fans.

In 2013, I was appointed to the board of directors at Bury FC and Ratio Law has provided legal support for the club over the last few years, including its recent move to Manchester City’s former Carrington training ground earlier this year. Ratio Law has also been a proud sponsor of the club since August 2013.

I’ll never forget the buzz in the stadium on Saturday as the final whistle blew and we realised we were going up – watching thousands of fans pour on to the pitch was quite a sight! Well done again to the team – you’ve done us all proud and we can’t wait to see you next season at Gigg Lane.

Achieving a fairer ratio of women in law

By Joanna Norris, partner at Ratio Law

It was International Women’s Day last month; a day where people all over the world celebrate women’s achievements and call for greater equality. Events took place far and wide and social media buzzing with inspirational quotes and calls for fairer treatment of women.

Women in business remains a hotly debated topic. Just last week, Germany passed legislation requiring large companies to allocate 30 per cent of seats on non-exec boards to women and the UK is also striving to see more women in decision making roles. Figures released in March 2014 showed that in the UK, women account for 20.7 per cent of board positions in the FTSE 100; not too far of Lord Davies’ original target of achieving 25 per cent in 2015.

While issues around the fair treatment of women in the workplace affect most sectors, it’s been interesting to look at how the legal sector performs in this area. Research by the Solicitors Regulations Authority shows that law as a subject attracts more females, with women making up 62.4 per cent of students accepted on a university law degree course in 2012. Yet despite more women studying the subject, female law graduates earn nearly £8,000 less than their male counterparts.

Further figures reveal male lawyers earn on average 28 per cent more than women, but there are signs that this figure is decreasing. Chris Cayley, managing director of Laurence Simons, was quoted in the London Evening Standard as saying: “Our research … shows that the gap is closing, which is important for the UK legal profession to remain at the top of its game globally.”

Pay isn’t the only issue though, as more needs to be done to ensure women are given the same opportunities and recognition as men. This too is improving in the legal sector though. While figures from 2012 suggest only one in ten top lawyers were women, The Lawyer’s Hot 100 2014 list ranked an equal number of men and women.

At Ratio, we seem to buck the trend of what’s going on elsewhere in the legal sector. The two partners – myself and Gisella Alberici – are both women, and out of a team of nine, eight are females. So what’s our secret? Well, I’m not sure if there’s a secret. Ratio was born out of a lot of hard work and determination, as well as a desire to offer our clients first-rate legal advice and business support on a one-to-one basis.

While our team may not reflect the rest of the industry, women in law – and business, in general – is a topic we all care a lot about. There is still some work to be done to ensure women are treated and rewarded fairly, but it’s promising to see statistics in the legal sector moving the right way.

What makes a property spot hot?

By Joanna Norris, partner at Ratio Law

Recently, Lloyds released research which revealed the UK’s new property hotspots. Daventry, Corby, Margate and Slough all made the top ten list, which was compiled by comparing the percentage increase in property sales between January and October 2014.

The league of locations has attracted a lot of media attention, with journalists describing them as “unlikely property hotspots” and warning people who have visited the towns to “prepare for a shock”.

But regardless of how desirable the public view these places, what actually helps a property spot become hot and how can people look out for the next up and coming area?

  • Well connected: A good transport network is important, not only to help people get around their local area but also to connect them to other major towns and cities. Look out for locations where transport improvements are planned, as properties in these areas often benefit as a result. Manchester, for example, has invested considerably in improving and expanding the Metrolink network. The new lines have helped to boost property prices, with reports suggesting that living near a Metrolink station could add as much as £8,000 to a property.
  • A job lot: If there are plans to open a new business park, hospital, factory or other establishment that will create a number of jobs, this could be an indication that an area is going to grow in popularity. Not only will the job prospects attract more people to the area, but an increase in residents will naturally lead to an increase in amenities.
  • Food for thought: According to some property experts, areas with a growing number of independent restaurants, coffee shops and delicatessens are often up and coming. Successful retail and leisure businesses like these suggest that residents have a good level of disposable income.
  • Go further afield: Online estate agent Rightmove points out that people who are priced out of property spots which have become too hot often want to stay as near to these areas as possible. This results in a ‘ripple effect’, so it can often be a good idea to look at houses and flats on the outskirts of popular locations.

Be warned though, while some areas show the perfect signs of becoming a property hotspot, house and flat prices can fall as well as rise. Are you an estate agent or property developer? What factors do you look out for when identifying new up and coming areas?

Happy Birthday to us!

By Gisella Alberici

We’ve been celebrating in the office this January as Ratio Law has turned five!

It feels like only yesterday when myself, Joanna Norris and Stuart Stones started talking about setting up the firm. We all wanted to offer a genuinely different type of legal service to our clients; we wanted to be able to deliver first-rate legal advice and business support on a one-to-one basis. By working in this way, we believed we’d be able to make a real impact on our clients’ businesses by becoming an extension of their team and delivering a truly bespoke service.

This ethos has been integral to how we run our business and key to our success over the last five years. We’re committed to staying true to our roots and will continue to work in this way as we move the firm forward over the coming years.

In 2013, we moved into our new office in Hanover House in Manchester city centre. A couple of years in and it definitely feels like home. Looking around the office, it’s hard to believe we now have a team of 9 people – a number that is sure to increase this year as we look to expand further into our areas of specialisms, especially property finance.

Starting and growing any new business presents challenges, but thanks to our fantastic team and clients we’ve been able to build a law firm which we are truly proud of. We’d like to thank everyone for all their support over the last five years and raise a toast to the next five years and beyond.

Is your business ready to be franchised?

 

Whether you’re a retailer, estate agent or in the hospitality industry, franchising can be an effective way to grow your business. But is your business right for this type of business model – and are you ready for the unique challenges it would bring? Here are 10 key points to consider.

  1. Is your business already tried and tested? If your business has been running for a number of years, you’re happy with your offering and confident it can be rolled out to other locations, then franchising may be a suitable option.
  2. Have you researched the market? Your business may have proven successful in one or two locations, but is there the demand for your products and/or services elsewhere? Are there any other businesses or franchises offering the same or similar to you? If so, how are you going to set yourself apart?
  3. Can you let go? If you like to have control over all aspects of your business, franchising may not be the best option. While you can choose your franchisees and train them, you can’t manage them as closely as you can direct employees.
  4. How will you encourage team spirit? Although it may be in all of your franchisees’ interests to work together for the greater good of the brand, some may not see it like that as ultimately they will be concerned with their own profits. You will need to find a way to make each franchisee understand the importance of the wider team and company.
  5. How will you protect yourself? If you are going to franchise your business, you will need to seek legal advice. A solicitor who specialises in franchising will advise you on protecting your intellectual property rights and help you draw up a comprehensive franchise contract. You should also draw up operation and training manuals and programmes to help maintain a consistent level of service across all franchisees.
  6. Have you completed a test run? While it can be tempting to dive straight in and start franchising your business, it is worth running a pilot operation to test it will work. This will help you refine your strategy and identify any potential issues.
  7. How will you manage the finances? If you franchise your business, you benefit from the capital investment and fees paid by your franchisees. However, you need to decide what level to set your fees. It may be a good idea to consider keeping fees relatively low to start with in order to help your franchisees succeed.
  8. Who will be your franchisees? Many people opt to become franchisees because it’s a way of running a business without all the usual associated risks. However, this means some necessarily won’t have a proven track record in business. There’s no need to rush into any decisions though and you should weigh up each applicant and their skills, knowledge and experience in the same way as you would when recruiting employees.
  9. What if things go wrong? Identifying any issues with franchisees early on will give you the opportunity to resolve them before they spiral into anything bigger. Even if a problem can be resolved easily with a face-to-face conversation or top-up training, it is always worth keeping a written record of what happened in case it happens again. For bigger challenges, seek legal advice as soon as possible.
  10. Where to turn for help? The British Franchise Association is a brilliant resource for advice and information. Your solicitor can also provide support and help.

If you’re thinking about franchising your business and want legal help, contact Ratio Law. 

Autumn Statement 2014: Stamping out the UK’s property problems?

By Joanna Norris, partner at Ratio Law

One of the most talked about points from last week’s Autumn Statement is the reform of residential property stamp duty, which will see anyone purchasing a property worth less than £937,500 paying less tax, with a corresponding rise for those above that figure. George Osborne said the changes, which came into effect at midnight on 4 December, would cut the tax for 98 per cent of homebuyers.

Following the announcement last Wednesday, a number of estate agents and solicitors saw a flurry of activity – especially in London – as people hoping to purchase higher priced properties rushed to exchange before the strike of midnight.

Some are criticising the stamp duty reform for targeting families in London and the South East, and there are worries from some that it will lead to average house prices increasing – just as they were beginning to level out again.

Ultimately, we will see a boost of activity in the property market. As well as being good news for estate agents, the likes of DIY retailers, furniture manufacturers and retailers and building and repair contractors should all benefit too.

But the one issue the stamp duty reform doesn’t address is the fact there remains a huge housing shortage in the UK. Although the Autumn Statement revealed a new garden city will be built in Bicester and Chief Secretary to the Treasury Danny Alexander made an additional announcement that the state had “radical” plans to build 300,000 new houses a year, it will be interesting to see what the next 12 months hold for the sector.

Housing is on the top of all of the parties’ agendas, as we looked at in one of our previous blogs, but it all very much comes down to who will win the general election in May – and whether the winning party stays true to its promises.

What do you think about the changes to stamp duty – should it be welcome news or will it simply push up property prices for your average house buyer?

Is it a yes or no for the Greater Manchester mayor?

Since Chancellor George Osborne announced at the beginning of November that Greater Manchester is to have an elected mayor in a devolution deal worth £1 billion, there have been debates and discussions around the pros and cons of such a move.

Part of the Chancellor’s plans to create a ‘Northern Powerhouse’, the elected mayor – who will be voted in during 2017 – will have powers over transport, housing, planning and policing. On top of this, further powers will be devolved to the Greater Manchester Combined Authority, including support for business growth, as well as joining up health and social care budgets.

Much of the criticism surrounding the move stems from the feeling that the people of Greater Manchester haven’t been consulted on whether or not they want an elected mayor. In fact, it was only in May 2012 that voters in eight cities – including Manchester – declared they didn’t want elected mayors.

The Manchester Evening News provides a good summary of the pros and cons of an elected mayor and points to New York City, where an elected mayor has made a notable impact. It’s interesting to see the newspaper’s online poll, asking readers “an elected mayor in return for £1billion in devolved powers – are you happy with the deal?” currently (26 November 2011) stands at 73% yes and only 27% no.

Like it or not, the decision to give Greater Manchester an elected mayor is a huge shift in power and should enable the region to prioritise and refocus resources based on its own objectives. It will be interesting to see who steps up to be considered for the role (with reports already that celebrities and business owners are among those who will be in the running), what they campaign for and how engaged the people of Greater Manchester become. Hopefully Greater Manchester residents will be enthusiastic and willing to use their vote so we can all be confident in a meaningful outcome.