GoConqr has a new look! Let us know what you think.

Sign up free

Flashcards

ARLA APPRAISAL and Residential Property letting practice

Katie Shellard Property ARLA English 46 cards

Cards in this deck (46)

  1. 1If demand increases, the demand curve moves left or right?Right
  2. 2if buy to let mortgage costs increased substantially, the SUPPLY curve would move?Left
  3. 3In rental markets which moves faster, supply or demandDemand
  4. 4Demand and supply interact to provide a?Market price
  5. 5Supply curves slope?bottom left to top right
  6. 6Demand curves slope?Top right to bottom left
  7. 7Why might capital values vary more than rental values for residential property?Investor owner benefits from increase in capital value long term
    Owner-occupiers bid up price
    Tenant see rental as short-term
  8. 8ON site factors affecting value are?Location: access to jobs, transport, amenities
    Buildng: type, accommodation, condition, services, garage, EPC
    Site: garden, car parking, boundaries, outbuildings, flat site
  9. 9OFF site factors affecting value are?- Nature of the legal interest: free/leasehold, lease terms, legal constraints (easements etc)
    - Statutory considerations: planning restrictions, highways matters like parking, TPOs, conservation
  10. 10What are the major and minor influences on property value?Location is the major influence on property value
    * Capital values vary with LOCATION to a greater extent than rental values
    * Property type, style and age
    * Occupancy restrictions – eg agricultural or affordable housing restrictions
    * Environmental factors – pollution, light, noise, flooding
  11. 11What do investors look for in an investment? x 9* Security of capital,
    * income,
    * ease of sale/purchase,
    *divisibility,
    * low cost of management,
    * inflation proofing,
    * low tax,
    * little Govt interference,
    * high yield.
  12. 12Main investment types are..? x 3* Gilts, (Govt stocks),
    * Equities (stocks & shares)
    * Property.
    Gilts most secure and have lowest yield.
  13. 13Advice to LLs at a market appraisal to include...?*Presenting property
    *Types of tenancy
    *Consents
    *Inventories and schedules of condition
    *Maintenance and repair contracts
    Not pass responsibility to tenant, section 11 of LL and tenant 1985
    *Insurance – fixtures and fittings
    *Tax - income to be declared annually.
    *EPC – available within 7 days normally.
    *Gas safety certificates – also PAT testing
    Utility accounts
    *Flood and water management act 2010, * *LL’s must provide details of tenants to water companies.
  14. 14Premium lease - what is the minimum period of rent pre-paid?2 years
  15. 15What is an option to renew?Gives tenant option to renew subject to complying with lease
    Care not to create a PERPETUAL TENANCY
  16. 16What is a break clause?Opposite to option to renew.
    One or both parties have option to end the lease, either on rolling notice or at a point. Usually needs to be on both parties, otherwise unfair(UTCCR 1999).
  17. 17Agent must disclose positive and negative features of a property under what legislation?Consumer Protection
    Competition and Market Authority - property displayed 'in the round'.
  18. 18What does AIDA stand for?Aware, interesting, desire, action.
    Follow agency style
  19. 19What charges are usually made to the tenant?*Application charges cover – drawing up tenancy, negotiating terms, check in
    *Referencing charges – obtaining references
    *Admin charges – cost of processing applications. May be controversial
  20. 20What is the Holding Deposit?Holding deposit – or tenancy charge, application charge, admin and set up charge property holding charge. Property taken off the market. Amount must relate to the work required to be done, otherwise deemed unfair. CPRs require openness and full explanation of charges. Clear and in plain language especially if deposit could be forfeited. OFT allow only only reasonable amount to be retained.
  21. 21Different types of tenant referencing include...?*Bank ref’s – advise bank of whole rental amount if sharing. Short reply.
    *Employer’s ref – how long employed, what salary, permanent or contract. Need signed authority
    *Accountant ref’s – Get signed authority
    *Ref from previous LLs – amount paid, regularly and breaches
    *Credit ref – shows any CCJs
    *Personal refs – someone who knows the applicant
  22. 22If applicant has no guarantor and no credit history but LL wants to accept, request...?An indemnity
  23. 23Problems with housing benefit/universal credit?*Shortfall between benefit & rent charges
    *Update authorities claimant circumstance
    *Delay in claims,
    *Claw back
    *Rent shortfall – due to 30th percentile
    *Paid every 4 weeks 2 arrears 2 in advance
    *Local authorities – some easier to work with than others
  24. 24What contributes to fair wear and tear? x 3* Length of tenancy
    * Number and type of tenants
    * Quality of fixtures and fittings
  25. 25What is an inventory?Lists all movable items in the property – items not part of the structure
  26. 26What is a Schedule of condition?Actual structure of the building inside and out.
    Start and top and then room by room.
    Can use photos
  27. 27When might the tenancy be signed other than by the tenant or LL?* Someone with power of attorney *Corporate client
    * partnership
    * trustee landlord or
    * executors
  28. 28Related documents for the tenancy for LL include?* signed terms of business,
    * management detail form about property * consents to let (freeholder, mortgagee)
    * correspondence – eg. altered clauses
    * LL’s payment details
    * references
    * guarantors
    * indemnity from LL if no references, right to rent
  29. 29Related documents for tenant?*inventory
    *tenant info pack
    * power of attorney
    * keys/alarms
    * utilities,
    * gas safety record
    * EPC
    * electrical safety
    * Deposit prescribed information
  30. 30Allowing tenant to move in without cleared funds breaches?Terms of business
    Is also negligence
  31. 31What do deposits cover?Cost of rectifying damage done by tenants to property or LL’s fixtures and fittings or any other matter agreed with tenants.
    UTCCR 1999/Consumer Rights 2015 – deposit clauses must be fair and negotiated.
  32. 32Overseas Lanlord's tax - where is application made?Made to Personal Tax International
    Apply as a Prescribed Person
  33. 33What form is used for applying for an overseas LL approval number?NRL1 – individual LLs
    NRL2 – off-shore company
    NRL3 – off-shore trust
  34. 34What is the process for processing rent for an overseas LL without an approval number? 3 steps* Deduct basic rate tax (20%) from rent less deductions.
    * Send tax deducted quarterly to HMRC with ref no, gross income, expenses, tax deducted
    * Give LL certificate of tax deducted for the year – NRL6 by 5th July
  35. 35Process for paying rent to overseas LL with an approval number? 2 steps* Pay gross rent received less fees to LL.
    * LL responsible to account to HMRC within 3 m Yr end
    * Provide to HMRC LL’s name, address, gross income paid, approval number
  36. 36If rent is below what level, tenant does not need to deduct tax?£5,200
  37. 37Let only - if balance is less than what figure, is there no liability to retain tax?If agent collects less than 3 months’ rent and balance is less than £100 after deductions, no liability to retain tax.
  38. 38Street v Moutford What date was this? What did the case decide?1985
    Lease or license - lease due to exclusive occupation
  39. 39When can a Section 13 notice be used?- Minimum period 12m from start of periodic,
    - 12m from previous increase
    - Notice period – 6m for yearly, ¼ for quarterly or 1m for monthly or weekly
  40. 40Process for overseas LL WITHOUT specific approval is...?1. Deduct 20% tax less fees
    2. Send tax to HMRC quarterly
    3. Give HMRC your ref no, gross income, expenses, tax deducted
    4. Annual return from NRLY
    5. Give LL cert of tax NRL6
  41. 41What is the process for overseas LL WITH an approval number?1. Pay rent less fees to LL
    2 Submit annual return to HMRC
    3. Give HMRC LL's name, gross income, approval number
  42. 42Terms of business with a LL must meet the requirements of what legislation?Unfair terms in Consumer contracts 1999
    and
    Consumer Rights Act 2015
  43. 43Three common services to LL's are?- Introduction only
    - Letting and rent processing
    - Letting and management
  44. 44Cooling off period? What legislation? How long for?Consumer Contracts Regs 2013 require 14 day cooling off period where contract signed shortly after an appraisal
  45. 45If details of right to cancel (cooling off period) what happens?Cooling off can be extended to 12 months
  46. 46Dealing with LLs and tenants fairly - legislation?Consumer Protection from Unfair Trading Regulations 2008

Information

Description
ARLA level 4 module on Appraisal and letting practice
Created by
Katie Shellard
Views
25
Rating

Feedback

What is it about?

What do you think of the new look?

How do you like it?