Glossary Section

Our glossary section lists all important Rentsurance related terms, associate companies/organisations or legal terms referenced on the website.

A

Accidental Landlords 

An accidental landlord is someone who became a landlord without intending to.  This usually happens when a let property is inherited, or when struggling to sell a property but wanting to buy and hence leave a property let whilst moving.

ADR 

ADR stands for ‘Alternative Dispute Resolution’ and refers to independent adjudication services offered by Deposit Protection Schemes.

APR

Annual percentage rate (APR) is the official rate used to help you understand the cost of borrowing. It takes into account the interest rate and additional charges of a credit offer. All lenders have to tell you what their APR is before you sign a credit agreement. ARLA ARLA stands for Association of Residential Letting Agents and is the UK’s most recognised industry body for letting agents, with over 9,000 members

Arrears

Money that is owed and should have been paid earlier. In case of property, it could either be rent or mortgage.

Assured tenancy

At the end of your starter tenancy by housing association homes, you may be offered an assured tenancy. An assured tenancy – meaning you can normally live in your property for the rest of your life

Assured shorthold tenancies (ASTs)

The most common form of tenancy is an AST. Most new tenancies are automatically this type.

A tenancy can be an AST if all of the following apply:

  • you’re a private landlord or housing association
  • the tenancy started on or after 15 January 1989
  • the property is your tenants’ main accommodation
  • you do not live in the property

A tenancy cannot be an AST if:

  • it began or was agreed before 15 January 1989
  • the rent is more than £100,000 a year
  • the rent is less than £250 a year (less than £1,000 in London)
  • it’s a business tenancy or tenancy of licensed premises
  • it’s a holiday let
  • the landlord is a local council

ATED

What is ATED?

Annual Tax on Enveloped Dwellings (ATED) is an annual tax where a property that is owned by a company,  partnership with a corporate member or other collective investment vehicle. In these circumstances the dwelling is said to be 'enveloped' because the ownership sits within a corporate 'wrapper' or 'envelope'.

ATED is a tax payable each year by companies on high value residential property (a dwelling).

An ATED tax return is needed for your property if all of the following apply:

  • it's a dwelling (see below for definition)
  • it's situated in the UK
  • it was valued at more than £500,000
  • it's owned, completely or partly, by a company, a partnership where one of the partners is a company, or a 'collective investment vehicle' - for example, a unit trust or an open ended investment company.

ATED charge for the 2021/22 tax year

B

Bedsit

A one-roomed unit of accommodation typically consisting of a combined bedroom and a sitting room with cooking facilities.

Bridging Loan

A bridging loan (or ‘bridge loan’) can be useful if you need to borrow money for a short period. It can help to ‘bridge the gap’ if you want to buy a new home before selling your old one. Bridging loans can also be used if you buy a property at auction, where you’ll need the money immediately but may not have sold your current property yet. BTL BTL stands for ‘Buy to Let’ and refers to buying a property to rent it out for a commercial gain.

BRRR

Buy refurbish rent refinance

Buildings Cover

Buildings insurance cover is designed to cover the cost of repairing the damage to the structure of your property in the event of a fire, flood, earthquake or lightening.  Most policies generally include damage to pipes, cables and drains in such claims.  The freeholder of the building is typically responsible for the arrangement and payment of such cover.  For example, if you have a leasehold property, the buildings cover is most likely covered in the service charges.  

Buy-to-Let Mortgage

A buy-to-let mortgage is a mortgage sold specifically to people who buy property as an investment, rather than as a place to live. If you plan to rent out a new property, most lenders will prefer you not to finance your purchase with a standard residential mortgage.

Buy to Let Return On Investment (ROI)

ROI stands for Return On Investment. ROI is the percentage return you make on your investment (cash) that you put into a property purchase, after considering all expenses.

The calculation (see below) includes all expenses, including finance costs but normally excludes tax, involved in running the investment property. Similarly, all purchase costs are included in the investment figure used.

It is the comparison between the cash you put in and cash you get out (per year).

Buy to Let Yield

Yield is a simple way to estimate the potential return from a buy-to-let investment property. The calculation is based only on the property value and the annual rental revenue it can generate.

"Yield" is also sometimes called "Gross Yield" to distinguish it from "Net Yield" which would be a variation that includes expenses in the calculation

C

Capital repayment

Regular capital repayments are made over the term of the loan, usually monthly. Mortgages repaid in this way are known as repayment mortgages or capital-and-interest mortgages.

Chain

A number of linked property sales where exchange of contracts must take place simultaneously.

Check out

The process of checking a property after a tenant has vacated. Normally only done when an inventory was carried out at the start of the tenancy. The condition of the property and the contents is checked against the inventory and the report is used as evidence for the settlement of the deposit. Client Money Protection CMP stands for ‘Client Money Protection’ and refers to a scheme in which funds are protected should a letting agent misappropriate money they hold.

Client Money Protection (CMP)

The Client Money Protection (CMP) Scheme provides compensation for landlords, tenants and other clients when agents misuse or misappropriate their rent, deposit or any other client funds.

Closing Date

The date set for submission of offers when more than one party show interest in the property

Completion Date

Completion of the legal transaction with all monies and documents having been distributed. This is also when the seller’s solicitor will instruct the estate agent to release the keys.

Council Tax Band – A council tax band indicates how much council tax will be paid; it is based on the value of the property. If you are marketing your rental property on an online platform, you should include the properties’ council tax band.

Councils 

UK Councils are funded by Central Government and are responsible for the infrastructure, transport, housing and education of their local regions (Council).  Often known as ‘Local Government’, they are responsible for day to day running of each of their regions, including all social and economic impacts within the council, including housing.  Councils have a legal obligation to seek out suitable accommodation for homeless and displaced individuals.  

Covenant

A condition, contained within the Title Deeds or lease, that the buyer must comply with, which is usually applied to all future owners of the property. A restrictive covenant is one that prohibits the owner from doing something.

D

Deeds

Legal documents assigning ownership of a property and/or land.

Detached house

detached home is a permanent dwelling, usually set on a separate lot and includes ownership rights to the land on which it is situated.

Disbursements

Fees, such as Stamp Duty, Land Registry and search fees on top of conveyancing which you normally pay via your solicitor. Deposit A deposit is a lump sum taken from the tenant at the start of the tenancy which acts as a financial safety net for any deductions required when the tenancy ends, this deposit must be protected through a Government approved Tenancy Deposit Protection Scheme. 

Displaced Tenants 

Tenants which are of no fixed abode either forced or voluntarily, due to domestic violence, homelessness, drug abuse and unemployment.

Disturbance Payment

A compensation payment made to an individual or family who have been forced to leave their property permanently.   Also refer to Home Loss compensation.

Deposit Protection Scheme(DPS)

The Deposit Protection Service (DPS) is one of the three tenancy deposit protection companies set up by the government to protect tenants deposits. The DPS is the only ‘custodial’ scheme, and is completely free to use.

Done Up Value (DUV)

The property’s Done up Value (DUVmeans the value of the property after your refurbishments. The loan to value (usually 75% in the UK) The mortgage interest rate e.g. 2.5% on the loan.

E

EICR

EICR stands for ‘Electrical Inspection Condition Report’ and should be carried out by a registered electrician once every 5 years in rental properties as a duty of care.

EPC 

EPC stands for ‘Energy Performance Certificate’ and is a certificate that measures the energy efficiency of a property on a rating scale from A – G. All privately owned properties must have a rating of at least E before they can be sold or let.

Equity

Equity is the market value of a homeowner’s unencumbered interest in their real property, that is, the difference between the home’s fair market value and the outstanding balance of all liens on the property.

Estate Agents

real estate agent is a licensed professional who represents buyers or sellers in real estate transactions. A real estate agent usually works on commission, being paid a percentage of the property’s sale price.

Exchange of Contracts

The point at which the sale becomes legally binding from which neither party can withdraw without financial penalties – In Scotland see ‘Missives Concluded’.

G

Greater London Authority 

Great London Authority (GLA) is a government body created in 1998 where Londoners have a great say in the future of London, ranging from social and economic future plans that London has.  

F

FCA

The UK financial and insurance regulatory body that is operated independently of the central government, but is designed to govern regulated businesses through frameworks and principle in order to best protect members of the public.  Rentsurance is authorised and regulated by the FCA, which can be seen here.

The Financial Conduct Authority (FCA) has three operational objectives in support of its strategic goal—to protect consumers, to protect and enhance the integrity of the U.K. financial system, and to promote healthy competition between financial services providers in the interests of consumers.

Fixed-term Tenancy

At the end of your starter tenancy by housing association homes, you may be offered a fixed-term tenancy. A rental contract with a fixed start and end date. A  fixed-term tenancy – usually lasting for at least 5 years (your landlord will decide whether it’s renewed)

Freehold

The freeholder of a property owns it outright, including the land it’s built on. If you buy a freehold, you’re responsible for maintaining your property and land, so you’ll need to budget for these costs.

FSCS

The Financial Services Compensation Scheme (FSCS) is a compensation scheme for authorised financial and insurance services firms.  In the event that an insurance company is unable to pay a claim, the customer can contact the FSCS to receive compensation.   

Fully Managed

A service level offered to landlords by letting agent. This is our comprehensive, hassle free service requiring minimum involvement from landlord. Whatever is required by landlord or the tenant, letting agent take care of it.

Full Structural Survey

This is the most comprehensive survey and is suitable for all residential properties. It’s particularly good for older homes or homes that might need repairs.

Further Advance

further advance is taking on more borrowing from your current mortgage lender. This is typically at a different rate to your main mortgage. This route can make sense if: Your lender’s further advance is competitive. You don’t want to re-mortgage or switch lenders. Furnished If a rental property is furnished, then it includes everything needed to live in. There is no legal definition, but this usually includes wardrobes, dining table and chairs, sofas, TV and mattress.

Flying Freehold

Flying freehold is an English legal term to describe a freehold which overhangs or underlies another freehold. Common cases include a room situated above a shared passageway in a semi-detached house, or a balcony which extends over a neighbouring property.

G

Gas Safety Check 

A gas safety check should be carried out annually by a Gas Safe registered engineer. A record of the check should be given to tenants within 28 days of completion or at the start of their tenancy.

Gross Rental Yield

A value stated by calculating the percentage between yearly rental revenue and the price of the property.

Ground rent

As a legal term, ground rent specifically refers to regular payments made by a holder of a leasehold property to the freeholder or a superior leaseholder, as required under a lease.

Guarantor

More common amongst younger renters, having a someone as a guarantor means that the landlord can legally ask them to pay any rent due if the tenants fail to. There are also guarantor insurance policies now which can be used as an alternative.

Gazumping

The practice by a seller accepting a higher price than that previously agreed with someone else.

Gazundering

The practice by a buyer lowering his offer just before exchange of contracts.

H

Home Emergency

Home emergency insurance is a specialist type of insurance cover, designed to cover landlords and agents in the event of an emergency that requires immediate remedial action – such as blocked drains, boiler breakdown, burst pipes, electrical shortages and so on.  This allows the policyholder to contact the insurers 24/7 who will immediately arrange for repair works to be carried out, preventing further damage to the property.  

This is an insurance policy, defined by an insurance contract between the policyholder and insurer who will indemnify the policyholder for a fixed annual premium.

Homebuyers report

A HomeBuyer Report (or HomeBuyer Survey) is a survey to find and document any problems in a property that could cause damage and need future repairs, such as damp or subsidence. A HomeBuyer Report is carried out on homes that are in a reasonable condition and only checks for easily visible problems.

The Homebuyer Survey includes a visual inspection of all major indoor features including ceilings, roof, walls, and bathrooms, as well as permanent outdoor buildings and features including roofing, pipes, gutters, walls, windows, and doors.

Home Information Packs (HIPs)

Under Part 5 of the Housing Act 2004 a Home Information Pack (HIP, on lowercase letters: hip), sometimes called a Seller’s Pack, was to be provided before a property in England and Wales could be put on the open market for sale with vacant possession.

Home Loss Compensation

A compensation payment to a person or family if they are permanently displaced from a dwelling as a result of; 

  • Making of a housing order in respect of the dwelling.
  • Redevelopment of land or improvement of any dwelling on land previously acquired or appropriated by an authority possessing compulsory purchase powers.
  • Redevelopment or improvement by a registered social landlord.
  • Making of an order for possession because the landlord (in the case of a secure tenancy) intends to demolish or redevelop the dwelling or carry out extensive work, or the area is to be sold and redeveloped. Also refer to Disturbance Payment.

Housing Benefits

Housing benefits help you cover your rental obligations if you are on a low-income, claiming benefits or unemployed.  The amount you may receive will be calculated based on your individual (or family requirements) and whether you rent privately or from a council.  You can calculate housing benefits here

Housing Charities 

Housing charities (also commonly referred as Homeless charities) support individuals and families who struggle with poor housing or homelessness – often through support, advice and introductions to councils to assist in finding accommodation for such individuals. Some of the more prominent housing charities in the UK are Shelter, Crisis, The Salvation Army and the Big Issue Foundation

HMO 

HMO stands for ‘House in Multiple Occupation’. A property is classed as an HMO if there are shared facilities between members of different families. Different rules and legislation apply to HMOs across different counties within the UK.

How to Rent

How to rent is a guide produced by the Government to help tenants and landlords understand their rights and responsibilities. If you are a landlord, you need to provide tenants with an up to date version of this at the start of new tenancies. Download a copy here.

I

IFA

Independent financial advisers (IFAs) are professionals who offer independent advice on financial matters to their clients and recommend suitable financial products from the whole of the market.

IMRO

Investments Managers Regulatory Organisation. Regulates investment managers.

Instruction

When a seller instructs an estate agent to market a property.

Interest Cover Ratio 

Interest Cover Ratio is another name for Rental Cover.

It's a restriction that's used on buy-to-let mortgages to limit the loan amount based on the rental income.

Interest-only

An interestonly mortgage allows you to pay just the interest charged each month for the term of the loan. You don’t have to repay the amount you’ve borrowed until the end of the term.

Inventory

An inventory is a documentation of all the contents and condition of a property which is taken before a tenancy begins, this is then referenced at the end of the tenancy to document any changes in its condition. Taking a thorough inventory at the start of the tenancy and ensuring the tenant agrees with it can help avoid disputes at the end of the tenancy.

J

Joint Agency

Where two estate agents work together to market a property.

Joint Mortgage

A mortgage where there is more than one individual named responsible for the mortgage.

Joint Tenancy

A joint tenancy is where two or more people rent a property together & are jointly responsible for the items within the AST.

K

Kerb Appeal 

Kerb appeal refers to how good the exterior of a property looks. This can include things like the guttering, paint, front garden and windows. A property with good kerb appeal can make a better first impression with prospective tenants.

L

Landlord

landlord is the owner of a house, apartment, condominium, land, or real estate which is rented or leased to an individual or business, who is called a tenant (also a lessee or renter).

Land Registry

The Government organisation that holds records of all registered properties in England and Wales.

LAUTRO

Life Assurance Unit Trust Regulatory Organisation.

Lease

lease is a contractual arrangement calling for the lessee (user) to pay the lessor (owner) for use of an asset. Property, buildings and vehicles are common assets that are leased. Industrial or business equipment is also leased.

Leasehold

With a leasehold, you own the property (subject to the terms of the leasehold) for the length of your lease agreement with the freeholder. When the lease ends, ownership returns to the freeholder, unless you can extend the lease.

Legal Expenses Insurance

Legal Expenses Insurance (LEI) is typically purchased alongside a ‘main’ insurance policy that can potentially trigger the use of LEI.  For example, our Rent Guarantee Insurance comes with LEI as standard as this gives policyholders protection for legal cover to cover the costs of eviction and any other associated legal costs.  

This is an insurance policy, defined by an insurance contract between the policyholder and insurer who will indemnify the policyholder for a fixed annual premium.

Letting Agent

The letting agent is responsible for helping landlords and their tenants. Duties of a letting agent include managing rental properties, finding tenants and making sure rent is paid. A letting agent is responsible for managing properties for private landlords. Depending on the level of service acquired, the agent’s responsibilities can include finding tenants, collecting rent, and fully managing the tenancy.

LIBOR

LIBOR is the benchmark interest rate at which major global lend to one another. LIBOR is administered by the Intercontinental Exchange, which asks major global banks how much they would charge other banks for short-term loans. The rate is calculated using the Waterfall Methodology, a standardized, transaction-based, data-driven, layered method.

Loan To Value (LTV)

Loan-to-value (LTV) is an often-used ratio in mortgage lending to determine the amount necessary to put in a deposit and whether a lender will extend credit to a borrower.  For example a £75,000 mortgage on a property with a value of £100,000 would be a 75% loan to value.

Mortgage lenders often use LTV to restrict the maximum amount they will lend against a property

Local Authority Search

An application made to the appropriate Local Authority requesting details of any planning or other matters which might affect the property being sold.

London Councils

London Councils, or boroughs as they are also commonly known consist of all 33 London councils operating in and around London.  (Also refer to Councils).  The 33 councils are; City of London, Barking and Dagenham, Barnet, Bexley, Brent, Bromley, Camden, Croydon, Ealing, Enfield, Greenwich, Hackney, Hammersmith and Fulham, Haringey, Harrow, Havering, Hillingdon, Hounslow, Islington, Kensington and Chelsea, Kingston upon Thames, Lambeth, Lewisham, Merton, Newham, Redbridge, Richmond upon Thames, Southwark, Sutton, Tower Hamlets, Waltham Forest, Wandsworth, Westminster

Long Lease

Leasehold means that you just have a lease from the freeholder (sometimes called the landlord) to use the home for a number of years. The leases are usually long term – often 90 years or 120 years and as high as 999 years – but can be short, such as 40 years.

Long Let

A long let generally refers to a tenancy term that lasts longer than 6 months.

M

Maintenance Charge

A charge made towards the upkeep of a leasehold property.

Managing Agent Another term used to describe a letting agent or other third party responsible for the management of the property.

Missives Concluded

Scotland only. The solicitors must agree on the written negotiations of the sale – the ‘missives’. This can only be done once a mortgage offer is received. When the missives are agreed, this is known as ‘conclusion of missives’. Both parties are now legally bound to the sale/purchase.

Mortgage Deed

A legal document relating to the mortgage lenders interest in the property.

Mortgage Types

The main difference between most types of mortgage products is the way interest is added to the loan.

  • Fixed-Rate - The interest rate is set for the initial period of the loan i.e. 1, 2, 3 or 5 years then reverts to the lender’s standard variable rate. Early repayment charges will often apply.
  • Tracker - This will follow the Bank Base Rate usually with a percentage added or deducted. Early repayment charges will often apply.
  • Capped - Follows the bank base rate like a tracker mortgage but has an upper limit to the rate. Early repayment charges will often apply. There are very few capped rates available currently.
  • LIBOR Linked - Follows the London interbank offered rate (the rate banks lend to each other at) with a percentage added or deducted. Early repayment charges will often apply. There are very few Libor Linked rates available currently.
  • Standard Variable - Follow the banks SVR but are not guaranteed to change when the Bank of England Base Rate or LIBOR rate changes. Often available without early repayment charges.
  • Discount rate - Follow’s the bank’s SVR minus a certain percentage.
  • Flexible Mortgages - These products may offer features such as additional borrowing facility, over and underpayments, payment holidays and current accounts. They vary from lender to lender but should usually have a daily interest calculation.
  • Offset - With an offset mortgage, you hold a savings account with the lender and pay no interest on the part of the mortgage that is offset by your savings. So, if you borrow £100,000 and have £20,000 in savings you will only pay interest on £80,000 of the mortgage which is tax-efficient and they may be available with a fixed or variable rate of interest..
  • Low Start - Low start mortgages either offer a greatly reduced rate in the initial years or switch from an interest-only basis to capital and repayment. 
  • Multi-Agency - The selection of two or more estate agents to act on the seller’s behalf, usually incurring a higher fee than if the sale is completed by a sole agency.

N

Negative Equity

When the value of a property is less than the outstanding sum owed on a mortgage.

Notice Period

This is the amount of time that the landlord or tenant must give the other party to end the tenancy.

Non- Resident Landlord (NRL) scheme

The scheme that sets the rules for how overseas landlords pay tax.

O

Occupancy Rights 

These rights are included within the tenancy agreement and give tenants the right to occupancy of the property.

Ombudsman

Independent professional bodies who investigate complaints on behalf of customers against estate agents, solicitors and insurance companies.

Offer

A bid made by a prospective buyer, this is not legally binding.

Offers Over

Offers are invited above the price shown.

P

Part-furnished

A property let with some furnishings, usually white goods.

Part-possession

The term used when a property is being sold, where a tenant has legal right of occupation.

PAT 

PAT stands for ‘Portable Appliance Testing’ which is an examination of electrical equipment to ensure it’s safe to use, this should be carried out by a registered electrician. Most professionals recommend that landlords have electrical equipment PAT tested annually or at a change of tenancy.

PCM

PCM stands for ‘Price per Calendar Month’ and relates to the cost of renting the property on a monthly basis.

Portfolio

property portfolio is a collection of property investments owned by an individual, a group or a company. There are many benefits to owning a property portfolio as opposed to either owning no properties or owning just one investment property.

Portfolio Gearing

Gearing is a term used to describe the overall equity levels within a portfolio of properties and gives an indication of the level of debt against the portfolio value. If a portfolio has a high gearing there is very little equity in the overall portfolio. Phone Interview/Verification Before accepting a tenant, some landlords choose to carry out phone interviews to find out more about the person they might be renting to.

Private Rented Sector (PRS)

PRS property, or Private Rented Sector property, is a classification of housing in the UK. PRS properties are owned by landlords, who can either be individuals or companies, and leased out to tenants. Other UK housing tenure classifications are: housing association, council housing, and the owner-occupancy (home ownership).

Private Rented Sector Scheme (PRS Scheme)

PRS schemes allow individuals and families to secure privately rented accommodation directly from landlords.  This is particularly common where councils do not have sufficient housing available.  Under the PRS scheme, councils provide incentives to private landlords, such as financial support for tenants who are having difficulty with their finances (such as unemployed, on state benefits, housing benefits etc).

Private Treaty

The way in which most house sales are completed in England and Wales.

Protected Tenancy

A protected tenancy is one which is regulated by the statutory code set up by the Rent Act 1977.

This applies to most tenancies which started before 15 January 1989 (when the new code set up by the Housing Act 1988 came into force).

R

Remortgage

Re-mortgaging is the process of switching your existing mortgage to a new deal, using the same property as security.

Rent Guarantee Insurance 

Often referred to rent protection insurance, is an insurance contract between the policyholder (typically the landlord/agent) and the insurance company who insure any rental voids and associated legal fees for a fixed annual premium.

Rentsurance are one of the first such providers to offer rent guarantee insurance to landlords and agents housing unemployed tenants on state benefits.  

This is an insurance policy, defined by an insurance contract between the policyholder and insurer who will indemnify the policyholder for a fixed annual premium.

Rent Guarantee Scheme

A commercial arrangement where a company (typically a lettings agent/property management company takes interest in a property for a pre-agreed period of time, in exchange of paying a fixed monthly rent to the landlord.  The letting agents then sub-let the property to tenants of their choosing.  

Rental Cover

Rental cover is a restriction that's now used on all buy-to-let mortgages to limit the loan amount based on the rental income.

The idea is to ensure there's at least a little "spare" in the rent, above and beyond the mortgage payment.

To pass a rental cover check, the monthly rent must be at least a certain multiple of the monthly mortgage payment (using a standard interest rate).

Rental cover restrictions are always calculated for individual properties but they are normally also calculated at a portfolio level for landlords with multiple properties.

Rental yield

Rental yield is the return a property investor is likely to achieve on a property through rent. It is a percentage figure, calculated by taking the yearly rental income of a property and dividing it by the total amount that has been invested in that property.

Rentsurance

Rentsurance are a Rent Guarantee insurance provider for unemployed tenants on state benefits.  

Return On Investment(ROI)

Return on Investment (ROI) is a performance measure used to evaluate the efficiency of an investment or compare the efficiency of a number of different investments. … To calculate ROI, the benefit (or return) of an investment is divided by the cost of the investment. The result is expressed as a percentage or a ratio.

Reference Check

Before accepting a tenant, landlords or agents should check references from employers, credit agencies and previous landlords to ensure that tenants can afford the property and have been good tenants in the past.

Right To Rent

Before landlords can legally rent to a prospective tenant, they must check that they can legally rent in England, this is called their ‘right to rent’. Find out more about carrying out right to rent checks here.

S

Sale Agreed

A verbal agreement from the seller.

Searches

Checks of local council records for planning applications and restrictions, etc.

  • Local Authority Search – A local authority search will provide you with detailed information about your property and the surrounding areas. This will give you peace of mind before going ahead with the purchase of your new home and ensure you avoid any nasty surprises in the future.There are two parts to a local authority search, a LLC1 result and a CON29 result.
  • Water, drainage and other property searches – A water and drainage search carried out by your conveyancer will also highlight the proximity of the property to public sewers and whether the property has a sewer running within the boundaries of the property.
  • Environmental search – Environmental search will highlight issues including, Landslips, Subsidence, Contaminated land due to historic landfills and waste sites, The risk of flooding from nearby rivers or seas.
  • Commons registration – If a property border with common land, village green or is in a rural area a search is recommended in accordance with the Commons Registration Act 1965. This property search should also be carried out when purchasing agricultural land.
  • Mining search – A mining search is required if the property is situated in an area of previous or current mining history and is at risk of being built on unstable ground. This search is largely carried out for the benefit of the mortgage lender.
  • Land charges – This is a search that should be taken when dealing with unregistered land, detailing any bankruptcy proceedings attributed to the owner of the land. It will also highlight if there are any restrictions on the use of land, estate contracts and mortgages.
  • Chancel repair liability –  All parochial church councils in England and Wales were given until October 2013 to identify and register any land-bound to chancel repair liability. This information is kept by the Land Registry and stored on the Title Register database, so if you buy or inherit property and you live within the parishes of the church, it is worth checking if you are liable to contribute towards the cost of repairs to the church.
  • Disadvantage area relief – Disadvantage area relief on Stamp Duty was phased out by HMRC in April 2013 as evidence showed that this “relief” did not encourage people to purchase a property. Up until this date, anyone that purchased a property valued over £125,000 or did not exceed £150,000 was exempt to Stamp Duty in they lived in a designated disadvantaged area.

Section 8

Commonly known as an Eviction Notice that has been sent from the landlord, to tenant.  The reasons for eviction are often stated within the notice.

Section 21

A section 21 notice is the notice a landlord must give a tenant to end the tenancy, this can only be used after the fixed tenancy term ends of if there isn’t a fixed end date. Landlords must always give tenants at least 2 months’ notice to leave the property.

Section 24

Section 24 is the name commonly used to mean the reduction in mortgage interest relief for buy-to-let investors.

The changes mean that mortgage interest (and other finance related costs) can no longer be deducted from income as standard expenses for landlords. Instead a separate relief is given at 20%, regardless of the tax rate you're paying.

The new rules were phased in from the 2017/2018 tax year with full effect in 2020/2021.

There are more details on the gradual implementation on our blog.

Calculating your own impact from the Section 24 tax changes is unfortunately complicated. Generally speaking you'll need to investigate the rules in detail or seek advice from a qualified accountant or tax advisor.

 

Semi-detached house

semidetached house (often abbreviated to semi) is a single-family duplex dwelling house that shares one common wall with the next house

Social Housing

Social Housing are homes provided by councils or not-for-profit housing association, that own and managed rented hosing.  Social Housing has been designed to be more affordable to renters, than private accommodation and usually provide a more secure, long term tenancy solution.  Social Housing is limited in the UK, which has led to the chronic housing shortage across all UK major cities.  Examples of social housing providers include Peabody, Notting Hill Genesis, Clarion Housing, One Housing and Sanctuary Housing.

Social landlords

Social Housing are homes provided for by housing associations or councils.  Refer to Social Housing.

Sole Agency

The seller chooses a single estate agent to act on their behalf, incurring a lower fee than multi-agency.

Short Let 

A short let generally refers to a tenancy term that last 6 month’s or less.

Smart Meter 

A smart meter is an energy meter that records electricity and energy usage in near real time. They are free and can benefit both landlords and tenants.

Stamp Duty Land Tax (SDLT)

The stamp duty land tax (SDLT) is the tax imposed by the UK Government on the purchase of land and properties with values over a certain threshold. This tax is payable to Her Majesty’s Revenue and Customs (HMRC) and must be remitted within 30 days of the completion of the purchase.

Starter tenancy

New housing association tenants may be offered a starter tenancy. These usually last 12 months and are like a ‘trial’ period.

You become an assured or fixed-term tenant after 12 months unless your housing association has either:

  • started action to evict you
  • extended your starter tenancy

State Benefits

State benefits in the UK covers a host of payment(s) that an individual could receive from central or local government (Councils).  In the UK, some state benefits are subject to income tax, whereas others are tax free.

Taxable State Benefits:

  • Bereavement Allowance
  • Carer’s Allowance
  • Contribution-based Employment and Support Allowance (ESA)
  • Incapacity Benefit (from the 29th week you get it)
  • Jobseeker’s Allowance (JSA)
  • Pensions paid by the Industrial Death Benefit scheme
  • State Pension
  • Widowed Parent’s Allowance

Tax-Free State Benefits Include:

  • Attendance Allowance (for elderly and disabled persons)
  • Bereavement support payment *Complimentary TV licence for over 75s.
  • Child Benefit (Based on income bracket)
  • Child Tax Credit
  • Disability Living Allowance (DLA)
  • Guardian’s Allowance
  • Housing Benefit
  • Income Support
  • Income-related Employment and Support Allowance (ESA)
  • Industrial Injuries Benefit
  • Lump-sum bereavement payments
  • Maternity Allowance
  • Pension Credit
  • Personal Independence Payment (PIP)
  • Severe Disablement Allowance
  • Universal Credit
  • War Widow’s Pension
  • Winter Fuel Payments and Christmas Bonus
  • Working Tax Credit

Studio flat

The studio apartment is an apartment with a single room. They are also known as single-room dwelling places or studio flats

Subject to Contract

When a property is sold subject to contract, this means an offer submitted by a buyer has been accepted by the seller, but the paperwork is not complete. It should also mean both parties are working towards an exchange of contracts. This term is used to specify that a contract is not yet lawfully binding.

Sub Let

Sub-letting is where a tenant rents out the property or part of the property they are renting to another tenant. If you are a tenant, you will need approval from your landlord before you can sub-let.

Sub-prime mortgage

subprime mortgage is a type of loan granted to individuals with poor credit scores.

T

TDP/TDS 

TDP or TDS stands for ‘Tenancy Deposit Scheme’ and is a Government-backed scheme that ensures tenants get their deposits back so long as they meet the terms of their tenancy agreement, don’t damage the property and pay the rent and bills. You can find out more about tenancy deposit protection schemes here.

Temporary Accommodation Providers

Temporary Accommodation providers (TA providers) are typically privately owned organisations who work with Councils to house displaced tenants.  UK Councils simply do not have enough of their own ‘stock’ to house tenants on short notice, thus Councils outsource this function to organisations who then arrange temporary and suitable property to the tenant, based on their individual needs.  

Tenant

A person who occupies land or property rented from a landlord.

Tenancy Void

A ‘void‘ can be defined as a property, which does not have a legitimate tenant.

Tenant Find

A service level offered to landlords by letting agent. We find you a tenant and organise a tenancy agreement, leaving you with the day to day running of the let.

Tenants Liability

A specific type of insurance for tenants renting properties from landlords, which covers all landlords’ fixtures and fittings from accidental damage by the tenant.  Whilst most landlords typically do not rent fully furnished properties – some landlords may request the renter to purchase Tenants Liability insurance to cover accidental damage to a new bathroom, or kitchen for example.

Tenancy Fee Act

The Tenant Fees Act is the ban on letting agency fees that became law on 1st June 2019

Tenant Reference

tenant reference is used to evaluate a potential tenant’s suitability to rent a property. A tenant reference check provides the landlord with a clear and accurate snapshot of the applicant’s ability to pay the rent, as well as their recent renting history.

Tender

The process whereby the seller asks for written offers on a property usually with a set closing date. When a property is sold by tender, the buyer pays the fees.

Tenure

The conditions under which land or buildings are held or occupied.

Terraced houses

Terraced houses are distinguished by properties connecting directly to each other in a row, sharing a party wall.

Title

The ultimate record of ownership of a property, the evidence of which is found in the title deeds.

Transfer Deeds

The Land Registry document that transfers legal ownership from seller to buyer.

U

Under Offer

When the seller has accepted an offer on the property but contracts have not yet been exchanged.

Unemployed 

A person who is without a paid job or occupation, but is available to work.

Unfurnished

A property let with no furnishings.

Universal Credit 

This is payment made from central government as part of state benefits to help you with your living costs.  Universal Credit has been designed for individuals who are: 

  • Low-income
  • Unemployed
  • You and your partner have less than £16,000 in savings between you
  • You live in the United Kingdom

Payments for Universal Credit can be paid alongside other state benefits. (Universal Credit differs from Scotland).

V

Valuation 

A valuation is a survey or inspection of a property which gives landlord’s an estimate of how much they can rent it out for Variable Interest Rate

An interest payment that changes depending on market interest rates.

Vendor

A person or company offering something for sale,

Viewings

Viewings are the tenant’s opportunity to come and take a look around the rental property before deciding whether or not to rent it.

W

Wear and Tear

Wear and tear is damage to the property caused by day to day living such as worn carpets or small scuffs on the wall. Wear and tear is not allowed to be deducted from deposits.

Writ

Mode of commencing legal proceedings

Y

Young Professional 

The term ‘young professional’ is generally used to describe an individual who is in their 20 – 30s working in a white-collar job.