Author Archive: Muhammad Zia

Post-Brexit row over Northern Ireland sparks trade war fear

The UK Government has announced it will introduce a new law to change the post-Brexit trade deal for Northern Ireland, known as the Northern Ireland Protocol.

Foreign Secretary Liz Truss insisted the bill would be legal under international law, but the EU has warned it could trigger a trade war and will pursue a legal challenge against the UK if the Government proceeds with its plans.

The deal governs how goods enter Northern Ireland from the rest of the UK and was negotiated by the Government after the Brexit vote in 2019.

The Foreign Secretary told Parliament the move would change the deal rather than scrap it, to resolve “the grave situation in Northern Ireland”.

But Maros Sefcovic, the Vice President of the European Commission hit back and said it would “need to respond with all measures at its disposal” if the UK went ahead with the legislation.

What is the protocol?

  • It is designed to protect the Good Friday Agreement by avoiding a hard border on the island of Ireland.
  • The protocol allows goods to move freely between NI and the Republic of Ireland. NI remained in the EU’s single market for goods.
  • But NI also stayed in GB’s market too because it is still part of the UK.

What is the Irish Sea border?

  • NI’s border with the republic also became the UK’s new border with the EU after Brexit. There needed to be a border somewhere on the island of Ireland because the UK and EU follow different customs rules.
  • As a compromise, the UK and EU agreed to a deal that would see customs checks at NI’s ports, creating what is now referred to as the ‘Irish Sea border’.

In October last year, the EU set out its own proposals, which included:

  • An 80 per cent reduction in checks on food products arriving in Northern Ireland and halving the amount of paperwork.
  • Legislation to allow the trade in medicines between GB and Northern Ireland to continue.
  • Relaxing rules so chilled meats, such as sausages, could still be sent across the Irish Sea.

In return, the EU wanted extra safeguards to prevent products from Great Britain crossing into the Republic of Ireland.

The UK rejected this offer, saying it would “worsen the current trading arrangements”.

For help and advice and related matters contact our expert team today.

New legislation will provide a ‘new deal’ for tenants

The Government says it will deliver the biggest change to renters law in a generation, with the Renters Reform Bill, which was outlined in this month’s Queen’s Speech.

It says it will improve the lives of millions of renters by driving up standards in the private and social rented sector, delivering on the Government’s mission to level up the country.

A “new deal” will be put in place for the 4.4 million households privately renting across England by extending the Decent Homes Standard to the private rented sector for the first time.

It is designed to ensure all renters have access to secure, quality homes, levelling up opportunities for the 21 per cent of private rented who currently live in homes of an unacceptable standard.

  • Legislation will drive up quality for private renters, extending the Decent Homes Standard to the sector for the first time and giving all renters the legal right to a safe and warm home
  • It will ban Section 21 ‘no fault’ evictions, protecting tenants from unscrupulous landlords, while strengthening landlords’ legitimate grounds for taking back their property
  • New support for social renters, with regular rigorous inspections and stronger powers to tackle failings by social housing landlords

Levelling Up and Housing Secretary Michael Gove said: “This is all part of our plan to level up communities and improve the life chances of people from all corners of the country.”
A new Private Renters’ Ombudsman will be created to enable disputes between private renters and landlords to be settled quickly, at low cost, and without going to courts

Social renters

The Social Housing Regulation Bill will continue to deliver on the Government’s reforms in response to the Grenfell Tower fire as the fifth anniversary of the tragedy approaches.

It will create a regulatory framework that will drive up the standards of social housing accommodation and help tenants and the Regulator hold social housing landlords to account.

  • Giving the Regulator stronger powers to enforce action if they see failings by social housing landlords.
  • Placing an expectation on social landlords to place tenants’ concerns at the heart of all they do, with effective resident engagement in place, so no one has to live in sub-standard social housing.
  • Providing greater transparency for tenants on how their landlord is performing, how their homes are managed and who is responsible for compliance with health and safety requirements.

Strengthening the economic regulation of the social housing sector, increasing protections for tenants’ homes and supporting continued investment in the new supply of social housing.

Relying on the ‘bank of mum and dad’ can be fraught with difficulty

The ‘bank of mum and dad’ has been a source of borrowing power for young people looking to purchase their first home.

However, new figures show that in March, borrowers continued to rely on their loved ones to boost their borrowing power, but are increasingly exploring new ways to fund it.

According to new research from Legal & General Mortgage Club’s SmartCriteria tool, searches for homeowners looking for joint borrower sole proprietor (JBSP) mortgages climbed by 17 per cent in March, suggesting that borrowers are relying on financial support.

Often referred to as a JBSP mortgage, a joint borrower sole proprietor mortgage allows a parent (or family member) to contribute to their son or daughter’s mortgage without being a co-owner.

It gives the young homebuyer a feeling of independence and ownership. The JBSP is flexible too, so parent contributions can reduce over time until the son or daughter can cover all mortgage payments themselves.

How is a JBSP mortgage different from a joint mortgage? 

With a JBSP mortgage, the other person (typically a parent) accepts joint responsibility for making mortgage payments but has no legal claim to the property.

The research tool tracks product searches from over 8,000 advisers, highlighting the purchase and remortgage trends witnessed by brokers across the industry.

The data also shows that demand from buyers continued despite rising living costs and soaring house prices.

While parents are a welcome lifeline, couples aiming to get on the property ladder can help themselves maximise deposits by:

  • Reducing rent as much as possible. Consider something cheaper like a house or flatshare for the short term.
  • Putting away savings on payday. This will show lenders you are serious about repayments and will prevent overspending while you save.
  • Open a Lifetime ISA. As long as you’ve had your LISA for longer than a year, you should be able to cash it out as a first-time buyer.
  • Move back with family. A tough decision, but you will save money as you are likely to pay less rent and allow you to save.
  • Buy part of a property. You will need to save less for shared ownership and you will still pay rent on part of the property. But you are on your way.
  • Cut out unnecessary costs. That should be obvious!

Landlords must make sure properties meet energy standards or face fines

Private residential property landlords need to make sure they do not try to grant a new tenancy of longer than six months if the property has an Energy Performance Certificate (EPC) below the E rating.

Unless they have a valid exemption, from 1 April 2020, landlords can no longer continue to let properties covered by MEES regulations if they have an EPC rating below E.

The Minimum Energy Efficiency Standards (MEES), are a minimum energy efficiency level for domestic private rented properties.

What is an EPC Rating?

The EPC measures how energy efficient a property is then given a rating between A and G. Within MEES regulations, a property with a rating of F or lower means the landlord is liable to pay a substantial fine.

Department for Business, Energy & Industrial Strategy (BEIS) says you need to improve the property’s rating to E, if it falls into F or G bands, or register an exemption before you enter into a new tenancy.

Equally, you must improve the property’s rating to E immediately, or register an exemption, if you are currently letting a property with a rating of F or G.

There is a different rule for empty properties, where landlords do not need to make improvements to upgrade the rating until they decide to let it again.

When you need to take action to improve your property

  • A cost cap set at a figure of £3,500 is the maximum you will be required to spend on energy improvements
  • If all the improvements cannot be achieved for this figure, then you can register for an ‘all improvements made’ exemption.

What are the MEES Penalties?

The penalty for renting a property for fewer than three months that is in breach of MEES Regulations will be equivalent to 10 per cent of the property’s value, with a maximum amount of £50,000 and a minimum penalty of £5,000.

After three months, the penalty rises to 20 per cent of the property’s value, with a maximum amount of £150,000 and a minimum penalty of £10,000. Where MEES Regulations are breached, the lease between the landlord and the tenant remains valid and in force.

The scope of MEES can be complicated and there are exceptions, so it would be wise to get in touch with your professional adviser to make sure you are compliant with the law.