LATEST: Plans to increase size of Manchester’s selective licensing scheme given thumbs down by landlords

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City wants to include at least another 1,200 properties within its scheme in four new areas, on top of the 2,281 already covered by its existing scheme.

At least another 1,200 private rented properties could be included in in Manchester’s extended selective licensing scheme if councillors give it the go-ahead.

Manchester City Council’s
scrutiny committee is being encouraged to approve the scheme in four yet-to-be
confirmed additional areas, each covering between 300 and 600 homes.

The current pilot scheme –
covering 2,281 properties in Crumpsall, Moss Side, Moston and Old Moat – has
been deemed a success; 1,932 applications have been received and 1,540 licenses
granted.

It says although only halfway
through the five-year pilot, anti-social behaviour, noise and fly tipping are
showing “encouraging signs of improvement across most of the pilot areas”.

In the Crumpsall area, rowdy and
inconsiderate behaviour has dropped by 64% and anti-social behaviour from
neighbours was down by almost a third.

Councillor Suzanne Richards, Manchester City Council’s executive member for housing and regeneration, says: “In those areas targeted by Selective Licensing, we often have concerns about the standard and safety of properties. Our four pilots are having a positive impact, not just from a property management point of view, but on a neighbourhood level as well.

“We are now identifying further
areas for selective licensing, so that we can build on the positive results of
the pilots for private renters in other parts of the city.”

However,
the Residential Landlords Association believes the council should use its data
to find landlords and target resources to properly enforce the wide range of
powers it already has to deal with unsafe and sub-standard rented
housing. 

Policy manager John Stewart says: “Extending a licensing scheme in the way Manchester Council is proposing is not the answer. All it does is identify the good landlords who register and then tax them. They do nothing to flush out the criminals who stay under the radar.”  

Read out guide to landlord law and licensing.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Plans to increase size of Manchester’s selective licensing scheme given thumbs down by landlords | LandlordZONE.

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EXCLUSIVE: What’s really happening on the ground following the tenant fees ban

admin    Uncategorized     agents

Letting agents gather to tell LandlordZONE why the fees ban is, as predicted, pushing up rents as one agent reveals losing £270,000 since act became law.

Government ministers who last
year rejected landlord and letting agent claims that the tenant fees ban would simply
force up rents should have been at a gathering at the LandlordZONE offices last
week.

We invited ten letting
agents to take their business pulses, and many were candid about out how much
they had lost following the ban, which went live in England on June 1^st
last year, and how the money was being recouped.

Many said they had
experienced lower revenues including a single-branch agent who had lost between
£25,000 and £30,000 since the fees ban became law, while a large multi-branch
agency had lost £270,000.

Only one agency said they
had increased their fees to landlords to make up the shortfall; the rest said
they had either agreed with them to raise rents and/or cut their business
costs.

The agents also revealed how
much they charge landlords, ranging from 5% to 10% for let only, while three
charged 5% for fully managed and two charged 13%.

Several said doing business was
getting more difficult as landlords and the law required them to do more and
more work, while their fees remained static.

The fees ban is also bad
news for renters with pets, the agents said. Now that the rental deposit cannot
be larger than five weeks’ rent, the traditional ‘pet deposit’ many
animal-loving tenants paid in the past is no longer legal.

“I am more wary of pets now because, if they do cause damage to a property, then the new capped deposit won’t be enough to cover the cost of repairing the damage,” said one agent.

Find out more about the tenant fees ban.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – EXCLUSIVE: What’s really happening on the ground following the tenant fees ban | LandlordZONE.

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BUDGET 2020: Landlords expecting announcements on tenancy length, HMO regulation and landlord licensing

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Chancellor Rishi Sunak’s first Budget is due on Tuesday and a poll of nearly 800 landlords reveals what they expect him to reveal either then or later this year.

Most landlords are braced for a
shake-up of the private rented sector this year, believing that they face the
introduction of minimum tenancy terms, more regulations around HMOs and
individual licensing of landlords.

In the run-up to the Budget, Foundation
Home Loans says most landlords (70%) anticipate further Government intervention
during 2020.

Of those, 73% believe it is this
will probably mean the introduction of minimum tenancy terms, while the same
number think action is likely in the HMO and multi-unit block sector.

Meanwhile, 72% reckon individual
licensing for all landlords and their properties is likely, while 38% can
envisage a rental cap for private rental properties being introduced.

In an online survey of 791 landlords,
it found the issue of abolishing Section 21 evictions was a major concern with
53% saying they would feel much less confident about their portfolios if this
was introduced, 34% would be unlikely to buy any further properties, 33% would
consider exiting the sector, and 31% would consider reducing the size of their
portfolios.

Jeff
Knight, director of marketing at Foundation Home Loans, says: “There’s definitely a degree of uncertainty around what
might be coming next. Landlords appear to be bracing themselves for a Budget
which may not be in their favour, rather than one which seeks to roll back on
the measures which have undoubtedly impacted on their profitability over the
last few years.”

Despite this, the poll found landlords
the most upbeat they’ve been in over a year, with 25% reporting tenant demand
had increased from the last quarter (up 3%), with those landlords with 11-plus
properties particularly positive about rental yields. Read more
about HMOs.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BUDGET 2020: Landlords expecting announcements on tenancy length, HMO regulation and landlord licensing | LandlordZONE.

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Landlords invited to free conference this March

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Landlords invited to attend the National Landlord Investment show , which returns to London Olympia in two weeks. The free event will take place on Thursday 19th March, and is the perfect opportunity for landlords to hear from a superb lineup of speakers and network. Political broadcaster Andrew Neil will chair a panel debate on […]

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BREAKING: Controversial MP proposes new law to tackle rogue landlords and unregistered HMOs

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Christopher Chope, MP for Christchurch, wants to see private housing market mare robustly policed by local authorities, but makes no mention of how it will be financed.

Conservative
MP Sir Christopher Chope has called for tougher action to be taken to remove
rogue landlords from the housing market and for councils to enforce HMO
regulations more effectively.

His comments were made yesterday in Parliament as he moved to introduce his 42nd Private Members Bill, this time calling for increased efforts to hunt down criminals in the UK.

“Although there are more than two million landlords in England, only 18 individuals and five companies have been put on the register of rogue landlords for offences committed since 6^th April 2018,” he said in a lengthy speech introducing his Rule of Law (Enforcement by Public Authorities) Bill.

Chope is referring to a statement last month by outgoing Housing Minister Esther McVey, reported by LandlordZONE, which revealed how few rogue landlords had been added to the government’s much-heralded database.

“This ineffectual regulation is driving good private landlords out of the market without deterring or penalising the rogues.”

Chope also claims that half of all HMOs – or 76,000 properties – that should be regulated have not been registered with local licensing schemes.

“Local authorities are ignoring all properties that should be incorporated into the licensing system while trying to penalise those that have already applied for licensing.”

Chope’s housing proposals are not his only ideas mooted within the bill, which seeks to force local authorities to ‘exercise their statutory powers to investigate and take enforcement action for breaches of the law’.

The MP, who infamously last year blocked legislation to ban the practice of photo ‘upskirting’ of women, also wants tougher enforcement of traveller communities, park home operators and illegal immigrants.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BREAKING: Controversial MP proposes new law to tackle rogue landlords and unregistered HMOs | LandlordZONE.

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RLA responds to Hastings licensing consultation

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Landlords with rental properties in Hastings are being encouraged to have their say on plans to renew a selective licensing scheme in Hastings. The council is proposing to introduce a scheme requiring landlords to licence all privately rented flats and houses that are occupied by one household (i.e. single persons or couples, or one family) in […]

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Winning Deposit Disputes

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Tenancy Deposits:

Landlords often fail to win tenancy deposit disputes, not because the claim is unjustified, but purely because of the way they have gone about claiming, and usually because they have insufficient evidence to support their claim.

A recent case involving a tenant with a pet cat leaving fleas behind in the property is a prime example of how a deposit claim can be won or lost on the way the claim is presented and the available evidence.

In this case involving a dispute of £180 for the pest controller’s fees, the dispute went to the scheme’s arbitrator who awarded for the landlord.

Despite the tenant’s arguments to the contrary and evidence put forward the landlord claimed that the tenant left behind a flea infestation which had to be irradiated professionally.

Claims for pet related costs are likely to increase because (1) the government is encouraging landlords to take in more “well behaved” pets, and (2) the tenant fees act now restricts the maximum deposit a landlord can take to 5 week’s rent, leaving landlords the only option for their protection, when pets are involved, to charge a higher rent.

According to Property Eye, in this case the landlord claimed the tenant should pay for the cost of treating the flea infestation at the property. But the tenant denied there was any evidence of fleas at the property when they left, and put forward convincing evidence that their cat was flea-treated by their vet and had never had fleas.

The landlord submitted the following evidence to the adjudicator:

• dated and signed check-in and check-out reports
• invoice in the amount claimed from a pest treatment contractor
• a statement of opinion from the contractor
• various emails between landlord and tenant
• a photograph of a flea-bitten ankle.

The tenant submitted submitted:

• Various documents relating to their cat’s vet treatments
• receipts for the purchase of pet flea prevention treatments.

No mention of fleas was made on the check-in report, but the photograph of the flea bitten ankle appeared to have been taken at least a week after the tenancy had ended.

This evidence the adjudicator thought was insufficient, but what swung it for the landlord was the pest controller’s statement that showed a flea infestation was present at the property, two weeks after the tenancy had ended, with no other occupation in between.

Further, the tenancy agreement set out the landlord’s agreement that the tenant could keep a cat at the property, stipulating clearly the tenant’s responsibility for any costs arising for damage or to eradicate any pests caused by or resulting from the presence of the animal in the property – the relevant clause in the agreement stated stated very specifically: “The tenant will be liable to compensate the landlord for any losses due to flea infestation by an animal of the tenant, his family or his visitors”.

Whether disputes like this one go to the deposit scheme’s dispute arbitration or a county court, the principles are very much the same and there are a couple of lessons to be drawn here:

1. Documentary and independent evidence is vital. This, including any photographs, must be dated and confirmed independently.
2. The tenancy agreement must set-out very clearly the obligations and responsibilities of the parties for these eventualities.

These measures are particularly important where pets are involved, but also for other potential damage such as condensation, rent arrears issues etc.

Landlords take deposits to give them financial security should tenants: (1) cause damage in the property, (2) leave the place needing extensive cleaning, (3) leave possessions in the property which need expensive removal, or (3) leave owing rent.

Landlords / Agents should ensure that the letting agreement (contract) provides for all these reasons for retaining a deposit.

Landlords / Agents should also be aware that damage deposits should not exceed 5 weeks’s rent.

Landlords and agents taking a deposit from an assured shorthold tenancy (AST) tenant must protect it in one of the approved schemes within 30 days of taking it. They are also obliged to serve on the tenant a set of statutory information regarding the scheme in question. This information and documentation (s213 notice) is available for download from the relevant scheme’s website.

Landlords and agents are advised to get proof of service of this documentation on their tenant as failure to comply with any of the TDP rules will invalidate any accelerated possession (s21) claim.

Deposit Disputes and that Crucial Evidence

Most tenancies end amicably and the landlord or agent will agree to either refund the full deposit or an agreement between them and the tenant will be reached, such that all or a part of the deposit is retained to cover the issues mentioned above.

However, it is sometimes not possible to reach agreement and therefore the deposit amount in dispute is put into an arbitration process, which is handled by the DTP scheme in question at no cost to the parties involved. In some cases, where complications arise, the dispute will be transferred to the county court for settlement, in which case fees and costs will be involved, and normally the losing side pays these.

Deposit amounts in dispute will be released from the scheme when the parties agree to this. Otherwise the scheme adjudicators will decide on the evidence presented to them who receives the money.

It is crucial therefore that landlords and agents during the course of letting and managing a tenancy build-up sufficient documentary evidence to enable them win a deposit dispute claim should the need arise: a good inventory (preferably done by an independent inventory clerk) with check-in and check-out reports, including photos and tenants signature, is essential.

Further evidence would include estimates and invoices for repairs and renewals, cleaning and removal costs, rent schedules where there are arrears and statements from third parties / contractors as in the case above. It is not possible to claim for work that landlords do themselves (DIY).

Fair Wear and Tear

The contract between a landlord and a residential tenant has an implied term which means dilapidations to the property due to fair wear and tear are acceptable and cannot be claimed against the deposit.

What is fair wear and tear is a matter of subjective judgement to some extent but is informed by the experience of the landlord, agent or inventory clerk, and when in dispute will be decided by the scheme’s adjudicator.

These requirements contrast with commercial tenancies where the lease usually requires the tenant to put back the property into a tenantable state, which usually means complete redecoration, and can even mean major structural repairs as well.

Fair wear and tear has been defined by the House of Lords as resulting from:
“Reasonable use of the premises by the Tenant and the ordinary operation of natural forces”

This statement is not all that helpful when it comes to the task of deciding what is fair wear and tear and what goes beyond that?

Reaching a decision means making an allowance for:

– The original age, quality and condition of any item at the start of the tenancy
– The average useful lifespan to value ratio (depreciation) of the item
– The reasonable expected life time usage of such an item
– The number and type of occupants in the property
– The length of the tenants’ occupancy

It follows therefore from established legal practice that a landlord cannot charge its tenants the full cost of having any part of a property, or any fixture or fitting, returned to its original condition, or even the condition it was in at the start of the tenancy.

When it is not possible to make repairs, any compensation when a new for old replacement is made will therefore involve an allowance for age, quality and fair wear and tear.

Further, a duty is placed on landlords and agents to adopt the most reasonable, practical and appropriate cost-effective approach to achieving a remedy.

Appropriate remedies might include:

Only replacing items where it is so severely and extensively damaged it is now beyond economic repair or, it has become unusable. Here, the most economic repair would be expected.

Small stains on carpets for example may be put down to fair wear and tear, whereas more extensive mark and staining or burns would not.

However, depending on their position it may be possible to cover them with strategically placed rugs and mats and the adjudicator may insist on that.

Otherwise where a replacement carpet is deemed acceptable, any compensation by the tenant would need to take into account: (1) its appropriateness for use in a rental (e.g. colour), (2) quality, its age and expected lifespan. Therefore in these cases the tenant would be asked for a contribution to the cost, new verses old.

Repairs or Cleaning

What is clean to one person is sometimes downright filthy to another.

Cleaning is the most common cause of a deposit disputes between a tenant and a landlord, with nearly a quarter of all dispute cases being attributed to issues of cleanliness.

Therefore any adjudicator’s decision will depend on the evidence submitted, how reasonable is the amount being claimed, and is the claim supported by a contractor’s statement.

Questions the adjudicator may ask:

– Who says it needs cleaning? Is this opinion independent and impartial, e.g. an inventory clerk or agent?
– Did the tenant agree to condition and cleanliness at the start of the tenancy and was it made aware of potential costs of not complying – e.g., a specific clause in the agreement?
– Was the property professionally or DIY domestically cleaned at the start of the tenancy?
– What evidence have you got that shows deterioration, start to end?

Photo & Video Evidence

Photo and video inventories (ideally produced independently) are useful for recording the condition of the property at the start and end of the tenancy and when done properly will provide a clear record of the property prior to its occupation.

You need to make sure all photographs and video evidence is clearly dated and signed and agreed by both parties. This is much easier to achieve when an independent inventory clerk completes the task.

Always make sure the tenant is given a copy at Check-in/Check-out stage, and get a signature to say they agree and understand all the implications after viewing and discussing.

The end result of adjudication will always hinge on the quality of the paper based documentation presented, so good quality photo evidence, signed by both parties will add considerably to the weight of a landlord’s case.

Preparing a Claim

Preparation for a deposit dispute claim starts pre-tenancy. If you have not planned your management process: agreement wording, quality inventories, check-ins and check-outs, communicating to tenants your expectations, interim inspections if necessary etc., then your chances of successfully claiming against a deposit are pretty low indeed.

Putting together a good claim is time consuming and evidence heavy – the adjudicator can make a decision only on the evidence presented in document form. Furthermore, there is no appeal once the adjudicator makes a decision. You cannot challenge an adjudication decision unless it is via a court of law. The more evidence you can produce and the more transparent you are with the whole process the better your chance of success.

As a landlord or agent you need to weigh the costs of putting forward a good claim against the amount of money involved. It the one outweighs the other it is sometimes better to return the deposit to the tenants and “bite the bullet” as cost of regards reinstatement.

This can sometime be an act of good will and will prevent any chance of retaliatory action by the tenant – it would not be the first time a landlord had a brick through the window of its rental property because the tenant felt hard done by losing its deposit.

To help you prepare your claim properly here are two very useful guides: – Recommended Books

Understanding Fair Wear and Tear by the Association of Independent Inventory Clerks (AIIC)

How To Win Deposit Disputes by Tom Derrett

Article By Tom Entwistle, LandlordZONE®

If you have any questions about any of the issues here, post your question to the LandlordZONE® Forums – these are the busiest Rental Property Forums in the UK – you will have an answer in no time at all.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Winning Deposit Disputes | LandlordZONE.

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Is YOUR letting agent following the law on rental deposits?

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Government reveals that six local authorities are looking into multiple breaches of deposit law by letting agents.

Some letting agents around the UK appear to be ignoring
the Tenant Fees Act, with at least 18 possible investigations pending which
could result in prosecution, it has been reported.

Camden, Westminster, Hammersmith and Fulham, Tower
Hamlets, Stoke on Trent and Leicestershire are all looking into issues around
deposits raised by tenants.

Tower Hamlets Council has served three notices of intent
for breaches relating to taking excessive deposits, taking multiple deposits
for the same property and failing to return a deposit within an acceptable time
frame.

However,
ARLA Propertymark points out that the sector is currently in a transition
period.

Chief
executive David Cox tells LandlordZONE: “If the
tenancy was signed and dated on or before the 31^st May 2019,
then the agents can charge a checkout fee up until the 31^st May
2020 as the Tenant Fee Act does not apply to those tenancies. That’s the advice
we have always given out.”

Following the Act’s introduction in June 2019, the maximum
fee allowed is five weeks’ rent for security deposits, and one week’s rent for
holding deposits.

According to the National Trading Standards Estate and Letting Agency Team, these cases could total £45,000 of financial penalties if the agents are found to have breached the legislation.

A spokesman for the National Trading Standards Estate and
Letting Agency Team says they are now seeing some authorities act against
agents who seem to be charging prohibited fees.

He says: “Many
tenants find themselves in vulnerable positions and are concerned about
retaliatory action if they complain about prohibited tenant fees. If you’re a
tenant, we want to make sure you’re absolutely clear: the landlord is not
allowed to serve an eviction notice if they haven’t paid back prohibited tenant
fees.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Is YOUR letting agent following the law on rental deposits? | LandlordZONE.

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A day in the life of HF Assist

admin    Uncategorized     agents

Last month we reported that Hamilton Fraser, parent company of the Property Redress Scheme (PRS), mydeposits, and Client Money Protect (CMP), had launched a new helpline for letting agents, HF Assist.

In our new ‘Day
in the life of HF Assist’ posts, each week the HF Assist team will highlight
questions from customers and share their answers with us.

In our first Q&A, we discuss the upcoming tenant fee ban
transition deadline, Energy Performance Certificate (EPC) renewals, and tenancy
agreement charges.

Q1: The tenant fee ban
deadline of 31 May 2020 will soon come round. I am working through our
tenancies and making sure we have returned all surplus deposits over the 5 (or
6) week cap.  Is there anything else I
need to be aware of?

Answer:

It’s always good to get ahead of the game.  As well as checking which deposits are over
the cap, be sure to check the history of the tenancy too.

Landlords and letting agents are not obliged to
immediately refund part of a tenancy deposit that is above the cap but which
was paid before 1 June 2019. If a tenant signed a tenancy agreement before 1
June 2019 (and that tenancy is continuing or is a statutory periodic agreement)
then the tenant will be bound by the terms of that contract until it is either
renewed or terminated.

This means that you will be required to refund the deposit
at the end of the tenancy in the usual way and any new tenancy agreed after
this will need to comply with the tenancy deposit cap.

Did you know?

HF Assist Premium subscribers can
download a free template for assured shorthold tenancy agreements. Find out
more here.

HF Assist and mydeposits have
both received calls from landlords and letting agents confused about whether
they need to return
deposits for ongoing tenancies signed before 1 June 2019. We clarify the
situation in our previous post here.
mydeposits’ deposit calculator can help landlords to comply with the Tenant Fees
Act.

Q2: I have a tenancy where the exiting EPC has expired.
Do I need to renew it? The tenant is likely to stay in the property for some
time yet.

Answer:

An
EPC is valid for 10 years after an energy survey is carried out on a property.
It can be used multiple times during this period.

EPCs
have been required by law since 2008 in England and Wales. Since 1 April
2018, all new lets and renewal tenancies must have a minimum energy performance
rating of E on an Energy Performance Certificate. These regulations will come
into effect for all existing tenancies on 1 April 2020.

For
your current tenant:

• There’s no need to
  renew the EPC before 1 April 2020 unless you are going to extend or renew the
  tenancy

• Come 1 April 2020
  you will need to renew the EPC in any event

• If you do start
  looking for new tenants, an EPC needs to be made available to prospective
  tenants as soon as you begin marketing the property

Failure
to provide an EPC when required can result in a £200 fine per dwelling.

Did you know?

The MEES
regulation deadline is soon approaching, giving landlords until the 1 April
2020 to bring their properties to a minimum Energy Performance Certificate
(EPC) rating of grade E.

Find
out more about the new Energy
Performance Certificate: Keeping your property green. And in a previous
LandordZONE post we look at MEES
regulations: What you can do to prepare for the legislation deadline.

Q3:
We have a tenant who is on benefits and as a result their landlord’s insurance
premiums increased by £200 per year.  The
landlord told me last week that he wants me to make the tenant pay him £200 to
continue living at the property. He has told me that this is allowed because
the Tenant Fees Act allows him to change the tenancy agreement (and charge
another £50!).

Answer:

The legislation allows a charge to be made for changing the
tenancy agreement, but only where the reason for making the change is reasonable.
Requiring the tenant to pay an amount of money to continue living at the
property is prohibited under the Act and not, therefore, a reasonable change.

Requesting a prohibited payment is a breach of the Tenant Fees
Act 2019. A breach of the legislation will usually be a civil offence with a
financial penalty of up to £5,000, but if a further breach is committed within
5 years of the imposition of a financial penalty or conviction for a previous
breach this will be a criminal offence. The penalty for the criminal offence,
which is a banning order offence under the Housing and Planning Act 2016, is an
unlimited fine.

Did you know?

HF Assist can offer
expert advice on tenancy agreement processes and what you can and can’t charge
fees for.

The HF Assist helpline provides expert guidance and information from call handlers who have
both legal and lettings experience. The service can be accessed by phone,
email, and live chat during business hours. Upgrading to a HF Assist Premium
subscription provides a 24/7 legal helpline covering all types of legal issues
related to a letting agent’s business plus other useful extras.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – A day in the life of HF Assist | LandlordZONE.

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