As easy as it sounds?

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Is looking to sell a property with a sitting tenant as easy as it sounds?

The Local estate agents are useless, and anyway, this is clearly a property for an investor/cash buyer, happy to leave with the current tenant or someone that wants to turn it back into an HMO longer-term (was an HMO previously

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LATEST: Landlord duo to repay tenants £34,000 after rent-to-rent deal goes wrong

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A landlord pair have been ordered to pay more than £34,000 in back rent to six tenants after sub-letting their unsafe, unlicensed HMO via a rent-to-rent deal.

James and Catherine Doig were slapped with the rent repayment order despite insisting that they didn’t know about licensing rules.

The pair had let the property in Fordwych Road, Camden (pictured), to Rosemary Espinosa and Victoria Lai since 2009 on annually renewed tenancy agreements for a monthly rent of £2,600, who then sublet it to individual tenants, collecting monthly rental payments totalling £2,920.

Camden Council officers found nine tenants in four households using the property and sharing bathrooms and kitchen facilities.

They also uncovered numerous safety issues including obstructed fire escapes, inadequate fire doors, untested fire alarms and smoke detectors that didn’t work.

There were also large piles of personal items and furniture throughout the common areas of the house.

Ignorance and confusion

James Doig told the First Tier Property Tribunal that he knew nothing about HMO licencing, pleading ignorance, confusion and an inability to manage paperwork.

He claimed the pair didn’t realise it had been sub-let but admitted they had visited the property and seen other people living there who they didn’t know.

Doig suggested that Rosemary Espinosa and Victoria Lai should have applied for a licence.

The tribunal noted that the couple had never expressed concern about the dangers faced by the tenants as a result of their failures to comply with statutory HMO letting requirements, nor did they express any regret that this had happened.

Tenants Redindo Felix, Amor Bustamente, Rosemary Burias, Esperanza Ford, Luz Tonido and Ireno Tonido will be paid a total of £34,843 as well as £300 fees. Since the council’s enforcement order the Doigs have now applied for a licence.

Read the full adjudication.

Read more: Is a landlord responsible for a rent-to-rent operator’s mistakes?

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Landlord duo to repay tenants £34,000 after rent-to-rent deal goes wrong | LandlordZONE.

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LATEST: Scots government reveals new £10m rent arrears fund

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The Scottish government is to introduce a £10 million grant fund to help tenants who have fallen into rent arrears during the Covid pandemic.

Announced by Deputy First Minister John Swinney (pictured) as part of a debate on passing the SNP government’s Coronavirus (Extension and Expiry) (Scotland) Bill.

Swinney says he expects the legislation to be ready within eight weeks and that the scheme will go live ‘later this year’.

“We will work with stakeholders over the coming weeks to develop the details. We will deliver a new national awareness-raising campaign to ensure that all tenants are aware of their rights,” he said.

“Those crucially important interventions will help tenants and landlords to move towards a sustainable and fair recovery from the impact of the coronavirus.

But the new £10 million grant fund announcement did not pass without criticism. MSP Jackie Baillie pointed out that the previous tenant hardship “fund’s criteria are so tight that less than 5 per cent of the fund has been allocated and twice as many applications have been rejected as have been approved”.

Gaps

Citizen Advice Scotland, reacting to the announcement, said: “CAS is pleased to see the Scottish Government recognise the need for exactly this kind of support.

“Our evidence has shown consistently that people were still falling through the gaps, with rent arrears mounting up through factors completely out of their control.”

As LandlordZONE reported earlier this month, landlords in Scotland are worried that the Coronavirus Extension and Expiry Bill Coronavirus Extension and Expiry Bill would mean effectively extending the existing eviction ban much further than originally envisaged, possibly by an additional six months.

Read the debate in full.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Scots government reveals new £10m rent arrears fund | LandlordZONE.

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Home Office – Right to Rent update

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The Right to rent ‘Landlord’s Guidance’ has been updated to reflect the change in legislation due to come into force on the 1st July 2021. The legislation will change the way landlords carry out right to rent checks on EEA citizens.

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Refund of SDLT surcharge upon sale to Ltd company?

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We moved from our main home in late 2019 to a new home, so we paid an additional 3% stamp duty for our new home, and we have rented out our previous home since then.

Recently we have sold our previous home to a Limited company (we are the directors of the company

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BREAKING: End to unfair leaseholds in sight as Persimmon and Aviva promise change

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A major breakthrough in the reform of leaseholds has been secure by the Competition and Markets Authority (CMA) this morning.

The watchdog has secured commitments from two of the UK’s leading players in the leasehold house market to change their contracts to end doubling ground rents and enable existing home owners to buy their freeholds at a discount.

These changes follow a campaign by the CMA to look into unfair practices within the house building sector and enforcement action last year against several developers.

It has also been revealed that the watchdog has been putting pressure on several of the institutional investors who buy freeholds off house builders once developments are completed and who benefit from often unfair ground rent terms.

The two companies involved are builder Persimmon and freeholder Aviva.

Doubling removed

The insurance giant has promised to remove doubling ground rent and retail price index-based ground rent increase clauses from existing leaseholds and revert the leasehold to their starting ground rents.

Aviva will also reimburse property owners who have been affected by doubling ground rent clauses.

Persimmon, on the other hand, is to offer leasehold house owners – which are largely concentrated in the NW of England – the option to buy the freehold of their property at a discount, and reimburse those who have already bought their freeholders without the discount.

Pressure sales

The house builder has also agreed to give home buyers more time to purchase a property after reservation to stop ‘pressure sales’ during which many people don’t have the time to understand the annual costs of owning their home.

Andrea Coscelli, Chief Executive of the CMA, says: “It’s good that Aviva and Persimmon have responded positively to this investigation, enabling these issues to be fixed for leaseholders.

“But our work isn’t done. We now expect other housing developers and investors to follow the lead of Aviva and Persimmon. If not, they can expect to face legal action.”

Housing Secretary Robert Jenrick says: “The Government asked the CMA to conduct this investigation – and I welcome their efforts to bring justice to homeowners affected by unfair practices, such as doubling ground rents, which have no place in our housing market.

“We have also introduced new legislation that will protect future homeowners by restricting ground rents in new leases to zero and I would strongly urge other developers to follow suit in amending their historic practices.”

Other developers and freeholders facing the CMA’s wrath over leaseholders include Taylor Wimpey, Countrywide Properties, Brigante Properties, and Abacus Land and Adriatic Land.

Find out more about leaseholds and freeholds.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BREAKING: End to unfair leaseholds in sight as Persimmon and Aviva promise change | LandlordZONE.

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