Problems loom for ‘rent-to-rent’ as DWP demands Covid cash back

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People in receipt of Universal Credit renting in properties via ‘rent-to-rent’ arrangements face being asked to repay back-dated housing payments due to a change in DWP policy. 

The government suspended full checks after the first lockdown because it could no longer see claimants face-to-face but the department is now revisiting claims it approved during this time and asking for proof of tenancy agreements.

Housing charity Safer Renting fears renters in this ‘shadow’ part of the UK’s private renting sector will be hit hardest, where rogue landlords refuse to provide agreements or even confirm knowledge of their tenants’ existence.

According to i News, Tina Newman, 40, from Essex, has been told she must repay £5,372 of the housing element of her Universal Credit despite being able to provide bank statements showing that she had been paying rent to another tenant.

Unlicenced HMO

At the time of moving into the house-share with seven other people Tina didn’t realise it was an unlicensed HMO and says she was not asked to provide a tenancy agreement by the DWP last March.

While it would accept a written letter from her landlord as proof, he has refused to provide one and is currently denying all knowledge of Tina living at the property. He also denies operating an illegal HMO.

Rent-to-rent increase

Safer Renting says it has seen a 100% increase in rent-to-rent arrangements from March 2019-2020 to March 2020-2021 and is concerned about how many renters may be unprotected and asked to repay benefits by the DWP.

It argues that the DWP’s policy of asking for a tenancy agreement has no legal basis under Section 54 of the Law of Property Act which says you don’t need a written contract to create a tenancy unless it is to be for more than three years.

Director Roz Spencer (pictured) tells LandlordZONE: “DWP don’t seem to be interested in whether the landlord has acted properly, they just want to put the whole responsibility on the tenant.”

LandlordZONE has approached DWP for comment.

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Landlord battles Facebook after posting pictures shaming nightmare tenants

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A landlord who named and shamed his nightmare tenants on Facebook after she and her partner left their flat in a shocking state had his post taken down – then reinstated – by the social media giant.

Stephen Maxwell, from Falkirk, told followers that his post was initially removed “for bullying” but after getting local press coverage he was allowed to re-post it after Facebook agreed it didn’t breach any privacy rules.

Sharing photographs of the flat also resulted in numerous offers of help from both friends and strangers who turned up to help clear the property and take rubbish to the dump.

Stephen and his girlfriend Asha Ramzan rented out the property on Atholl Place, in the Ladysmill area of the town, to a tenant and her two children, but told The Daily Record that due to the pandemic, they weren’t able to do regular inspections.

The couple only saw the state it was in after the woman moved out; there was cat poo all over the floor, along with dirty dishes (pictured), soiled underwear and half eaten food and rubbish everywhere.

Fortune

Maxwell, 31, said: “It’s going to cost me a fortune to get this place sorted again. I gave this lassie a very low deposit to help her get on her feet and this is the horror I am repaid with.

She assured us she was getting the floor sorted last month, then this month it has been left half ripped up. The rubbish she has left is beyond shocking.”

He named the tenant and added: “This is a warning to other landlords – I really hope that nobody else is fooled by them.”

Read more about nightmare tenants.

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BREAKING: Major reforms to private rented sector planned for NI

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Tenants living with the Northern Ireland private rented sector have been promised more protection with the introduction of a Private Tenancies Bill.

If approved by the Assembly, the Bill would make it mandatory for landlords to provide smoke and carbon monoxide detectors and to carry out periodic electrical checks.

It also proposes limiting tenancy deposit amounts to one month, extending the notice to quit period, and restricting rent increases so that rent can’t be raised in the 12 months after a tenancy starts or within 12 months of a previous increase.

Communities Minister Deirdre Hargey (pictured) says the needs of tenants are at the heart of her approach.

“Private renters should have access to good-quality, affordable homes with peace of mind over the length and conditions of their rental contract. I want to see restrictions in rent increases and I want to extend the notice to quit, meaning we protect tenants when it comes to evictions.”

Electrical Safety First says the Bill finally gives tenants in Northern Ireland the same protection from electrical dangers provided to PRS tenants in England and Scotland.

Five-yearly checks

However, the charity’s chief executive Lesley Rudd, adds: “The Bill, at present, does not specify the frequency of the proposed electrical safety checks and we would urge the Assembly to ensure these are introduced on a five-yearly basis.”

Propertymark believes it will be important to get the detail right to make sure the safety measures are effective.

It adds that some aspects of the Bill could demotivate existing landlords and discourage new landlords from entering the market.

Says strategic development director Scotland and Northern Ireland, Daryl McIntosh (Pictured): “It is important to recognise that landlords make an essential contribution to local housing systems providing homes for those who need them. Propertymark will be scrutinising the Bill as it progresses.”

Read more about Northern Ireland.

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Sales (demand) still outstripping new stock (supply)

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As the stamp duty holiday price threshold drops in England, Northern Ireland and Wales, housing market demand remains above pre-pandemic levels and a record sale to stock ratio for agents has contributed to the 13.4% annual house price increase in June

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Average house price inflation cools 0.5% as Stamp Duty holiday incentive eases

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The latest Halifax House Price Index reports annual price inflation of 8.8% compared to 9.6% in May and the average UK property price now stands at £260,358.

Regions and nations house prices:

Whilst the two Midlands regions and Greater London saw slightly slower annual price gains compared to May

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