Have you paid a problem tenant to leave?

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My name’s Melissa Lawford and I’m the property correspondent at The Telegraph. We’re running a story on a report which says that some landlords who are worried about the slow and restrictive eviction process have tried to pay problem tenants to leave their properties.

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83% of PRS tenants are happy with their homes

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Figures from the English Housing Survey for 2019/20 report that 83% of private renters were satisfied with their current accommodation, a figure that has remained constant over the past 10 years.

In comparison, the proportion of social renters satisfied with their accommodation stands at 78%

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LATEST: Tribunal backs landlords over contested Rent Repayment Order claim

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An evicted tenant’s claim for a Rent Repayment Order was rejected after she failed to prove her former home was an HMO.

A First Tier Property Tribunal ruled there was no evidence the four-bedroom house in Enfield Terrace, Birkenhead had needed an HMO licence in August 2019 – just before tenant Abbey Stewart was forced to leave following a possession order.

It heard that Stewart moved into the property in June 2018 agreeing to pay landlord couple Mark and Myriam Spence £360 rent a month.

She shared the property with three others while the couple were abroad. Rent totalling £1,047 was paid between June and October 2018 but no payments were made until October 2019 when £690 was paid.

Court proceedings

In March 2019 they began court proceedings and, following a hearing in the Birkenhead County Court, repossession was ordered by 29th August, and the couple were awarded a money judgement for rent arrears of £4,061.

Stewart claimed the property should have had a licence. She also complained it did not have adequate fire exits, while she was not given any formal documents such as ‘how to rent’ or a gas safety certificate. She said the couple ignored her requests to try to pay the rent and claimed to have been harassed.

Rules broken

The Spences said they had rented out the house – their sole property – to friends. They told the tribunal that Stewart broke all the house rules; as part of their repossession claim they said she regularly brought illegal drugs into the property and held rave-style parties. They did not accept it was an HMO at the time and denied any intimidation.

The tribunal ruled that while there may have been times in the earlier part of the tenancy that the property was an HMO, it was clear that Stewart was the only occupier of the property during August 2019, if not also for a period before that. It also found no compelling evidence of any other relevant offence having been committed.

Read a guide to renting HMOs.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Tribunal backs landlords over contested Rent Repayment Order claim | LandlordZONE.

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Commercial rent arrears on the decline – new research

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The pandemic has created a swath of tenants in arrears with their rent payments, but there are encouraging signs the worst might be over, says Tom Entwistle

Property management software company, Re-Leased collected anonymised and aggregated data directly from over 10,000 UK properties and 35,000 leases, not relying on surveys or secondary data collections.

The company says it is confident about the validity of this data as its formation is a direct result of bank statements, with entries being matched and reconciled to rental invoices.

Their research took data samples of new rent collection figures to analyse rent collections 7 days after commercial rents were due on 24th June 2021. The figures reveal that commercial tenants in the UK over all sectors have paid 50% of all rents due at the 7-day mark since the June quarter day, which is down just 1% from the same point in the previous March 2021 quarter.

This shows an increase of 32% compared to rent collected on day 0 of the June quarter and an increase of 4% compared to rent collected at day 7 of the June 2020 quarter.

Industrial

In the industrial sector rent collection was flat at 7 day mark. After a slow start, rent collection for industrial assets mirrors almost exactly that of collections last quarter.

But industrial assets have not experienced the same level of resilience as the office asset class. Industrial rent collection has struggled to match the high performance which was commonplace pre-pandemic.

Retail

Retail rent collections have continued to improve as landlords collected 52% of rent due at the 7 day mark, an increase of 3% compared to the equivalent period for the March 2021 quarter. Retail rent collection is also up 12% on the levels seen a year ago. Despite the re-opening of retail in the second quarter, retail continues to be the poorest performing sector.

The Office Market

Office properties continue to be the most resilient asset class of them all. Compared to the other sectors, rent collection levels for office properties are the closest to pre-pandemic levels of all the sectors, up 4% compared to the same point in June last year.

While they are down 2% compared to the equivalent period for the March 2021 quarter, the sector is up 21% compared to December 2019, the last quarter before the pandemic measures came into play.

The Regions

According to Re-leased the North East region of England experienced the most significant decrease in rent collection levels, down 9% compared to previous quarter. Landlords in London have also seen a slow start to rent collection for the quarter with just 37% of rent collected.

The West Midlands however, continues to see the highest levels of rent collection at day 7 with 59% of rents collected in the region 7 days after the June 2021 quarter day.

Caleb Dunn, Product Manager at Re-Leased says: “The pandemic has been a huge instigator for change in the real estate industry. Over one-year on from the outset of the pandemic, our data is showing that credit notes are continue to fall following the peak in September.

“The office sector has seen the most significant drop in rent credited since this time last quarter.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Commercial rent arrears on the decline – new research | LandlordZONE.

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London Mayor predicts 20% rent hike unless he gets rent control powers

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Sadiq Khan has warned that Londoners could see private rents rise by almost 20% over the next five years unless he gets powers to control the sector, emboldened by his recent re-election.

The capital’s mayor cites new analysis by City Hall which shows that, if left unchecked, average asking monthly rents in the capital could rise to almost £2,300 by 2025.

Despite the cost of renting falling in some parts of London during the pandemic, it still has some of the highest rental costs in the world, with Londoners paying on average 35% of their income on rent.

Khan was re-elected in May, pledging to lobby the government to give him the power to introduce rent controls through a proposed London Private Rent Commission.

He has also called for powers to freeze private rents to protect renters from the ongoing financial impact of the pandemic.

Since being in office, he has introduced two online tools enabling Londoners to name and shame rogue landlords and allowing renters to check whether their landlord has a property licence. 

Khan says he plans to stand up for London’s renters by transforming tenancy laws and wrestling back control of runaway rents. “Todays’ analysis paints a stark picture of the next five years if landlords are allowed to increase prices unchecked,” he adds.

“If we want the next generation of nurses, police officers, transport workers and key workers to train and work in the capital, we have no option but to keep a check on spiralling rents.”

Alicia Kennedy (pictured), director of Generation Rent, says: “Over the past decade it has become impossible for many people to live close to their workplace or support networks they rely on, while others cannot afford to start a family.

“Without urgent action on rent levels, more Londoners will face these dilemmas in the 2020s and quality of life will deteriorate.”

Read Landlords’ reaction to rent controls.

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Are you a property voyeur?

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Research by viewings platform, U-See Homes, has indicated half of UK homebuyers admit to being virtual property voyeurs, viewing a property online without the intention of buying, with 16% going as far as viewing in person.

However

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RICS hopes Building Safety Bill is a step change

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RICS responded to the publication of the amended Building Safety Bill for England saying the Government’s proposals, alongside the publication of the Fire Safety Act earlier this year, should ensure that this country never allows a tragedy like Grenfell to occur again.

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