Good Samaritan landlord faces £13,000 RRO despite helping tenants during Covid

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London landlord Philip Griffiths is the latest to have been slapped with a big Rent Repayment Order for renting out his unlicensed HMO, even though he helped his tenants afford their rent and was flexible when they paid late.

Griffiths tried to show the tribunal that he would struggle to finance the order, saying that coping with unpaid rent meant he had applied for a Bounce Back Loan but his repayments exceeded his income.

But a First Tier Property Tribunal ordered him to pay back £12,965 to three tenants at his house in Earlsfield Road, along with £300 costs.

The court heard that Griffiths was not aware the HMO needed a licence during the tenancy from February to December 2020. He believed that two of the tenants were classed as one household and did not fail to licence it intentionally.

Faulty electrics

The tenants claimed the house was let in a filthy and unhealthy state. They reported a rat infestation, mould on the living room wall, shower head and other areas, along with faulty electrics and plumbing, an old redundant boiler which often broke and fake or not working fire alarms.

But Griffiths disputed the allegations of poor repair and said the fact that two of the tenants were still living in the property proved its condition was not that bad.

Griffiths has been a landlord in London since 1998 and had not previously been subject to any enforcement action.

The court said: “He considers he is a good landlord and goes over and above his duties to help the tenants of property in challenging times including making allowances in respect of rent for repair issues and allowing for late payment of rent.”

However, it ruled that ignorance of the law was no excuse and gave him three weeks to pay up.

Read more: Complete guide to renting an HMO property.

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Shock figures show 46% of landlords cut rent during Covid

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New figures show that nearly half of all private landlords have reduced their tenants’ monthly rent payments during the pandemic.

Shawbrook Bank research found that 46% had cut tenants’ rent while 28% of them had offered a full rent payment holiday. 

Rental payment holidays lasted for an average of three months and cost landlords £7,500, compared to rent reductions which lasted four months and cost an average of £6,500.

These figures are much higher than data released by the National Residential Landlords Association last year which found that since the start of the pandemic, 6% of private renters had secured a reduction in their rent payments.

Shawbrook Bank polled 1,000 landlords, including 150 portfolio landlords, and 1,000 private tenants on their property portfolio and rental situation.

Rent reductions

More than a third of landlords who gave rent reductions said that they had proactively offered it to their tenant, while a further 45% said it was a mutual decision.

Portfolio landlords with four or more properties were more likely to have agreed a rent reduction with their tenants compared to single property landlords; 17% of portfolio landlords admitted to missing out on income compared to 12% of single property landlords.

The majority (59%) of landlords who gave rent reductions did this for more than one of their properties.

John Eastgate (pictured), MD of property finance at Shawbrook Bank, says landlords have acted pragmatically, recognising the additional strain their tenants were under.

In many cases landlords were initiating the conversation around cutting rents.

He adds: “This period has clearly underlined the critically important role that the private rental sector is playing, and will continue to play, in the UK housing market.

“Responsible landlords have shown their reliability during a crisis, understanding the changing needs of their tenants and acting quickly.”

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Robert Jenrick pays a heavy political price for his anti-landlord stance

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Housing secretary Robert Jenrick has polled near the bottom of a cabinet league table compiled by the party faithful who have slated his performance in recent months.

In the Conservativehome.com online poll of Tory voters, Jenrick came third from bottom with a paltry 1.3 point rating; only party chair Amanda Milling and education secretary Gavin Williamson fared worst, with a -14.3 and whopping -44.1 point score respectively, while Boris Johnson is only just above him with a 3.4 point score.

In stark contrast, Chancellor Rishi Sunak has a 74.1 rating, while even Home Secretary Priti Patel garnered a 26 point rating.

Landlord worries

Tory voters are no doubt worried about tax and regulation increases for landlords, as well as the eviction ban.

Jenrick has also fared badly across other areas; in May 2020, he was involved in controversy when he overruled the Planning Inspectorate and approved a £1 billion luxury housing development for Conservative Party donor Richard Desmond.

He was also criticised for his response to the national crisis following the Grenfell Tower fire.

High-flyer Jenrick, who won his cabinet post as part of Johnson’s 2019 reshuffle, is the 18^th minister in 21 years in a department which is still seen as a secondary area of importance, where ministers must fight for influence and funding alongside other priorities.

This is evidenced by the quick departure of many former housing secretaries and ministers such as Brandon Lewis (19.2 point rating), Sajid Javid (66.6), Alok Sharma (26.8) and Grant Shapps (17.5) who are better regarded by rank and file now they’re in new jobs.

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LATEST: Councils’ are ‘doing too little’ to tackle rogue landlords, says NRLA

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Criminal and rogue landlords are very unlikely to be fined over their activities with just 3,500 penalties issued by local authorities since 2018, it has been revealed.

This is despite ministerial claims that there are 10,500 such landlords in operation, says the National Residential Landlords Association (NRLA).

“Our findings show that most councils are failing to use all the tools available to them to tackle rogue and criminal landlords,” says Chris Norris (pictured), Director of Policy and Campaigns at the NRLA.

“By failing to apply appropriate sanctions to punish wrongdoing, councils are weakening the principle of deterrence which underpins the civil penalties regime.

“We are calling on all councils to ensure they are making full and proper use of the powers they have to tackle those landlords who cause misery to tenants and bring the sector into disrepute.

“The Government’s plans to reform the private rented sector due later this year will mean nothing if changes are not properly enforced.”

FOI requests

The NRLA quizzed local authorities across the UK via multiple Freedom of Information requests and found that very few had issued civil penalties against errant landlords, which can reach £30,000 under current rules brought in three years ago.

It also found that over half of authorities had not issued any civil penalties since these regulations were introduced.

Of those that did, most had issued only a handful with 71 per cent of all civil penalties being generated by just seven per cent of local authorities. And 40 per cent of councils that had issued civil penalties issued between just one and five penalties.

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Built-to-Rent chief says landlords leave tenants ‘in fear of eviction’

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The CEO of the UK’s largest listed residential landlord has taken aim at private landlords whom she accuses of leaving tenants in constant fear of eviction.

Helen Gordon, boss at Build to Rent expert Grainger, told Property Week that it had a stronger social conscience than many of its competitors.

“On the topic of Environmental, Social and Governance, our ‘S’ is much stronger than many other property companies. Anyone renting with a buy-to-let landlord is worried they’ll be served notice at any time. In a Grainger block, people are working all the time to make sure you stay with us.”

She adds that as the country has reopened, demand has swelled for its high-quality, professionally managed rental product. “We launched schemes in Southampton and Manchester at the end of March,” Gordon says.

“Our Southampton scheme has beaten all records – it’s now fully let. We had allowed a year to lease it up, and it happened in under four months. And in Manchester, 140 units have already been let.”

Technology

Gordon believes the emphasis Grainger places on technology and service is a key reason for continued demand for its properties.

“We have superfast broadband going into each apartment, not being split at the building,” she points out. “We doubled the speed for our customers during the pandemic.

“Grainger offered co-working spaces, gyms, extensive cleaning regimes and even parcel collection. We were doing shopping for people. That really differentiates us from the buy-to-let landlord who may have been absent.”

The firm, which has 9,000 operational units, with another 9,000 in the pipeline, boasts that it has been particularly resilient during the pandemic, with rent collection levels at about 97-99%, while others have struggled. Gordon suggests that local councils struggling to meet housing targets should also consider partnering with Build to Rent developers.

Read the Property Week article in full.

Read more about build-to-rent.

Pic credit: YouTube.

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Tory MPs declare war on landlords who convert rural rentals into Airbnbs

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Tory MPs have declared war on landlords in holiday resorts who are kicking out tenants to convert their properties into Airbnbs.

Totnes MP Anthony Mangnall is set to declare a housing emergency by the autumn, reports The Times, as locals have been left homeless by soaring property prices and the staycation boom.

“There are just 19 properties you can rent long-term in the whole of South Hams on Rightmove, yet there are 300 advertised on Airbnb in Salcombe, another 300 in Kingsbridge, a similar number in Totnes. Yet we have hospital staff who can’t find anywhere to live, RNLI crew that can’t live in the town they serve,” says Mangnall.

Holiday spots

Fellow Tories in the South West – Steve Double and Derek Thomas – and Duncan Baker in North Norfolk want housing secretary Robert Jenrick to introduce a range of measures to ease the housing crisis in key holiday spots.

Plans include regulation of Airbnb-style rentals, incentives for landlords to rent to local people, the building of more affordable homes, restrictions on the number of holiday and second homes and the ability to impose council tax surcharges on second homes.

They say the pandemic has accelerated a problem which has been brewing for years fuelled by low interest rates, cheap mortgages and a stamp duty tax cut.

Tim Farron (pictured), the Liberal Democrat MP for Westmorland and Lonsdale in the Lake District, has also launched a petition urging a change in planning laws to stop family housing being turned into second homes and holiday lets.

In the first six months of 2021, 14,660 second homes were bought in Britain according to Countrywide, which is the highest number since 2009. Across the UK, the number of new rental properties being listed is down 14% compared with the 2017-19 average, according to analysis by the property portal Zoopla. In Cornwall, it has dropped by 44%.

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INTERVEW: Meet the landlord who’s built an ‘Airbnb for long-term lets’

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If anyone was likely to build a renting platform for landlords and tenants then it should be Toks Adebiyi, who has observed rental property from every angle.

The 38-year-old is a landlord but has also been a tenant, run a property investment group with 1,000 members, established his own estate agency and trained as a letting agent.

But it took one of his tenants ringing him while he was on holiday to set him on a path to what would become Clooper.

“I had been managing my properties via pretty crude methods of paper and maybe some Excel spreadsheets and I had always meant to try and build a digital solution,” he says. 

Better way?

“But it took a tenant phoning me on holiday requesting that something be fixed that was the final straw – surely there had to be a better way, I asked myself.”

Clooper has been in development for several years and he describes it as an Airbnb for the long-lets market rather than another landlord platform or an online estate agent.

“We are building a social platform that is home-centric and enables our users to be better landlords,” he says.
One key element of the platform is that landlords can, if they are busy or on holiday, enable tenants to get quotes to have issues fixed – the landlord then signs off the best quote.

The platform launched in earnest during March this year and in June raised £400,000 in seed funding from over 300 investors on website Crowdcube.

Empire Property

This included a major contribution from Paul Rothwell, the MD of commercial-to-resi developer and landlord Empire Property.

“Clooper has been built to serve the smaller landlords who will never use an agent because they prefer to manage their properties themselves, which is around 60% of the market,” he says.

“I like to think they are people who want to do it themselves but do it properly – and we already have many landlords using us who like that.”

Adebiyi says a more advanced version of the platform called Clooper PRO is waiting in the wings that will be for larger landlords and letting agents too.

Read more about Clooper.

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Check properties every three months or risk tenants from hell, landlords warned

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A buy-to-let investor in Bradford has called on fellow landlords to inspect their properties every three months after a ‘tenant from hell’ trashed his terraced house and cost him thousands in repairs and lost rent.

Hassanin Al-Assan has contacted LandlordZONE after a year-long saga that started when he rented his property (pictured) in the West Bowling district of the city.

The tenants started out as a hard-working couple with two children but after a few months began reporting damage to the property including a broken side-door lock, front door handle and, on the final occasion, a smashed rear kitchen window.

NHS job

“Just after they moved in I took a job working for the NHS in Glasgow so I had to leave Bradford and, along with several Covid lockdowns, this made it difficult to keep an eye on the house,” says Al-Assan.

“When the damage occurred I organised for the items to be replaced, but then the police called to say that the woman, who appeared to be living in the property with her kids but no partner, was being re-housed after anti-social behaviour outside the property.”

Drug use

The landlord says it transpired that the woman had been smoking cannabis in the house and owed money to her dealers, who had been causing the damage to the property.

“I asked a friend to check on the house and it was a total mess – dirty throughout including spliff butts everywhere, broken doors, windows and generally in a terrible state,” he says.

The tenant left the property without having to be evicted but Al-Assan say quotes to reinstate the house are around £3,000 on top of lost rent.

“I would urge all landlords to check their properties every three months and have that written into their tenancy contracts,” he says.

“And if you don’t have the time to do that, then use a letting agent; the cost and hassle are a lot less than the nightmare I’ve been through.”

Read more about tenants from hell.

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Relaxation of the planning laws could lead to poor quality housing

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From the 1^st of August, developers will be allowed to convert a wide range of business premises into residential apartments and flats.

Office to residential conversions are already allowed under permitted development rights (PDR), but as from 1^st August these rights are to be extended to include Covid hit vacant shops, restaurants and gyms.

There are of course some safeguards. To be eligible for these conversion rights, developer’s proposals must meet specific limitations and conditions set in the legislation. In some cases a prior approval application is required and even where a scheme meets all the PDR criteria developers can ensure that a scheme is lawful by applying to the planning authority for a lawful development certificate (LDC). In all cases initial consultations with local planners is essential.

The move to relax restrictions on conversions through PDRs, it is hoped, will help regenerate Covid hit town and city centres that will struggle to recover during and after the pandemic.

However, a recent study by insurers Zurich UK warns that some of these conversations are likely to lead to poor quality housing which not only fail to meet recognised space requirements, they will be vulnerable to overheating in summer.

With housing provision high on the political agenda, reforming the planning system has been a recurring theme over recent years with extensions of permitted development rights introduced in 2005, 2010, 2013 and 2015 and now in 2021.

A recent research report published by RICS has highlighted the benefits but also the problems introduced by extending permitted development rights. By having building conversions proceed without formal planning approval in England it limits planning authorities control.

Of five local authorities studied by RICS, with high rates of permitted development schemes, Camden, Croydon, Leeds, Leicester and Reading, including site visits to 568 buildings, inconsistencies were found in the quality of developments. RICS found that only 30% of conversions delivered through PDR met national space standards.

While the chartered surveyor’s body did find examples of “extremely high-quality housing conversions”, there were also examples with “no amenity space, low quality design and were poor locations for residential amenity.”

The study concluded that office-to-residential conversions under PDR had produced a higher number of poor quality housing than those governed through full planning permission.

The Zurich UK study warns that the drive to convert more town and city centre commercial space into residential housing risks creating more poor quality homes that are vulnerable to overheating in the summer.

The company fears that “A rush to redevelop shops and offices left empty by the pandemic could create a swathe of sub-standard homes that are vulnerable to climate change.”

Zurich thinks the problem could be so severe that small self-contained bedsits and studio flats in particular “could potentially become uninhabitable during increasingly hot summers.”

Warning that properties in built-up areas, towns and cities, are affected by what is termed the “urban heat island” effect, where temperatures are much hotter than suburban and rural outlying areas. There is also the danger in some locations of flash flooding as we have seen in recent weeks, caused by heavy downpours on mainly paved, tarmacked and concrete surfaces.

Tony Mulhall, associate director of the land professional group at the Royal Institution of Chartered Surveyors say:

“The post-Covid city may need to quickly adapt to new modes of behaviour, which could see many building types adapted for purposes not originally intended.”

According to the Climate Change Committee (CCC), the independent body which advises the government on climate change, says that already 20% of homes in the UK are susceptible to overheating. This, the organisation warns will result in a tripling of the heat related death toll by 2050 as temperatures continue to climb.

According to the Zurich UK study, over 64,700 flats have been converted from unused offices in the last five years and between January and March this year, applications for office-to-residential conversions in England have risen by 28%, to a three-year high.

Developers are currently buying up office blocks which have been left vacant by an exodus of workers from city centres and which are now ripe for conversion to residential. The conversions typically have large windows, but no air conditioning. If all the windows face south, it can create a sweltering flats, with no escape from the heat.

A government spokeswoman for Housing, Communities and Local Government (HCLG) has refuted some of Zurich’s claims, arguing that the claims are based on unfounded assumptions and that homes delivered through PDR have continued to make an important contribution to housing delivery.

“Our reforms will transform unused buildings into much-needed new homes, and all new homes must be of high quality and meet national space standards and building regulations, including ventilation requirements,” the spokeswoman said.

Mr Mulhall for RICS has said that the changes to PDR mean:

“A generation of hermetically sealed commercial buildings may now fall into this category to be repurposed for housing, needing to satisfy a completely different set of standards.”

Adding that energy poverty may mean that some residents cannot afford to heat their homes during the winter, “The other increasing concern is residential buildings which, due to increased natural temperatures, are tending to overheat,” he said.

Those flats developed out of a commercial buildings, from a large square floor-plates, often have only one facing aspect and no outside space which this means they can’t get the cooling effect of a good through-draught.

Zurich says it wants ministers to look at ways to climate-proof buildings, including cooling measures in flat conversions. Fitting heat-reflecting windows, installing window shutters and sunshades and using reflective surfaces and improved ventilation systems are suggested solutions.

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BREAKING: Managing agent bodies ARMA and IRPM put merger proposals to members

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The Association of Residential Managing Agents (ARMA) and The Institute of Residential Property Management (IRPM) have proposed a merger.

The UK’s two largest property management profession bodies want to establish a united and stronger voice for the industry, at a time when managing agents and property management professionals face unprecedented changes and as legislation begins to make its way through Parliament. 

ARMA executive chair Nigel Glen (main image, left) says the bodies have worked together on a wide range of topics including the building safety crisis, sector mental health and wellbeing and regulatory reform.

A merged organization would give it greater power and enable it to support both managing agent firms and professional individuals. 

Effective support

“Combining our resources, data and expertise allows us to more effectively support our membership through guidance and business support, raise standards through enhanced professional qualifications, multi-channel training and ongoing professional development opportunities, and provide a more influential and representative voice to our ongoing government and stakeholder engagement,” says Glen. 

The proposal would be subject to approval by members at their forthcoming general meetings.

If approved, the two organisations and their respective secretariat teams would come together before the end of the year and the two brands would be retained for a period of time under the new organisation.

It is proposed that IRPM CEO Andrew Bulmer would become CEO of the new organisation, while Glen would become the executive chair of the new board. 

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