Research lays bare failure to tackle criminal landlords

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Two thirds of English councils have prosecuted no landlords for offences related to standards in or the management of private rented housing over the last three years.

 The National Residential Landlords Association is warning that this failure to take action against the criminal minority brings the sector into disrepute and risks undermining further reform of the sector.

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BREAKING: Bailiff evictions to be suspended over Xmas and New Year for a month

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Tenants facing eviction in England are to be protected from losing their homes during the Christmas and New Year period, HM Courts and Tribunal has confirmed.

Between 13^th December and 10^th January no evictions should be scheduled or executed by a bailiff, although if landlords have an urgent eviction they need to book-in following the court process ‘around these times’ then they can alert the bailiff manager of the court in question.

This is similar to last year, when bailiffs were asked that they should not enforce other than in the ‘most serious circumstances’.

The festive amnesty occurs every year but was controversial last year because it came at the end of an extended blanket ban on bailiff evictions brought in during the worst months of the pandemic. Also, at the time Boris Johnson suggested that it should be extended.

“It is never nice to evict a tenant at the best of times but especially over Christmas,” says Paul Shamplina of Landlord Action (pictured).

“This amnesty is only for a month and I’m sure that landlords whether they are affected or not would expect such an amnesty during a period of the year when good cheer and kindness are to the fore – and in the wake of the Covid pandemic.”

As last year, it is expected that Wales, Scotland and Northern Ireland will follow suit and implement similar amnesties.

This year’s announcement in England has been rolled out informally through the courts, although officially the normal procedure is for the Lord Chancellor to inform the High Court Enforcements Officers Association which then informs its members.

But in previous years before Covid, the arrangement was more informal and under the radar – and shorter – but Covid appears to have changed that.

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Landlords expected to waive rent debt for commercial tenants in trouble

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Earlier this week the Business Secretary Kwasi Kwarteng announced:

– New laws are to be introduced to provide a legally-binding process to resolve the remaining commercial rent debts

– a new Code of Practice is being published to guide landlords and tenants in how to negotiate a way through this, and

– changes are being introduced, designed to protect tenants from rent debt claims against them and help the market return to normality as quickly as possible.

Short-term breathing space

The Government has taken steps to protect commercial (business) tenants from eviction until 25 March 2022. The aim is to provide tenants in arrears with rent payments a short-term breathing space which will help protect jobs and facilitate businesses survival.

The object is to provide time for landlords and tenants to talk, to negotiate how to share the cost of commercial rent debts caused by the pandemic. From the time of the publication, Kwarteng says, these negotiations will be underpinned by the new Code of Practice, providing landlords and tenants with a clear process for settling outstanding debts before the new legally binding arbitration process comes into force.

Expectation of leniency

This Code implies that there is an expectation of leniency on the part of landlords, that landlords should, in the first instance, waive some or all of the rent arrears where they are able to do so.

From 25 March next year, new laws now being introduced in the Commercial Rent (Coronavirus) Bill will (subject to successful passage through Parliament) establish a legally-binding arbitration process for those parties who have not already reached a voluntary agreement.

Applies only to lockdown closure businesses

The Bill will apply only to those commercial rent debts that relate the mandated closure of certain businesses, including pubs, gyms and restaurants etc., during the pandemic. Rent arrears accruing outside of these periods will be out of the scope of the new legislation and subject to the normal courts jurisdiction.

The new laws will affect England and Wales. Northern Ireland will also have powers under the legislation to introduce similar rules.

The result of the arbitration process will be a legally-binding agreement that the landlord and tenant must adhere to, resolving rent arrears disputes and helping the market return to normal as quickly as possible.

Immediate effect

From 10 November 2021, the government protects commercial tenants from debt claims, including County Court Judgements (CCJs), High Court Judgements (HCJs) and bankruptcy petitions, issued against them relating to rent arrears accrued during the pandemic.

These new measures will provide further protection to businesses which have had to close causing them to accumulate debt during the pandemic. Those affected already have protection from forfeiture for their business tenancies under the Coronavirus Act 2020.

Business Secretary Kwasi Kwarteng says:

“Today’s measures provide commercial landlords and tenants with the clarity and certainty they need to plan ahead and recover from the pandemic.

“We encourage landlords and tenants to keep working together to reach their own agreements ahead of the new laws coming into place, and we expect tenants capable of paying rent to do so.”

UK Hospitality CEO Kate Nicholls OBE said:

“We welcome the publication of the updated Code of Practice. Vitally important is the emphasis on ongoing negotiation to share the burden of the impact of lockdowns and restrictions that prevented hospitality businesses from trading for so much of the last 18 months. It is in the long-term interests of landlords and tenants to come together and find solutions that ensure business survival and that do not undermine the economic recovery.

“We share government’s view that arbitration should be a last resort and this process must take into account the exceptional and existential level of pain that hospitality businesses have faced over the last 18 months. It must not impact this industry’s ability to rapidly recover and create jobs throughout the country.!

Helen Dickinson OBE, Chief Executive of the British Retail Consortium, said:

“The overwhelming majority of retailers with stores just want the breathing space to trade their way out of the debt unavoidably built up during the pandemic and a constructive agreement with their landlord.”

“While we support the principle of compulsory arbitration, the devil will be in the detail on issues around what tenant viability really means in practice and the power of arbitrators. We will engage closely and constructively with government to help ensure their proposals protect otherwise viable businesses, secure the recovery, and protect jobs.”

British Property Federation CEO Melanie Leech said:

“Property owners and their tenants should be wholly focused on working together to continue the economic recovery from the Covid-19 pandemic. The majority have already reached agreement on the treatment of Covid-related rent arrears, with millions of pounds of support being provided by property owners to tenants in distress.

“The publication of an updated Code of Practice is a clear signal and framework for the minority who have not yet done so, to come together, reach agreement and look to the future.”

Andrew Goodacre, Chief Executive of British Independent Retailers Association commented:

“We welcome this new code of practice. It encourages both landlords and tenants to negotiate and share the burden caused by this pandemic. Independent retailers have worked so hard to reach this point after the hardest 18 months we can all remember, and it would be a tragedy if the ongoing survival of the business was jeopardized due to rental debt.

“Survey data from the British Property Federation indicates that agreement has been reached on the treatment of rent arrears in the vast majority of cases – more than 80% – since the start of the pandemic.

The publication and this announcement follows an Autumn Budget which included measures to support commercial landlords and tenants. This includes reducing the burden of business rates in England by freezing the business rates multiplier for a further year – a tax cut worth £4.6 billion over 5 years – and introducing a 50% business rates discount for the retail, hospitality, and leisure sectors in England, the Government says.

New laws and code to resolve remaining COVID-19 commercial rent debts

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When is a new Council Tax banding charge applicable?

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I am currently renovating a large 3-story flat into three totally separate self-contained flats – one on each floor. Clearly, they will need to be separately CT banded – how, and when is this done?

Am currently paying the CT on the whole flat as it is currently banded

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Jon’s top tips for post-eviction peace of mind

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Jon Tatam is Head of Client and Commercial Services at Court Enforcement Services, the UK’s largest High Court and Commercial Property enforcement company. Jon is a specialist in providing recovery solutions to landlords and throughout his 10+ years in the industry he has helped landlords recover their properties, unpaid rent and other costs.

Below, Jon shares his top tips on what to give some thought to from the point of eviction onwards. They are not all essential requirements but some will certainly be very essential and others may seem drastic but if you have a particularly difficult or troublesome tenant, they are certainly worth considering.

You have successfully served your tenant with notice, obtained a Court Order for possession of your property, transferred the enforcement to the High Court to expedite the matter and the High Court Enforcement Agents are now on site executing the eviction for you….

Problem solved and you have your property back, right?

Unfortunately, not quite, there are a few more things you need to consider to fully resolve the matter:

TORTS (Interference with Goods) Act 1977

A TORTS Notice essentially gives the tenant a fixed period of time to arrange to collect all their goods and chattels from the property post eviction if they cannot achieve this on the day.

The last thing you want is to be left with a property full of your tenant’s belongings that you cannot remove and dispose of leaving you with a property that is technically returned to you but that you cannot use.

At the point of eviction Court Enforcement Services Limited (CES) will always serve a TORTS Notice simultaneously to evicting in accordance with the Torts (Interference with Goods) Act 1977.

The timescale on our TORTS Notice is typically 7 days as it needs to be deemed as reasonable, therefore, for a larger scale operation you may consider giving longer accordingly.

If the tenant fails to act within the terms of the Notice, then you can remove the goods and chattels yourself. You would not be permitted to do so if you had not firstly served the TORTS Notice.

It is a very good tool to put some pressure on tenants when they are likely to try and cause issues and delays, whether you follow through on it or not, is up to you but it could help. The test of a TORTS is have you been reasonable, so, I would not recommend providing anything less than 7 days to protect your own position.

Supervised Access

This follows on from the above tip around the service of a TORTS Notice. When the tenant wants to collect their goods and chattels how do you manage that scenario?

At the eviction and on the assumption that the tenant won’t be able to remove all their items on the day, they will pack enough for a few days and then will have to return to collect the remaining belongings at a later date.

At CES we offer a “Supervised Access” service whereby we retain the keys to facilitate this access in order to protect your position and minimise the risk of a claim for missing or damaged items (which happens more regularly than you would think) or alternatively you can handle that aspect yourself.

It essentially is a balance of cost versus risk, however, if you wanted to remain distanced from the matter and for CES to conduct supervised access for the tenants to remove their goods then we can easily organise this for you.

If you decide to handle this yourself then the key points you should remember are:

• There may be a conflict, especially given that you are emotionally involved in the matter and our attendance removes this worry.
• Have a suitable number of people present depending on how many the tenant has. I would suggest equal numbers.
• To avoid the tenants trying to reclaim possession of the property you absolutely should do the following:
  • Dead lock the doors open so that the door cannot be properly closed on you.
  • ALWAYS ensure that you or someone you have with you is inside the property. Do NOT merely wait outside.
  • If the tenant refuses to vacate, do not leave and allow them sole occupation. Call the police and/or the Enforcement Agent for assistance.
  • Keep an eye on what is going on inside to prevent any damage being caused or items being removed that my belong to you.

Property drain-down

This is a very important requirement for almost all landlords and is very regularly overlooked. Most landlord insurance policies will state that if the property is stood vacant then it must be “drained down”.

This means that the water tank, systems, central heating etc., need to be fully emptied. If this is not done and the property sustains water damage for any reason, then the insurance policy may be voided.

This is a relatively simple and speedy process and CES can make all these arrangements for you at the time of the eviction.

Security

If your tenant is particularly difficult and/or troublesome and you think they may take extreme action to try and break back into your property or land, there are many options available to add additional security to try and prevent this from happening, such measures include but are not limited to:

• Manned guarding
• Canine guarding
• Dog handling
• Concrete Barriers
• Steel protection
• PIR alarm system
• CCTV systems

CES can make the necessary arrangements for any of these additional measures to prevent an unauthorised re-entry. If the tenants do break back in then whilst it is a lot quicker to remove them a second time around by way of restitution, it does still involve a Court process and associated costs. As they say, prevention is always better than cure.

Tracing

Finally removed the tenant and all their belongings from your property but they still owe you money, maybe for rent arrears or damages, costs, or other dilapidations?

The good news is that at CES we have a range of tools available to trace your tenant to their new address. We would, however, recommend waiting at least 2 months to do this so it is not a wasted exercise. The reason being is the databases we use such as the Electoral Roll and credit reference agencies take time to update and we want to maximise the chances of locating a new address for you.

Pre-sue reports

Once we have found your ex-tenants new address what happens next?

If the Order you already have from the Court allows for the recovery of the monies owed to you then we can immediately proceed with our enforcement process to attempt recovery for you.

If, however, you only obtained an Order for possession of the property and not the monies owed it can be difficult to ascertain whether the further cost exposure to try and recover the debt amount is a worthwhile risk.

Whilst we can never guarantee a successful recovery or make a promise on the chances of one, at CES we can carry out a pre-sue report for you. This service is designed to try and ascertain the debtor’s propensity to pay and/or the availability of any assets that may be identifiable as available to assist in the recovery process.

Whether the assets are removable tangible assets such as vehicles etc., or fixed assets such as property will determine the best route to take in trying to recover, or worse case, secure your debt.

Our pre-sue reports help in identifying such assets and propensity to pay to greatly mitigate the calculated risk you would take in pursuing further recovery options.

As I said above, these measures are not all essential requirements but some will certainly be needed, and, others may seem a bit drastic but if you have a particularly difficult or troublesome tenant then they are worth considering.

Please do not hesitate to get in touch if we can help.

How Can We Help?

Contact us and discover more about how we can help you to use High Court Enforcement to speed up the eviction process as well as to locate former tenants and recover any monies owed to you:

Call: 01993 220557
Email: bd@courtenforcementservices.co.uk
www.courtenforcementservices.co.uk/landlord-zone-residential-evictions/

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Landlord added to national ‘rogue database’ after dodging HMO rules and ignoring fines

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Preston Council has added its first name to the rogue landlord database after a landlord failed to improve and licence a string of student houses in the city.

Michael Gibbons, trading as Student Accommodation Preston, was served an Improvement Notice after a tenant complained about living conditions at his HMO in Pedder Street, Ashton, in December 2018. An inspection discovered he did not have an HMO licence.

Gibbons refused to engage with the housing standards team in its attempts to make improvements at the property and a number of other student houses. The council then refused his belated HMO licence applications as he was not deemed to be a fit and proper person.

In September 2019, Gibbons was fined £12,375 for each offence. Last year, he lost both appeals – against the fines and the ruling that he was not a fit and proper person – at First Tier Tribunal hearings, preventing him from operating any licensed HMO properties in Preston. As these fines remain unpaid, the council is now in the process of enforcing them through the courts.

Gibbons appealed against being put on the national database, but in September this was abandoned. During the investigation, 13 former tenants won rent repayment orders totalling £46,908.

Held to account

Councillor Jennifer Mein, cabinet member for health and wellbeing, says the landlord has finally been held to account for his behaviour.

“Thanks to the team’s intervention and dedication, local authorities across the country will now be aware of Mr Gibbons’ record in Preston and it is likely this will severely limit his ability to operate any other HMOs,” she adds. “Preston City Council takes all tenant complaints seriously and investigates them thoroughly.”

Councils can add landlords to the database after they have made a banning order; earlier this year the government revealed that only 38 had been included since it was set up in 2018.

But Gibbons will be in sparse company – only a handful of rogue landlords have made it onto the database so far.

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‘We all need to work together to change attitudes about private landlords in Whitehall’

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A new group for portfolio landlords has officially launched today that hopes to change attitudes in the corridors of power about landlords.

During the launch event today attended both in-person and online by many leading members of the landlord community, founder Marcus Selmon revealed that his organisation now has 35 founding members who collectively operate portfolios containing some 6,000 properties.

“The UK’s landlords, the vast majority of whom are hardworking and diligent, are concerned over the current government agenda suggesting that the problems of the private rental sector (PRS) are somehow largely their fault,” said Selmon.

Called the Portfolio Landlord Action Group (PLAN), Selmon told the gathering that the initiative had been well received and that although originally only open to those with 75 properties or more, its doors may now be thrown open to landlords with smaller portfolios too.

“I want to make it clear that we are not trying to replicate other trade organisations and we are not competing against them,” he said.

Improve the PRS

He said instead PLAN would work with all the sector’s trade bodies to engage with ministers in a bid to persuade the government to work with landlords to improve the PRS rather than appearing to blame them for its failings.

“We also want to bring portfolio landlords together in order to discuss the specific challenges we experience and share information face-to-face and online about how to support ourselves – including how best to use tech to improve our service and source funding,” said Selmon.

Nevertheless, many around the table urged ministers to ‘have a rethink’ about the Government’s approach to the PRS, highlighting how many of its proposals – such as banning Section 21 evictions – will have unintended consequences.

Those interested in finding out more should contact Marcus Selmon direct via email.

Read more about PLAN.

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Confessions of a Council HMO Enforcement Officer

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Today we had an unusual communication: This morning was one of those mornings where you receive a message and punch your fist in the air with delight – discovering that there are still some good, discipline-fashioned Enforcement Officers standing up and enforcing in the right way.

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BREAKING: Landlords lauded as official report reveals PRS greener than expected

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Private landlords in England and Wales have been praised for being one step ahead of the government’s energy efficiency certificate (EPC) rules after an official report revealed that the median EPC achieved by all properties within the sector is a band D.

For a property to be rented legally, a landlord or letting agent must obtain an EPC for a property that’s a Band E or above.

But there are Government proposals on the table for all rented properties to reach a Band C by December 2025 for new tenancies and 2028 for existing ones.

The latest report on progress by the department of housing shows that in terms of median EPC band, flats and maisonettes have already reached a band C, while terraces and semis have much further to go, while detached houses are the least energy efficient.

Safe, secure, reform

“It is…good to see letting agents and landlords meeting the requirements and adhering to the rules – everyone wants to see rented property that is safe, secure and warm,” says Timothy Douglas, Policy Manager at Propertymark.

“But the UK Government’s latest proposals for EPC band C presents a much tougher challenge for many properties across the country.

“It is of no surprise that social rented dwellings are more energy efficient because the social rented sector has received significantly more funding to improve energy efficiency than the private rented sector, despite being the smallest housing tenure in England.

“With the wide range of property types in the private rented sector and proposals for a £10,000 cost cap, landlords across the country are being presented with financial and practical challenges, which if not tackled, could result in a reduction in supply and landlords exiting the market.”

Read the DLUHC official report in full.

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The Commercial Rent (Coronavirus) Bill and new code of practice

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The Department for Business, Energy, and Industrial Strategy, and the Department for Levelling up, Housing and Communities has announced the introduction of the Commercial Rent (Coronavirus) Bill into Parliament alongside a new code of practice.

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