Council denies keeping landlords in the dark as huge licensing scheme launches

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Durham Council waited three weeks after launching its selective licensing scheme to share the news on its website – potentially leaving some landlords in the dark.

Despite announcing it had won approval back in December for a launch on 1^st April, the council’s website went quiet on the subject until 21^st April.

The NRLA and other landlord groups have often criticised selective licensing schemes for their poor communication; Southend landlords were recently frustrated by their council’s failure to update them about registration delays.

Lynn Hall, Durham County Council’s strategic manager for housing, tells LandlordZONE it had previously told landlords the application process would open in early February.

She adds: “At the same time, we contacted all landlords and agents that we had email and postal addresses for and issued public notices in local and regional newspapers.

“We also shared information with local councillors, parish councils, MPs and relevant housing advice centres and agencies to ensure details of the scheme were shared as widely as possible.”

Encourage landlords

It plans to further promote the scheme over the coming months to encourage landlords to apply before compliance checks begin; they will need to fork out £500 per property for the five-year scheme, with a £60 early-bird discount available until the end of July.

At least 29,000 properties, 42% of the county’s PRS, are covered by the scheme. Durham County Council had originally approved a plan that covered 65% of the county and included 51,000 private rented properties, however following a consultation it submitted a smaller application.

Councillor James Rowlandson (pictured) cabinet member for resources, investments and assets, says the scheme is a key objective of County Durham’s housing strategy and will raise the standards of private rented properties, improve the health and wellbeing of tenants and cut anti-social behaviour.

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BREAKING: Number of landlords chasing tenants for rental debts jumps by 180%

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The number of landlords seeking to recover debts owed to them by former tenants has risen nearly two-fold, latest figures from leading evictions specialist Landlord Action reveals.

It says that over the past 12 months the number of landlords seeking to recover money owed by former tenants has jumped by 180% year-on-year.

This is because in the past many landlords worn down by protracted eviction battles have written off debts rather than chasing tenants for repayment.

But an increasing number of renters have been using the pandemic evictions ban to wilfully dodge paying rent, rather than because they are in financial difficulties it is claimed.

And because of the 14-month PRS eviction ban during Covid, these rent arrears are now eye-watering sums, which many landlords involved cannot afford to lose.

Paul Shamplina (main picture), founder of Landlord Action and commercial officer at Hamilton Fraser, says: “We have hundreds of live debt recovery cases, ranging from a few thousand pounds right up to one where the arrears have reached £200,000.

“Admittedly, this is an extremely rare case, but what many of our cases have in common is that the tenants had the means to pay. For example, one case is against a practising doctor who owes £42,000.”

Case study: Philip Robinson

Philip had tenants who stopped paying rent in October 2019, four months prior to the national lockdown.

They remained in situ throughout the pandemic but would not communicate with him or the letting agent. 

They finally left without surrendering the keys or informing him that they had vacated. Having caused significant damage, Philip decided to pursue the tenants’ arrears through Landlord Action’s debt recovery service. In October 2021, the team recovered £14,950.

Philip Robinson says: “I have always been very fair and taken my tenants’ personal circumstances into account, but this tenant ran a company which had £250,000 in the bank.

“They abused the restrictions put in place by the Government which were designed to help those in need.

“The tenants purchased a property, renovated it and managed to pay the mortgage, all whilst living in my property for free.

“If more tenants like this knew there would be repercussions, such as a County Court Judgement, I believe they would cooperate much earlier in the proceedings.”

How do debts get paid?

Once a judge has granted possession, they will then look at the arrears schedule to see what the landlord is owed.

As part of the judgement, the judge will order that the tenant pay the arrears owed which will include costs incurred by the landlord for bringing the claim and interest in an amount the court sees fit.

The tenant will then be issued with a County Court Judgement (CCJ).  If, however, the tenant does not pay the money that is owed, the landlord can then move to enforcement by instructing a debt recovery company, like Landlord Action. 

The Money Judgment is not registered as a CCJ on the Register of CCJ’s Court Orders and Fines until the landlord attempts to enforce the judgement.

Shamplina adds: “If there are substantial arrears and the tenant is employed with a steady level of income, therefore has the means to pay, but has simply stopped paying, it is worth pursuing the money that is legally and rightfully owed to the landlord.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BREAKING: Number of landlords chasing tenants for rental debts jumps by 180% | LandlordZONE.

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LATEST: 18% of tenants rank ‘pet friendly’ lets as main priority when house hunting

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Nearly one in five tenants rank permission to keep pets in their top three priorities for renting a home, new research has found.  

A report by the Social Market Foundation, sponsored by Paragon Bank – Where next for the private rented sector? – highlights how 18% of tenants particularly look for landlords who allow four-legged friends into their homes.

Despite this, government statistics show only 7% of landlords market their properties as ‘pet friendly’. 

The survey quizzed more than 1,300 renters and found that they most value aspects that enhance their experience, with outdoor space alongside permission to own pets among their top priorities. 

The most important consideration is the monthly rent cost – a top three priority for 55% of those surveyed – followed by property size, in terms of the number of bedrooms, which is prioritised by 35% of renters. 

In terms of what is important about the area where rented accommodation is located, being close enough to work was a priority for just under one in four renters (38%), followed by public transport facilities (37%) and shops (36%).

Richard Rowntree (pictured), mortgages MD for Paragon Bank, says the study shows that tenants are likely to stay in a property for the long-term and want to make it a real home, so he encouraged landlords to consider how they can facilitate that. 

Rowntree adds: “In the current economic climate, we’re likely to see further pressure on rents but it is encouraging to know that there are things that landlords can do to improve the experience of renters.

“By listening to tenants and working to meet their needs, we can help to provide houses that people will be happy to call home which benefits the renters, landlords and wider community.”  

Have your opinion on pets heard

LandlordZONE is supporting an ongoing effort by campaigning group AdvoCATS to find out landlord attitudes to pet damage to properties. Have your say here.

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Pandemic has exposed weaknesses in rent-to-rent, PRS annual report reveals

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The weakness inherent in the rent-to-rent model have been exposed by the rent arrears caused by the economic downturn created by the Covid lockdowns, the annual report from redress scheme the PRS has revealed.

Rent-to-rent is where a landlord permits a third party – usually a letting agency – to take over the management of their property in return for a ‘guaranteed income’.

The letting agent then makes a profit on the difference between the income paid to the landlord and the rent charged to the tenants. The properties are often operated as HMOs.

But the profits can be thin and the PRS says that last year rent-to-rent was the only sector where it saw a large increase in complaints.

Landlords have been left high and dry during Covid by failed third-party firms and agents engaged by them to operate a rent-to-rent agreement – largely because losses from rent arrears rendered these types of agreements uneconomic.

“Many of these [rent-to-rent] businesses struggled during lockdown and the increase in rent arrears that resulted during the pandemic led to a lot of problems,” says Sean Hooker, Head of Redress at the PRS (main picture).

Read a recent case we reported on about a landlord trapped in a dodgy rent-to-rent agreement.

The PRS annual report also warns landlords and letting agents that the private rented sector is ‘on the cusp of dramatic reform’ when the Government’s Renting Reform Bill proposals are unveiled in the Queen’s Speech next month.

Membership

During 2021, the PRS had a membership of 16,272 estate agents, an increase of 9% on 2020 and of whom 81% are letting agents.

Landlords may soon have to join a redress scheme too – assuming proposals to include landlord redress in the Bill come to fruition.

Complaints about agents reduced by 2.4% last year to 1,872. In lettings, the top complaints by landlords and tenants about agents were a lack of ‘duty of care’, disputed terms of business and disputes over tenancy agreements, completing inventories and deposits.

The report also includes a case study involving a disputed £9,600 ‘sourcing fee’ charged by an agent to a rent-to-rent property, a case that highlights the world of such sourcing fees but also, in this case, how the description of the property failed to reflect the true condition of the property.

Read the PRS annual report in full.

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By reducing the tax on properties landlords can reduce rents?

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Following the recent sky news and shelter report regarding section 21 and many tenants being asked to leave, surely now is the time to review the section 24 tax increase, perhaps owing to some landlords having to increase rents to cover the additional tax cost?

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