ADVICE: Robust referencing and regular visits vital amid cannabis farm boom

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The recent story of a Nottinghamshire landlord who tipped off police when he couldn’t gain access to his property, but could smell cannabis, serves as the latest reminder to landlords to carry out a thorough tenant referencing check and make regular visits to their property.

In this case, the police arrested two men after discovering a cannabis farm in the rental property, where some 200 plants were being grown and the electricity had been bypassed.

Following a nationwide boom in the illegal cannabis industry over lockdown, police have been urging landlords to carry out regular checks on their properties.

Leicester police report closing down at least one cannabis set-up every week, while Nottinghamshire Police have seen a rise of 280 per cent in cannabis plant seizures during lockdown compared to the same period last year.  

And nationally, police say that more than 90 per cent of cannabis farms are set up in residential properties. Rented properties, the police warn landlords, are particularly attractive due to the lack of paper trail, which means that they can’t so easily be connected to the gangs running the operations.

Steve Barnes, Associate Director at Hamilton Fraser Total Landlord Insurance, explains how landlords can make sure they are protected should they discover their rental property has been turned into a cannabis farm.

“Firstly, landlords should check that their policy covers malicious damage, as many don’t. Our premier policy offers protection against malicious damage by tenants and their guests, as well as loss of rent resulting from the need to carry out repairs. But for a claim to be successful, you’ll need to provide evidence that you did all you could to prevent the damage from happening in the first place.

Although carrying out regular visits and thorough referencing checks may be a bit more complicated in a pandemic, these figures highlight how important they are. If anything goes wrong, to make a successful claim you’ll need to be able to show that your tenant passed a full and robust four-point reference check and that you carried out regular inspections.

Our updated guide to tenant referencing contains all the information you need to know about referencing and what a four-point check involves.”

The police have appealed to landlords who suspect foul play to look in on their homes, at least from the outside, every three months, as this is about the time it takes for a cannabis plant to provide a yield. 

The tell-tale signs of a cannabis farm include a strong smell of cannabis, blacked out windows, excessive condensation, powerful lights, fluctuations in electricity bill and birds gathering on the roof as it is warmer than others in the street.

Find out more about the signs to look out for and the steps you can take to minimise your risk in Hamilton Fraser Total Landlord Insurance’s guide, The growing threat of cannabis cultivation for landlords.

Cannabis farms pose a real threat to landlords today – not only is the production and distribution of drugs often linked to more serious organised criminal activity related to drug dealing networks, as well as violence. But cannabis farms cause enormous damage to a property.

Cannabis can be extremely dangerous due to the fire risk, especially if people are living in adjoining properties. Hamilton Fraser Total Landlord Insurance has seen a rise in cannabis farms, in particular those that cause major fires within properties due to the rewiring of electrics and overloading of sockets from heat lamps.

Case study

“The landlord had been trying to contact the tenants to collect rent for the forthcoming month but was not receiving any reply. So they decided to drive past the property and saw the police removing bags of material from the flats,” says Melissa Choules (pictured), Senior Claims Technician at Hamilton Fraser Total Landlord Insurance.

“The police officers explained that the property was being used as a cannabis factory and made the property secure while they carried out their investigations.

“The tenants had caused extensive damage where they had used the bedrooms to grow cannabis. They had knocked down walls and made holes in the ceilings, rewired the electrics and reinstalled the plumbing systems. In this case, the landlord had completed full tenant reference checks and carried out regular property inspections.

“Because they had done everything they could to prevent this from happening and were able to provide evidence, the insurers paid out £25,000 for the buildings damage and £350 for loss of rent.”

The coronavirus pandemic may have made it more difficult to carry out referencing checks and property visits, but it has also caused a nationwide boom in cannabis farms. Landlords need to be aware of this and do all they can to minimise risks by making sure they have adequate landlord insurance, are carrying out robust referencing and regular visits to their rental properties. 

As a valued LandlordZONE reader you’re entitled to 20% off Hamilton Fraser Total Landlord Insurance’s policies, call the team today on 0800 63 43 880 quoting code LZ2021 or get a quote online in under 4 minutes. 

Pic Credit: Cannabis Urlaub via Flickr.

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