LEGAL LATEST: Landlord’s leasehold cancelled after ignoring anti-social tenant complaints

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A London landlord has had his leasehold cancelled after ignoring neighbours’ pleas to deal with an aggressive, anti-social tenant for more than a decade.

Neighbours Mr and Mrs Kandala claimed Andrew Cripps, who owns the leasehold on a property in St Ann’s Way, South Croydon, was in breach of lease covenant for allowing his tenant to cause damage, annoyance or inconvenience to the neighbourhood for 11 years.

Prolonged abuse had taken its toll and led to serious mental and physical health issues for Mrs Kandala.

Failure to respond

A First Tier Property Tribunal heard that despite writing to the landlord many times, he had failed to respond constructively to their letters or take any action. In an email from October 2019, Cripps replied to a letter complaining about the sub-tenant’s conduct, saying: “I apologise for any inconvenience/damage caused and please be advised I am taking this matter extremely seriously.

“We will of course give him notice if he continues to behave in this way.”

In 2010, the tenant was issued with a harassment warning by the police after setting fire to the Kandala’s back garden, but Cripps again did not reply to letters and the cost of repairs was met by the residents association.

“The tenant also let his dog foul in neighbours’ front gardens, parked across their garage and made regular threats of violence, screaming and shouting directly at the couple.

They said: “The residents association recently informed us that a notice requiring possession was served on the subtenant by Andrew Cripps. The subtenant immediately took to making repeated offensive sexual gestures to Mrs Kandala.”

The tribunal was satisfied that this was clear evidence of completely anti-social behaviour, amounting to breach of covenant. It also ruled that as Cripps was not named as a joint party on the building insurance policy, this was also a breach of covenant.

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Tenants’ rent tribunal win may cost billionaire landlord dearly – claim

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Billionaire landlord John Christodolou could face a deluge of rent claims after a judge ordered him to pay back £18,000 to former tenants in his Stoke Newington block.

The three members of Somerford Grove Renters (SGR) campaign group received a Rent Repayment Order for eight months’ worth of rent.

It has promised to file nearly 50 more cases from tenants, representing half a million pounds in possible claims, after a First Tier Property Tribunal heard how the 56-year-old tax exile had failed to license an HMO in Simpson House, Somerford Grove.

The tenants told the tribunal that their landlord had neglected to install fire safety measures. They also reported a lack of heating and hot water, poor building maintenance and lack of pest control measures

But a director of his investment company said that maintenance works had been carried out promptly when complaints were received.

Rent reduction

Last summer, SGR wrote to the lettings agent that represents Christodoulou, Tower Quay, asking for a rent reduction for struggling residents in next-door Olympic House (pictured, above), which he largely owns.

After initially saying renters’ requests for relief would be dealt with individually, they were turned down and instead told to use money saved on lunch, holiday, entertainment, clothes and travel to pay rent, it is claimed.

The judge ruled: “The tribunal does not accept that…a company with a large property portfolio could not have become or made itself aware of the additional licensing scheme that had come into effect on 1st October 2018.”

One of the winning tenants, Marc Sutton, told the Hackney Citizen that the victory would be the first of many. He said: “Our billionaire landlord responded to a request for a rent reduction by those of us who have lost income due to the pandemic by issuing eviction notices.

“After a year of campaigning and fighting, we are thrilled to have achieved such a major win, the first of many more to come.” 

Read the tribunal ruling in full.

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Five-fold increase in London rent repayment orders this summer

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London councils are relying more heavily on low-cost ways to penalise landlords and letting agents, resulting in a whopping 532% increase in Rent Repayment Orders during the last three months.

Fines totalling £139,146 were handed out in July, more than doubling June’s figure of £42,500 and up on May’s figure of £22,000, reports geospatial technology firm Kamma.

Its analysis of the Mayor of London’s Rogue Landlord and Letting Agent Checker (RLAC) shows £6.5 million in fines have been handed out since it was set up in 2018.

Both landlords and agents are at risk, with landlords fined more often and agents fined more heavily; the largest single fines ever recorded are £100,000 for a landlord and £167,000 for a letting agent.

Despite housing officers’ work being impacted by lockdown rules and regulations, this data reveals a dramatic return to enforcement practices, says Kamma CEO Orla Shields (pictured, below), who adds that councils are also deploying tenants to support enforcement in a low-cost way by using a checker search tool.

“While the pandemic seems to have reduced enforcement levels, it did not slow the level of regulation which is higher now than at any time before,” she says.

Tower Hamlets Council has issued almost 70 RROs, reclaiming £200,000 in rent, and with other local authorities following suit it’s more important than ever that agents get up to speed, advises Kamma.

“As the NRLA has recently pointed out, it’s right that councils enforce their own regulations, which otherwise would be a tax on good landlords, with rogue individuals continuing as before,” adds Shields.

“The danger is that good landlords and letting agents offering high quality homes to market could still get caught out by a change in regulation. With tenants acting as enforcers, agents and landlords have to stay one step ahead.”

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Rent arrears at lowest level for ten years, landlords reveal

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The average number of tenants in rent arrears is at its lowest point for ten years, according to Paragon Bank, while the amount of outstanding rent is the lowest since 2017.

New research shows that in the second quarter of this year, landlords had an average of 1.3 tenants with outstanding rent payments, the lowest number since the first quarter of 2011 when research agency BVA BDRC started its survey.

This has continued to fall consistently after climbing to 2.1 in Q2 2020, as the Covid-19 pandemic hit incomes.

The average amount of outstanding rent has reached a four-year low, adds Paragon, after falling from £2,376 in Q1 2021 to £1,781 in Q2, and the lowest figure since the end of 2017 when it was £1,584.

Rent reductions

The survey of more than 750 landlords found that just over a third (36%) have had a tenant request a change to their rent, most commonly rental holidays (18%) or a reduction in rent of up to 20% (14%).

Agreements were reached in almost all cases as 36% of landlords said they had granted requests to some form of change. These requests have also been falling off since the start of the pandemic, with the proportion of those asking to change rental agreements dropping by seven percentage points year-on-year.

Moray Hulme (pictured), Paragon Bank’s director of mortgage sales, says the vast majority of landlords are supporting tenants.

He adds: “These requests have been falling alongside the incidences and volume of rent arrears, and considering that the fewest number of people are now on furlough since the scheme launched in March 2020, it is a good indicator that the economy is bouncing back well.”

Read more about rent arrears.

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Bold action needed to save the PRS

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Covid-19 restrictions are easing, so now is the time to take decisive action to support landlords and tenants. NRLA chief executive Ben Beadle shares his thoughts on the country’s rent debt crisis and what the Government can do to tackle it.

After months of emergency restrictions as a result of the Covid-19 pandemic, measures are now being lifted.

It has been a tough 18 months for the sector – and while we are pleased change is coming, following extensive talks between the NRLA, ministers and civil servants, more is needed.

Latest figures show that a debt crisis is on the horizon.

New research carried out on behalf of the NRLA shows more than 800,000 of those living in the private rented sector in England and Wales have built arrears since lockdown measures started last year.

This is despite 82% of those owing no rent debt prior to lockdown.

We need the Government to step up to help these tenants and the landlords who house them.

Campaigning

We have been campaigning for a comprehensive package of financial support for the sector for some time now and we continue to lobby the Government to commit resources to this to help maintain tenancies and ease the pressure on the already overburdened legal system.

Those landlords who have no option but to repossess will also need support.

Recent figures show average waiting times from claim to possession were more than a year (57 weeks) in the first quarter of 2021 and action must be taken now to reduce that backlog.

Possession claims fell considerably during the pandemic, with the courts closed and landlords doing all they could to keep tenancies going.

If we want the courts to be able to tackle the backlog, then we need to keep those tenants who are in arrears as a result of the pandemic in their homes. We need to tackle the issue of arrears head on.

The NRLA’s proposal, for ringfenced Government support, includes interest free loans to allow tenants to pay off Covid-related arrears and stem the number of cases going to court, as well as grants for those claiming benefits.

Court figures

Latest figures show almost 23,000 possession claims have been made since the courts closed in March 2020. However, the same time frame only 8,600 possession orders have been issued.

This leaves a substantial proportion of claims – more than 60% – still unheard.

There are also enforcement issues.

Bailiff enforcements were permitted as of June 1 in England. At this point there were around 11,000 warrants, 70% of which are estimated to have pre-dated the pandemic – and the figures are only going to go one way as news claims are submitted.

However, there are changes that can be made by Government to streamline the process and help tackle this backlog.

These include:

• Getting rid of the additional ‘review’ hearings. These were introduced during the pandemic as a means of prioritising cases, but are now contributing to the delays
• Making greater use of digital remote hearings over the phone or online for simple cases
• Increasing the use of High Court Enforcement Officers to tackle the backlog of enforcement

There are also a number of technical administrative changes which could also make a difference when it comes to wait times.

The NRLA has produced an in-depth report on the challenges, and potential solutions, which can be read here.

Resolution outside the courtroom

Landlords too can play their part and we would encourage them, where possible, to look outside the courtroom for solutions should they have issues with their tenancy.

Mediation and conciliation – while not guaranteed to work in every case – can be highly successful. If your tenant has fallen into arrears working with them or via a mediation service to find a suitable payment plan can help you avoid court or, at worst, show you have made every effort to avoid it.

NRLA members can access a free mediation service provided by TDS  to this end.

We are on the road to recovery and, although we are not there yet, we at the NRLA will rise to the challenge and continue to campaign at the very highest level for positive change to sustain the sector.

For more information about the NRLA campaign lobbying for Government support for the sector click here.

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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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