Tenants “homeless” if rent is unaffordable? – new caselaw

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The important case of Samuels v Birmingham City Council was decided by The Supreme Court on 12th June 2019. This case decided that a person who had been evicted for rent arrears, as the Housing Benefit did not cover the full rent (£151.49 pcm shortfall)

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Renting cheaper than buying over a ten year period

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Renting v Buying:

Renting can typically work out as an option that is cheaper than
buying over a 10 year-period, that’s according to research carried out by rentBunk.com and reported by Mortgage Introducer.

When all other costs are taken into account, such as upfront
and monthly payments, the Bristol based lettings platform says:

“Across the UK the average monthly rent is £676. With the
newly introduced five-week cap, that means a rental deposit costs an average of
£845 and renting at this average monthly rate over a 10-year period would cost
a total £81,120 – a total cost of £81,965 when including the deposit.

“The current average UK house price is £226,798 and so a 10%
deposit would set you back £22,680. This leaves a loan amount of £204,118 and
at a 10-year fixed rate of 2.58% would mean a total repayment of £231,798, a
total of £254,478 including the deposit,� says Mortgage Introducer.

The conclusion is that renting works out £172,513 cheaper on
average across the UK over 10 years, but the big difference of course is that
there’s no long-term benefit of the terminal bricks and mortar investment
secured buy buyers.

Renters benefit from a cheaper deal over the short term, if
you can call 10 years short term, and they have the freedom of the landlord
being responsible for everything, all repairs and emergency problems with the
property, plus renters have the flexibility of mobility, if job opportunities
arise elsewhere. Renters also have the opportunity to invest the savings into other
types of investment which, who knows, my even out-perform property long-term.

Co-founder of rentBunk.com, Tom Woolard says:

“Of course the big difference between renting and buying is
that one leaves you with a sizable financial asset as a reward for your years
of hard work making mortgage payments.

“However, more and more of us are opting to rent long-term
and what we wanted to highlight is that while the rental market is generally
viewed in a negative light due to high rental costs, it is actually a
considerably cheaper option when compared to homeownership, even with almost
record low-interest rates.

“Not only this but those that feel resigned to renting due
to the high financial barrier of buying actually have a much better opportunity
to save compared to those paying a mortgage.

“Whether they choose to use this for a deposit further down
the road or simply to enjoy a better quality of life is up to them.�

This saving, says Woolard, is greatest in Cambridge, the difference
being £341,090 over 10-years, with the comparable figure for London at
£316,247.

Bournemouth, comes in at £183,376 cheaper, Bristol
(£177,613), Edinburgh (£166,547), Cardiff (£143,984), Southampton (£138,617),
Portsmouth (£137,240) and Plymouth (£128,480).

Glasgow is the lowest city at a saving of renting over
buying in 10-years at £43,145.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Renting cheaper than buying over a ten year period | LandlordZONE.

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What if Section 24 is applied to recently incorporated landlords?

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I see this question posted on Facebook every few weeks, so I have decided to write an article on the topic, which I can share a link to whenever it pops up again.

It wouldn’t matter if Section 24 was applied to LTD Companies

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From Scam Artists to Family Feuds

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In this week’s episode of Channel 5’s ‘Nightmare Tenants Slum Landlords’ (Monday 17th June), Landlord Action tackles two very different eviction cases, one involving an illegal sub-let by a ‘professional’ scam artist, the other which sees a favour turn into a family feud.

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Landlord prosecuted for illegal eviction

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Eviction:

A Mostyn, Flintshire landlord Mr Gruffydd Edwards has achieved
the dubious distinction of becoming the first landlord in Flintshire to be
prosecuted for unlawfully evicting a tenant.

Flintshire County Council’s Environmental Health Officers brought
the prosecution against the landlord for illegally evicting his tenant.

Edwards pleaded guilty to the offence which took place at
one of his properties in Llys Y Wennol, Mertyn Downing Lane, Mostyn and was
fined £1,040 at North East Wales Magistrates Court.

In this case it would seem the landlord was lucky to receive
a relatively low fine as fines have been much higher in other similar cases and
the offence carries a potential 2 year prison sentence.

The Protection from Eviction Act 1977 makes it a criminal
offence to harass or unlawfully evict a residential tenant, so Edwards receives
a criminal record for his pains. Penalties for a breach can be quite severe.

Assured shorthold tenancies (ASTs) are covered by the 1977
Act which protects tenants from harassment and forced eviction. Specific legal procedures
must be followed before a tenant can be evicted illegal which involves a court
order and where necessary a court bailiff eviction.

An illegal eviction can take many forms including removal by
physical force or threat of force, denying re-entry, changing locks to deny
entry, or denying access to a part of the property to which the tenant previously
had access or needs access such as toilets etc.

Flintshire County Council’s Cabinet Member for Planning and
Public Protection, Councillor Chris Bithell, said:

“I am pleased that the Council has been successful in
pursuing the prosecution of this landlord for an unlawful eviction. It is most
important that tenants’ rights and interests are protected and that landlords
respect them.

“This prosecution sends a clear message that Flintshire
County Council will protect residents against unlawful private landlords. It
reflects Flintshire’s commitment to ensuring homes in the private rented sector
are properly managed.�

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Landlord prosecuted for illegal eviction | LandlordZONE.

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Can we Save You Money on Landlord Insurance?

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Property118 could save you money on your landlord insurance. Whether a single property, portfolio, HMO, landlord contents, sub-let, flood risk, renovation, unoccupied property or even your own residential home, we have access to some of the best rates in the UK through The Home Insurer and have tasked them to save you money on your existing or new policies.

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From Scam Artists to Family Feuds – ‘Nightmare Tenants Slum Landlords’ continues

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In this week’s episode of Channel 5’s ‘Nightmare Tenants
Slum Landlords’, Landlord Action tackles two very different eviction cases, one
involving an illegal sub-let by a ‘professional’ scam artist, the other which
sees a favour turn into a family feud.

In the first case, young landlord Han Yip discovers his West
London flat is being illegally sublet to three unsuspecting students. They have
been paying thousands of pounds to live in an exclusive part of London, but
their rent is being pocketed by the man who posed as the legitimate tenant.
Flaunting his seemingly ‘flashy’ life on Instagram and showing off about his
‘property business empire’, he is in fact a scam artist, who has spent time in
a US prison on fraud charges.

Calling on the help of Paul Shamplina, founder of Landlord Action,
Han Yip is determined to expose the rogue tenant and reclaim his debts. Paul comments:
“Han Yip was very unlucky. He had done everything correctly, from using a
professional letting agent to carrying out thorough referencing. Unfortunately,
this particular fraudster had changed the spelling of his name among other tricks
to slip through referencing.  Illegal sub-letting
is becoming something of an epidemic in London and more needs to be done to
prevent cases like these.�

In the second case, Landlord Action is called upon to help
end an unusual family disagreement.  Three
years ago, Sade Ademoye took pity on her cousin Kirk, who was in dire straits
after his divorce. Agreeing to temporarily let a room to him in her elderly
mother’s home, Sade also gave him a cheap rate. But after her mother passed
away, he refused to leave. With this family feud turning acrimonious, Sade also
turns to help from Paul and his team to evict her cousin.

“This tenant took advantage of his cousin’s late Mother
and took over the property, even though the agreement was only to rent a
room.  He then refused to leave. These stories,
and others throughout the series, demonstrate the diversity of cases that we have
to deal with at Landlord Action and the reasons landlords look to gain
possession.  It is rarely non-fault but
often landlords feel powerless and turn to eviction as an absolute last resort.�

Watch Nightmare Tenants Slum Landlords on Channel 5, Mondays
at 9pm

About Landlord Action

Landlord Action is a UK based organisation helping landlords,
letting agents and other property professionals. As a champion for landlords,
it has campaigned extensively and was instrumental in getting the law changed
to make squatting a criminal offence.

It was founded in 1999 as the first ever fixed-fee tenant eviction
specialist, they revolutionised this area of legal practice. They have now
acted in more than 35,000 problem tenant cases and are considered the authority
in this field.

Landlord Action run a free advice line to help landlords and
property professionals understand their rights: 0333 321 9415

www.LandlordAction.co.uk

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – From Scam Artists to Family Feuds – ‘Nightmare Tenants Slum Landlords’ continues | LandlordZONE.

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Tenants can reclaim excess on their deposits…

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Tenant Fees Act:

The ban on letting fees and excess tenancy charges in
England came into force nearly two weeks ago. This is a new set of regulations
affecting landlords and letting agents which the Government estimated will cost
(in aggregate) landlords up to £83m and letting agents £157m.

The new rules apply to new or renewed tenancy agreements signed
on or after 1 June 2019.

Similar legislation was imposed in Scotland a couple of
years ago, and are on the cards for Wales from this September. A ban will not
be brought in Northern Ireland until there is a sitting assembly able to pass
the relevant legislation.

So, in some case tenants will be entitled to a partial deposit
refund should they renew a tenancy that commenced before the 1^st of
June, and where a deposit was taken which exceeded the 5 week rule. As it has
been commonplace for landlords and agents to request at least 6 week deposits and
sometimes more, there could be a considerable number of tenants entitled to
refunds on renewal in the future.

The new law prevents landlords or their agents requesting
most types of fees associated with letting a property in the private rented
sector in England, fees that were previously taken as a matter of course, not
so much by private landlords but most certainly by agents.

Unless payments appear in a statutory list (Schedule 1 of the Act) of permitted payments no fees can now be taken and penalties for transgressions are quite sever. A breach of the legislation will usually be a civil breach with a financial penalty of up to £5,000, so it’s very important that landlords and agents understand the rules on this. Tenant Fees Act

If a further breach should be committed within five years of
the imposition of a financial penalty or a conviction for a previous breach,
this will be a criminal offence. Upon conviction, the penalty is an unlimited
fine and a banning order offence under the Housing and Planning Act 2016.

As with some other transgressions however, enforcement
authorities can now impose a financial penalty of up to £30,000 as an
alternative to prosecution. In such as case the local authority will have
discretion over whether to prosecute or impose a financial penalty. Where a
financial penalty is imposed it will not amount to a criminal conviction.

The ban includes fees for viewings, credit checks,
references, inventories and the drawing up of a tenancy agreement, all of which
have traditionally been charged and in some extreme cases have led to upfront
costs for tenants of up to £800.

Other than rent, in practice the only fees that landlords or
letting agents can charge tenants are refundable security deposits capped at no
more than one weeks’ rent (annual rent divided by 52), providing the total
annual rent is less than £50,000, or six weeks’ rent if over this. However,
there are some other costs that can be charged – see the links above.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Tenants can reclaim excess on their deposits… | LandlordZONE.

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New form 6A – Date format confusion?

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Last week I had to serve notice on a tenant and I noticed the Form 6A had changed.

The new Form 6a must be used from 1 June 2019: Click Here to download the new form.

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10% report same problem 10 times in social homes!

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Two years on from the Grenfell Tower fire, Shelter is warning the government must listen to the third of families with children in social housing who feel less safe in their homes and take urgent action to prevent further tragedies.

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