Selective licensing forces more landlords to use letting agents, council claims

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Peterborough council has claimed that selective licensing schemes compel more landlords to switch from self-managing their properties to using a letting agent.

The claim was made this week at the meeting of a scrutiny committee looking at the success of Peterborough’s large selective licensing scheme which is due to end in October.

A new scheme is to be submitted to the secretary of state for approval, which may include more wards than the original scheme following calls for the scheme to be expanded

So far 6,500 licences have been issued to private landlords and 227 properties inspected but with a further 551 due to be inspected including 180 that the council suspects don’t have licences.

Landlords prosecuted

Peterborough council has also prosecuted 15 landlords for non-compliance with the selective licensing scheme regulations, it was revealed.

Jo Bezant, a prevention and enforcement service manager for housing, told councillors at the meeting that most private landlords the council contacted to chase them up on getting a licence, then applied for a licence.

Bezant added: “It’s gone really, really well. What we’ve found has happened is landlords that didn’t know what they were doing – they had one property or two properties – a lot of those have moved and given their properties to agents so the agents manage them,” the Peterborough Telegraph reports.

“So we’ve seen a rise in professionalism of landlords through the management of the properties. And also a lot of landlords went on and did their own accreditation – so went off and became educated in what they should be doing and their legal responsibilities.”

The main reason for non-compliance was from landlords who did not believe the council would take enforcement action, she added.

Read more about selective licensing.

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Have you paid a problem tenant to leave?

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My name’s Melissa Lawford and I’m the property correspondent at The Telegraph. We’re running a story on a report which says that some landlords who are worried about the slow and restrictive eviction process have tried to pay problem tenants to leave their properties.

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83% of PRS tenants are happy with their homes

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Figures from the English Housing Survey for 2019/20 report that 83% of private renters were satisfied with their current accommodation, a figure that has remained constant over the past 10 years.

In comparison, the proportion of social renters satisfied with their accommodation stands at 78%

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LATEST: Tribunal backs landlords over contested Rent Repayment Order claim

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An evicted tenant’s claim for a Rent Repayment Order was rejected after she failed to prove her former home was an HMO.

A First Tier Property Tribunal ruled there was no evidence the four-bedroom house in Enfield Terrace, Birkenhead had needed an HMO licence in August 2019 – just before tenant Abbey Stewart was forced to leave following a possession order.

It heard that Stewart moved into the property in June 2018 agreeing to pay landlord couple Mark and Myriam Spence £360 rent a month.

She shared the property with three others while the couple were abroad. Rent totalling £1,047 was paid between June and October 2018 but no payments were made until October 2019 when £690 was paid.

Court proceedings

In March 2019 they began court proceedings and, following a hearing in the Birkenhead County Court, repossession was ordered by 29th August, and the couple were awarded a money judgement for rent arrears of £4,061.

Stewart claimed the property should have had a licence. She also complained it did not have adequate fire exits, while she was not given any formal documents such as ‘how to rent’ or a gas safety certificate. She said the couple ignored her requests to try to pay the rent and claimed to have been harassed.

Rules broken

The Spences said they had rented out the house – their sole property – to friends. They told the tribunal that Stewart broke all the house rules; as part of their repossession claim they said she regularly brought illegal drugs into the property and held rave-style parties. They did not accept it was an HMO at the time and denied any intimidation.

The tribunal ruled that while there may have been times in the earlier part of the tenancy that the property was an HMO, it was clear that Stewart was the only occupier of the property during August 2019, if not also for a period before that. It also found no compelling evidence of any other relevant offence having been committed.

Read a guide to renting HMOs.

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Commercial rent arrears on the decline – new research

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The pandemic has created a swath of tenants in arrears with their rent payments, but there are encouraging signs the worst might be over, says Tom Entwistle

Property management software company, Re-Leased collected anonymised and aggregated data directly from over 10,000 UK properties and 35,000 leases, not relying on surveys or secondary data collections.

The company says it is confident about the validity of this data as its formation is a direct result of bank statements, with entries being matched and reconciled to rental invoices.

Their research took data samples of new rent collection figures to analyse rent collections 7 days after commercial rents were due on 24th June 2021. The figures reveal that commercial tenants in the UK over all sectors have paid 50% of all rents due at the 7-day mark since the June quarter day, which is down just 1% from the same point in the previous March 2021 quarter.

This shows an increase of 32% compared to rent collected on day 0 of the June quarter and an increase of 4% compared to rent collected at day 7 of the June 2020 quarter.

Industrial

In the industrial sector rent collection was flat at 7 day mark. After a slow start, rent collection for industrial assets mirrors almost exactly that of collections last quarter.

But industrial assets have not experienced the same level of resilience as the office asset class. Industrial rent collection has struggled to match the high performance which was commonplace pre-pandemic.

Retail

Retail rent collections have continued to improve as landlords collected 52% of rent due at the 7 day mark, an increase of 3% compared to the equivalent period for the March 2021 quarter. Retail rent collection is also up 12% on the levels seen a year ago. Despite the re-opening of retail in the second quarter, retail continues to be the poorest performing sector.

The Office Market

Office properties continue to be the most resilient asset class of them all. Compared to the other sectors, rent collection levels for office properties are the closest to pre-pandemic levels of all the sectors, up 4% compared to the same point in June last year.

While they are down 2% compared to the equivalent period for the March 2021 quarter, the sector is up 21% compared to December 2019, the last quarter before the pandemic measures came into play.

The Regions

According to Re-leased the North East region of England experienced the most significant decrease in rent collection levels, down 9% compared to previous quarter. Landlords in London have also seen a slow start to rent collection for the quarter with just 37% of rent collected.

The West Midlands however, continues to see the highest levels of rent collection at day 7 with 59% of rents collected in the region 7 days after the June 2021 quarter day.

Caleb Dunn, Product Manager at Re-Leased says: “The pandemic has been a huge instigator for change in the real estate industry. Over one-year on from the outset of the pandemic, our data is showing that credit notes are continue to fall following the peak in September.

“The office sector has seen the most significant drop in rent credited since this time last quarter.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Commercial rent arrears on the decline – new research | LandlordZONE.

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London Mayor predicts 20% rent hike unless he gets rent control powers

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Sadiq Khan has warned that Londoners could see private rents rise by almost 20% over the next five years unless he gets powers to control the sector, emboldened by his recent re-election.

The capital’s mayor cites new analysis by City Hall which shows that, if left unchecked, average asking monthly rents in the capital could rise to almost £2,300 by 2025.

Despite the cost of renting falling in some parts of London during the pandemic, it still has some of the highest rental costs in the world, with Londoners paying on average 35% of their income on rent.

Khan was re-elected in May, pledging to lobby the government to give him the power to introduce rent controls through a proposed London Private Rent Commission.

He has also called for powers to freeze private rents to protect renters from the ongoing financial impact of the pandemic.

Since being in office, he has introduced two online tools enabling Londoners to name and shame rogue landlords and allowing renters to check whether their landlord has a property licence. 

Khan says he plans to stand up for London’s renters by transforming tenancy laws and wrestling back control of runaway rents. “Todays’ analysis paints a stark picture of the next five years if landlords are allowed to increase prices unchecked,” he adds.

“If we want the next generation of nurses, police officers, transport workers and key workers to train and work in the capital, we have no option but to keep a check on spiralling rents.”

Alicia Kennedy (pictured), director of Generation Rent, says: “Over the past decade it has become impossible for many people to live close to their workplace or support networks they rely on, while others cannot afford to start a family.

“Without urgent action on rent levels, more Londoners will face these dilemmas in the 2020s and quality of life will deteriorate.”

Read Landlords’ reaction to rent controls.

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Are you a property voyeur?

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Research by viewings platform, U-See Homes, has indicated half of UK homebuyers admit to being virtual property voyeurs, viewing a property online without the intention of buying, with 16% going as far as viewing in person.

However

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RICS hopes Building Safety Bill is a step change

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RICS responded to the publication of the amended Building Safety Bill for England saying the Government’s proposals, alongside the publication of the Fire Safety Act earlier this year, should ensure that this country never allows a tragedy like Grenfell to occur again.

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Problems loom for ‘rent-to-rent’ as DWP demands Covid cash back

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People in receipt of Universal Credit renting in properties via ‘rent-to-rent’ arrangements face being asked to repay back-dated housing payments due to a change in DWP policy. 

The government suspended full checks after the first lockdown because it could no longer see claimants face-to-face but the department is now revisiting claims it approved during this time and asking for proof of tenancy agreements.

Housing charity Safer Renting fears renters in this ‘shadow’ part of the UK’s private renting sector will be hit hardest, where rogue landlords refuse to provide agreements or even confirm knowledge of their tenants’ existence.

According to i News, Tina Newman, 40, from Essex, has been told she must repay £5,372 of the housing element of her Universal Credit despite being able to provide bank statements showing that she had been paying rent to another tenant.

Unlicenced HMO

At the time of moving into the house-share with seven other people Tina didn’t realise it was an unlicensed HMO and says she was not asked to provide a tenancy agreement by the DWP last March.

While it would accept a written letter from her landlord as proof, he has refused to provide one and is currently denying all knowledge of Tina living at the property. He also denies operating an illegal HMO.

Rent-to-rent increase

Safer Renting says it has seen a 100% increase in rent-to-rent arrangements from March 2019-2020 to March 2020-2021 and is concerned about how many renters may be unprotected and asked to repay benefits by the DWP.

It argues that the DWP’s policy of asking for a tenancy agreement has no legal basis under Section 54 of the Law of Property Act which says you don’t need a written contract to create a tenancy unless it is to be for more than three years.

Director Roz Spencer (pictured) tells LandlordZONE: “DWP don’t seem to be interested in whether the landlord has acted properly, they just want to put the whole responsibility on the tenant.”

LandlordZONE has approached DWP for comment.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Problems loom for ‘rent-to-rent’ as DWP demands Covid cash back | LandlordZONE.

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Landlord battles Facebook after posting pictures shaming nightmare tenants

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A landlord who named and shamed his nightmare tenants on Facebook after she and her partner left their flat in a shocking state had his post taken down – then reinstated – by the social media giant.

Stephen Maxwell, from Falkirk, told followers that his post was initially removed “for bullying” but after getting local press coverage he was allowed to re-post it after Facebook agreed it didn’t breach any privacy rules.

Sharing photographs of the flat also resulted in numerous offers of help from both friends and strangers who turned up to help clear the property and take rubbish to the dump.

Stephen and his girlfriend Asha Ramzan rented out the property on Atholl Place, in the Ladysmill area of the town, to a tenant and her two children, but told The Daily Record that due to the pandemic, they weren’t able to do regular inspections.

The couple only saw the state it was in after the woman moved out; there was cat poo all over the floor, along with dirty dishes (pictured), soiled underwear and half eaten food and rubbish everywhere.

Fortune

Maxwell, 31, said: “It’s going to cost me a fortune to get this place sorted again. I gave this lassie a very low deposit to help her get on her feet and this is the horror I am repaid with.

She assured us she was getting the floor sorted last month, then this month it has been left half ripped up. The rubbish she has left is beyond shocking.”

He named the tenant and added: “This is a warning to other landlords – I really hope that nobody else is fooled by them.”

Read more about nightmare tenants.

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