Sorry about the break in transmission folks. My muse has been busy with other things recently, but hopefully will be back on the blog job in the new year.
In the meantime, I wish you readers all the best for the Christmas holiday, followed by a happy and prosperous new year.
A friend of mine who sits as a Deputy District Judge told me of an interesting case recently. Apparently a local authority tenant had moved out of his rented property, thereby losing his security of tenure and making his tenancy a common law one. The landlords had therefore served a notice to quit (as this is the appropriate notice for common law tenancies) and sought possession of the property.
However in the tenancy agreement there was a clause saying that the tenant could only be evicted after service of a notice of possession as provided under the provisions of the Housing Act 1985. This is the notice which is normally served for secure tenancies but which had not been served in this case as the tenancy was no longer secure. My friend concluded therefore that as no such notice had been served, he was not able to make an order for possession.
His view was that there is no reason why a landlord should not enlarge the tenants security of tenure under the terms of the tenancy agreement, and that if the landlord does this, it should be binding upon him.
In the same way, in the case of Welsh -v- Greenwich London Borough Council, wording in the tenancy agreement was held to enlarge the landlords repairing obligations.
The moral being that local authorities should be more careful about the clauses included in their tenancy agreements. And that they should comply properly with the provisions of their tenancy agreements once these have been issued. And perhaps most importantly of all, they should ensure that their tenancy agreements are drafted by experienced housing lawyers and reviewed regularly.
I have seen a couple of reports recently on the internet (here and here) saying that a study by Heritable Bank has recommended that the HMO system be reviewed, as there is such a wide discrepancy between the license fees charged by different local authorities, and also a wide variation in the way they deal with licensing generally.
Strangely, I cannot find any mention of this report on the Heritable Bank web-site, although maybe I am not looking in the right place.
However everyone who has anything to do with residential landlord and tenant law and practice, must know of this wide variation in license fees, which many feel is wholly unacceptable. It has been mentioned several times on this blog, and I have also been developing a list of different license fees, which you will find here. Fees on this list run from about £30-50 per room or unit to £1,100 for Newcastle (as mentioned in the articles). In fact though, the most expensive Local Authority to my knowledge is Southend. However they cunningly disguise their high charge by saying that it is £660 for two years, whereas most authorities charge for a five year period. The Southend fee for a five year period works out at £1,650.
There is no doubt that the new HMO regulations have greatly upset landlords, and I believe that many former HMO landlords have now sold up altogether. On the whole I do not think that the regulations are too excessive. The worst problem, that of the wash hand basin requirement for large HMOs, has now been dealt with. The regulations were only introduced last year and perhaps should be given a bit longer to bed in before any revisions are made. However I do think that the wide fee variation is generally undesirable and this aspect should be looked at. Whether it will or not, is of course another matter.
I am just recovering from an exhausting week. Thursday saw the first course we have run via our training company Legal Professional Training Ltd. It was a good day, but involved a huge amount of work and administration, and left me feeling like the proverbial limp dishrag.
Things were not helped by the fact that I had also been working on an upgrade of Landlord-Law for several weeks, which went live the following day. Not very good timing. Particularly as the upgrade went wrong! A rather overlong period then ensued of checking things on the live site, finding that they did not work properly or were not there, emailing my web-designer, and finding that she had gone out! Its all been sorted out now (well I hope it has …) but it was not a good time. I am pleased now its done though.
The upgrade includes a new Tenants Problem Solver, a new extensive section of the site with articles and information geared at problems experienced by tenants. Most tenants should now be able to afford to read it, as the other major introduction is a new membership fee of £4.70 for three days. So anyone can afford to take a look, so long as they can pay by credit card.
Hopefully this new section will not alienate my landlord members – the problem solver sets out tenants obligations as well as their rights, and good landlords (of course all my Landlord-Law members are good landlords) have nothing to fear from well informed tenants.
The week has ended with the broadband connection on my main computer suddenly going off (I am writing this on the laptop). I assume that a connection has disconnected but can’t work out which. There are so many wires under my desk that it is impossible to keep them in order (I have tried), or to work out what is wrong, even if it were possible to see them properly which I can’t. Another job for my computer service company I think.
So, one of those shattering weeks when good and bad come together in a climax at the same time so you don’t know whether to be pleased or in despair. I expect you get them too. Maybe next week will be calmer.
The Local Housing Allowance Scheme, discussed in my earlier article regarding landlords from Blackpool, is due to be rolled out across the country in 2008. The main criticism from landlords is that under the new scheme the rent cannot be paid to them direct any more. It has to be paid to the tenant, unless either the rent is in arrears of eight weeks, or if the tenant is adjudged to be 'vulnerable'. However in both of these cases the direct payment takes some time to be set up, during which time arrears may be accruing making the tenant vulnerable to a claim for repossession.
Many tenants also are unhappy about not being able to elect to have the rent paid to their landlord direct. They would much prefer to know that this is being done and that their home is not at risk. If they want rent to be paid direct, it seems ridiculous that they should not be allowed to have it.
The reason given on the DCLG web-site for the enforced payment to tenants is
"Personal responsibility: Empowering people to budget for and to pay their rent themselves, rather than having it paid for them, helps develop the skills unemployed tenants will need as they move back into work"
However it is noticeable that this personal responsibility is not being encouraged where the landlord is a social landlord, or where the benefit is for mortgage payments. Only the poor old private landlord (with considerably less political clout than the social landlords and the banks) is going to be vulnerable to having his rent spent on drink and drugs in an effort to encourage personal responsibility among his tenants.
There may though be an answer. I attended a Landlords Forum meeting at Suffolk Coastal Local Authority recently where a lady from a local Credit Union told me that they are now setting up special accounts for tenants so the rent can be paid in and then paid out to the landlord. This is better than having the LHA paid to the tenants bank account because, as it is only being used for the transfer of the housing allowance, the money is not at risk of being swallowed up by the tenants overdraft or being spent by the tenant (perhaps in error, perhaps while under the influence) on other things.
Even more interestingly, we were told by a gentleman giving a talk on Local Housing Allowances, that section 94(3) of the Housing Benefit Regulations 2006, provides for the tenant to request that the benefit be paid to another person. This is the statutory authority for setting up the Credit Union payment, however he speculated that the tenant may also be able to use this section to request that the rent be paid to the landlord!
Looking a little closer at the regs, section 94(1) seems to be providing against this. If this is the case though, that means that the only person the tenant is not allowed to request the rent be paid to is the landlord – the person he is legally liable to pay the rent to! How mad is that? Are there any human rights ramifications here?
Still, the Credit Union idea seems like a very good one, and I commend it to you.
Landlords in Oxford who let to three or more unrelated tenants who share amenities (i.e. bathroom, toilet, kitchen and living space) beware! Your city council is seeking to extending the current mandatory licensing scheme (which just applies to the larger properties of three or more stories and five or more occupiers in two or more households) to all HMOs. This will include, for example, three students sharing a small two story house or a flat. See the report from the Oxford Mail here.
The city council say that 26% of houses in Oxford are privately rented (many presumably to the large student population), 61 per cent of HMOs are below standard in terms of fire precautions, and 29 per cent of HMOs have below adequate management. The Council hope that extending the licensing system will allow them to change this. I hope they have sufficient manpower to deal with the massive amount of extra work they are taking on.
No doubt other cities with large student populations will in due course be looking to do the same as Oxford. Although of course much of the student population in Oxford comes from a ‘posh’ background, so they may be under more pressure to deal with the problem of sub standard student accommodation.
The city council have started public consultation on the proposals. If you want to be involved in this the email address is hmos@oxford.gov.uk or contact the HMO licensing officer on 01865 252307. After this process they then have to apply to the government so the extending HMO licensing regime is not going to come into force until next year at the earliest.
There is an interesting article here on the new government ‘pathfinder scheme’ for the payment of housing benefit. This was initially set up in 2003 in a few pilot areas and is gradually being rolled out across the country. A fixed rate of benefit, known as a local housing allowance, is paid for all properties of the same type, and which is not linked to individual rents. The tenant can therefore shop around, and if he finds a property with a cheaper rent, can keep the difference.
However the aspect of the pathfinder scheme which annoys landlords is that the option which the parties had under the old scheme for tenants to elect to have their rent paid direct to the landlord, is no longer available. Some of the Blackpool landlords are claiming that the rent payments are too much of a temptation for some tenants who are using the money for drink, drugs and lottery tickets.
The problem, they claim, is particularly acute in Blackpool as it has such a large private rented sector. It is also apparently the ‘drug death capital of the UK’, and a local coroner has recently claimed that benefit money is helping to fund the cities drug problem.
Landlords have been complaining about the pathfinder scheme ever since it was first set up in 2003, claiming that many tenants will not be able to resist the lure of these lump sums of money being paid to them, to fund their drug and similar problems. However areas where the scheme has been piloted have not apparently had that many problems. Skeptics claim that this is because the rate of benefit set in pathfinder pilot areas has been more generous than in other areas. When the scheme is rolled out nationwide, they claim, this generous rate will not continue and huge problems will result.
If a tenant in receipt of local housing allowance falls into arrears, there are two options for the landlord:
1. To try to persuade the Local Authority to pay the rent to him direct. There is a general rule that this will be done if the tenant is in arrears of more than 8 weeks. The DWP Resource Centre on benefit states on this point
"If rent arrears are owed, the local authority will arrange to make payments direct to the landlord unless it is not in the customer’s overriding interests to do so. However, landlords are encouraged not to wait for the 8-week period to be reached before contacting the local authority."
The landlord may also be able to persuade the Benefit Office to pay the rent direct on the basis that the tenant is ‘vulnerable’. Information on how Officers are to identify potentially vulnerable claimants can be found in paragraph 5.30 onwards in the Local Housing Benefit Allowance Guidance Manual, to be found online at the DWP web-site.
The main criticism of both of these options from landlords, is that it takes time for the benefit office to be persuaded and the new arrangement set up, during which time they are not receiving any rent.
2. To bring proceedings for possession. This is unpopular with landlords as it can take up to six months (more if the landlord is unlucky) to recover possession of the property, during which time he will not be receiving rent and will have to pay court and legal fees.
Also, although this will resolve (at a cost) the individual landlords problem, the tenant will still need housing, and his addiction problems will not be helped by being evicted from his home. The problem to society therefore will remain.
The Blackpool landlords suggest that landlords who are accredited should be permitted to have rent paid direct to them, if the tenants agree (and many probably would). The Local Authority say that they cannot do this as it is not permitted by the scheme rules. However the government might want to consider this option, if it wishes to encourage accreditation and thereby improve standards.
Readers may be interested to learn that I have been contacted by a landlord who tells me that his tenant is defending, or rather seeking to overturn, a possession order obtained via the accelerated procedure under section 21, under the provisions of the Disability Discrimination Act 1995. This is the very situation I was concerned about when I wrote my earlier posting on the Malcolm case.
The landlord brought the claim after it became apparent that the tenant was spending her housing benefit on other things, although this was not specified in the particulars of claim, which (as is usual) gave no reason for the claim other than that the notice had been properly drafted and served and that the tenant had not vacated. Her lawyers however are claiming that the reason why she has not paid her rent is because she is suffering from a mental disorder, and therefore the landlords action in evicting her is discriminatory and unlawful.
The landlord is aghast at this claim, as if it succeeds he is faced with the prospect of this tenant remaining in his property indefinitely, free of charge. How, he asks, is he expected to pay his mortgage and other expenses on the property? Is this really what the draftsmen of the DDA 1995 intended?
The tenant is in receipt of legal aid and the landlord has been told by her lawyers that they will fight the case all the way to the European Court if necessary. The poor landlord however has no legal assistance and is unable to afford expensive legal fees (particularly as he is not receiving rent!).
If this claim succeeds, bearing in mind that the landlord had no idea that the tenant was suffering any mental problems, it will have serious repercussions throughout the whole of the letting industry. The landlord has agreed to keep me informed of the outcome of the case.
Following on from my previous item on the Equality website, I was interested to see this item in the Times Law section today on John Wadham who is heading up the new Equality and Human Rights Commission.
This article makes the point that the new commission not only covers areas of law formerly dealt with by three separate commissions, it also has a budget to enforce the Human Rights Act. It will be really interesting to see how that works out.
How will it affect housing law? The main area that I can see at present is defending possession claims where the defendant is being evicted for some reason connected with their disability. It will be interesting to see if this will be largely confined to the social landlords or whether it will extend to the private sector (something discussed by myself and Nearly Legal in my previous post on the Malcolm case).
Can anyone see any other potential areas of conflict?
While doing some writing for Landlord-Law I discovered that the new Equality Web-site is live. This was set up by the Equality Act 2006 which also set up a new Equality and Human Rights Commission. This will deal with discrimination over all areas, rather than, as before, just concentrating on specific areas such as race, and disability. The act also gives the commission power to make regulations regarding other types of discrimination, such as religious belief and gender.
The three earlier commissions, The Commission for Racial Equality (CRE), The Disability Rights Commission (DRC), and The Equal Opportunities Commission (EOC) have now been merged into this new organisation, which has a web-site at www.equalityhumanrights.com. Any attempt to reach the old web-sites will just take you here.
It is a very clear web-site. All the fussy content of the old sites is gone. Anyone searching for information about their rights will find it quite easy. There is also a section for advisors which, again, is very clear, if rather sparse.
In fact the whole site has a ‘light on content’ feel about it, perhaps because it is so new. I spotted a A-Z index at the bottom but this just lead me to a registration page. It was extremely irritating however, having registered, to be told that access was denied and that the page had been disabled! (Was it because I said I am a lawyer? Am I being discriminated against?)
Still, if you are looking for information on any sort of discrimination this is a good place to start. Although like most sites aimed at the general public it is rather light on authorities.
I did my Q&A this morning, something I do every other Sunday morning, and which see I wrote about nearly a year ago on this blog. I always get far more questions than the 10 that get answered (I had 32 today I think) and the same old questions still keep cropping up.
For example, unbelievably, there are still landlords who think that they can go in and change the locks if their tenant has not moved out after the notice period of the possession notice expires. I still get loads of questions on damage deposits, and from the way some of these are worded it is apparent that the landlords are failing to protect deposits under the statutory tenancy deposit schemes. Properties are still being let in a poor condition, and there still appear to be quite a lot of dodgy and/or useless agents, greedy landlords, and clueless (or thick) tenants about.
No change there then.
Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.
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When I wrote about tenancy deposit protection avoidance earlier this year, I did not mention one other option which I understand is being taken up by many landlords – that of taking no deposit, but two months rent in advance instead of one month.
Although there is nothing wrong with this, and superficially it seems the same, as very often the tenant will be paying the same amount of money in advance, in fact the landlord will not be protected against damage in the same way as he will by taking a damage deposit. This is because the money will be paid as rent.
The significance of this is that money paid as rent cannot, technically, be used for dealing with damage. That is not its purpose. So with a six month tenancy the tenants will pay no rent in the last two months. They do not have to – it was paid in advance. However, if they then leave the property in a mess, the landlord will have no fund of money to deal with it. In fact it is probably more likely that the tenants will leave the property in a mess. As they are not at risk of losing their damage deposit there is no reason why they should bother overmuch about the condition in which the property is left.
Better for landlords to bite the bullet and take a deposit, in my opinion. The custodial scheme, for example, is free of charge, everything can be done via the internet, and the tenants will know (as the money is being held by the scheme administrators) that their money is safe. Where is the problem?
If anyone is interested in why I became a sole practitioner and then went on to develop my online service, see this post which I wrote for American lawyer and blogger Susan Cartier Liebel. Susan has developed a consultancy helping American lawyers who are tired of ‘big law’ and want a life, to go solo.
Visiting the Amazon associates central website the other day after a long absence, I was excited to see that they now have some intriguing new ‘widgets’. The most useful for me is the ‘my favourites’ widget, a customizable box you can put on your web-site containing selected books, and your own comments on each book. Once you have set the box up and put it online, you can then alter it via the Amazon site, for example by changing the books.
I have put one on this blog, in the side bar, featuring all the books I have mentioned in posts. It will now be much easier to add new books, than via the individual entry for each book I did before.
I have also done lots of ‘favourites’ boxes on my Landlord-Law site (I don’t call them that, you can change the text at the top). Its great because I can recommend books which relate to the content of the page. More of a service to readers really than a money earning exercise - I think my average earnings are about £10 per quarter so it is hardly a get rich quick exercise.
But there is more. I can now put links in the text like this (hover your mouse, it is supposed to make a box pop up, but even if it doesn't it will still link to the book). Cool eh? You need an ASIN for that – I had to go to the ever helpful Wikipedia to find out what that was, and how to locate it (it is the ISDN number for books).
Other widgets include a slide show and product cloud, but I don’t like them as much, so will leave them for the time being.
Still, hours of innocent fun to be had. Why not try it - you too could earn a few pence extra per day! Oh, and here's a banner:
Of course your links depend on the Amazon site working properly. So if none of the above are showing - its not my fault!
Speaking to a solicitor friend of mine recently who does housing association repossession work, she said bitterly that it seemed to be impossible nowadays to evict tenants who have any sort of disability. She is not going to be pleased with the recent Court of Appeal decision in London Borough of Lewisham -v- Malcolm.
Mr Malcolm was a tenant of Lewisham LB. He suffered from schizophrenia which initially was controlled by medication. He applied to buy his flat under his statutory right to buy. However there were delays. At about this time he stopped taking his medication, and his behaviour became erratic. Before his sale had gone through he let his property to tenants. By doing this he lost his security of tenure, and with it many of his statutory rights. Lewisham therefore decided to serve him with a Notice to Quit, and then issued proceedings for possession.
Normally there would be no defence to such as claim, Malcolm having lost his security of tenure. However Malcolm defended on the basis of the Disability Discrimination Act 1995, section 22(3) of which makes it unlawful to discriminate against a disabled person by evicting them, claiming that he had only parted possession with the flat as a result of his disability which led him to make irrational decisions.
At first instance the Judge found that (1) Malcolm was not disabled within the meaning of the act, (2) that the section would not apply anyway in a claim where the Judge had no discretion to refuse an order for possession, (3) that the subletting was not caused by his disability and (4) that the LA could not have discriminated as they had no knowledge of his disability. However the Court of Appeal did not agree.
Rather worryingly for landlords, the Court of Appeal found for the tenant on all four of the issues in question. Malcolm was disabled with in the meaning of the act. The subletting had been connected to his disability as it had affected his day to day activities (and by implication the subletting, even though there was no direct evidence on this point). A landlord does not have to know about the disability to discriminate against the disabled, and finally s23(3)(c) is unqualified and does not limit the unlawfulness to cases where Judges have a discretion to grant possession. The Judge refers in paragraph 52 to two County Court decisions, one of being a case where a Judge refused to make an order under s21 where the tenant was disabled, as examples of courts happily adapting to the DDA 95 without difficulty.
The thought of landlords being unable to evict tenants under section 21 because of the DDA will send a shiver down the spine of all private landlords, and may well result in a private determination not to knowingly let to any disabled tenant in future. This will do nothing to help the prospects of the disabled (particularly those suffering from mental illness) obtaining accommodation in the private sector.
I have to say that although I do not like discrimination and approve broadly of protective legislation, I am worried by this case. For example, the status of Malcolm’s current occupation is now uncertain. He presumably is now unevictable, but it is probable that he does not have a tenancy (if the notice to quit served on him is still valid). Does this mean for example that the repairing obligations in s11 of the Landlord and Tenant Act 1985 do not apply? Or would this also be a breach of the DDA?
Also, it is one thing to use this type of legislation against social landlords, who to a certain extent have a duty to look after those in society who are disadvantaged. However this case opens up the prospect of the DDA being used against private landlords, even if claims for possession are brought under section 21. Is it right that a private landlord, who may only have a few properties, should be forced unwillingly to continue to rent to a tenant, simply because he is disabled, even if the landlord was unaware of his disability, when he would normally be entitled to possession as of right? Or would the private landlord be able to use justification in such a case?
This case opens up a vista of uncertainly which will no doubt make private landlords (particularly those who rent to tenants who are disabled) most uneasy.
I was excited to read about possible plans for an eco town in the now disused RAF centre at Coltishall in Norfolk. It would 10,000 homes and 2,000 jobs with an electric bus link to Norwich and a new broad.
It sounds brilliant. I hope they get the ‘green light’
I read a book on Gordon Brown today. There is a cautious feeling of optimism in our house at his becoming PM, and I have long had a feeling that in the cup of cappuccino which is the Labour Party, Tony Blair was the froth on the top and Gordon Brown the grounds underneath.
Deciding against the Tom Bower book
It was an enjoyable read. He gives a certain amount of background, for example he discusses Browns alleged ‘weakness’ in not pursuing top jobs at certain times, explaining that those jobs were either ones he didn’t actually want anyway, or he that felt it was the wrong time to pursue them. I must say I felt a lot more sympathy for Gordon Brown, spending that crucial day after John Smith died in writing obituaries, than for Tony Blair, eagerly setting his machine in motion to bid for the leadership.
I am not sufficiently knowledgeable on all the events to say whether Beckett’s book gives an accurate representation or not of Brown, his actions and his policies. However I would like to think that the picture he gives of a man deeply concerned about poverty and education, with an abiding sense of moral justice, and a disinclination to follow any course of action he has not thoroughly researched is a correct one. It is comforting to think that the man in charge understands the economy and (hopefully) will be reasonably competent at the job.
I am also guardedly encouraged by the fact that he has started his premiership by focusing on something really needed in this country – more affordable housing. It would be really nice if he could also think a bit about transport (better trains please), and perhaps leave the transport minister there long enough to sort things out properly. And please, please can he not squander time and money on unnecessary wars, and interference in the running of foreign countries. We have quite enough problems in our own country to sort out, and that is after all what he was elected for (genuine humanitarian concerns excepted).
The only thing that worries me a bit is that he really, really wanted the job. Didn’t someone (was it Plato?) say that the best rulers are those who do not want to rule, the worst those who eagerly seek the position? But I wish him well.
Fresh from a holiday in Southern Ireland, I must tell you all about a gem of a place we discovered – Ormond Castle. Situate in the pleasant town of Carrick on Suir, this comprises a ruined medieval castle and (we were told by our guide) the only intact 16th century manor house in Ireland.
However what none of the online sites or indeed the published leaflets I picked up tell you, is that in a room off the main entrance are a set of eight original charters granted to the family by the English monarchy, all beautifully illuminated. (What I, as a 1066 and All That
They are the most beautiful documents, most still with their original seal, and little bag to put the seal in. Wonderful pictures of red and gold dragons, unicorns and other fabulous beasts, together with life like portraits of the reigning monarch of the time. Three of Charles II, instantly recognizable with his heavy eyes, one of William III, one of William and Mary, and two of Queen Anne. I think there was also one other but I forget who.
The two portraits of Anne were interesting – the first one in 1703, when she had just become queen, showed her face looking rather thin and worried. The second one in 1710 showed her looking less worried and noticeably more plump. I have never been particularly familiar with this period of history, but reading about Anne in Wikipedia she does not seem to have had a very happy life.
The house was built by one Thomas Butler (hence the Butler pub on the approach road to the town), 3rd Earl of Ormonde, known locally as ‘Black Tom’ on account (according to our guide) of his black hair and eyes (which you can see in the portrait on the left and also here), as opposed to the more usual Irish red gold hair. The family appears to have been stinking rich, largely due to their rights in connection with wine trade, allowing the young Tom, fresh from education in England and the Court of Queen Elizabeth I, to create this lovely manor house, in which he hoped one day to entertain the Queen (her portrait and crest is repeated many times in the original plasterwork on the walls) but sadly never did.
So if you find yourself in Tipperary, I would suggest a visit to Ormond Castle – there is no charge and the guided tour is excellent. As well as the charter room, you also get to see the rest of the house, climb the tower and see the original oak beams (marked by the original carpenters) in the attic.
The government published its Housing Green Paper recently, and I have now been able to have a quick flick through it. It looks pretty impressive at first glance.
A few points spring to mind. First of all, here’s hoping that they will be able find sufficient builders, bricklayers, electricians, and plumbers etc to do all the work. Second, although I am delighted that for the first time in years, funding is being put in place to allow new housing to be built by Local Authorities, I do hope that this will not then be all sold off at an undervalue to tenants, as happened to much of the previous LA stock under the right to buy.
However I am really pleased that they are looking to make all new housing environmentally friendly. Let us hope that they are able to resolve the planning problems so that on the one hand development is not thwarted by being stuck in the doldrums for years and years, and on the other hand things are not loosened up so much that inappropriate building is allowed (for example on flood plains …).
If you want to read the Green Paper you will find it here – if you want to respond note that you need to get it in by 15 October.
I have already mentioned in previous posts that the Law Commission are undertaking a massive review of housing law and practice. This started with their Renting Homes project, now completed, and continued with their project on Proportionate Dispute Resolution. The final stage is the project on Encouraging Responsible Letting.
Both the dispute resolution and the responsible letting projects currently have consultation papers out, with closing dates respectively of 28 September and 12 October. The proportionate dispute resolution consultation is the second one in the project – this one is specifically on the role of tribunals. We did an online answerform for the previous consultation on Landlord-Law but sadly got very few responses, so we have decided not to do another one this time. If you want to respond you will be able to download an answerform on the Law Commission web-site.
However the consultation on responsible letting is very relevant to the majority of users of Landlord-Law so I have once again, with the agreement of the Law Commission, set up an online form (which they have approved). As with our other online forms, this gives sufficient information to allow the reader to answer the questions without having read the full report, although if you have time this is always better. The answerform can be found at www.housing-law.co.uk.
The reasoning behind the responsible renting project is that we have a lot of law aimed at protecting tenants and ensuring that properties are in good condition. However it does not seem to be working, as so many properties do not meet the legal standards (which themselves are fairly basic). The paper also covers unlawful eviction and harassment, but the main thrust of the questions relate to ‘how can we ensure that property which is made available for renting is in a proper condition?’
The paper puts forward a number of suggestions upon which it seeks feedback, ideally from practicing landlords. The two main suggestions are:
1. That landlords should be required to join a landlords association or accreditation scheme which would take on a regulatory role, and take steps to ensure that their members comply with the relevant law, and/or
2. That landlords be required to obtain a certificate certifying that the property is in a proper condition before being allowed to rent it.
It is not as simple as that of course, and the Law Commission recognise that there are problems with both suggestions. However they also point out that the nettle of enforcing standards against landlords really needs to be grasped, as there is a substantial cost in doing nothing. Poor quality housing leads to increased illness, underachieving children, and generally less socially cohesive and problematic communities.
The cost of these problems may indeed be greater than the cost of improving the condition of the housing. So there is an incentive for government to sink some money into housing for the greater good. Thankfully we now seem to have a prime minister who is taking the issue of housing seriously so we may see some action.
However if you are a landlord or are involved in the private rented sector, I would urge you to read the consultation paper (either in the original, or in my condensed version) and submit your views to the Law Commission. They are very anxious to hear from you. This is your chance to have your voice heard and to influence policy! Do not waste it!
PS See our poll on the right - closes 27/08/07
Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.
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There’s been quite a bit in the news recently about on the one hand how good marriage is for family life, but on the other hand how it is getting less popular. Well there is one very good reason which may partly account for its popularity decline - it is very expensive. Or, rather it is perceived to be very expensive. £14,000 is a figure I have heard as being an average price for a wedding. A phenomenal amount of money to spend on just one day.
But you don’t really need to have all that. The church, and the wedding breakfast, and the clothes, and the reception, and the disco, and the buffet, and all the relatives you don’t really want to see ... All you need is a license and an appointment at a registry office. That’s what we did.
We decided to get married but did not want all the doings. We just wanted to be married. We got a license, booked date in a registry office in a different town (you don’t have to get married on a Saturday, and if you get married on any other day you can get an appointment really quickly), told no-one, and just want up there and got married.
It was great. We had a friend come to be one witness and got an old lady off the street to come and be the other witness (I had always through it would be really romantic to drag a stranger off the street to be a witness) – she was delighted! Then we went and had a pub lunch. We had had a combined hen and stag night the night before when we went to see Joan Armatrading who happened to be in concert that night. It was a lovely time, a time just for us. I don’t think we would have enjoyed it any more if we had had the £14,000 do, in fact I am certain we would have enjoyed it a lot less.
Then we went back and told everyone. Their faces!! It was great fun, but also very romantic.
I think all this expensive wedding day business is a mistake. A racket in fact, maintained by those with a financial interest in perpetuating it. To have a chance of a good marriage, you have to want to be married, not to have a fairytale 'day'. It is the married life that is important, years and years of it, not just one day at the start of it which is going to cost a fortune, put you in debt, and probably thereby make the rest of your married life (or at least the early years) more difficult.
Marriage is good. Your children are legitimate, which (whatever anyone says) I think is nicer for them. You are next of kin to your spouse, which means you have the right to be with them in hospital and be consulted if they are very ill or have an accident. Even if you do not make a will, your spouse will inherit all or part of your estate on death. And if you divorce there is a court who can, if needed, supervise the fair division of your possessions and make provision for the care of the children. Maybe these things do not work as well as they could all the time, but they are generally there to facilitate the family and fairness.
I think that our cheaper, alternative model for getting married should be promoted. It is just as much, if not more, fun than the expensive version. But you have more money at the end of it, and instead of spending hours and hours planning events and frocks, you can spend more time thinking about your life together. Which is after all what getting married is all about.
And maybe more people would get married if they did not feel put off by having to wait years and years for a Saturday registry office appointment and by feeling that they have no option but to pay such enormous sums of money for the wedding event.
Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.
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Who’d be a smoker today? First it was just a few places, then transport with the trains and busses bringing in a ban, now its banned practically everywhere! Happily I gave up quite some time ago so its not a problem for me.
It is going to be a problem for landlords though, particularly HMO landlords, as from 1 July they must not permit smoking in any of the communal areas of their properties. This includes things like shared stairways, lifts, common parts in houses converted into flats and shared kitchens, toilets and the like. Notices must be put up in entrances, and it must be made clear to tenants that slipping off to the toilet (a shared one that is) for a quick ciggie is definitely not allowed!
In point of fact, landlords should have been wary for some time of allowing any smoking in the common parts of their properties, if only because of the 2000 Court of Appeal decision in Ribee v. Norrie. This is an entertaining case with many typically British case law features – a quotation from Phillip Larkin, reference to a Lord Denning decision, Rylands and Fletcher (escape by fire), and ‘a sprightly 70 year old lady’ (with a ‘heroic’ pet spaniel) who had lived in the adjoining property all her life.
The case makes the point that landlords should take care to prevent their tenants smoking and allowing fire to escape and damage neighboring properties – Mr Norrie ended up paying a judgment debt of £5,063.02 plus a substantial interest payment and costs. One of the Judges even suggested that he should have appointed a live in manager or moved to live at the property himself.
So bear in mind landlords, that if you do not have strict no smoking rules and notices, and your tenants break the law, you are risking not only an on the spot fine but also (if fire escapes to next door) a claim for damages from your neighbours.
An interesting snippet from the afternoon press briefing from No 10 for 28 June:
"On the role of the Minister for Housing, whilst the breadth of her responsibilities would stay the same, clearly the fact that she was in Cabinet sent a very clear message about the much greater importance of the Housing Minister and the role of Housing more generally in the Government's agenda."
It will be interesting to see how that works out. It will also be interesting to see if the new government takes up the Rented Homes Bill so carefully drafted by the Law Commission and published in May 2006.
Did you know, dear reader, that The Times have included this as one of their 25 top property blogs in their Friday Life and Style section?? I am very honoured. Their comments:
"Low on entertainment, but high on enlightenment. All buy-to-let landlords should make this a regular read."
That does rather sound as if they think I am a touch boring, which is a bit of a blow, but then I suppose I am a lawyer and therefore boring by definition. Still the rest of it is very flattering. Thank you . I will try to continue the enlightenment and perhaps sneak in a bit of entertainment along the way.
I had a very odd court order come though the post today. It was in respect of a hearing two days ago (which surprised me to start with!). It had the correct heading, but then said that the hearing took place in on 15 June in the Clerkenwell and Shoreditch County Court, whereas in fact it was in Norwich County Court on 25 June. It said that the defendant did not attend when he did, although they got his name right. They got the name of the Judge wrong though, and the judgement sum was incorrect, etc, etc.
It looks as if two separate cases have got confused. Perhaps there is a Clerkenwell case where the parties are going to receive an order with my case details in it! So much for the new central system.
The moral of the story – always check your court orders!
A busy time recently. For my sins I am the Hon Secretary of the Norfolk and Norwich Law Society, and I have been very busy dealing with the launch of our new web-site, which went live on Monday. The site not only has more information for the public and members than our old site, but also includes the membership database, so we can use if for subs admin. Hopefully it will eventually save us time. However it is certainly taking up a lot of my time now as I try to get the database in order, and deal with the various glitches and problems which occur whenever a complex site goes live. However I am quite pleased with it.
The other thing is the imminent launch of my book
There is an interesting article in the Guardian pointing out that buy to let landlords are buying up properties suitable for families in Nottingham and letting them out to students, and that this is causing major problems in the area. Students leaving the place in a mess, shops closing and pubs closing during vacation, and schools being put at risk as there are fewer children.
Emailed comments from readers at the end confirm this trend for other towns such as York and Bath and bemoan the fact that absentee buy to let landlords are being allowed multiple mortgages by landlords helping to push property prices beyond the reach of ordinary people.
It is a difficult problem. One answer is no doubt the extension of licensing suggested by the article, which points out that landlords are selling larger properties and buying two story ones to escape the current licensing regime. Any extension of licensing would be bitterly opposed by the landlording community however (many of whom are responsible and provide an excellent service), and local authorities would struggle with their present funding to deal with this additional work.
However the real problem is undoubtedly the shortage of housing generally. After all students have to live somewhere. Universities generally bring benefits to towns and cities, but you cannot have a university without students! Also many students will stay in their university town and become part of the community - at least that is very common in my own city of Norwich (my husband being one such!).
It looks as if the problem may be relieved to a certain extent in Nottingham as at least 5,000 purpose built student rooms are to be built there shortly. If other universities follow suit (and if there is profit to be obtained from student housing they probably will if they can get the investment), this will help considerably. However unless either more property is built, or there is a property crash, or wages increase substantially, it is unlikely that property will become more affordable for low income families.
But then, it was ever thus! Low income families being unable to afford to buy their own homes, although unfortunate, is hardly a new problem.
The tenant’s dilemma, a new report from the Citizens Advice Bureau, states that tenants are put off complaining about their landlords failure to keep their property in proper repair because their landlord might retaliate by evicting them under the section 21 ‘loophole’. Government figures indicate, they say, that nearly one million private rented homes fail the Government’s decent homes standard and therefore need repair. It asks for a change in the law to prevent landlords being able to evict under section 21 where tenants are trying to enforce their repairing rights.
Although I do not agree with landlords being able to evict in retaliation to their tenants requests to make their homes meet basic standards, we do have to be careful about interfering with the landlords right to evict under section 21. This has been one of the main reasons for the buoyant private rented sector we have today. If landlords perceive that their right to recover their property is being interfered with, this may result in many selling up or discourage potential new landlords. It is important that there is a good supply of rented accommodation if only because local authorities need to have properties available in the private sector to place people in priority need (who they have a statutory duty to house), as much of their own housing stock has been sold under the right to buy.
As the report points out, the right to evict under section 21 has already been made unavailable to those who fail to get a license for a (mostly HMO) property subject to licensing, or who fail to protect damage deposits under the new statutory tenancy deposit scheme. This could be extended to properties in disrepair, but care must be taken so that ‘devious tenants’ cannot take advantage of it.
However, if the HMO licensing regime is extended to more, or even to all rented properties (as many suspect it may be), the problem may well be solved in that way. All licensed properties need to be inspected at some stage during the 5 year license period, and if it fails to meet the statutory standards, and landlords fail to carry out the necessary work to bring the property up to those standards, licenses in future should be refused. As this will have nothing to do with the tenant, landlords will not have any reason for (or obtain any benefit from) carrying out retaliatory section 21 evictions. Indeed if they are unable to obtain a license because of the condition of the property they won’t be able to use section 21 anyway!
I think that this or something similar, is probably the best way to go. To make the request for improvement work come from the local authority rather than the tenant, so the tenant cannot be blamed for it. Also, once a property has been identified as being in poor condition, this should be noted in the local authority files, and a check kept upon it until the repair work is done. So that if it is then let to another tenant, action will be taken without the tenant having to do anything about it.
The report suggests at the end that the right to use section 21 could also be limited to landlords who are members of an accreditation scheme or other similar organisation. However I think that this would probably be a step too far. There is no point in having a strong scheme to protect tenants, if because of it few people are prepared to be landlords any more. This will benefit no-one, tenants least of all, as there will be fewer properties available for them to rent.
I have been neglecting this blog of late, for which my apologies. I have been rather caught up with work – my book is nearing completion and I was given just a few days recently by my publishers to check the proofs. This meant that I had to drop everything to get it done. A good thing I had nothing urgent on! Publication is getting very close and I was excited to see that it can already by pre-ordered on Amazon!
The book is to be called ‘Renting: the essential guide to tenants rights’. I wanted it to be called just ‘Tenants Rights’ but I suppose my publishers have their reasons. I am quite proud of it and Mr GP, a legal aid practitioner who kindly agreed to have a look at it, seems to think it is all right.
You can see it on Amazon here
Coming as I do from south east London (where the taxis don't go after midnight) I was devastated to learn about the Cutty Sark fire. I have often been there in the past, and only last year we visited it, at the request of my son, while on a family weekend holiday in London.
Here is a picture taken during that w/e, of what it used to look like:
Let us hope that one day we can see it again.
I was very concerned to read in the Law Society Gazette today that if the proposed reforms to legal aid go ahead, it will lead to the 'immediate dismantlement' of specialist civil liberty legal teams in some firms. This is because cases dealt with by specialist providers tend to be more complex and time-consuming and are likely to be unprofitable under the reformed 'fixed fee' system. Government cannot expect solicitors to maintain a service if it is going to be run at a loss or at no profit.
Michael Schwarz, partner and Bindman & Partners said "Clients will not have access to specialist lawyers and their human rights will be at risk. It will be an encouragement for negligence or abuse by state officials, and is a recipe for injustice."
A LSC spokesman trotted out the usual statement saying that the numbers of people helped has increased. But we all know that statistics can be very misleading. Maybe more people wanting to know what to do about their grazed knees after tripping on a paving stone in the High Street have been advised via a telephone helpline, but what about those with serious human rights problems who need more specialised help? Does giving basic legal telephone help to ten people really equate to a better service than helping one person with a serious but expensive human rights problem? It is certainly cheaper, so maybe in government-speak it is.
It is ironic that the government which introduced the Human Rights Act is now going to be responsible for taking away the ability of people to use it.
Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.
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Housing associations, in particular Riverside Housing Association, will have been popping champagne corks recently, to celebrate the result of the recent House of Lords decision in the case of Riverside Housing Association v. White.
In this case Mr and Mrs White, who were being evicted by their landlords, Riverside, sought to claim that they were not really in rent arrears because Riverside had not complied properly with the rent review clause in their tenancy agreement for the past four years or so. Worryingly for the housing association, the Court of Appeal agreed with them. This had very serious implications for Riverside, as the Whites were not the only tenants whose tenancies contained this clause and whose rent had been increased in this way. They had no option but to appeal.
The House of Lords have now found in their favour, finding a slightly different way of interpreting the wording of the review clause. However there were some interesting points in this decision:
I was on the radio last week! I got rung up I think on Monday by a lady from Radio Solent (Hampshire, miles away from me in Norwich) saying that they wanted to do a feature on lodgers and would I go on and talk a bit? Well I’m always willing to give it a go if it means publicity for Landlord-law (such a capitalist!) so I said yes, why not?
Although I would have preferred to be interviewed on proper landlord law, my site does cover lodger stuff. Apparently there is not much on the net on lodgers so when she did her re-searching, my site was pretty high up on the list (perhaps partly due to my www.lodger.org.uk domain name).
They were not able to do the first day they suggested as someone important in sport died and they had to do a feature on him, but we did it on the Friday.
As it was in Hampshire and I am in Norwich it was done on the phone. You get rung up and they then put you on hold but you can hear the program. When you are on the air they clue you in by asking a question with your name in it so you know when to answer. It is all very immediate and frantic on the radio, quite fun, but there were constant interruptions for things like traffic reports, or updates on a charity auction they were doing. I just sat there and spoke when asked to.
I listened to myself later via the BBC listen again feature and I suppose I was not too awful, although I ummed a bit. But you do, don’t you, when you are thinking of what to say? I don’t think there were any real bad bits, although I suspect that they knew when I was struggling as they would cut in with a charity auction update, which let me off the hook a couple of times.
Anyway, I have now ‘done’ radio. Did anyone hear me? What did you think?
Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.
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I read a news report recently which said that about 97% of all landlords holding deposits have not yet joined one of the government authorised tenancy deposit schemes. Although one reason for this surprisingly high figure may be that many landlords have not needed to join a scheme yet, it is still disgraceful. So I have decided to do something about it!
I have therefore drafted up two county court claim forms (one for tenants who paid deposits after 6 April 2007 and one for tenants who paid the deposit earlier and whose tenancy was renewed after 6 April 2007) and a set of instructions, to enable tenants to reclaim their damage deposit and the 'fine' of three times the damage deposit figure, and these are being given away free of charge to annual members of my online service at www.landlordlaw.co.uk.
I did consider adding this to my list of online kits. However I charge extra for these as they are very detailed and include telephone advice. The tenancy deposit claim is fairly straightforward (4 pages of instructions as opposed to about 30) and I know that many tenants will not be able to afford my subscription fee and an extra fee for a kit. I am afraid I do want the subscription fee though (I have to earn a living somehow)! Also if the tenants are members, this will allow them to ask questions in the members discussion forum, which will serve instead of the telephone advice.
Hopefully my landlords will not be too annoyed about this and think I have betrayed them! But my site is for both landlords and tenants, and I have to keep tenants interests in mind too. All my landlord members should be already complying with the scheme anyway, and if they are dong it, why should other landlords get away with flouting the law?
I would be interested in any feedback from tenants using the forms to bring a claim.
I see from the Law Society Gazette this week (p5) that the County Courts made a profit of £45.5 million pounds last year. So why, when I was speaking to the manager of our local court last night, did she tell me that they have a massive turnover of staff because they cannot afford to pay them properly, and that they have horrendous listing problems because they cannot afford to use enough Deputy District Judges? Where is all this money going to?
By the way, turn over to page 21 of the Gazette and you will see a bit about me!!!
Of course it could all be part of a plan. "Getting a bit expensive to pay all those solicitors. Why not make it really difficult for them. Death of a thousand cuts. No-one will believe them when they complain, no voters will anyway. They are just whinging solicitors wanting more gravy.
Then when there are no firms left prepared to do the work, let the supermarkets and big companies take over. They will be able to automate it, do it at a bargain basement price. The clients, sorry customers, won’t know the difference. They don’t understand what its all about anyway. Give them a free digital clock with their first appointment and they’ll be happy.
We don’t want all those small firms anyway, so untidy, much better have one big one like Tesco. Get into a working agreement with them, so they won’t start criticizing and arguing and encouraging their customers to be difficult about government decisions. Things will be much easier. Lawyers will have to behave themselves in future and the exchequer won’t have to hand out all that cash."
Paranoia or what?
It looks as if some Councils at least are using the new Empty Dwelling Management Orders which came into force last year. I am delighted to see that my own local authority of Norwich seem to be in the van here, as reported in the Evening News, and their own web-site.
However it seems that they are not alone. David Ireland, the Chief Executive of the Empty Homes Agency, reports on his blog that other orders are being obtained in South Oxfordshire District Council. But, he reports, it is often enough just to threaten to use the order. Apparently Manchester have done this on no less than 15 occasions, each time the property was sold or let.
Its nice to hear of empty properties being brought back into use.
I was sitting at my computer about three weeks ago, wondering how I was going to fit everything into my day, when I was rung up by a journalist from The Times.
"I’m doing a feature on online sources of information for Landlords" he said ("goody, goody" I thought) "and I would like to mention your Landlord-Law website." ("Yippee!!") " But to do the article I need to speak to one of your web-site members, today, and this really needs to be someone who would agree to have their photograph taken. I know it’s a bit short notice but could you find someone by about 4.00pm this afternoon…"
Well after a lot of ringing around I managed to find him three loyal members in the end, by lunchtime, one of whom was the nice Mr Thornton who he finally used. The article however did not appear until today, about three weeks later, when I had forgotten all about it. Typical! I will have to see if my newsagent can get me a copy.
You can see the article online here. I can’t see the photo of Mr Thornton though, although he told me it had been taken. Maybe it is in the printed edition.
Nice article though. I particularly like the 'respected solicitor and author' bit. Sometimes I feel I could do with a bit more respect, particularly from my family (fat chance). But I note that I answer the Q&A once a fortnight not once a month.
He also mentioned this blog! I had a look at the Times moneyweblog he referred to but could not find any entries on landlord matters. So you are better off sticking with the Landlord-Law Blog! Why not bookmark it now? Or better still subscribe to the RSS feed! (You can do this by scrolling right down to the bottom of the screen and clicking the subscribe to posts link).
The telephone rang just now. "Hallo" said a male voice, "can I speak to your senior partner please, if he's in"
"You can speak to me", I replied, "I'm the sole practitioner"
He put the phone down.
Was it, do you think, because I am female or was it because I am a sole practitioner?
Figures from the DCA show that landlord possession claims were 20% down during the last quarter. Co-incidentally this was the first quarter after the rent arrears protocol came into force. That’s the protocol which requires social sector rent officers to try to sort things out before issuing proceedings for possession.
So maybe it was a good idea.
My anonymous correspondent (postmark Colwyn Bay) has sent me a cutting from the Big Issue Magazine, which shows that ASBO landlord Dickens is facing yet more court appearances. He has now received a summons from the Health and Safety Executive under the gas regulations, the gas appliances in his former properties having been substandard and the flues full of rubble.
I am glad to see the HSE doing something in respect of these regulations, which after all are there to prevent people being killed by gas emissions. I am just concerned to see that the article emphasises how unusual it is for the HSE to summons offenders in this way.
The article goes on to say that the authorities are using this high profile case to send out a strong message to landlords in North Wales. If that message is that avoidance of the gas safety regulations will result in prosecution, I hope that they will bring a few more, to press the message home. There is not a lot of point in having safety regulations if they are not enforced.
There was a big lawyers demo against the legal aid 'reforms' at Parliament today, but so far as the early evening news was concerned it might just as well not have happened...
As we work from home we are able to watch the news at lunch time. I was encouraged to see a rather good report of the demo on Channel 4 news which I felt presented the problems perhaps as well as we can expect. However it seemed to have vanished off the airwaves by the evening.
I made a point of watching BBC1, ITV and the 7.00pm Channel 4, and it was not mentioned on any of them. Indeed I have not been able to find much on the internet, other than a few blog entries and this on Channel 4 (not nearly as good as their lunchtime effort).
Of course it might be reported on Newsnight later on, but I am not sure if I can face another news program. I suppose the fact that the most needy in our country are shortly going to find it difficult to enforce their rights is not considered to be a newsworthy topic by those who select the stories to cover.
There are a lot of landlords who are very annoyed about the tenancy deposit scheme (described in previous posts). And many are not just annoyed about it, they are determined to avoid it! Here are some of the ideas I have heard:
Letting property as an assured rather than an assured shorthold tenancy. Well they can do this if they want to, but I think they will be pretty silly if they do. The benefit of an assured shorthold, as opposed to just an assured tenancy, is that you can use the 'no fault' notice only ground for possession to evict the tenant once the fixed term has come to an end. Let the property as an assured tenancy, and they will be able to stay there forever, so long as they keep paying the rent. Mind you if the landlord once lived there, or is going to live there after he gets it back, as his only or principle home, he may be able to use ground one (the owner occupier ground) to get the tenants out if he needs to. But that is not going to help the landlord with a portfolio of several properties – he cannot live in them all!
Taking a guarantee rather than a deposit. Well this would probably work in that they won’t have to comply with the scheme. However neither will they have money to hand – if they need it they will have to extract if from the guarantor. Who may not be willing to pay just now, and may need taking to court. Less trouble than the deposit scheme? I think not.
Putting up the rent instead. Well this again might get around the problem, but it will also make their property more expensive and less attractive to tenants (although of course they will not have to find a deposit). Plus if this brings the rent to above the market rent, the tenants have the right to challenge the rent this by referring to the Rent Assessment Panel, who may decide to put it down again. If this happens the landlord will not be allowed to put the rent back up again until after the end of the fixed term. NB, putting up the rent with a 'cash back promise' to the tenants if they leave the property spick and span is probably a bit too risky. Bearing in mind that there are pretty swinging penalities for non compliance.
The Tenant Guarantee Scheme. This is an insurance solution being developed by Residential Landlord and Letcare, where the tenants will be insured, with the benefit assigned to the landlord, for (we are told) more than a the deposit would have been. This does actually sound pretty good, however if the tenant has to pay the premium, would this be treated as a deposit in disguise? Also the web-site tells us that "only tenants with exemplary credit histories and references are accepted into the Tenant Guarantee Scheme". What about those with a less than exemplary credit history? They have to live somewhere, and I doubt that there will be enough ‘exemplary’ tenants to fill up all the rented property on offer.
No deposit. Finally there is this approach taken by a builder client of mine who says that he is just not going to take a deposit any more on the basis that as he is a builder he can get any repairs done quickly and cheaply anyway, and it is less bother. Probably the least risky course of action (and one I suspect that will be popular with his tenants), but we are not all builders.
But I think that landlords will probably find, once they start using the schemes, that they get used to them, and maybe wonder what all the fuss was about. That is what happened in Victoria, Australia apparently, where they have had damage deposit protection for some eight years now. The same company, Computershare, is running the custodial scheme here, and I suspect that they will run a pretty slick operation. In fact all of the schemes are anxious to cut down on the paperwork and will prefer landlords to register and do as much as possible online. So as long as landlords have a computer and broadband they should be all right!
It is probably also worth remembering that very many tenants (not a majority but still a lot) have had their deposit unjustifiably withheld (stolen some would say) by greedy landlords, and it is only right that they should be given protection.
Not a good day today. Problems with my website not working properly and people not sorting it in time to let me to get things done before the weekend, problems with other people not providing me with drafts when they said they would (so I had to draft them at short notice myself), problems with other people not getting other webby things done in time, sometimes I feel I am the only one doing anything. Thank God its Friday. I can sit here tapping soothingly into my laptop listening to Gene Harris’
And we did have spotted dick and custard for pudding. Very un PC of course, but nice.
Maybe if I forget about all the work problems I will wake up on Monday and find that they have been magically sorted over the w/e. Maybe.
I know it is going 'off topic' but I must just enthuse about a new jazz/blue CD I have bought - the The Best of the Concord Years
Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.
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I have now visited and done interviews with all three of the companies running the new Tenancy Deposit Protection schemes, due to come into force on 6 April, so am in a position to say a bit more about them.
The company running the Custodial scheme is Computershare Limited, a large multinational firm. They have set up a company called The Deposit Protection Service Ltd to run the scheme, which has a web-site here. Their scheme is free but involves the landlord handing over the deposit for them to hold, and their costs come out of the interest on deposits held. They have been running a similar scheme in Victoria, Australia for the past eight years, where they tell me, their custodial scheme is the only one. Apparently landlords moaned a lot when it was set up, but now take it for granted. They feel fairly sure that the same thing will happen here. I think that their web-site is pretty good and I suspect that they will run an excellent service.
There are two companies running Insurance based schemes. These are where the landlords get to keep the deposit but have to pay the scheme administrators for the privilege. They are both different, one is aimed largely at landlords and the other at agents.
The landlords scheme is run by Tenancy Deposit Solutions Limited which is sponsored by the National Landlords Association with Hamilton Fraser, and has a web-site here. Theirs is a pay as you go scheme. Landlords will have to pay a joining fee of £58.75 and then £30 per deposit. National Landlord Association members pay slightly less at £47 and £26. There is an annual renewal fee of £14.70. There are slightly different fees for agents, accredited agents paying less than non accredited agents. Note that it costs £83 to join the NLA, with a few variants.
The final scheme is run by the Dispute Service Ltd, whose web-site is here, and is aimed mainly at agents. The only fees announced at the time of writing this are for agents. These run from £521 for agents who are members of ARLA, RICS etc to £1,609.00 for unaffiliated agents, with a few variants inbetween. However once this fee (which is an annual fee) is paid, the agent can register as many deposits as he wants. So the more deposits are registered, the cheaper overall this scheme will be.
It will be interesting to see how the insurance based schemes go. I know that there is a huge amount of interest in the Dispute Service’s scheme, plus they already have an existing client base as they formerly ran a voluntary scheme for letting agents, and these firms will be passported through into the new scheme.
The National Landlords Association has, they tell me, over 12,000 members and I suspect that many of these will be using the NLA scheme. However other landlords associations appear to be boycotting it, and going for the Dispute Service scheme. I am not sure whether this is because they consider the Dispute Service will run a superior service or whether it is because they do not like the NLA. However it is likely that the NLA will do quite well out of this and will probably pick up a lot of new members, to the fury no doubt of the other landlords associations!
However I suspect that for the smaller landlord, the cheap and easy custodial scheme will be the most attractive, as it will not involve any cost. For if the property has good tenants and no recourse is needed to the deposit, then there is no need for the landlord to incur the additional expenses involved in having the deposit money in his bank account rather than the scheme administrators bank account.
Certainly the custodial scheme will be the most attractive one for tenants, as they will know where their deposit is. The NLA told me that if the landlord fails to pay the deposit over to them in the event of a dispute, the tenant will have to get a county court judgment (as opposed to going to arbitration) before they will pay anything over to them, which I suspect will not please tenants. I also suspect that this comment may not accord with the regulations, but we shall see.
However if you are a landlord, you should, fairly soon, read the information on the various scheme administrators web-sites, and register with them to receive more information. And then make your choice.
