Tuesday, September 29, 2009

The Dispute Service Annual Report

The Dispute Service have published their annual report, which can be downloaded from their web-site (a direct link is here) and it makes interesting reading. I list below the points which struck me.

Generally it looks as if the service has been under some strain during the year, due partly to the increase in tenancies covered and partly due to a huge increase in deposit disputes. Interestingly the report states that the majority of the disputes come from a small number of agents, which, they say, is going to be reflected in the subscriptions (presumably to the offending companies).

The case of Harvey v. Bamford (reported on this blog here) caused them some concern, resulting in a chance of their terms and conditions to reinforce the requirement for landlords and agents to both protect the deposit and serve the notice on tenants within 14 days of receipt of the deposit money. Which, they say was the intention of the act.

There is some discussion of the insolvencies among a few unregulated agencies, which between them resulted in lost deposits of over half a million pounds. The result of this was an increase in premiums and the withdrawal of cover from unregulated agents (reported on this blog here). Apparently half of the agents affected joined NALS and so were able to continue their membership.

There has been a massive increase in deposit disputes in the past year. This was not entirely unexpected, although the number is higher than anticipated, and has caused TDS problem. The report suggests that agents should make more effort to resolve these, rather than just passing the decision on to TDS. The majority of the disputes appear to be about standards of cleaning. TDS has suggested that tenants be given a list of approved cleaners so that if one of these firms are used, the tenants will not be held responsible if the level of cleanliness is subsequently criticised.

Even though all of TDS membership is now presumably regulated agents (save for a few landlords) it is surprising (or perhaps not) that the report complains about poor reporting and documentation provided by agent members. As many landlords will attest, even being a member of a professional organisation does not appear to give any standard of quality.

The report ends with a selection of interesting arbitration cases, which are worth reading.

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Saturday, September 26, 2009

New Apple store opens in Norwich!

The nice people at Apple having sent me an email to say that they were having a 'Grand Opening' of their new store in Chapelfield (a shopping mall in Norwich) this morning, I decided to pop along to see. (Having invested in my wonderful Macbook in January).

I got there at just a few minutes to 10.00, the time of the Grand Opening. The place was packed, Apple fans lining the walls and queueing up between lines of black tape. Excitement was obviously high, when the Apple store employees suddenly all ran up the stairs and did a lap of honour, to accompanying shrieks, hoorays, and high fives all round. Then once they were all in the store, the countdown began, five, four, three, until the glass doors slowly slid open, and the lucky few at the head of the queue were allowed in.

There was obviously no chance of my getting in for some time, so I went off to do more mundane shopping. An hour later I was back. Things had calmed down considerably, however there was still a queue to get in. As it was fairly modest I decided to join it, to see if I was still in time for my free T shirt (promised to the first 1,000 through the door). I had luckily hit a quiet patch as I only had to wait a few minutes (although the queue quickly built up again behind me). Then to cheers from the staff at the door we all went forward, to be greeted by smiles, more high fives, and a white box containing my apple T shirt (and very nice it is too).

Those Apple people are very clever. By only letting people in a few at a time, they prolonged the excitement outside, and general 'buzz'. Greeting us all with cheers and smiles (I bet those staff will be shattered tonight) made us all feel special, particularly as we got a present. And of course, once inside, (as numbers in the store were rationed) there was space to move around and see things properly and in comfort.

Chapelfield management must be delighted with their new tenant. I am sure that they will bring in lots of new customers. Indeed it is good for Norwich generally, already one of the top shopping destinations in the country (and being a fabulous city, a jolly nice destination in itself anyway). And I am already thinking of changing our office PCs over to Macs ....

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Friday, September 25, 2009

Amazon are selling my blog!

I was rather startled to learn today, via one of my feeds and reports, that Amazon appear to be selling a monthly subscription to this blog on Kindle for $1.99 per month! Can they do this without asking me first? It seems a bit of a nerve.

Mind you, the blog will not be of huge interest to most Americans unless they own property in England which is rented out. But even so ...

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Thursday, September 24, 2009

Plumbing problem

Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.


My Mother belonged to one of those schemes, where you make regular payments, and that is supposed cover callout charges for plumbers etc.

Last week she had an urgent plumbing problem. She duly rang the help line but after punching a series of numbers into her phone, was eventually told that no-one was available to take her call and that she should ring back. She did, but had the same problem. Needing to get the repairs done quickly, she contacted a plumber herself and the work got done.

However when she tried to get the money back, she was told this was not possible. For her to claim, the work needs to be done through the company and by one of their plumbers.

Needless to say, she has now cancelled her subscription.

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Wednesday, September 23, 2009

Long term tenants in Norwich

As a solicitor I see a lot of problem tenants and find myself writing a lot about problem situations, so it is nice to do a post about a tenancy, reported here on Norwich Evening News 24 website, which has been 100% successful. Doris and Jack Goodson have been tenants of their home in St Lawrence Street, off Pottergare, since 1967 and they have loved every minute of it.

Mr Goodson: “We've been ever so happy in this house. I wish we could take 40 years off so I can have another 40 years in the house. We have lovely neighbours and we all get on really well together."

The pair are the longest-standing tenants of Norwich Housing Society, who are this week celebrating their 75th anniversary.

Maybe if you choose the right tenant, you too could have no voids for 42 years!

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Sunday, September 20, 2009

Taking in a lodger may invalidate your insurance

Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.

See also my new website The Lodger Landlord.


This is the subject of an excellent (if worrying) article in today's Observer. Were you aware that failing to make proper enquiries, or taking in students (which some insurers find particularly objectionable "because the lifestyle of students - bringing friends home and perhaps leaving doors unlocked - poses a greater risk" according to the Bank of Scotland), can leave you without cover?

"We cannot provide home insurance to lodgers or paying guests because you [the policyholder] are giving access and responsibility for the security of your house to someone you do not know," said a spokeswoman for esure, "If a policyholder takes in a lodger without telling us, their home insurance is potentially null and void because withholding this information counts as non-disclosure."

Other insurers say the same. For example the Bank of Scotland: "If a policyholder did so [rent out a room] without informing us, this could invalidate the cover". Even if you are covered, an insurer is likely to refuse to pay out against losses from burglary, if there is no evidence of forced entry.

So what should you do? Here are some suggestions:

Tell your insurers
This is probably the most important thing. If you can show that your insurers were told, preferably in writing, that you were going to take in a lodger, and they did not warn you that your policy was at risk, you will have a good chance of successfully challenging any non payment of claims on that basis. Make sure you contact your insurers in good time, so that if they say that you will no longer be covered, you have time to find another insurer before the lodger moves in.

Carry out checks against your lodger
You should of course be doing this anyway. You need to take references and consider also getting a credit check done (there are many companies online which will do this - you will find some listed here). Make sure you double check that referees actually exist, and that the telephone number given is not that of a friend of the prospective lodger! For example employers details can be verified by looking in the telephone directory or online.

Get your lodger to sign a letter confirming they have no unspent criminal convictions
Many landlords will find it very embarrassing to question potential lodgers (who they may then be sharing a home with) about this. Probably the best thing to do is just give them a form to sign, saying that it is a requirement of the insurers. Of course if the insurers themselves produced a form for landlords to use, this would make things easier.

It seems from the Observer article that insurers will expect landlords to question lodgers about unspent convictions. Zurich told them: "We do want a homeowner to ask tenants about criminal convictions because you have to declare, at inception or renewal of a policy, if anyone in the property has a conviction. We could decline a claim and void a policy because of non-disclosure. If the lodger lied to the homeowner we would look at it on a case-by-case basis. If the policyholder can prove they have a process including written confirmation, this is as much as they can do."

Find another insurance company if necessary
If your current insurer is proving difficult, this does not mean that you will be unable to find cover. For example companies which specialise in landlord insurance may be able to assist. If your lodger admits to a past conviction, but you still want to let a room to him, the charity Unlock (the National Association of Reformed Offenders) may be able to help you find an insurance company prepared to offer cover.

In conclusion
It is very important to be aware of this problem and to deal with it when taking in a lodger, Otherwise you may be in a position of suffering losses but without being able to make any claim against your insurer.

(NB All quotations are taken from the Observer article)

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Friday, September 18, 2009

A company let of a room in a shared house?

Over on the Property Tribes forum, there is a question by a lady letting out a room. Her prospective tenant/lodger told her that as he is self employed, he is going to have the rent the room out through his company.

My view is that a company let of a room in a shared house or a room as a lodger, is wholly inappropriate, but having been put on the spot, I can't put my finger on just why! (Maybe its because it is late on Friday evening ...)

Do any other lawyers have any views on this?

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Fraudsters target student tenants

Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.


Most students living away from home will need to find living accommodation. And where better to do this than one of the many online property services advertising properties to rent? There is just one problem though. That property you really love, may not actually exist!

There is a growing problem of criminals advertising fictional properties and asking for money up front as a condition of viewing. Needless to say, any money paid over is lost forever. The problem is getting so bad that the Metropolitan Police have issued a warning, which you can read here.

We had a really useful guest post recently from Dave Dugdale on how to catch a rental scammer, and this is well worth reading. However, specifically for students, I would add a few other points:

  • Never pay money in respect of a property you have not seen
  • Only use landlords and agencies recommended by your college or university, or someone you trust
  • Don't allow yourself to be rushed into anything. If you feel under pressure, or uneasy about a property or landlord, look for somewhere else
  • And finally, if something looks too good to be true - it probably is!
If you want to check up on a property or landlord, there are a few things you can do:
  • Do some searches on the landlords name (or his company's name) on Google - you never know what you may find!
  • Do a search at the Land Registry - this will show you the registered owner of the property and whether it has a lot of loans registered against it (a lot of loans may mean that the landlord is more likely to default on his mortgage payments, leaving you liable to be evicted by the mortgage company)
  • If the landlord is a limited company, do a search at Companies House to check that it exists
However the most important thing is to be very careful and not to hand over any money unless you are absolutely certain that you are dealing with a reputable landlord or agent.

Incidentally, if you find out that an online ad is suspicious, the property web-site hosting it would probably like to know! They don't want misleading adverts on their site as it reflects badly on them. For example, property website Upad has introduced a ‘report ad’ function, which you can use to alert them to a suspicious advert. Other portals may have something similar or at least a mailto link you can use.

If you have any other tips, or stories about fraudsters targeting students (or anyone else for that matter) please do leave a comment.

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Wednesday, September 16, 2009

DPS - tenant with CCJ unable to claim back tenancy deposit

Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.

A tenant recently wrote to me with a sad story:

"I vacated my property in February 2009, and due to the DPS not returning my deposit I became homeless. As the landlord and I were in dispute over the return of the deposit I had no option that to pursue the claim through the county court.

I did so and on Sept 3rd I attended court and was awarded the claim in my favour. I sent a copy of the General Form of Judgement or Order to the DPS and was advised under their terms and conditions (which I have never seen before) they cannot release the deposit as the order makes no reference to the DPS, but does state the landlords name.

This seems outrageous to say the least, and has caused me to have even more depression and stress. Can these people really hold me to ransom like this. I have been awarded the money and all I want is the return of my deposit.
I am not entirely sure why the lady did not use the free arbitration service provided, but we have always been told that landlords and tenants are free to use the County Court instead of arbitration if they prefer. I have had a look at the DPS terms and conditions though, and they do indeed say at clause 17:
"The DPS will not release any part of the Deposit unless it has: ....
iv. a Court Order which refers specifically to the Deposit and/or the scheme administrator and the amount of the Deposit to be paid out.
However it does seem very unfair that this lady should be deprived of her money (and we always have to work from the premise that the deposit is the tenants money) simply because the DPS have put this clause in their terms and condition. How many tenants, who after all are ordinary people and not lawyers, are going to read the detail of the DPS terms and conditions before issuing proceedings? It is not something that would occur to most people.

What do you think about this? Do you have any suggestions as to how this lady can get her deposit returned to her?

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Tuesday, September 15, 2009

Tenancy deposit protction - now only 30% failure

In July 2008 I did a post called Tenancy Deposit Protection - 62% failure which was based on a survey done by the Deposit Protection Service (DPS), one of the three tenancy deposit protection schemes. This survey said that 62% of landlords were flouting the law and not protecting tenants deposits as they should under the tenancy deposit protection scheme regulations, which came into force in April 2007.

One year on, the DPS have done another survey, and this shows that the situation has improved. However 30% of landlords are still openly admitting that they are not registering deposits. This is despite the fact that any s21 notices served on the tenant will be invalid until the deposit is protected, and that the tenant can also go to court and claim a 'fine' of three times the deposit money.

The conclusion reached by the DPS is that the government's idea of having a national register of landlords should be implemented. Many landlords however are stongly opposed to such a scheme.

Perhaps the best solutions would be

(1) to make sure that the requirment to protect deposits is widely known (so tenants are more likley question landlords this), and
(2) to make it easy for tenants to claim the penalty from non compliant landlords.

The the word is gradully getting out (which is probably why more landlords are now protecting deposits), but claiming the penalty award can still be a nightmare. The legislation has proved to be so problematic that no-one really knows where they stand. As can be seen from other posts about tenancy deposits on this blog!

What do you think is the best solution?

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Monday, September 14, 2009

Liberty - Charity of the Month (September 2009)

This year, 2009, is the 75th anniversary of Liberty, formerly known as the National Council for Civil Liberties. Founded in 1934 as a cross party organisation, they have during that time been “the conscience of a nation, fighting injustice and placing principle above populism”.

They are at the heart of the movement for fundamental rights and freedoms in England and Wales, and promote the values of individual human dignity, equal treatment and fairness as the foundations of a democratic society.

If you believe in their work you can find various ways to support them here.

For more information about your rights, see the information website here.

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Sunday, September 13, 2009

Urban Myth - a short let cannot be an AST

This myth is based on reality, and is due to the history of the assured shorthold tenancy (AST).

Protected tenancies under the Rent Act 1977
When the Housing Act 1988 first introduced ASTs, people were still used to the old Rent Act system of protected tenancies (although protected shortholds had been introduced by the 1980 Housing Act and there were quite a few around).

Under a Rent Act protected tenancy, a tenant instantly obtained long term ‘security of tenure’, and was entitled to stay there (so long as they behaved themselves), effectively forever, at a ‘fair rent’ (what a landlord of mine once described as ‘expropriation without compensation’).

Assured Shorthold tenancies before February 1997
The Housing Act 1988 changed all that, and with an AST, tenants could be evicted after the end of the fixed term without the landlord giving any reason at all, provided the proper procedure was followed. They could also charge a market rent.

So, when drawing up the legislation, Parliament felt that tenants need to be warned about the type of tenancy they were entering in to, and therefore imposed conditions on the creation of an AST. These were set out in section 20 of the Act and said that:

  1. The tenant (who must be a new tenant, an AST could not be granted to an existing protected tenant of the landlord) had to be served a notice telling him he would not get security of tenure (this became known as a section 20 notice)
  2. The fixed term must not be less than six months, and
  3. The landlord did not have the power to end the fixed term earlier (i.e. there could not be any break clause in the tenancy agreement).
Although Parliament was trying to be fair, in fact this rule lead to quite a few injustices (as often tends to happen in the ‘Nanny state’). Professional landlords and agents generally got things right. However, many amateur landlords did not appreciate the need for the section 20 notice to be given in advance, and created assured tenancies by mistake.

In the 1990’s and early 2000’s, I had quite a few landlords consult me about evicting their tenants, where nothing could be done, even though in many cases the tenancy had been granted on the understanding that it would be an AST. This was because the landlord had given all the paperwork to the tenant all at the same time, meaning that the s20 notice had not been handed over before the tenancy had been entered into, as required by the Act. Therefore the tenancy could not be an AST.

Assured shorthold tenancies after February 1997
Presumably this filtered through to our law makers, because in 1996, when the Housing Act 1996 was passed, this requirement was done away with for new tenancies (although it still applies to older tenancies). By then everyone was used to ASTs anyway, and arguably did not need the protection of the section 20 notice. From 28 February 1997 when this part of the 1996 act came into force, (virtually) all tenancies were or will now be an AST automatically, and there is no need to serve a section 20 notice any more.

So now you can have a tenancy fixed term for as short a period as you wish. Most are for six months, but you can have a tenancy for a week, a month, three months and two days, whatever you want.

The sting in the tail
There is a sting in the tail though. Parliament, reluctant to abandon ‘Nanny mode’ altogether, felt that tenants still needed protection. They therefore introduced in place of s20, a rule that says that possession orders are not enforceable within the first six months of a tenancy (that is the first tenancy - the rule does not apply to renewals). So what this means is that a tenant can take advantage of a two month let (by moving out at the end of the second month), but the landlord cannot. If he wants his property back he can’t get an order for possession until after six months.

There have been proposals to remove this rule (sometimes known as the ‘six month moratorium’) but it does not look as if this is going to be any time soon.

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Landlord Law Urban Myths

This post announces an occasional new series I am starting, which I am calling Urban Myths.

This will highlight and discuss ideas prevalent among landlords and tenants (and even sometimes their advisors), which may be based on misleading versions of the truth, or a hangover from past laws, or sometimes just wishful thinking. But all wrong!

If you have any ideas for topics for this series, please email me at tessa@landlordlaw.co.uk

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Friday, September 11, 2009

The London Landlords' Show - comments

Well the London Landlords Show is now over for another year. Thank you to all who came along to my talks and clinics.

I would also like to apologise to any who came along on the Thursday thinking to see my Dealing with Rent Arrears talk, only to hear me do the Essential Legal Points one - I had no choice though as the organizers decided to change it. Two of you were able to talk to me afterwards in the clinic though, so hopefully that helped.

It was also nice to meet up with other property 'people' - Tom Entwistle of LandlordZone, Mark Garner of LettingZone and James Davis of Upad, to name just a few.

If you weren't able to get to the London Show, I am also going to be at the Birmingham show on 16 and 17 October.

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Tuesday, September 08, 2009

The London Landlords' Show - 9/10 September at Olympia

Just a reminder to people that I will be speaking at the London Landlords' Show tomorrow and Thursday.

On Wednesday I will be talking on 'Essential Legal Points for Landlords' at 3.15 pm, and on 'Dealing with Rent Arrears' at 4.15 pm in the auditorium. I will also be doing a clinic between 2.00 and 3.00 pm.

On Thursday I will be talking on 'Essential Legal Points for Landlords' at 10.30am and doing a clinic between 12.00 and 1.00 pm.

Those who attend the talks will also be entitled to use a special online resource I have set up here. The enrolment key will be given out at the talks.

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Thursday, September 03, 2009

Tenancy deposit arbitrations - why landlords keep losing

Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.

Reading through the excellent 'Landlord & Buy-to-Let Magazine' today (September/October 2009 issue), I particularly enjoyed reading the landlords diary at the back by Barry Brunton. This gave some interesting background information on tenancy deposit arbitration's, which I thought I would share with you.

I was especially interested as a number of readers of this blog have posted their complaints about too tenant friendly arbitrators, for example here. In the context of this, Barrys article is quite enlightening.

He makes the point first that the tenancy deposit belongs to the tenant, and the landlord, if he wants to make deductions, is making a claim which he will have to prove by evidence. And if you do not provide this, you will lose your claim, the arbitrator is unlikely to write and ask you for it. For example:

  • Inventories - these need to be a detailed condition report on the property not just a list of the furniture in it. To make a claim for damage to furniture (for example) you are going to have to prove that it was in good condition at the start of the tenancy. It is best that this is done by an independent firm of inventory clerks
  • You will also need a check out report, again this should be done by the independent inventory clerks
  • Photos are generally of no value as they could be of anywhere. Presumably if they are signed by the tenant and inventory clerk on the reverse and dated they should be acceptable. If used they should be clear and have something (such as a ruler) to show scale.
Barry then explains how an adjudicator would approach a claim for a damaged carpet.
  • He would want to know the condition of the carpet both at the start and at the end of the tenancy
  • Evidence of when it was purchased
  • The cost of replacement
  • And the normal life of such a carpet
  • He would consider whether it could instead have been cleaned
  • Or whether any stain is relatively insignificant and can be left
  • In his award he will consider fair wear and tear
  • And base his award on the cost of replacement carpet but not underlay
  • For a ruined 3 year old carpet, the landlord (he says) will be lucky to get 40%, even if he can prove everything, as a tenants deposit is not a 'new for old' insurance policy
This is a bit different from in the old days, when the landlord would just deduct the cost of a new carpet leaving the tenants to sue him at the county court if they disagreed.

It seems that adjudicators also expect landlords to post notices explaining how things work and will accept a tenants excuse that he did not know (and therefore is not responsible for damage through misuse) even if the landlord has provided manuals. For example in one case, a tenant ruined a lawnmower by not putting oil in, but he successfully argued that he should not be held responsible as there was no 'check oil before use' notice on the mower, even though this was set out the manual he had been given.

I am beginning to see why landlords are often so incensed at arbitration results. I agree that the landlord should have to prove his case, but this seems a bit too much. I wonder whether a Judge in a County Court case would have come to the same decision.

Have you any stories to tell? If so please post a comment.

In the next issue, Barry is going to talk about adjudicators dealings with claims relating to gardening, condensation and tenants changing. Order your free copy now.

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Wednesday, September 02, 2009

4 Ways To Catch A Rental Scammer - guest blog by Dave Dugdale

Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.


I run a couple of classified rental sites in America, and while I do not live in England I know from monitoring Twitters search stream on rental scams, that America is not alone when it comes to dealing with rental scammers.

It feels like an on-slot of scammers have been using my sites to create bogus listings the past 10 months. They try to cheat future tenants out of their deposit money. I have been combating them for the past 6 months and I have learned a lot about how they operate.

I thought I would share with Tessas readers how I track down fraudulent rental listings.

Price Is Way Too Low:
If I see a rental listing come in that looks much lower than the others in the neighborhood, that is when my eyebrows go up and I pull up my chair for a closer look. Scammers are impatient, and with a low price they can get leads quickly.

Free Email Address:
The next step is to see if they are using a free email address like Yahoo, Gmail, Hotmail etc. Scammers only use free email services they can hide behind.

No Phone Number:
Most of the time the scammers will not list a phone number to call; they will only want to communicate by email. Most legitimate rental listings include a phone number. If none is listed, I look even further.

Exterior Photo Does Not Match Google Street View:
Google traversed American streets a few years back, getting a full street-viewto accompany their maps. I understand that Google has now started this project in England. This becomes a powerful tool for detecting scammers because many times they do not use the photos from the real house, so you can check the listing photos against Google Street View.

Duplicate Content Found On Another Listing:
Most of the scammers I deal with are from Nigeria. They want to blend in with the other listings so instead of writing the description of the rental themselves, they copy it from other rental ads. So, I Google paragraphs of the content to see if I can find a match with different pictures, address or price. This is a sure sign of a scam.

In conclusion
A good rule to follow to avoid becoming a victim in one of these scams is to deal with the owner of the property directly. When renting homes, meeting the property owner at the property is always a good practice. This helps you verify independently whether the offer is bogus or not.


Bio: Dave Dugdale has been in the online rental advertising business for 5
years with his sites RentVine.com and PickRent.com. He was the first to write a blog on the rental ad industry, and the first to podcast interviews of industry experts in property management (all for a USA audience). Dave has also been leading the way in better detection of rental scams by sharing his database of blacklist email addresses with competitors.

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Tuesday, September 01, 2009

Letting to companies

Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.


Most residential lets are to people, real people who are alive and who physically live in the property. However sometimes lettings are made to a limited company. If this happens there are a number of important differences and a few things to watch out for.

Firstly, lets to companies are not assured shorthold tenancies (ASTs). The reason for this is that the act which set up the protective code which governs ASTs, the Housing Act 1988, specifically states that its provisions apply only to 'individuals' i.e. not to artificial beings such as companies. Companies are businesses (so the argument goes) and do not need the protection that the act gives.

What this means is that 'company lets' (as they are called) are governed by the underlying 'common law', the legal rules which regulated tenancies before the Rent Act and Housing Acts came along to change them.

The main practical effect of this is that:

  • you should not use the standard AST agreements found in shops and on the internet, but a tenancy agreement designed for company lets (we provide one at Landlord-Law here)
  • You don't use section 8 or 21 possession notices. The correct form of notice is an old style Notice to Quit
  • The procedure and paperwork for evicting tenants is different
Why do people rent property through a company and not individually? There are a number of reasons. For example, it may be tax related. It may be so that they can provide accommodation for a number of staff and directors on a short term basis. Or it could be to provide accommodation for an employee or director who would not pass normal referencing.

You do need therefore, to be careful with company lets. Although they can be lucrative, bear in mind that you do not really have any control over who the company places in the property once let (technically you can take steps to repossess for breach of contract but practically this is difficult to do during the fixed term, for anything other than rent arrears). You therefore need to take steps to protect your position, before the property is let. I would suggest :
  • Doing a search against the company at Companies House. If your property is an expensive one, consider buying a more detailed report and (in particular) checking the last few years' accounts
  • Taking a guarantee from at least one director, preferably two
  • Checking carefully the references of the guarantors and getting credit checks done
  • Asking for details of the person(s) who will be living in the property and checking them also
  • Either letting for no longer than six months at a time, or ensuring that (for longer lets, eg a year) the tenancy agreement has a break clause.
You should also take a tenant/damage deposit. The good news here is that as this is not an AST you do not need to protect it in a tenancy deposit scheme, as the tenancy deposit regulations only apply to ASTs.

If you are careful, as with all tenants, you should, hopefully, be all right.

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