Tenants

Government Minister introduces intention to enforce PRS landlords to install smoke alarms and carbon monoxide detectors

With an expected absence of any detail, the Communities and Local Government Minister, Penny Mordaunt announced yesterday at the LGA Fire Conference the intention of the government to enforce PRS landlords to install smoke alarms and carbon monoxide detectors in their rented properties. It is not clear if this will apply across the board or just to licensed HMOs  and she did not say in her speech when this regulation will come in to force.

Here is that part of her speech relating to this:

“I am pleased to be able to announce today that following the consideration of responses to the public discussion paper on Property Conditions in the Private Rented Sector we are introducing regulations requiring private sector landlords to install smoke alarms on each storey of their property, carbon monoxide alarms in the rooms considered most at risk from high levels of carbon monoxide and to check the alarms are in working order at the start of any new tenancy.

To aid this we will be providing additional one-off funding to fire and rescue authorities this financial year to enable them to support landlords in the transition to complying with these new regulations.

We estimate the regulations will result in up to 36 fewer fatalities and 1,529 fewer injuries over a 10 year period.

Alongside this targeted regulation for carbon monoxide alarms the government intends to pursue non-regulatory alternatives to encourage installation of carbon monoxide alarms in all private rented sector properties.”

Would you let one of these in to your rented property?

Most experienced landlords will have had bad experiences with tenants’ pets damaging their properties or causing a nuisance with neighbours at some point in the past.

I had a tenant in my early landlord years that had another mouth to feed virtually every time I visited the property. He proudly presented them to me – not just dogs and cats but ferrets, lizards and even a dog fish amongst countless others. It was my experience with him that quickly taught me a few lessons on tenants with pets.

The first thing you’ve got ask yourself is whether or not the property is suited for a particular pet. Is it really appropriate to keep a large (or small ) hound in an upstairs flat? A dog cooped up in there could cause a real nuisance if it kicks off in the middle of the day when your tenant is at work. I won’t allow a pet in a flat. Most of the flats  where we let have shared yards and lazy tenants that allow their dogs to foul this shared space just bring problems to our door with us having to deal with irate neighbours and often we’ve had to work with the council to sort matters out.

Dog owners can really be a problem if they don’t clean up after their animals and can cost you a lot more money if they don’t house train their pet. Dogs left alone in locked rooms can rip up carpets scratching at the door and chew door frames. I’ve had skirting boards rot away because lazy owners allow their dogs to cock their legs in their favourite corner of the room.

It’s not just dogs that can cost you a few quid though. Cats can be a problem too. They love to stretch their claws and pull on them on your furniture and if you have blown vinyl on the walls you’d better have a decorating budget!

So, how can you minimize pet problems?

  1. Decide if your property is appropriate for pets. Does it have its own garden for a dog for example?
  2. Be clear from the outset what your policy is and be very clear with your tenant on the consequences of ignoring clauses in their tenancy agreement and the potential for eviction if they are.
  3. Include in your agreement a clause that says only the pets agreed at the start of the tenancy (if any) are allowed in to the property so none can be added.
  4. If accepting a pet consider the potential additional costs that the regular tenancy deposit might not cover and charge an extra pet deposit.
  5. If you are going to allow pets, consider landlord insurance with additional cover for pets.

The Housing Crisis and the ‘Disappearing Property Ladder’.

I watched yesterday’s Panorama programme about the housing crisis in this country.

The truth is that it is more of a crisis in some parts of the country than in others. Close to where I live now you can find a 3 bedroom terrace house in the centre of a village and within two minutes of a beach for less than £40,000. Renting is also still an affordable option and for most young people, although renting is still more expensive they don’t have to rent for long if they want to get on the ‘property ladder’.

The real problem is ‘down south’ and especially in London. Twenty five years ago my wife and I, in our mid-twenties, bought our first home; a one bed flat in south London for just under £70,000. It meant that with mortgage interest rates over 16% in an economy sliding into recession we lived life on the edge as the risk of losing one or both of our jobs was very real. As things turned out the recession was short-lived and later in the year interest rates began to steadily come down. We were lucky in the long run.

Today’s twenty-somethings in London simply don’t have the choice we had all those years ago. Back then, renting was always going to be a temporary exercise before we bought. Today they either have to live with their parents and try to save to buy a place or rent long term. Since the demise of council house provision, no one wants to rent long term in London and it was the sell-off of council houses that started the current housing crisis.

When the Thatcher government decided to sell-off council houses it was very unfair in the first place. Taxpayers paid to have them built but if you were lucky enough to live in one you got to buy it at a huge discount. There is very little social housing being built now even though it is very clear with the benefit of hindsight to see that the hope the Thatcher government had that the private sector would come to the rescues just didn’t happen.  And this council house sell-off is still happening – last year 11,000 council houses were sold while only 1,180 were built.

So, renting a council house is not really an option anymore for young adults in London. If I was still down there and in my twenties, the only option open to me would be to live outside London and if I found, work that village with the three bedroom house by the sea would be where I would be heading!

There must be an election coming – parties are lining up to give landlords a good kicking.

 

Whether it’s the Labour Party with their ludicrous talk of rent controls and a National Landlord Register or the recent Green Party leader, Natalie Bennett, making a complete fool of herself on the radio when trying, and failing miserably, to explain how withdrawing landlord interest tax relief will solve the housing crisis, landlords could be in for a nervous time depending on what happens in May.

A national register of landlords was proposed by the last Labour administration along with the a registration scheme for letting agents and neither ever saw the light of day. All it would do is penalise good landlords (it’s not going to be funded by anyone else but landlords is it?) and it would drive rogue landlords further underground – if they are bad landlords breaking all current legislation they are hardly going to come forward to register for this scheme are they? The Scottish scheme had only achieved 75% compliance six years after its launch. And anyway, there is plenty of legislation to encourage landlords to conduct themselves well it is just a matter of allocating enough resources to enable enforcement.

As for withdrawing interest tax relief – what a very poorly thought through proposal that is! Can you imagine the housing crisis that would cause as landlords sold up to get out of the market? Who else would fill the social housing gap? What would happen to ‘Generation Rent’ who can’t afford to get on the housing ladder and are forced to rent? The effect on house prices would be political suicide for any party that put that one through.

There are something like 1.6 million private landlords in this country – that’s quite a constituency. Many MPs are BTL investors too so vested interests start coming in to play (don’t they always). One in ten Labour MPs are BTL investors so even Labour wouldn’t go that far.

It’s Silly Season from now until the election and for all parties this means a certain amount of grandstanding to their core voters. None of them have really committed themselves to a programme of social housing to undo the damage of Thatcher’s Right to Buy scheme. Local authorities used it to raise cash by flogging off their housing stock without replacing it thereby forcing tenants in to the private rented sector. Such a commitment would create wealth in the country through jobs and bring about a natural rent control through a rebalancing of supply and demand. Now that’s a policy that makes sense and no one can argue with but it makes less of an impact unless it involves giving someone a good kicking.

 

Do’s and don’ts for Tenants’ do’s and don’ts!

It’s never a bad idea to give some guidance to tenants on what their responsibilities are. It’s all too easy for tenants to not read their tenancy agreement so give them a separate document outlining these responsibilities otherwise they might assume that every problem with the property is your responsibilty – whatever the cause.

It all comes down to common sense. If a tenant treats the property well then there will be fewer maintenance issues. For example, understanding when they move in the causes and affects of condensation, not making any structural alterations, understanding what, if anything, they can do with the property’s decor, their cleaning responsibilities can all save you both a lot of grief later.

I’ve seen it all as a landlord and an agent. Tenants spilling sugary drinks on a carpet and not cleaning up so dirt sticks to it like glue leaving dark stains; not looking after their pets properly and allowing them to damage carpets, furniture, door frames and skirting boards; allowing their children to scribble on walls; not keeping the oven clean; decorating (badly) without consent – the list goes on.

Most of the above are down to laziness and ignorance and most of them can be avoided if you simply point out to tenants, before they move in, what they can and what they can’t do. A cleaning checklist is a useful thing to give them so they understand the condition the property must be handed back in. Also, give them a maintenance guide which clearly outlines what they can and can’t do as well as what you are responsible for.

This landlord clearly has taken things too far with his restrictive do’s, don’ts and fines. He probably looks to make more money from fines than he does from rent. Clearly he is not cut out for this landlord business!

Landlords do's and don'ts  Landlord do's and don'ts 2

 

Late rent payments – how to approach them (and how not to)

 

I was recently introduced to a black-eyed landlord who proudly revealed that he had got in to a fight with one of his tenants. This came about as a result of him implementing his policy of asking for late rent just once and then ‘popping them one’ if he had to go back and ask again. While you might applaud the general idea of a ‘no-nonsense’ approach this ‘One Strike and You’re Out’ method is a little too literal for me.

I read recently of a landlord in the States that took an equally extreme approach to collecting his late rent. Let me explain. Ronald Kronenberger of Ohio was indicted for spanking a tenant that owed him $2,000. I suspect that in his own mind he was probably combining the sometimes onerous task of doorstep rent collection with one of his hobbies. But it didn’t stop there. During the proceedings a disabled man that worked in Kronenberger’s grocery store came forward and said he had also been spanked four times for minor misdemeanors.

Collecting rent and managing late payments can be done in a more conventional way than the ‘crime and punishment’ approach of the above two landlords. As in all aspects of tenancy management treating tenants respectfully goes a long way in cementing a positive relationship that enables early resolution of problems before they escalate out of control.

The Rentcollection approach is to try and get tenants to prioritize their rent over all else so we text them rent due reminders before they pay their rent and rent payment acknowledgements after. When their rent is late it is usually for a normal reason – cashflow problems being the most common. We provide them with another opportunity to make a payment easily with a link to our website where we can take a card payment. This works well for us and so to date we’ve had no need to reach for the boxing gloves or wooden spoon.

While most landlords may well have a wooden spoon and perhaps even a pair of boxing gloves most won’t have online card payment facilities to point their tenants to but the point here is about making it easier for tenants to pay their overdue rent. Making it easier makes it less likely that late payments become arrears, arrears become evictions and evictions become voids.

So what can you do? Don’t assume they are going to proactively follow up a missed payment. Send your tenants your bank details with a request for payment. They may not know yet that their payment hasn’t been made so you may be doing them a service in telling them. Speak to them in the right tone with a concise, matter-of -fact, friendly, non-judgmental approach and agree a date by which the payment must be made. If this payment isn’t made, simply ask them why and if necessary remind them that it is part of their contract to make payments on time and that they have breached their contract in this respect.

At this point remind them that up to now you have not resorted to mentioning the contract but now you have you will have to ask them to stick to it in the future. They may have temporary financial problems but you mustn’t let their financial problem become your financial problem. A reasonable tenant will accept this and so at this point, you should consider serving a Section 21 Notice and explain that this is not an eviction notice but a precautionary measure to protect your interests in the event that the rent isn’t paid. This should be served before the next rent day is due so that no time is lost. And that is where you leave it. By all means continue to follow-up if the rent doesn’t materialize but at least you know that the Section 21 has been served and a date set after which you will seek a possession order.

If the tenant doesn’t make the missed rent payment but does make the following month’s then that probably indicates some temporary hardship and a payment plan over however many months you decide should be agreed. In time, your rational approach will have recovered the missed month’s rent, kept a good tenant and created more goodwill than any clip round the ear or spanking good ever achieve! Of course you could always take the hassle out of chasing late payments and talk to us instead!