Category Archives: Lettings

26Sep 2012

Current Property News: Errant Landlord caught out.

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By Steve Roulstone

I have stated before that one of the major problems with legislation that is policed by Councils is the amount of effort placed upon seeking out Landlords and Agents that ignore the law. This applies to Houses of Multiple Occupation, Fit and proper accommodation, Tenant deposits and in the case to hand today, Gas Safety certificates.

Local Council request.

In this instance a Landlord who was asked to provide copies of Gas Safety certificates for two properties in Staffordshire by her local Council and having failed to do so was referred to the Health and Safety Executive (HSE). It is they that then pursued the matter, but it is good to see a Council taking a pro-active stance in ensuring property is properly maintained.

Legal requirement.

Just to confirm, for those without Gas in a property, the Gas Safety certificate is needed each year to ensure the equipment is working correctly and is safe to use (carbon monoxide gases)

No excuse!

The end result was a fine of £4709 including costs for a £65 job! There can be no excuse for not complying, especially as this Landlord ignored the requests for many months. This also included being given time to produce a certificate by the HSE within a month of notices issued.

Landlord needed convincing.

It does however strike me that by having gone through a procedure with the Local Council and then being given time by the HSE to comply, perhaps the problem lay not in what should have been done, but that the Landlord just did not believe prosecution would actually take place! It looks as though the whole affair took well over a year before any prosecution actually took place!

Contradiction in effect.

This is where action needs to be seen to take place quicker, because if the Law requires a Certificate to be renewed every year, then in a scenario where a certificate does not exist in the first place, to take a year to bring a case to court (assuming that one does now exist?) then the appliances concerned could have been unsafe for anything up to two years!

Does not add up!

Now forgive me for playing the cynic and far be it from me to suggest the Law is not correct, I would not dream of risking not having a property covered for a week, never mind a year, but to take a whole year to bring the case to conclusion for a Law that requires annual checks somewhat makes a mockery of the legislation that demands the check in the first place. Surely by delaying instant action, you are ignoring the supposed risk the Tenants are suffering?

 

18Sep 2012

Current Property News: What Landlords want to know?

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By Steve Roulstone

As part of our good practises when reviewing our methods of operation, between us we always discuss what Landlords ask about and speak about when we visits them to give a valuation and review of their property. It is important for us to be aware of any new trends and old ones and surprisingly, one trend that does not change is that Landlords are still discussing and talking about ‘Nightmare Tenant’ stories and what is done to stop them occurring.

Changed Market.

The market has changed considerably and I am sure will keep evolving over the next ten years. Certainly technology and mobile phones have meant we have to make information available quickly and accessible. Standard of housing has improved as competition for Tenants continues to grow and more and more properties enter the market. Yet the one thing that will not go away is the stories of Tenants trashing houses and the fear that brings with it.

Not common.

Yet certainly as far as I can comment on the houses we have been involved with, this is something that rarely happens now and I cannot remember the last time we had a property that was badly damaged by the Tenants.  We, like all Agents, get Tenants that do not care for property in the way that both our Landlords and we would prefer, but this is always a case of standards rather than actual physical damage done.

Strange beliefs.

There are also plenty of situations where what should be done and what the Tenants actually believe needs to be done differ, such as the Tenant who stated they did not need to clean one bedroom, because they had never used it during the Tenancy. Or the person who broke a window when mowing the lawn and said the Landlord had to be responsible because the lawn from where the stone came was the Landlords and not hers!

Manage to avoid.

The answer for me is to catch problems early and make sure the Tenant knows both their responsibility and our role as Agents in what you are trying to achieve together. In short, good Management will ensure damage limitation. But what this does prove is that some cases must still happen and that bad stories are the ones most Landlords hear first, or perhaps take note of!

Practical experience.

In the middle of writing this Blog, I have visited a new Landlord at their property, student accommodation it may have been, but she described the manner in which the last Agents had allowed the students to live last year. Not a property wrecked, as I have stated, more a question of standards. But it does rather prove my point. Whether self Managing or appointing an Agent, make sure that visits take place and that problems are resolved head on and not left to fester. Perhaps then we may allay Landlords fears by reducing further tales of the ‘Horror Tenants’

12Sep 2012

Property Landlords advise: Finding drugs in rented property.

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By Steve Roulstone

Like all good Letting Agents, we carry out property visits to ensure that our Tenants are looking after the home and living in line with their Tenancy agreement. We are used to looking for evidence of unofficial Tenants, would easily spot any Tenant growing cannabis, but have found a property we manage used for the storage of drugs and that has proven to discover what the house is being used for in these circumstances is a big challenge.

First indication.

The first we knew of a problem at the house was a phone call from the local CID advising us they had suspicions concerning activity of a house in a quiet country location. This was both a heads up but also a request to allow them to go about their business following a raid at the property. They later confirmed that drugs and a large amount of money had been found and seized from the house.

Information.

This was followed up with a visit to our offices where they gathered information about the Tenant, rent payments and our knowledge of what was happening at the property. We were able to supply information which we believe was of use and hand over keys to avoid any further damage and ensure the house was securely locked.

Property inspection.

A week later, with the knowledge that little damage had been caused and confirmation from the police that the house had not been abused and was in good order, we were able to visit the property and officially check out the Tenant at their request and see for ourselves just how the drugs had been stored.

Fridge Freezers.  

Now forgive me, but I have no knowledge of how and where drugs can be stored, but as soon as we opened the fridge and freezer doors, it became evident just what the appliances had been used for. The issue for us was that we had been to carry out a property visit some two months prior and because the house was being looked after and all was clean, as you would expect, we had no indication of the problem. Because the appliances belonged to the Tenant, we would also have no intention of looking in the fridges to check how they were being used. But as soon as we opened them now, even though they had long been emptied, the smell was overpowering!

Systems.

This situation, which is subject of a review of our practises as I write this, is a warning for us all. We have no right to open fridges, washing machines, cupboards and draws or look in boxes, cases or even envelopes that are the property of the Tenant and nobody would expect us to. Cooker yes, because that is always the property of the Landlord, but we need to be aware of the possibility, for if nothing else, this incident has, to say the least, sharpened our focus.

Aftermath.

 Thankfully, the Tenant who is obviously the subject of ongoing Police enquiries (about which this is not the place to comment) was most co-operative and the property will be marketed again without delay. What we must do is build safeguards in to our system, without over-reacting to what has happened, that will ensure we keep our eyes open at all times to possible signs and the Police have been most helpful in discussing the matter with us. What it has proven though, is that ensuring a house is used for its correct permitted usage, remains as difficult as ever!

10Sep 2012

Property Landlord advice: Insulation now available!

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By Steve Roulstone

A few weeks ago I wrote that Residential Insulation which is currently being promoted through the Governments Carbon Emission Reduction Traget CERT and the possibility of Landlords being able to claim for expenditure against annual costs, was very difficult to explain to current Landlords and Tenants when the Industry itself had no way of communicating its message.

VNR Contracting Services.

I am pleased to confirm that I have now found a Company who is not only being proactive in speaking and working with other organisations, but that understood what we are trying to do, but is also happy to put leg work in themselves in achieving a result.

Landlord and Tenant choices.

What we need to know is that as Property Managers, we can rely upon a Company who specialise in the Insulation field to explain clearly the benefits of having Insulation fitted and the grants that are currently available for Landlord and Tenant alike, one through direct costs and one through the tax incentive currently being offered.

Action plan.

This means we will be able to write to our Tenants and Landlords alike with information relevant to them and then allow the Company to follow up with visits to answer questions and quote for the work direct ensuring that our Tenants and Landlords are able to take advantage of the schemes before winter this year, if they choose to get involved.

Service provided.

To us, this is part of what we should be doing as Property Managers on behalf of all of our clients, not for any other reason than from a central point we are in a position to receive information as Companies approach us and distribute the same to a wide audience. It is not for us to dictate what decisions are made or even recommend what options are pursued, rather to place the information in front of those who have the right to take advantage of the grants etc that become available.

Reliable Contractor.

What is reassuring now is that having struggled to find a Contractor to work with, we have been approached by one who already works with local Councils and as such carries a pedigree that is re-assuring. I am happy to recommend VNR Contracting Services Ltd and in reality that is only the second recommendations we have made in over two years of writing!

06Sep 2012

Current property news; Squatting finally made illegal.

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By Steve Roulstone

It is possibly one of the most depressing and sickening things that can happen to a property owner, to find that squatters have broken in to your property and that the law does not support this effective breaking and entering in any way and the responsibility to deal with the intrusion is thrown squarely on the shoulders of the rightful owner. These words, whilst repeated as I remember them, were used during a presentation to the Lettings Industry during a speech on the use of empty housing some ten years ago.

At last!

Now, after so many years the Government has reacted and made it an illegal offense to squat in premises without a legal right or reason to be present. What should have happened then is the unfortunate property owners who were suffering at present be given their voice and an outcry of at last should have been heard. What was heard was a cry of ‘unfair’ as housing groups and charities warned of rising homelessness.

Responsibility.

Now I must make myself clear here, I am not uncaring of the position people are in that sees them squat in the first place or the problems they now face if removed from property. My problem is that the house owner should have always been in the position of being able to rely upon the assistance of the law and it is unfair to somehow shift the responsibility back on the shoulders of the owners. This is clearly a failing of the social system in providing housing for all in the first place. This is said with full knowledge that there are some who will always remain outside of the system and be non-conformist!

Ignoring the Law.

I have always found it somewhat ironic that the Houses of Multiple Occupation laws were introduced to tackle safety in high rise City Centre properties and for ignoring them Landlords could be banned from owning property. Squatters, by the very nature of what they do, cause far more danger and would never consider such legislation in how they live, yet they are protected because their activity has always fallen under civil offense legislation and not an illegal act. To make it so at last corrects this ridiculous state of affairs.

Financial requirement.

What is so often forgotten is the financial requirement that the owner needs to fulfil and the difficulties they find themselves left in when a property is a target for squatters. In my small way, I feel I need to make a stand for the owners, and no matter how many stories there are of squatters who have maintained a property well, there are just as many of properties left in an appalling condition.

Enforcement.

Now we must hope that this blight (although mainly a City centre problem) is dealt with in short order. It is a fairly simple statement for me to make, because no matter what your feelings, we should live by the letter of the law and I believe ownership rights should be amongst those at the top of the list of laws to abide by. My hope is that the charities and groups working with those made homeless by this change of law do not fund any legal challenge through the courts. Owners, who are not all £multimillion Companies who can afford losses, deserve the law to be enforced in full.

04Sep 2012

Property Landlord advice: British Gas laying down the Law!

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By Steve Roulstone

I am not a lover of utility suppliers, mainly because they never seem to know how our Industry works and prove time and again, that they do not have a system that can deal with people moving on a frequent basis. I have seen STWA send out invoices for a few days between Tenants at three times the rate of the normal daily cost, heard staff at British Gas say “let’s turn the fax of today, we have enough paperwork to deal with” and famously (for me) told British Gas, “sorry if I have not pressed the right option, there isn’t one for ‘we do not know what we are doing’ ”

Visit out of the blue.

This time however, they have gone too far! An engineer turned up at a house we manage last week to change the meter because the Tenants were stated as not having paid the Gas Bill. Unbelievably that simple fact was wrong, as the Gas Bill had been paid and was up to date. But that did not stop the BG Employee changing the Tenants on to a pay as you go meter and also whilst at the property looking at the appliances.

Gas Fire turned off.

Mistake number two. Whilst there, without looking at the operation of the fire, he decided the fire was unsafe, disconnected it and labelled it as unfit for use. The Tenant, understandably, phoned us and asked us to explain why? We sent a qualified engineer round, who confirmed, as he had when he carried out the annual Landlords Gas Inspection less than four months earlier, that the fire was perfectly OK and that there was no need what so ever to turn it off.

Not the first time!

What amazed me about this was that our Gas engineer confirmed that this was not the first time he had heard of this and that the meter people employed by British Gas were not even qualified as Gas Engineers. Rather they were trained to carry out a ‘Visual Inspection’ and it seems on that basis only without any qualified reason; the appliance was labelled as dangerous. Rightly, our Gas engineer has sent his invoice to British Gas, as why should the Landlord pay for the mistake?

Liability.               

Now I know from experience that they are not the purveyors of all things good as they like to be perceived (especially from the TV ads) but you have to ask the question, since when have they been given the role of sending unqualified people in too houses to carry out unsolicited inspections? It frankly beggars belief but they must see themselves as the protectors of all things Gas related in Britain’s houses to go about giving their staff this kind of instruction.

Admission.

Now they have apologised for even getting involved in the first place as the Tenants had as stated paid their Gas Bill and the meter will be changed back again. As to whether they will pay for the engineer’s time to confirm all was well? Knowing British Gas I doubt it, but hey, somebody who matters might just read this and agree they should. Feel free to get in touch!

Motivation.

That just leaves us wondering why they should do this in the first place? I am afraid in my opinion I only have one thought as to why and that is to generate income through the repairs that appear without the ability to check correctly, would have been generated from this incident – why else? Forgive me if I am wrong, but why else should British Gas staff be condemning appliances (even though they are unqualified in the first place) during visits they are not even supposed to be making? If we had not known better, the result could well have been a call to a British Gas engineer to repair the fire and the result of that would have been an invoice.

Summary.

By all means call me cynical, but I believe this would probably have been the outcome of a visit to a property lived in by the house owner and the only reason this did not finish in this manner, is because British Gas would not have expected a third party to have knowledge through the Landlords inspection of the appliances and be able to call upon an engineer as we did. In other words it resulted from British Gas NOT understanding how the rental system works, but then I already know that.

Bad practise British Gas, Bad Practise!

31Aug 2012

Current property News: Montague report offers the Key for growth? Part 2

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By Steve Roulstone

In looking at the second part of the Review of the Barriers to Institutional Investment in private Rented Homes, I have read and will comment on the sections headlined; The Barriers and Conclusion and The Recommendations.

 The Barriers.

 Most of these sections concentrate on the land and planning permission needs, but do refer to some rather confusing detail. Such as that Management costs are as high as 30% for Residential property. Now I know that National Companies specialise in offering services for Companies with large property portfolios, but when you consider the normal cost for Management on a local level would average at 10%, I find it difficult to see how this rises to 30% when managing from afar.

 Total Costs.

 I may of course be wrong, but it rather looks as though it is the cost of maintaining the property that has been added to the running costs, however, as the report confirms that it is normally Capitol growth that is considered to be the income from residential and not the rental income, whereas with Commercial investment it is the opposite way round. Surely then, if Commercial values drop over time, the cost of maintenance should be offset against Capitol growth and it is both that should be considered, as they are real income, when comparing residential to Commercial? Is this where encouraging Tax breaks can be made?

 Local market.

 Otherwise, once again, local Management will answer the cost issue, rather than distance Management having to find a local Agent to carry out the role of providing a Tenant, let the Local agent be the sole property Manager. Costs halved? – probably!

Lack of Experience.

The report then states that there is a lack of experience in knowing how any scheme would operate. But this does not exist in the market place; rather this confirms that in compiling the report, the Property Management Industry has not been approached. A fact confirmed by the later statement in Recommendation Five: that the market would benefit from; the professionalism of the management service. Had the Industry been spoken with (also confirmed in the Terms of Reference) then Sir Adrian Montague would have been aware that one already exists.

Right Model.

I also believe that the right model already exists as well. There are numerous professional Letting agents, who also operate as Property Managers as well, looking after leasehold sites (Block Management) throughout the UK. Providing that any incentives in profitability and land availability are made available Nationwide and providing there exists Agents with the ability to run both, then costs can be controlled, the whole Industry will benefit and progress can be made throughout the UK.

Professional Management.

But I believe that this is another opportunity for the Government to change their attitudes towards the rental sector, which is growing at the same speed home ownership for individuals is declining giving a thriving rental sector the opportunity to be part of the growth if not the very reason for it, that this country desperately needs. Tied with ensuring the Industry moves forward in a professional self managed, or Government managed (although I believe this is where the lack of motivation currently exists) manner, ensuring the scheme meets all the requirements listed in this report and that the properties concerned will continue to give the profitable long term return institutional investors require.

29Aug 2012

Current property News: Montague report offers the Key for growth?

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By Steve Roulstone

The Montague report which reviews the manner in which the Private Rented Section is viewed by the Institutional Investment market has been released and is available for download from the Department for Communities and Local Government. The basic idea of the report was to look at why Investors do not look upon the Private Rental sector in the same way that they do Commercial property investment.

 The report is a weighty 28 pages of Summary and evaluation, but holds many good ideas and could just see the way forward for our sector as we struggle to meet the demands of a modern mobile work force. It is in three sections and is going to take at least two posts to comment upon, in this first post, I have selected highlights from the Background and Evidence sections in this post. I will follow this up by looking at the Barriers, Conclusions and Recommendations.

 Growth.

 I am a total advocate for the building industry (Housing) being the vehicle for leading the way out of recession. This is why I am always looking at new build and activity and look to the property sales figures of a guidance for where financially we currently sit. It is therefore nice to see clear figures quoted to support my theory. For every £1m spent, 12 jobs are created or supported and for every £1 invested in construction, £2.60 is generated elsewhere in the supply chain. The supporting sources are listed in the report.

 Local or distant Management.

 It struck me quickly when looking at the Evidence that a market exists, that there was a need to build in assured maintenance. I agree whole heartedly, that any long term scheme should include an organised plan for both maintaining of and maintenance on the property concerned. My immediate thought was to ensure the properties are managed locally and not by some distant organisation, to ensure both a distribution of the Management structure and workload through local contractors rather than the majority of the expenditure remaining in London.

 Across the Country.

 To do this, as the report recognises, there needs to be many differing schemes, which, in order to maximise the effect across the Country, as highlighted above, needs to be spread across the country and not concentrating again in the area that generates ever increasing rent levels; London. It is important in arriving at any conclusion that promotes and encourages Investor growth in Private rented property, that the whole Country sees the benefits.

 Wardens.

 Unsurprisingly, the wish to see Wardens or a Management presence in specific developments is a nice idea, but one that is only reflected for affordability, through the size of the initial development. As an Agent who Manages whole sites on behalf of one owner, exactly the type of site referred to in the report or that would be developed as a result of Investors becoming involved, there is a recognisable limit to the size of what are acceptable sizes of development so as not to have to large an impact on the local market, both by type of property available and by long term effect on local suburbs. In short, there are places that high rise buildings fit in and areas where they do not! Wardens suit large buildings but would cost too much for more localised schemes offering between 20 and 40 units.

 Long Term Agreements.

 I think it is a good idea to generate an agreement that sits well for longer than the current popular Assured Short Term agreement, but by the same token, I see no need to do this by changing the AST. As case of ‘It ain’t broke, don’t fix it!’ But a document built around the normal lease as exists for purchasing leasehold property would be ideal. This could still give the Tenant of this shorter term lease the protection afforded to the leaseholder, whilst reflecting the short term usage and the interests of the Freeholder as well.

 Block Management.

 It is suggested that Management of such buildings would tie in nicely with the current Block Management style and again as this is one of the services we offer I can comment and could not agree more. This would be ideal providing that local Companies were sought for provision of services, instead of the properties being managed from afar. Why do I feel this is important? Because we have grown our business on the dissatisfaction of leaseholders whose representative never visit sites or more importantly, cannot be visited because their offices are in London, Birmingham or Manchester.

 There are some great ideas in this report and I look forward to commenting on the conclusions but if there is one point of caution it is that consideration has to be made as to the spread of housing, which is needed throughout the Country as well as provision of service, which, to avoid complaints about schemes failing to deliver and being unapproachable, need to be sourced close to the buildings concerned.

 More to follow!

24Aug 2012

Happy Birthday to us.

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By Steve Roulstone

It is a short on news week this week and time, as my daily work in the Lettings office has stripped me of the opportunity to research the market for current news or write a more informative post before the week ends, so instead:

Happy Birthday to us!

This week marks our two year anniversary of posting regular weekly comments through our Blog. This is now a total of 230 posts on our ever changing and informative Industry.

It is no real surprise that their is never a shortage of topics to write about, as matters arise in the National press and daily workings of a Letting agency on subject of Law, good practise, professionalism and ever changing Legislation and many many more on a dialy basis.

So another opportunity to say thank-you to those who bother to read our posts and an even bigger thank-you for those who bother to comment. I am always happy to respond and answer further questions through communication, so please, carry on asking.

Well here is to the next 230 and next two years, Thanks again!

 

22Aug 2012

Tenant advice: Social housing lacking major detail.

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By Steve Roulstone

A short topic today, but a situation that has left me somewhat surprised by what I found last week when helping a Family member move in to a new rented home through a social housing organisation.

The Lady checking the Tenant in and I, with a common interest in renting, chatted about the differences between what they do in the social sector and what we do in the private sector and it was noticeable that despite the obvious difference being the nature of the Tenant, and their circumstances, the trappings of how we do our business remains the same, I pad and agreements in hand!

What we did not speak about and what I found the most dramatic difference was the standard of the house concerned and what Tenants are supposed to put up with in the social sector. Actually, it was not so much the house as the fittings or lack of them!

The property itself was fairly modern, being no older than twenty years or so, but downstairs only had laminate in the kitchen and bare concrete floors elsewhere. Upstairs the picture was the same with bare wooden floorboards and throughout, not a curtain at any window.

I can just imagine the reaction of any private Tenant should I carry out a viewing at a house and inform them they would have to carpet throughout and find curtains for every window themselves! I can assure you we would let very few houses!

There was also the question of the state and condition. The Kitchen had three walls painted red and one wall half painted (and not in a its finished type of half) the main bedroom was painted in union flag shades of red blue and white, in blocks some two feet wide, in stripes! The second bedroom in cerise pink on one wall only! Now when we check Tenants out of a property we ensure the decoration is both as it was when the Tenancy started and therefore in good order for the new Tenant and start of Tenancy. It seems clear that when people leave social housing they are not checked, or if they are nothing is done to correct or put right the type of decorating schemes that would strike us in the private sector speechless.

The obvious smack in the mouth opinion that I am left with, is that those who have little choice of where they are able to live because of their financial position ensuring they do not have choice, have to accept whatever house becomes available when it is offered and are therefore also left with the bill of being able to live with the very basics of comforts by having to purchase both carpets and curtains themselves!

This when they are where they are because of financial difficulties is a situation which does not sit well with me. Perhaps I am naive in my outlook, but it is clear the Housing authorities and Social Housing providers are happy to rely upon the charity of the wider family to enable those in dire straits to be provided with such basic comforts as curtains and carpets!

At least if the Government do manage to find a way of attracting the Private sector to social Tenants, another much wider subject of discussion, at least they will enjoy a far better standard of accommodation without the fear of how much such a move could cost them or their relatives!