Tag Archives: Letting Agents

16Dec 2010

Property Landlord advice: Unlawful Eviction supports Professional Agents

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By Steve Roulstone

I have constantly voiced the opinion that our Industry progressively gets more professional year upon year. I was totally behind the recommendation of the Rugg review that both Landlords and Agents should be licensed and or registered having qualified in some prescribed manner. I believe the benefits will be for all to see and enjoy and enforce the movement away from unlawful activities. I also understand the current Government saying they would not pursue this policy at the moment, with the current financial situation to deal with they have bigger fish to deal with!

Breaking the Law

This week, I have had two reminders that what was recommended by the review is still important and that the review was correct to recommend the introduction of legislation in the first place. I have reported in these pages that as an industry we are moving away from horror stories and that renting has become embedded in our way of life as an acceptable and in many cases preferable way of life, but what I have heard this week has reminded me that some people still believe they can act outside of the law!

Landlord jailed

The first case concerning unlawful eviction was reported back in November and was referred to this week in a conversation with a colleague. A Landlord looking to remove a Tenant who had become a Housing Benefit applicant attempted to do so without proper recourse to legal methods and then physically removed the Tenant when they refused to move out. Oxford City Council took the appropriate action and the Landlord was charged and convicted being jailed for three months. Whilst it is always sad to hear about Landlords trying to act outside of the law, at least the Law caught up with him and justice was seen to have been done. Although of course the Tenant still had to go through the indignity of being dealt with unlawfully in the first place!

Unlawful Agent recommendations

The second case was I admit hearsay, but I have no reason to doubt the source or the motivation for telling me what had been heard, as it was bought out in normal conversation and not raised intentionally. In concerned a Local (to me) Agent, who advised a Landlord when discussing the methods of dealing with Tenants who fail to pay due rent and when discussing notices served within the Housing Act in such cases, with a sideways tap of the nose saying; ‘Of course there are always other ways of dealing with Tenants who do not pay’

Legal Methods

Well there are not! Any method of eviction which is not within the Housing Acts is of course unlawful and what amazes me is that agents should still recommend some midnight knock on the door method openly to a Landlord! Perhaps I should not be surprised that the agent concerned was not a specialist Letting Agent being involved in other aspects of the Housing Industry! So bring on the legislation and I shall report such matters that come to my attention wherever possible to further legitimate professional Landlords being recognised as just that!

29Nov 2010

Rental issues: Property maintenance delays caused by freezing weather.

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By Steve Roulstone

As a Landlord I have experienced that dreaded call from the Tenants on many occasions, the one about the leak when the weather is -5 and giving no sign of letting up. Now as a Tenant and a Landlord, I am currently experiencing both. I must admit that I have had a good look around the property I now rent to see if any weak spots exist, but even in temperatures as low as we have experienced this weekend all seems well!

When problems occur

But when problems do occur especially at this time of year, it can be a nightmare for those concerned. I know that plumbers, who of course work all hours when we have cold spells of this nature, have to turn work away and often work a fortnight in advance. What all concerned have to do here is realise that (as agents) we do not have the right to demand contractors arrive at the property we manage before and in advance of their other customers. The problems occur when Tenants feel they should not have to wait because they are renting the property. Well now I may be in the same boat, but I know that I will understand if we are faced with any delays.

Delays in Agent services

It is not just plumbing where problems can occur, all types of property maintenance services can be delayed and on one occasion this month I am aware of a Tenant who felt sufficiently aggrieved to raise a complaint against the agent concerned. The security of the property had been placed at risk because of the actions of others and whilst there are many occasions where special arrangements can be made for all manner of maintenance issues, on this occasion none were. The point being that in the vast majority of cases special arrangements are not made and neither should they be. When you own a property you do not have all manner of immediate response contracts with every service conceivable, but unfortunately because Tenants pay rent sometimes we are expected to provide such cover.

Services not serviced

As agent of the Landlord we are charged with looking after our Landlords interests and this of course includes the property, we will therefore note all special arrangements in existence and provide services when needed, for whatever may befall the property in our charge. But that does not mean for example that we are going to stand guard over a broken front door for a weekend whilst the Tenant goes shopping! Of course the vast majority understand our responsibility and take sensible steps to cope until we can do our job.

Patience is still a virtue

What we all need to do is give some patience and assistance by way of availability and flexibility of when property can be accessed (I know of one Plumber who will work until midnight under circumstance that currently exist) that way more will be done sooner and let’s not forget, human nature makes us all try harder for those who treat us nicely! I know that’s how we treat our Contractors and that’s how we manage to get that little bit extra that so often makes the difference!

10Nov 2010

Franchise News: Property Letting Agents set to boom.

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By Steve Roulstone

And that is not just my opinion, indeed it is not just the evidence of my own Franchise office in Stafford, but more and more people are agreeing that the demand for rental property is growing quarter on quarter. From my standpoint as a Franchisor this is of course good news, especially for our network of offices, but also because of the large number of entrepreneurs looking to become Letting Agents, that we are currently interviewing as a result of the National Franchise Exhibition in October.

Buy to Let Mortgages.

But of course this is not the whole picture, because the large number of Tenants need a large number of houses to live in and at the moment, whilst I am confident there are a large number of Landlords looking for the opportunity to buy, the vehicle they require, is not yet readily available. Those who are closest to the situation, will be aware that some Building Societies appear to be ‘testing the water’ with offers that are only available for a short space of time. The reasons for this could be many, but I would surmise that two very good reasons are initially to see what interest such offers attract and secondly to see what reaction there is from the industry and regulatory bodies to any easing of cash availability in the mortgage market.

Market forces will dictate.

Certainly, one offer drew such interest, that it became impossible for the brokers to action all requests in time, before the offer was withdrawn. This of course confirms that where there is a demand, the market will provide. The natural outcome, as our offices confirm, is that Landlords are keen to buy, but only when the market shows confidence, the available deals are consistent (Nobody wants to buy when better offers are just around the corner!) and property prices become stable.

Reporting good news.

So hopefully and sometimes I have my doubts, the media will start to print, confirm or just talk about the positive things happening in the rental sector and stop making headlines out of property prices, especially  when historically they have always shown a decline at this time of year! In October, even when one agency confirmed an increase month on month, it did not achieve the status of the report from a differing agency the week before that house prices had fallen ‘Yet again’ as the report gleefully confirmed!

 UK Letting Agents will prosper.

But the facts are that during all of this time of property uncertainty, the Rental sector has prospered and letting Agents in the UK are now set for another increase in business as the economy recovers and the increase in rental property continues across the UK. I believe that trading over the next decade could be as good as it was at the beginning of the last decade as we enter a period of sustained growth. This is of course, all good news for those looking to join our ranks as franchised Professional letting Agents!

21Oct 2010

Franchise News: Franchising appealing to younger entrepreneurs.

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By Steve Roulstone

I have been attending the National Franchise Exhibition for several years now and there is no doubt in my mind that the age of those attending is dropping year by year, with for me, a definable difference this time around. I have already commented in these posts that the quality of attendee was very high this year and therefore having spoken to many people between twenty and thirty years of age, it confirms that the younger entrepreneur is no different in researching the potential offered by Franchising than anybody else.

Recognition for the Industry.

I have searched the internet for proof of my beliefs through the written word or quoted statistics, but can find nothing to back up my feeling, but for me, being convinced through what I experienced myself, it looks as if the facts behind the ability for Franchising to offer such a higher success rate for new Business is beginning to be seen and hopefully appreciated by a younger market.  

New Initiatives?

And with new initiatives supporting  the Industry due to be announced  in November as well, although as yet the context and content is not known, good support schemes can only legitimise the Franchising route to being the owner of your own Company for a wider market of would be entrepreneurs.

Age should be no barrier.

It is of course just as important for us to treat everybody in the same way when as Franchisors we look at the attributes of every applicant we see, regardless of age or any other definable characteristic. But experience has to be taken in too account and without being ageist, I will continue to consider the individual qualities of every potential Franchisee I meet. It would be a tough call if like the X Factor, I had to recommend to somebody that they ‘Came back next year’ or something similar but because Franchising is very much a two way street, I would continue to take this approach with everybody who approaches us.

Franchising will be the benefactor.

But normal evaluation aside, I firmly believe that a younger more dynamic age group seriously considering our market place has got to be good for the whole industry. Whatever sector is considered, a drop in the average age of Franchisees has got to be welcomed.

19Oct 2010

Property Landlords advice: Resident Landlord agreements (Part 1)

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By Mike Edwards

Deciding if a Resident Landlord agreement is the correct solution to any situation can be a nightmare for Landlords to determine. What can on the face of it look straight forward may not be and vice versa. What happens if there is completely separate access for the tenant? Or what if their accommodation is like a granny annexe or a garage converted into a studio, or a building in the garden? The list goes on!

Popular practice

These situations are becoming more common as the credit crunch inspires some innovative use of spare accommodation by Landlords, but do we treat these scenarios as tenancies or licences? And above all if they are tenancies then should they be ASTs which means registering the deposit – or a fine if you don’t!

Some definitions

If the building as originally constructed is a purpose built block of flats no matter how small and the Landlord occupies a unit as their main residence it can never be a Resident Landlord case. But if you have a conversion to self contained flats and the landlord lives downstairs it is a Resident Landlord case but the tenant cannot have an AST because it is a Resident Landlord situation. In the conversion if the occupier has their own bedroom but shares facilities with the Landlord then only a license can be granted. This is because under the 1988 Act the tenant only needs exclusive possession of “any part of the dwelling” to have a tenancy so the exclusivity of the bedroom is enough to make them a tenant and an AST can be created if there is no Resident Landlord.

And more definitions

Rules on exclusive possession are different outside the 1988 Act as to be a tenant the occupier must have exclusive possession of all essential living accommodation. Therefore if the tenant cannot have an AST as the landlord is in the building, he must have exclusive possession of all essential living accommodation before he can be a tenant and therefore be granted a Common Law tenancy (as in the example above of the two self contained flats above).

Further legal implications

However all this throws up another key issue. In managing the situation, you must make sure it should not have been an AST for if it is then the deposit must be protected. So if you wrongly designate an occupier as a licensee and do not give them an AST when you should have done so then you will be open to a claim for mishandling their deposit.

Link to Res LL Part 2

14Oct 2010

Property Landlord Advice: Rent limit for AST Agreements increased to £100,000

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By Mike Edwards

From 1st October 2010 all tenancies where there is no legally stated reason why they cannot be ASTs  will be so deemed unless the annualised aggregate rent is in excess of £100,000 or basically £8,333 a month no matter how short the initial term might be.

The Change in Law

So if a tenant rents at £10K a month for 6 months it still cannot be an AST because annualised the rent would be £120K. The term stated in the agreement makes no difference just multiply the rent by 12 and if the result exceeds £100K then from the 1st of October it can no longer be an AST. Do not make the mistake of thinking the tenant actually has to pay £100,000 or more in a year, they do not. The same rules that applied when the limit was £25,000 now simply apply at £100,000 instead. In effect the figure for a tenancy to fall within the EXCLUDED CATEGORY and be incapable of being an AST has now been increased to £100,000

The Affect

This will mainly affect the London market (over £1924.00per week) or very high rental value properties elsewhere but it applies to all new tenancies granted from 1st October onwards and also to all tenancies granted on 6th April 2007 or later as and when they are formally renewed.

The problem

The issue here for Landlords and agents is because these previous non ASTs now become ASTs do existing deposits now need to be registered and protected for these higher value tenancies. However the provision that applied when deposit protection first came in that periodic tenancies were unaffected is thought not to apply. Unfortunately the Government Department responsible for the TDP provisions (Communities and Local Government) omitted the word “new” at a critical point when drafting these revised Regulations.

The result

In doing so they condemned all existing cases to potential uncertainty which can only be clarified by a test Court case. So the advice from CLG, ARLA and the TDP schemes is to register ALL deposits where, under the revised limit if an existing tenancy was actually a new one being granted now it would be covered by the new rules. A Prescribed Information Form must also be issued and interestingly so must any clauses that would be in any such new tenancy but were not of course in the original agreement.

12Oct 2010

Property Landlord advice: Letting Agencies or Letting Agents

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By Steve Roulstone

I have just spent two days telling people what I do at the NEC National Franchise Exhibition and have come to the conclusion as the result of what my answer was that I might be a bit of a snob!

Vive la Difference!!

You see, I discovered that I always answer the question ‘Who or what are you?’ with the answer that I am a Letting Agent. It was only when the question was put to me in a different context that I found myself explaining the reasons why I call myself a Letting Agent – so what is the difference?

Individual Agent or Company Agency?

I see myself as a Letting Agent, because I am qualified through my professional body and having passed my exams it is something that I rightly feel proud of. As a Company we have always and still do look to have all of our agents qualified (There I go again!) because exams are a confirmation of knowledge and it is something tangible that our Landlords can rely upon. But that does not mean that our offices are not Letting Agencies, because they are.

Agency AND Agent.

The difference is that not all Letting Agencies are run by Letting Agents, if you believe as I do, that to call yourself an Agent, you should carry some qualification, through the Industry you serve, that is recognised by the people who work in it, that marks you as qualified to carry out the role. Those who have read my Blog in the past will recognise a theme here, because I firmly believe that as an Industry, it is only by Industry recognition and Legal registration that we will become truly professional and that has to be the goal for all agencies.

Landlord advice.

So I will continue to call myself an Agent first and my advice to all Landlords is check the professional qualifications of any Agency they wish to employ. As a Franchisor who is aware of the competitors in my sphere of operation, I know that the systems we employ mark us out as protective of our clients interests in all that we do, but why not go that extra mile and prove our knowledge through qualification, then, especially if legally registered, all Letting Agencies will be run by Letting Agents!

29Sep 2010

Property Landlord advice: Understanding Letting Agent fees.

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By Samantha Knight

It is important for Landlords to understand what they are paying for and to do that you need to understand the jargon!

Just some of the charges you may come across:

A renewal fee is referring to a fee which the agent will charge when the tenancy comes to and end and a new contract is entered into with the existing tenant.  For this fee you should expect the agent to take control of negotiating the terms of the renewal with both parties and drawing up the new tenancy agreement.

A Check in / Check Out fee can be charged to cover the cost of the agent /inventory clerk meeting with the tenant at the property, checking through the inventory either before, or after the tenancy (or both), signing the documentation and taking meter readings

Inventory Fee – a vitally important document to have prepared for you, especially since Deposit Protection Legislation has come into force.  Check if you own the rights to this document i.e.- will they email you a copy that you can edit at a later date should you change agents, to save paying out for a brand new document to be produced again. 

Document Fee – this may be referring to the preparing of your tenancy agreement and or inventory.  Check exactly what documents you are getting for your money.

Tenant Find Fee – a fee charged when the agent is finding the tenant but will not be handling the management of the property thereafter.  This fee really will vary drastically from agent to agent.  Check exactly what the fee includes.  Will you be getting all of your legal documentation drawn up inclusive in the fee or will the agent charge you extra for this.

Management Fee – a monthly charge to manage your property throughout your tenancy which is normally based on a percentage of the rent collected.  8%-15% is considered to be industry norm, moving up or down the scale dependant on the area of the UK

A clear fee structure should always be presented

Whatever the fee an agent intends to charge you, they should be laid out clearly for you to see and agree before you enter into business with them. Look out for all inclusive packages; these can work out cheaper than a fee structure which charges for each item individually. But always consider, a cheap price does not always mean a good price! Whatever fees you agree, it is the standard of the service that matters the most!

23Sep 2010

Property Landlord advice: Property Letting Agents

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By Steve Roulstone

 

As against Property Estate Agents, and this is the subject of my blog for today. Why do people still visit Estate Agents to carry out a role covered by a different trade? and we are different, in all the training I have gone through, I have never been taught how to manage a property sale and I can guarantee you that at no stage has any Estate Agent under the guise of training for selling houses, ever been taught how to be a Letting Agent.

So do you just not like us?

But people still knock on the door of Estate Agents to place their property on the Rental market. Of course, one of the reasons is the image that has historically hounded our trade, but I firmly believe that is changing. With the proliferation of Franchised offices throughout the Country over the last ten years, we are finally getting the professional image across and it is with great pride that I count Castle Estates as one of the Companies creating the change, but I believe this goes deeper than image and is tied to tradition.

Habits die hard.                      

I believe that it is habit that causes most people to look to the traditional office to look after our property interests. This is of course where Estate Agents score, because the Letting Industry is still new compared to the traditional route of property ownership, but this situation is changing, as the % of UK rental property continues to rise, currently sitting at 14%.

Property Letting Agents, a developing Industry.

This is where we must now concentrate as an Industry and look to educate the public, that our Industry is not one that can be turned to in a time of need (most Estate Agents started to offer rental services because they could not sell enough houses) but rather to be able to provide the correct Management that ALL of our Landlords need, the agent should be trained and specialise in its own field. After all, you rarely see a Letting agent who sells as well!!

16Sep 2010

Property Landlord advice: The Importance of Landlord Insurance.

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By Steve Roulstone

 

Firstly, to explain the title, this is not House Insurance, as being advertised as Landlord Insurance by a well known Company at the moment on TV. Proper Landlord Insurance is about Insuring against loss of Rent and Legal expenses (R&L) should a Tenant fail to pay and need evicting.

Is Insurance for Rent and Legal Expenses important?

When you consider that annual policies that cover the period that Courts could take to evict Tenants from a property are available for less than £100 in today’s market, I think every Landlord should think so and I speak as a Landlord myself. When you consider that any Tenant could find themselves redundant, then taking out a policy for less than 2% of a year’s rent should not be a difficult decision.

Our duty of service to advice.

We must always ensure that as Letting Agents we stay inside the FSA regulations surrounding the selling of Insurance policies and unless we are qualified then our role is to advice Landlords that the policy is available and then let the Insurance Company sell the attributes of R&L Policies to our Landlords.

Should be common practise.

I have just found an advice line for Landlords statingthat Landlords should be careful how they select Tenants in case they cannot afford to pay the rent. No problem at face value, but if they employ the services of an agent, which they do not advice, by using professional referencing we can both ensure the Tenant is acceptable at the start of the Tenancy and because through this referencing R&L Insurance will automatically be available, providing of course the Property is fully managed, then Landlords can ensure against such problems during the Tenancy.

Managing the situation.

As I have reported in a recent Blog, Local Council Housing departments do NOT offer help and only act to delay the process of providing the Tenant with accommodation. So by having the correct Policy in place, Rent and Legal expenses which can be expensive on their own, will be covered.

Hidden advantages.

There is a valuable side effect that should not be ignored: By knowing you will not lose any rent, you can at least work with your Tenant and assist him with the Housing department. Such acceptance and assistance can only receive appreciation from the Tenant – after all, they will not want to be in this position either and human nature should ensure that the property is at least looked after during the process.