Tag Archives: Landlord Advice

13Jul 2011

Landlord Advice: Utility Bills under control

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By Craig Smith

A lot of Landlords may not realise that, even if a property is unoccupied, they could still be liable for utility bills at a rental property. Usually, unless a property has been let with bills included, the Tenant would be responsible for payments. But what happens during the periods that a property is empty?

Ensuring the Accounts are set up Correctly

During an empty period, the utility accounts need to be set up in the name of the Landlord. It is important to take meter readings at the start and end of a tenancy to ensure that Tenants and Landlords don’t pay for each others energy used. A lot of companies will automatically send an estimated bill so regular meter readings should help to keep costs down. Most utility companies will be happy to send billing to another address, such as the Landlords home or letting agent address, which helps to prevent any debt letters coming through the post.

Debt Chasing and Court Action

If a bill gets missed, the utility companies usually send reminders and letters threatening court action, regardless of whether or not they intend to take you to court. (Further information Blog)) The best action is to act quickly to resolve any issues, the majority of cases are where the companies haven’t taken note of meter readings or start/end dates of a tenancy.

Choose Your Suppliers Wisely!

Landlord cannot force a Tenant to take a particular supplier for gas & electricity, although there is usually no choice for water and Council Tax! However, different suppliers charge different amounts for energy used. If a property is going to be empty for a period of time, it is always worth looking into the prices charged by different suppliers. Some suppliers will charge a standing charge, so even if no energy is used at a property a daily charge could still be payable!

Whenever a Tenant leaves a property, the Landlord should always aim to obtain the gas and electricity providers. If the Tenants don’t give the information, the suppliers can be found by contacting National Grid for gas and MPAS for electricity.

Water Supply

Some water companies will also make a standing charge even if no water is used. This is to cover costs of drainage and maintenance to the pipe supply. If the stop cock is turned off in a property, inform the supplier! Usually, if the supplier has been informed that the stop cock is turned off then the standing charges are normally cancelled (from our experience with Severn Trent).

Council Tax

A property can have an exemption from council tax payments if it unoccupied & unfurnished, usually for up to 6 months in each financial year. After this, a 50% rate is applied and will become payable, although after 6 months you would certainly hope that the property has been relet!

13Jul 2011

Advertising a Rental Property: Where and How?

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By Craig Smith

Each advertising platform may try to tell you that they are the best to market your property, whether it be online or in your local newsagents. But which really is the best way of advertising a property?

Internet Property Advertising

Well, I guess there can’t really be a right or wrong answer to this as there are so many factors to take into account. Perhaps the most wide reaching method is the Internet with, according to the Office of National Statistics, more than 30 million adults having Internet. In turn, some of the more widely recognised property advertising sites advertise using television and radio campaigns, which then generate more users for the agents using the sites.

It is a fact that most enquiries we take are from Internet sources. The majority seem to be either from our own website, Zoopla or Rightmove just to name a few. Some of these sites are particularly useful to working professionals who might not always be at home to read the local newspapers or they can perhaps even look whilst they are at work or travelling with the aid of modern mobile phones or a laptop.

As an ARLA regulated agent, Castle Estates also display available properties on Property Live (refer to our previous blog on agent regulating).

Your Local Newspapers

If you are looking to stay in your local area, most local newspapers have sections for property for sale and to let. The disadvantage to this is that it will only reach a local audience and won’t appeal to the national audience. We see a large number of professionals who move from various places around the country and even abroad for work or to be closer to family. However, newspapers might only be published once or twice a week, whereas Internet advertising can be changed as and when properties come available.

Of course, there are still a number of people who don’t have Internet access or prefer not to use it, which is where the local newspaper will reach more prospective clients. Most areas have a weekly free newspaper which will be distributed throughout the area and should reach a large number of people.

The Good Old Advertising Boards!

Some people will see boards displayed at a property as a nuisance, particularly if a number of properties are available in a small road. However, on busy roads and popular housing estates, these boards can generate a lot of interest in a property. A lot of people will see a board and then go onto the Internet to find out further information. They also come in very handy if your not sure whereabouts the property actually is!

So Then, Which is Best?

Unfortunately, there is no definitive conclusion on this. Each way of advertising has is benefits and disadvantages, which might suggest that the best way is to use all of them. The best would be whichever suits the clients that are being targeted, in our area there are rural villages where many people prefer a local paper than using the Internet, but also people relocating who find it easier to look at the up to the minute details on the web. 

08Jul 2011

Property Landlord advice: Periodic Tenancies – friend or foe?

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By Mike Edwards

Under the provisions of section 5 Housing Act 1988 when a fixed term tenancy reaches its last fixed date from the next day onwards it becomes a periodic tenancy. This is an automatic process, no-one has to do anything and it happens whether or not the landlord is happy about it, or would prefer a new fixed term agreement to be in place. Either party can state if they want another fixed term but if the other party doesn’t agree then they are going to end up at best with a periodic tenancy. Or if it is the landlord that is insisting on a fixed term then his only option is to give notice to the existing tenant and find a new one.

Landlords decision.

Few Landlords normally feel that strongly but occasionally if the initial agreement is ending at a date that could make the end of any replacement tenancy awkward – say between mid November and mid March, then it is not uncommon for that Landlord to seek a longer term in an attempt to avoid having to re-let at what is generally acknowledged to be the worst time of the year. It is very much horses for courses at the end of a fixed term as to what the parties would prefer, or indeed insist upon. There are advantages and disadvantages for both parties both in being committed to a fixed term or in having a periodic tenancy. The most obvious for the Landlord is he is at the mercy of a month’s notice from the tenant at any time.

It’s that last day rule again!

The notice must expire on the last day of a period of the tenancy, so if rent is due as per the agreement 1st monthly the notice and any obligations under it – such as rental payments – must continue until that date unless the parties mutually agree an earlier surrender of the tenancy. The Landlord must give two months notice if it is an AST or an AT with the same end of notice period dating requirements. These were clarified in Church Commissioners v Meya (2006) in the Appeal Court and thus the decision is binding on lower Courts.

Notice period.

The requirement of two months notice in a periodic tenancy sometimes causes Landlords real difficulties so the trick is to do a standard visit 10 – 12 weeks before the known end date of the tenancy and while looking around subtly sound out the tenant’s intentions. If there is any hint they might want to go periodic rather than sign up for another fixed term (if that is what the Landlord wants) then serve a s21(1)(b) during the fixed term as a belt and braces position to protect the landlord. The matured notice can then be used at any time during the periodic state. This was enshrined in Case Law many years ago as there is no time stipulation stated in the Statute for how long a matured s21 notice remains valid and can be used in Court. So you could serve a s21(1)(b) on day 2 of a 6 month AST if you like and use it to evict the tenant after he has been periodic for 5 years or any time.

Agreed solution.

Finally if the tenant does want to go periodic then on giving one month’s notice a 13(2) notice can be used if a rent increase is due. A fixed term does give the landlord more certainty – but like the tenant it does mean he is stuck with the other party if his plans change and he wants the house back, so the key to unlock any problems? Discussion! Talk to your Tenants and reach an agreement that satisfies everybody – ah the art of Management!

05Jul 2011

Property Rental Advice: Unregulated Agents May Not be Properly Trained

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By Craig Smith

There have been a number of news articles recently about the number of letting agents going out of business whilst still in possession of money that is owed to Tenants and Landlords. Sometimes the office may relocate to save costs but sometimes poor communication can lead to a lot of confusion and Landlords being out of pocket.

Professional Bodies

There are a number of professional bodies that agents can join, there is ARLA, RICS and NALS to name just a few, and Castle Estates Staffordshire is an ARLA regulated agent. By being members of a governing body, this can give Landlords and Tenants reassurance that their money is safe and protected as necessary.

Is Your Agent ‘In the Know’?

There is no current law that says a letting agent must be governed and near enough anybody could start their own letting agency. Some of these agents may be charging very low management fees which will no doubt attract some Landlords due to the lesser amount of money that they would have to pay out. But do some agents have the experience and the knowledge to manage a property correctly?

We are proud to have 4 fully ARLA trained staff in our office and 3 more staff members currently working their way through the training material and examinations. By having staff members completing this training, they show that they understand the current legislations and practices that dictate the world of lettings as well as receiving regular updates in lettings news.

Safety Risks

As mentioned earlier, some agents may not have the experience or the know-how when some matters arise. In turn, this could compromise Tenant safety during a tenancy, for example not having a Landlords Gas Safety Certificate completed each year. The safety check is perhaps the most commonly thought of but there are dozens of other examples, such as the Fire & Furnishing Regulations Act 1988 where furniture provided by a Landlord must meet certain safety criteria.

So Who Can We Trust?

There are a number of unregulated agents who are more than trustworthy and we do not aim to ‘tar everybody with the same brush’ where this is concerned. Likewise, there are still a few rogue agents who will be regulated but may still choose to deal in an inappropriate manner. Sometimes the best marketing tool is the simplest… recommendation! 

04Jul 2011

Current Property News: Increased Renting demands pays dividends for Landlords.

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By Steve Roulstone

I have looked at three pieces of news this morning, all surrounding the property market and I believe all good, proving yet again that the rental property market continues to be positive in a period of time even for the current downturn we are experiencing that has seen nothing but negative news on closures, redundancies and negative forecasts. Other items I read this morning even hinted that ‘savvy’ business people might continue to look to the property market as a better investment than the more traditional stock and finance markets.

Squatting made illegal.

The really interesting point about the news released by the Government recently, is the amount of reporting that defends both the action of squatting and the need for squatters making this bad news for the public in general, but I would like to pick on two points that the majority of commentators have missed. Firstly, it is totally inappropriate to say that Squatters in some way make use of empty property and are therefore unlocking living space for those without a home of their own. This is just a way of turning the eye from the reality of the fact that they have no legal standing in occupying any home they choose, empty or not! I am not in disagreement that empty property could be better used, but only with the acceptance, knowledge or permission of the owner. I do not need to point out the damage caused to owners who are unable to utilise their property because of somebody squatting.  Secondly, all this does, is continue to take pressure of local Councils. This is where any move to utilise property that is truly left unused, as the Government and therefore local Council need to be the vehicle given the power to unlock property that is left empty long term, and is genuinely available to ease our housing needs. One further point for the writer, it is at least Mr Cameron and the words Prime Minister are suffixed by a capital letter!

Gazumping on the increase.

There is no doubt that rents are on the increase, but we are not seeing any great evidence of Gazumping outside of major cities, but before anybody starts to jump up and down about Landlords making profit, two points again that need to be confirmed. It is not often that I comment that we are in a similar position to Estate Agents as letting Agents, but it needs to be confirmed, that we are duty bound to advise our Landlords if a better offer for a property is received, just as Estate Agents would do for their customers, even more so because our contract with our Landlords gives us a duty of responsibility to comply with and therefore we have no choice but to both advise and react to our customers wishes. But holdfast! These were the same Landlords who were faceing offers on property below the asking price only two years ago and this current trend is only really redressing the balance from that period of rent reduction.

Renting numbers still increasing.

This is of course good news and confirms that by the end of this year, the percentage of rented property in the Private sector in the UK will have increased to something close to 20% and overtaken the Public sector at the same time. The issue that jumped out of this report at me was the mention of avoiding rogue agents in the links. Sorry to be a bore, but how simple would that job be if the Government were to protect this now significant and continually increasing sector, by introducing licensed Agents! (Now where have I heard that before?) For me, as a Professional who spends most of his time pushing the message that qualified Letting Agents are both the Tenants and Landlords best way of managing and finding property, allow me to add one more reason to the case: One of the main reasons we have an increase at present is because the Sale market is unable to move property for owners who need to move on and the rental market provides the outlet owners need. But by default, the Estate Agents who now have a captive audience are the beneficiaries of this business. My comment to owners is that they should try at least one qualified specialist Letting Agent. By doing so, you should be amazed just how knowledgeable they are and therefore better protected and prepared you will be in the rental market! This is what being trained in our market means and only by speaking with a specialist office will you find out for yourself what that difference means.

30Jun 2011

Property Landlord advice: Block Management: The importance of local services.

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By Steve Roulstone

I have written before about why so many Block Management sites, when the existing site Managers are failing through the eyes of the site Directors, end up in the hands of local Letting Agents, who can quickly make the adjustments to carry out the role of Managers for a site rather than for a Landlord, especially where maintenance is concerned. This is one of the major advantages for local Agencies, because in the nature of their day to day business, they will have developed working relationships with the whole gambit of building craftsmen who can help cement the Agencies new Property Management work.

 Local services for Local people!

 It is also not just that by being a local Company it is highly probable that there will be some relationship either privately with the Leaseholders or just by the very fact that the people concerned live in the same location. In Stafford for example, one of my main ‘fix all’ contractors, lives looking over a site that we manage. The relationship that this has developed between the Directors, some of whom already knew the chap concerned and the Contractor is so strong that they now insist he carries out the annual balcony maintenance programme we organise for them. The trust in his work and the way in which he deals with both the problems that occur and the people living on site is the reason the relationship has developed in this way. I believe what helps make this kind of situation possible when dealing with local trades, is the fact that they are Neighbours. Everybody feels more comfortable than the unknown quantity of a visitor from out of town!

 Time is not a factor.

And then of course, there is the ability to react quickly to any emergency situation, and I have known many schemes that operate Nationally for Letting Agents to deal with those Emergency call outs (and I know at first hand, that the level of performance from Contractors attending through such schemes leaves a lot to be desired) All of whom do not react in the same manner as a Contractor who is not only going to start the job to hand, but probably visit again to complete it. Not to mention being the Contractor who will have visited before and will no doubt be needed to visit again! All of these things make the local chap the choice for me.

 Not just Contractors.

 Of course other services are needed through the offices of Block Management and white collar trades also benefit from knowing the area. I have witnessed myself how the local Solicitors have been able to give more appropriate advice when legal issues have arisen, even benefiting from staff living on the site, in this case being able to clear a very difficult recognition problem for us, simply because when typing correspondence, they were able to answer the issue through personal knowledge of the person we were trying to trace. A situation which ended up benefiting all of those concerned and avoided higher costs to boot!

 No comparison.

 So being looked after by a Local Company has many advantages and I cannot see how the largest of the many major City based specialist Block Managing Companies can compare, and even though they may not advertise such services initially, if I were looking in relation to any property owned on a Leasehold site, I would not hesitate to check the local options first. Of course, they must also have a clear understanding of how to run a site in the proper manner, both legally and financially, on behalf of the owners, but I still believe that most organisations in our trade, if they knew they could not do a good job, would say no from day one. But then we all have to start somewhere as did I when I took my first site on back in 2003. But then I had the advantage of being part of a National Company who could offer me both training and other Franchisees who were already undertaking the role themselves, as they say, you cannot beat knowledge!

28Jun 2011

Cost Cutting Leads to More Disputes Between Landlords and Tenants

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By Craig Smith

In recent years, the country has been through a recession (some people would argue that we a still in the recession) and the cost of living seems to be ever increasing. Not only the cost of food and necessities but the cost of fuel has risen dramatically in just the last few months. This has had a knock on effect in the way that some properties are presented at the end of some tenancies.

Increasing Disagreements Between Landlords & Tenants

We have seen an increasing number of disagreements between Landlords and Tenants over some items which may be considered insignificant in the scheme of things. For example, a shower curtain may be left in a well used condition at the end of a tenancy by a Tenant who doesn’t think they should spend £10-20 replacing it. However, the Landlord may also be less willing to replace it as they may see this as an unnecessary expense. This then leads to a dispute between them and can sometimes turn what was a perfect tenancy into a feud.

Deposit Disputes

Thankfully, we don’t have a great deal of deposits that go through the DPS adjudication process (please refer back to our blog relating to best practice for deposits) although it is increasingly difficult to reach an agreement between both parties. We act as agents on behalf of our Landlords which means that some Tenants see us as ‘taking sides’ This isn’t the case and whilst we do work for Landlords primarily, we always try to reach a fair decision. For example, a Landlord who may be trying to charge £100 for that shower curtain probably wont get his money if the case went to dispute.

Issues at the Start of a Tenancy

Not all disagreements occur at the end of a tenancy. Some Landlords may not see the need to clean a property before tenants move in or have those little jobs finished. This then comes back round in a circle at the end of a tenancy when the Tenant may feel that they should leave it in the same condition.

What to Do?

Best practice dictates that a property should always be presented clean and in good condition at the start of a tenancy. By doing this, there is a benchmark for how the property should be returned when a Tenant vacates. Although wear and tear can only be expected, properties should always be presented as you would like to find it!

08Jun 2011

Property Landlord advice: Length of Tenancy under BBC scrutiny.

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By Steve Roulstone

On Saturday morning I sat eating my Toast and Marmalade and was told during a report on the BBC 24 Hour News channel, that agreements for Tenants are six months long and that any Tenant who was in a property for longer than two years effectively became a squatter and could not be moved out! Well after I recovered from what I thought had been a tremendous shift in the legislation being introduced by the forthcoming Localism Bill I realised once again that here was my Industry being discussed on a National prime time News programme and once again the information being presented was at the very least misinformed if not just plain wrong!

Please check your facts.

It is a long term complaint of mine, that by allowing people to phone or e-mail or text in to News programmes, that the comments and therefore air time that is given to some outlandish views is so miss-representative of what the majority think and believe that it is treating the majority views with disrespect and paints such a false picture of whatever topic is being discussed as to be totally miss-leading of the nations views. But here we have a topic that I know about being given the same treatment by the chosen speakers who were given plenty of time to get the facts totally wrong.

Let’s put the record straight.

Firstly, that a Tenant who has been in a property for two years is as good as a squatter! Unbelievable! All I can say is if that was the Gentleman’s experience, then he needs to get better advice, because as long as the correct agreement is used to best suit the situation, then no matter if a Tenant has been in residence for ten years, both Landlord and Tenant rights remain the same. In fact, if the Landlord lived in the house as their main residence then with the correct agreement, when it is time for the Landlord to give notice, again providing that the notice is issued correctly should for some reason the Tenants not move out, which they would 999 times out of 1000 then the courts have no say in the matter and must award the property back to the Landlord.

Tenants can only stay six months?

Well forgive me but here is a situation which best serves both parties, because in order to ensure the Tenant is responsible in their actions and that the Tenant enjoys living at the property, an initial six months is just what is required, but that is not the end of it! I myself have just moved in to a property on a five year deal, which, with the correct clauses for bad health etc, is exactly what my wife and I wish for. It also suits the Tenant and with reason, for it should always be the case that length of Tenancy is for negotiation between the Tenant and the Landlord. But more interestingly, as a Letting Agent in my twelfth year of running an Agency, it is the Tenant who will always want the lesser time, indeed most stay in property under a periodic agreement after the initial period, which gives them the right to leave at short notice, because it suits their needs better!

Professional judgement!

Once again I see a situation that would have been presented in such a better manner if Professional Agents had been introduced to the situation (and it is a pity that once again I do not see our Industry professional bodies flying the flag for Letting Agents) at least the facts would have been correct, but perhaps it is because the powers that be at the BBC already know that the story would have much shorter legs, if a voice of common sense and reason was introduced to these sound bite discussions, which continue to pour confusion and fear on the housing market. What a pity that those who listened will probably consider the Lettings market something to be avoided. Instead of probably frightening house owners who cannot sell at present, they could have been re-assured that the rental market is a viable proposition and a possible answer to the lack of activity at a time when three times the normal number of properties than normally enter our market year on year are currently being rented throughout the UK!

03Jun 2011

Property Landlord advice: Student Accommodation and Council Tax for part time Students.

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By Steve Roulstone

I have recently come across a situation that I would both welcome comment on and happily post as a warning to all Student Landlords that possession of a Student card does not always mean that as far as the local Council are concerned, the person you are dealing with is not necessarily considered to be a Student. This has specific impact on the Council Tax status of your property.

Large Student accomnodation.

The situation we have just found ourselves in is somewhat complicated by the building in which the students reside. We manage a converted ex County Council building in the middle of Stafford, which comprises of two sets of accommodation, split by a central corridor. To maximise the Landlords return, one half is for Students and one half used for normal Council Tax paying workers. The Student half, comprises of 12 flats, with anywhere between four and ten rooms per flat. They have centralised kitchens, en-suite facilities and they all share one large common room on the ground floor. So not the usual Student accommodation, more purpose built.

Not enough hours.

The problem we encountered with the Student concerned was that they were only a part time Student, on a course which was for 16 hours per week. The problem arose when the Student concerned approached the Council for financial assistance, even though we had advised they would not be eligible. They were not, but the Council then questioned the Student status and quoted from their own web site that: ‘To qualify as a student, the course must be over 21 hours per week and last for at least one year’

Caught out.

I am sure we are not the first to have fallen foul of this ruling and because it is on the Council web site we cannot complain too loudly. But this does show one very alarming hole in what we normally accept as proof of status. This is that the Student card issued by the College is not sufficient proof for the Council to agree. In future we will be insisting on seeing the appointment letter as well as the Student card, because as usual in these situations the consequences are financial!

Consequences.

In the Councils eyes, any property which has been used as their main residence by a person who is not a registered Student (to their own translation) no longer applies for full Student discount. The end result is that the Council have asked for Council Tax for the whole flat for the period that the person lived in this accommodation. This totalled a period of six months. Now many people would already be aware of this rule, but obviously we were not and this is why I have chosen to post this information in this manner. It just proves the old adage; you are never too old to learn!

23May 2011

Property Letting Advice: The Importance of Good Communication

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By Craig Smith

In a recent ARLA publication, the property ombudsman (Christopher Hamer) has written an article relating to a tenant decorating a property. The story goes that, following the tenants request prior to signing the tenancy agreement, the Landlord would not decorate the property. The agent had then given permission for the tenant to carry out the works themselves. However, the Landlord had no knowledge of this and as such tried to claim for the costs of returning the property to its original condition from the deposit.

Tenants Decorating Permission

In this case, it appears that the Landlords agent had given permission for the tenant to redecorate, which could have cost the tenant a substantial amount of money, without first gaining the permission of the Landlord.  There really can be no excuse for this, even if the Landlord was away or unable to be contacted the agents should not have given the permission to the tenants.

Payback Time

As the Landlord had claimed for recompense from the deposit, the tenant then complained to the property ombudsman due to the distress caused by the lapse in communication. If an agent is a member of the ombudsman, it will deal with any complaints made in the most suitable manner.

The article states that the ombudsman awarded £200 in compensation to the tenant for the stress.

Lessons to be Learned

Although the tenant had quite rightly sought permission from the agent to carry out the decorating, the agent had not contacted the Landlord for their advice. Ultimately, it should have been the Landlords decision whether or not to allow the decorating to be carried out.

Best practice dictates that permissions should be in writing and a record kept of and do’s and don’t given to the tenant by the Landlord. The agent in question was at fault for not fulfilling their obligations to their Landlord, which goes to show the importance of having trust in your agent.