Rogue Landlord Complaints Underestimated?

A survey commissioned by the Housing Charity Shelter has found that complaints over rogue landlords have increased by 27% over the course of the last three years. The stories behind those figures are quite alarming but the Charity feels that the actual numbers of landlord problems are even higher and that many tenants are simply not reporting their problems through fear of reprisals.

In the last year alone, 85,000 complaints were submitted to local authorities across England and Shelter found that 62% of these issues involved serious or life threatening situations. An additional 781 cases needed the involvement of local health services due to private landlord behaviour or neglect.

Shelter are urging their supporters to petition their local councils and they believe that the situation is even worse than the figures suggest.

“Despite the significant increase in complaints, we believe that the number of rogue landlords is still underestimated,” said Campbell Robb, Shelter’s Chief Executive.

“Some local authorities don’t keep records of complaints and tenants often hold back from complaining out of fear of the consequences or because they don’t believe their voices will be heard, even though such a high proportion of complaints are about life-threatening issues.”

The figures have come after a two year campaign by Shelter to highlight the growing problems with regards to rogue landlords and to encourage the government to put effective measures in place to tackle them.

In a response to these moves, the government has set up its own dedicated taskforce to tackle these problems. Under the scheme, local authorities will be given all the support they need to deal with rogue landlords and to bring about prosecutions.

In addition, £1.8m will be invested to tackle so-called ‘sheds with beds’ – slum properties that are unfit for habitation – while the plans will also remove limits on the fines that can be imposed on landlords.

Shelter may have welcomed the proposals but they insist that there is more work to be done.

“There is still much to be done,” Mr Robb continued. “It’s ultimately local authorities that must do everything in their power to support people who are suffering by cracking down on the worst offenders in their area.”

Those wishing to add their name to the charity’s campaign are invited to e-mail their local council while Shelter are urging any tenants experiencing problems with rogue landlords to get in touch with them for advice without delay.

Scale of Rental Arrears Revealed

Recent reports have shown just how much of the UK are relying on renting their homes while many of those are facing the prospect of having such an arrangement on a permanent basis. As a financial comparative, it’s widely claimed that renting is more expensive than buying and the struggle to maintain payments seems to be getting worse.

A report generated by Receivers Templeton LPA, who comprise part of the LSL Property Services Group, is suggesting that over 100,000 people across Great Britain are more than two months behind with their rent. This represents a significant increase of 24% compared with a year ago and the numbers are at their highest since 2008.

In addition, the number of eviction court orders for tenants increased by 6% in the first quarter of 2012 and by 5% over the figures declared twelve months ago.

Paul Jardine of Templeton LPA suggested that the rise was, in some part due to the increase in the number of rental contracts but that falling incomes and genuine hardship were significant contributors to the final statistics.

“As the private rented sector grows, the number of tenants in dire financial straits is steadily climbing. Falling wages in real terms have been compounded by rising rents, pushing a greater number of rented households over the edge financially,” Mr Templeton said.

“With the instability in the labour market and wider economy, and public sector cuts still to come, the section of renters in multiple months of arrears is likely to continue its expansion.”

Meanwhile, the Housing Organisation Shelter are claiming that the situation is being compounded by higher rents that are rising towards unaffordable levels.

“This is yet more evidence of the crushing impact rising rents and stagnating wages are having on family finances,” said Shelter’s Kay Boycott.

“Shelter research found that average private rents are now unaffordable for working families in more than half of England, with many paying up to half of their income each month. And with homeownership out of reach for so many, hundreds of thousands of families are beginning to realise renting looks set to be a way of life, not just a temporary stopgap.”

In recent weeks, there have been calls from Shelter and others for the government to look at ways in which they can overhaul the rental sector. The findings from Templeton LPA cannot differentiate between those who are hit by higher rents compared to others who have lost their job or are suffering financial issues due to other factors. Everyone does seem to be agreed however that the statistics can only get worse over the course of the next few months.

Action Required to Make Home Ownership More Than Just a Dream

Earlier in the week we saw the reaction of Shelter, the housing and homelessness charity to a survey claiming that property rental could soon become a permanent way of life for many. The organisation suggested that the government had to wake up to the reality that only a quarter of the UK population may be owning their own home by the year 2025 and to ensure that improvements were made in all areas.

“It’s time government woke up to the fact that ‘rental Britain’ is here to stay,” said Shelter’s Chief Executive Campbell Robb.

While these are apt comments, some observers were surprised that the organisation didn’t take the opportunity to suggest that home ownership needs to be more affordable. To be fair however, Shelter have been vocal on this subject in the past but for the time being, this particular challenge has been taken up by another charity – the Joseph Rowntree Foundation.

The organisation focuses on potential buyers between the ages of 18 and 24: At present it claims that 2.4 million of them live in private rented accommodation but as they attempt to save for home ownership, ‘inflated’ house prices mean that they face an uncertain future.

The foundation then calls for major reforms in order to avoid a permanent rental trap by the start of the next decade. By 2020 it claims that young people will be staying with their parents for longer and they will subsequently need to call on those parents to help them purchase their own home.

Those that decide that staying at home has run its course face the prospect of a long period of private rental.

“The challenges facing young people by 2020 will require fundamental changes to the UK housing system. Young people are particularly vulnerable in a badly functioning housing system due to their lack of resources and opportunities,” the report states.

It goes on to echo the comments made by Shelter in suggesting that huge reforms are needed in the private rental sector.

“There is a particular need to reform the private rental sector, balancing the interests of both landlords and tenants. The growing number of families living in the private rental sector will create a need for more stability in the sector,” the report concludes.

While Shelter and the Joseph Rowntree Foundation may be approaching things from slightly different angles, they both agree that home ownership may become just a distant dream unless more positive steps are taken to address the issue.

A Third of Rented Properties are Hazardous

Almost a third of all properties in the private rented sector have major safety hazards according to data released in a Government survey of housing stock in the UK.

The annual English Housing Survey reveals that 28.2% of homes in the private rented sector have what is known as a category 1 hazard.  This is compared to 14.5% of local authority properties, 10.8% of housing association properties and 21.5% of owner-occupied accommodation.

A category 1 hazard is classified by the Housing Health and Safety Rating System and includes any hazard that could cause death, permanent loss of consciousness, lung cancer, the loss of hand and foot, heart attacks, 80% burn injuries, eye disorders and poisoning.

Under the Housing Act 2004, these hazards obligate a local authority to vacate a property of all tenants and to arrange immediate repair and making safe of these hazards.  The most hazardous type of property is flat conversions, with 37.7% having at least one category 1 hazard.  Older properties can also pose more dangers especially those built before 1919.

A total of almost 5 million properties in the UK have such hazards with the most common hazards being those which could cause slips and falls.  Baths, stairs, and showers with inadequate or poorly installed grab rails and handles were the most likely areas to cause issues.

Newspapers recently published a story about how an 85 year old man in Hackney, East London, became stuck in his bath with no heating or food for five days.  Luckily he was able to reach his sink to drink water, but even this suggested the bathroom was too small and not fit for purpose.  The man was only rescued when friends became worried about his whereabouts.

The second largest hazard listed was excess cold and this is especially a problem for those aged 60 or over.  A healthy indoor temperature as at around 21C, but many properties were found to have inadequate heating leading to a serious risk to health.,

The report said: “The percentage rise in deaths in winter is greater in dwellings with low energy efficiency ratings. There is a gradient of risk with age of the property, the risk being greatest in dwellings built before 1850, and lowest in the more energy efficient dwellings built after 1980.”

Other category 1 hazards included biocides, asbestos, lead and radiation, carbon monoxide, and electrical and fire hazards.  Of course, occupier behaviour can also play a major part in the risk these hazards pose and certainly was a factor in over 80% of fires in rented accommodation last year.  However, there were also 2000 fires in the same year associated with faulty wiring and cabling, issues that can be avoided.

All landlords have a duty to protect their tenants and a vested interest in protecting their property investment.  Any category 1 hazards need to be dealt with immediately with tenants vacating the premises if necessary whilst any other reported hazards should be assessed and dealt with as soon as possible or at the very least made safe.

Spotlight Shines on 2012 Rental Costs

Property lettings are put under the microscope this week as a survey released by one prominent agent suggests that the costs of renting your home may be dropping. Meanwhile, the survey goes on to suggest that Christmas spending is one of the factors currently having an impact on a rise in late rental payments.

LSL Property Services claim that the average monthly rental payment across the UK in December fell by 0.8% from the previous month. However, LSL go on to state that this still represents an increase of 4% on comparative prices from December 2010.

The fall comes after ten straight months of rental increases, although this does represent a fairly familiar ‘seasonal decrease’.

“The rental market was sheltered from the full impact of the seasonal lull by the strength of underlying tenant demand as many prospective renters took the opportunity to move in the run-up to Christmas at a time when the market is traditionally less competitive,” said David Newnes, director at LSL.

The survey also revealed an increase in late rental payments which it blames squarely on the impact from Christmas spending. The findings suggest that 10.7% of all rental payments were late or unpaid in December, as opposed to a figure of 9.3% from the previous month.

Those figures have prompted the Association of Residential Letting Agents to highlight the difficulties faced by tenants and landlords alike and has reiterated the need for watertight contracts, preferably from a recognised agent.

“It is more critical than ever to take references and conduct thorough research before signing a tenancy agreement,” said Arla’s President Tim Hyatt.

“Seeking advice from a professional, licensed letting agent is the best way to ensure tenants and landlords’ rights are protected.”

The fall in monthly rental prices may be seen by those looking to rent as a positive sign however, industry experts are warning against too much excitement, while affirming their belief that this is no more than a seasonal anomaly.

“It may be premature to say the UK rental market has peaked and that we are about to see rents fall away,” said Matt Hutchinson, director at Spareroom.co.uk.

“What we are probably seeing is a temporary blip, a natural cooling off period for the rental market.”

Overall, rental prices are expected to shortly begin climbing once again while continuing to increase throughout 2012 but the next survey run along similar lines may give us a more telling picture.

Tenant Checks – A Service No Landlord Should Ignore

If you are just starting out in the buy-to-let game or you’re a seasoned landlord, you need to understand the importance of carrying out background checks on potential tenants.  It’s a landlord’s market right now with more and more people choosing to rent so you don’t need to bite off the hand of the first person who shows an interest in your property.  You can afford to be a little more choosy.

The National Landlords Association (NLA) has issued a reminder to landlords to carry out checks on potential tenants before they let out a property.

This advice is being given to all landlords so they can confirm the identity of the tenant and ensure there are no reasons why rent payments would be missed.

The NLA carried out recent survey which revealed that almost three quarters of all landlords seeking possession of one of their properties suffered from rent arrears.

After carrying out a number of searches, NLA’s Tenant Check found that almost 1 in 20 tenants had more than one CCJ (County Court Judgement) against their name at a previous address during the first quarter of 2011.

Most tenant check services include a CCJ search, ID check, alias name search, history of previous addresses, together with a bankruptcy check.  A more thorough check, and this is recommended, will include employer and landlord references and an assessment of a tenant’s ability to meet rent payments.

The NLA reported a record number of tenant checks during the month of August and this included the highest number of full tenant checks in any one month.  These figures show that landlords are becoming more and more conscious of the tenants they let their properties out to.

David Salusbury, Chairman, NLA, said: “Getting a proper background check done on all tenants before they move into a property is one of the most important things a landlord can do before handing over the keys.

“It is vital landlords find out basic information about their prospective tenant to help avoid rent arrears or other problems further down the track. This gives the landlord peace of mind that their properties are in good hands and will hopefully mark the start of a satisfactory and hassle-free tenancy.”

Tenant from Hell Walks Away After Wrecking Property

A landlord has been left picking up the pieces after a tenant wrecked his property and then walked away from court without paying a penny.  £20,000 of damage was caused in total rendering the property inhabitable until the damage is put right.

Teenage tenant, Lee Davis destroyed the flat he was renting in Darlington following a request to vacate the property due to non-payment of rent.  Most tenants would simply accept this as a fair request, but Mr Davis was intent on going on a rampage instead.

The Judge, whilst admitting that he would like nothing better than to make Mr Davis repay the costs of repairing the property, was only able to give the defendant 300 hours of unpaid community service as punishment.  He said his hands were tied as there was no way that Mr Davis could find the funds to pay for the damage.  The defendant walked away whilst the landlord was left open-mouthed and out of pocket.

These problems are actually fairly common in the rental world.  Often, when discrepancies arise between tenants and landlords they are settled amicably, but occasionally a tenant will take umbrage over a request or issue and set about destroying their surroundings in anger.  Many of these issues can of course be avoided by carrying out thorough checks of tenants before agreeing to let the property.  The good news is that the majority of tenants are law-abiding, respectful and honest and will give no cause for concern.

We don’t believe thorough checks were made in the case of Mr Davis and that if checks were made there was probably fraudulent information supplied or shortcuts taken.  A thorough tenant check requires credit checks, personal character references, financial checks, and employment checks to ensure the tenant is who they say they are and that they can afford to pay the rent each month.  £20,000 is not a figure that any landlord wants to think about coughing up and we think this landlord probably cut their losses and sold the property in the end.  A big price to pay for not checking up on a tenant.

Any landlord who has suffered losses because of malicious damage will understand how important it is to conduct proper checks of their tenants.  Of course, even a tenant that looks great on paper can suddenly turn into whirling dervish when tempers fray and there is little you can do in these cases.

In addition to carrying out the right level of checks you should also add malicious damage to your landlord insurance.  Many low price insurance policies won’t usually include this as standard so it’s worth covering your back and your property.

Record Rental Payments Take Up Half of Tenants’ Income

If you’re thinking about renting a property be prepared to surrender almost half of your take home pay or more.  Rents hit record levels in September and look set to rise even more as landlords hike up their rates.

Research has revealed that the average monthly rent rate rose by 1.6% in September alone taking the typical payment up to £890 a month.  This is making rents unaffordable to many across the country.

Rental asking prices have increased each month in 2011 with a total increase of 4.6% in the last 12 months.  This has added a whopping £468 onto the average annual rental bill.

Those living in London appear to be hit the worst.  Despite earnings being 41% more here than on average, the rents charged in London cancel out any benefits of a higher salary.  Average rents in London account for 76.3% of average earnings each month.  On average, landlords with rental property in London charge £2,075 a month whilst the typical London family brings in £2,721 in net monthly income.

By comparison, the best rental properties offering the best value are in Yorkshire.  Here average rents are only 35.2% of incomes.  With rental prices increasing at such an alarming rate it will be harder for UK families to afford to live in the areas in which they work or have family and friends.  It’s a catch 22 situation as many people choose to rent so that they can save for a deposit on their first property, but with little in the way of disposable income left for savings this is going to be very hard.

As a result of rental rises, many young professionals are starting to opt for flat shares in an attempt to save money on rent and put into a first home deposit.  Of course, it all depends on where you want to live or rather where you need to live.  If you can relocate to cheaper areas without any detriment to your working or personal life then this may be a good option to consider.

UK Rental Market Nearing Capacity

According to the Association of Residential Letting Agents (ARLA), the private property rental sector in the UK is close to capacity.

The number of new tenancies being released onto the rental market has been at record levels over the past year, but the private rental sector may finally be facing a challenge with meeting demand from tenants.

ARLA conducted a survey across 6,000 of its members in the UK and 74% of those questioned said there were more tenants than properties and that this deficit had reached the highest level since records began.  Demand has slowly continued to outstrip supply and has been that way for the past four quarters.  The problem is particularly acute in London and the South East.

The survey also shows that tenants are staying in their rented properties for much longer with most tenants staying in their properties for 19 months or more.  Tenants seem to be becoming more and more wary of the unstable housing market and choosing instead to ride out the unstable market conditions by renting property instead.

‘The UK cannot rely on the rental sector to support the housing market in perpetuity. The reality is that there is a finite amount of rental property and unless both housing supply and mortgage availability improves then renters will find that their options in the market are reduced,’ said Tim Hyatt, president of ARLA.

‘The Government is doing little to encourage landlords to invest in new properties therefore we are running out of quality stock to offer to tenants. This is reflected in rent increases and a lack of choice for consumers,’ he explained.

‘Within such an intensely competitive market, we would advise tenants and landlords to seek the best possible advice from agents as there will be those that seek to exploit this situation. Engaging with an ARLA licensed letting agent is one way to protect your assets guard against this and guard against unethical operators,’ he added.

Tenants and Landlords Urged to Be ‘Gas Safe’ This Winter

As the winter months approach, we’ll all be reaching for the heating controls to turn up the heat.  This week marked Gas Safety Week, a drive to remind the public about the importance of safety measures and checks where gas is concerned.

So, what can landlords and tenants do to ensure they keep safe this winter?  The HAS Gas Safety Statistics 09/10 reported that a total of 10 people died due to gas related accidents and incidents across the UK last year and that a further 330 needed hospital treatment.  With that statistic in mind, it hits home how important it is to carry out regular checks and that applies to tenants, landlords and homeowners.  Landlords and building owners are legally responsible to arrange annual safety checks and necessary maintenance and should ensure all works are completed by a Gas Safe registered engineer.

If you are a tenant and think you might have a problem with a gas appliance, get onto your landlord immediately.  They have a legal obligation to arrange emergency assistance and should provide assurances that the matter is in hand as quickly as possible.

These checks will help to ensure that pipes, appliances and flues are in a safe condition, all gas equipment is safe prior to letting, and that gas safety records are maintained for the property.  Checks also ensure that potential problems are spotted and rectified before a major incident can occur.  Leaking gas and unsafe appliances are a very real hazard and can kill it not attended to immediately.

Paul Johnston, chief executive at Gas Safe Register said: “Every year, far too many people suffer from preventable gas related accidents, such as gas leaks, explosions, fires and carbon monoxide poisoning. If maintained and installed properly, gas appliances are safe. If neglected, gas appliances can kill.”

It’s so important that you use Gas Safe registered engineers.  These industry experts have undergone rigorous training and assessment and have the skills and expertise to spot problems and deal with them safely and completely.  Before you employ any engineer it is essential that you check their ID and you can also check them out on the Gas Safe website.