Landlords in firing line of new immigration controls

The Queens Speech today will outline the Governments legaslative plans for the year.  Included in these will be a proposal to use landlords to cut the amount of illegal immigration by forcing them to check their prospective tenants immigration status.  This will involve fines for landlords that failed to do this.

Landlords in the firing line

Whilst many of us would support the tightening of controls over illegal immigration I'm concerned that landlords will have yet another administrative responsibility during the letting process.  As always the devil of this new proposal will be in the detail.  However, the talk that landlords could be fined raises worrying thoughts of landlords being held financially responsible for very credible illegal immigrants posing as British citizens.  After all we are only landlords not fully trained members of the Border Agency!  It would be interesting to see what other landlords think on this one.
 
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Deposit Disputes - latest ADR figures

The Deposit Protection Service now holds the deposits of over 335,000 landlords according to their latest press release. Despite these impressive numbers only 7,400 cases end up in dispute last year with the landlord and tenant disagreeing over the amount of deposit to be returned and this being dealt with under the Alternative Dispute Resolution Service (ADRS).  That's impressively low.  It equates to approximately only 2% of all deposit repayments.

Landlords & tenants are reasonable people

Does these figures offer some insight into the relationship between landlords and tenant in that most of them are pretty reasonable and honest people who actually don't need a hugely expensive arm of government sitting over them to manage their affairs.  Actually when left to their own devices landlords and tenants just get on and sort things out fairly and amicably.  This is probably NOT what some politicians want to hear.  After all their message to you is that you NEED them to protect us from ourselves.  In reality, I would argue we do pretty well without them.  Wasn't it the politicians that were meant to protecting us all from a banking collapse.  Nice work guys... but just leave us alone.

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Universal Credits rent arrears might be avoided

As the Governments big reform, the Universal Credit cracks off in parts of Manchester, landlords might be relieved to hear some new directives in the trial scheme.

The RLA have reported that on a circular sent by the DWP states, “Landlords can refer rent arrears cases to Universal Credit; those which are under 2 months rent will trigger Universal Credit to contact the claimant to discuss their non payment as part of the Personal Budgeting Support process, where as those with over 2 months arrears will be switched to direct rent payment automatically and relevant budgeting support activity arranged subsequently.”

This appears to signify that  two months of arrears will automatically trigger a with to payments direct to the landlord. This sounds like some kind of recognition of common sense and the reality of the situation, taking over from politicised dogma. Thank goodness.

Landlords fear of housing benefit payments been mismanaged by tenants resulting in rent arrears might well be avoided. But this policy has not been confirmed and still might not be there for the national launch. We can all just hope the Government has woken up to the potential disaster of millions in rental arrears that could result from these new reforms, as highlighted by the experiment of direct payments in Southwark.

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Court Orders to Evict a Tenant at the End of the Tenancy

Renting out your property is something of a ‘leap of faith.’ Giving a stranger the keys to your property requires not only trust, but also a guarantee that they will look after it, pay the rent and generally be responsible. Of course going through a letting agent and/or carrying out thorough tenant reference checks can help to reduce the risks, but in spite of the best checks and guarantees – no one can predict the future, and for most landlords “problem tenants” are part and parcel of the buy to let industry. How the problem tenants are dealt with however can make a big difference to the overall negative impact these tenants have on the profitability of the rental property. For example tenants who has persistently been late or troublesome paying the rent are unlike to be offered a renewed tenancy.  

What do you do if your ‘perfect’ tenant stops paying the rent?

Most tenancies are on a shorthold basis, which gives the landlord some chance of evicting problem tenants. Within the shorthold tenancy agreement the tenant may either have a fixed term tenancy (for instance, over 6 months) or a periodic tenancy (an indefinite tenancy running from one rent period to the next). The most common way of removing a tenant from your property is through using a ‘Section 21 Notice,’ which gives the tenant two months’ notice to vacate the property. This notice is usually effective, but it is absolutely critical that the landlord follows rules and procedures, or the tenant may have the right to remain in the property for longer. It is also often the case that the deposit must be registered under a government-backed deposit scheme, in order for a ‘Section 21 Notice’ to be applied. (Click here for advice if the tenancy deposit was not registered correctly and you now need to evict the tenants)

The most common grounds for eviction:

• Persistent late payment of rent.
• No payment of rent.
• Damage to the property.
• Anti-social behaviour.
• Breaking the terms of the tenancy.

What happens if, after a ‘Section 21 Notice’ has been served and the two months’ notice has been served, the tenant refuses to leave the property?

• Firstly, you need to make sure that the Notice is valid and provides all the legally required information because an incorrect notice will invalidate your claim.
• In order to be valid, the Notice must be in writing; give at least two months’ notice; end on the last day of a rental period; state that it is being issued under Section 21 of the Housing Act 1988; the deposit must be protected under a government-approved scheme and, if it isn’t, must be returned to the tenant either in full or part.
• If the Notice has been valid, then the County Court will award a ‘Possession Order.’ The tenant can ask for the eviction to be deferred by 6 weeks, but this will usually be granted only if there is extreme hardship. 
• Unless you apply for a ‘Money Judgement Order’, the tenant will not have to pay back any money in arrears once they have been evicted. 
• More information about Money Orders on GOV.UK.

What happens if the tenant still won’t leave after a possession order is granted?

• It is important to note that you must not try and force the tenant to leave, as this could be classed as harassment. 
• The next step will be that the Court will instruct bailiffs to move the tenant on. This is called a ‘Warrant of Possession.’ 

Top tips to ensure a smooth eviction process

• The problem is that, although the serving of the ‘Section 21 Notice’ and subsequent ‘Possession Order’ might be simple, it is only so if everything is completed properly.
• Courts cannot take the chance that they may be evicting somebody unlawfully, and therefore it is imperative that all the paperwork is completed correctly.
• This can be difficult if you have other commitments and are trying to organise the eviction of the tenant whilst working, or looking after a family.

Using a specialist eviction service company

• Using a specialist eviction company does have the clear benefit of dealing with the hassle of the court process.
• A reliable eviction company should also be able to provide information about the likely success and time scales you should expect so you can budget accordingly.
• Some eviction companies (Evictions South East being one of them) hold a 100% eviction success rate, when you compare this to the fact some private landlords experience several failed attempts at evicting tenants, this can be very reassuring to know.
• The eviction company will deal directly with the court and the tenant on your behalf. No more angry text messages or phone calls to your soon to be ex-tenants!

Rents flatline

After years of constant rent increases the Rentindex latest figures indicate that rents maybe flat lining.

Rents over the last 6 months and the last month are now down 0.5%.

Why the flat lining?

Could it be that rents are now being subject to the economic headwinds being felt in the wider economy with tenants unable to afford rental increases.  More importantly does the stagnation in rents reflect the recently introduced  housing benefit cuts.

After years of steadily increasing rents landlords maybe in for a period of stagnation as the winds of economic reality slow our recent progress.
 
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Savills next property auction catalogue

View the next Savills property auction catalogue here

The auction is set to take place on Wednesday 08 May 2013 - 9.30 a.m at the London Marriott Hotel, Grosvenor Square, London,W1K 6JP.

Happy bidding.