Fire safety legislation for landlords – Single Household (family) Occupation

In the aftermath of the Grenfell Tower tragedy there has been renewed interest in fire safety. In the coming months and years it seems likely that there will be changes to legislation but what does the law currently say about fire safety in rental property?


In this article I focus on dwellings used for rented single household (family) occupation.


Fire safety in this type of dwelling is covered by the following:


Building Regulations 2010 Part B


See – Technical guidance for Part B is contained in Fire safety: Approved Document B.


Application – all dwellings where significant building work is carried out.


Housing Health & Safety Rating System (“HHSRS”)


Fire is included in the 29 hazards covered by the system introduced by Housing Act 2004.


See – Operating Guidance and Guidance for Landlords and Property Related Professionals. Further information on fire standards can be obtained in the LACORS Guidance on fire safety provisions for certain types of existing housing.


Application – all dwellings


The Smoke and Carbon Monoxide Alarm (England) Regulations 2015


See – Smoke and carbon monoxide alarms: explanatory booklet for landlords.


Application – all rented dwellings


Licensing Condition


Basic fire safety conditions including provision of alarms have to be imposed if the premises requires a licence under Housing Act 2004 and Councils have discretion subject to appeal to impose additional fire requirements.


There are 3 types of licence.


• Mandatory Licence – applies to HMOs of 3 or more storeys and occupied by 5 or more persons who occupy as 2 or more households. Applies to all areas of England and Wales.


• Additional Licensing (HMO) – discretionary scheme which a Council may apply by Declaration which can apply to any HMO, other than those requiring Mandatory Licensing. Council has discretion on the extent of the area affected and the type of HMO e.g. could limit to HMOs with only 4 persons, or could apply to all other.


• Selective Licensing – discretionary scheme may apply by Council’s Declaration to any rented dwellings which are not a HMO – family/single households – and may cover all or part of the Councils district.


Application – any premises which requires a Licence under Housing Act 2004.

Posted in Landlords | Leave a comment

How to deal with bats in a property

Unlike rodents, wasps and cluster flies, bats are not pests. As population numbers have fallen, all bats and their roosts are protected under The Wildlife and Countryside Act 1981 (as amended) and The Conservation of Habitats and Species Regulations 2010 (as amended). Under these pieces of legislation it is illegal to:


* deliberately capture (or take), injure or kill a bat;
* intentionally, recklessly or deliberately disturb a bat. In relation to the The Wildlife and Countryside Act 1981 (as amended) the offence applies whilst the species is occupying which it uses for shelter or protection; in relation to the Conservation of Habitats Regulations 2010 (as amended) it applies anywhere;
* damage or destroy the breeding or resting place (roost) of a bat;
* possess a bat (alive or dead), or any part of a bat;
* intentionally or recklessly obstruct access to a bat roost;
* sell (or offer for sale) or exchange bats (alive or dead), or parts of bats.


Under the law, a roost is any structure or place used by bats for shelter or protection. Because bats tend to re-use the same roosts year after year, the roost is protected whether or not bats are present. In this context ‘damage’ could include treatment with chemicals found in wood preservatives.


For more information contact the Bat Conservation Trust here

Posted in Landlords, Tenants | Leave a comment

Can an agent withhold part payment of 6 months rent in advance?

Yes – If the terms of the agency/client agreement allow the agent to retain certain monies received on behalf of the principal (landlord) it is acceptable for the agent to do so consistent with the terms of the agency/client agreement.


If the agency/client agreement does not allow the agent to withhold rent paid in advance then the agent should not do so….


The agency agreement (the contract) is governed by a fiduciary duty which the agent owes to the landlord. A fiduciary duty is a very stringent duty and Bristol and West Building Society v Mothew [1996] EWCA Civ 533 is a leading English fiduciary law that is globally cited for its definition of a fiduciary. In the landmark case Lord Milllett said a fiduciary is someone who is undertaken to act on behalf of another the circumstances of which give rise to a relationship of trust and confidence. As the fiduciary, the agent has the highest duty of care, higher than any contractual duty, because it is a fiduciary duty. The agent must be loyal to the principal, not put his own interest first and not profit from his fiduciary position unless the principal consents. Breach of a fiduciary duty is considered a fundamental breach and would allow the landlord to terminate the contract without notice. Specific examples:


* Agent must not delegate from his office – the agent cannot get someone else to do what he is contracted to do


* Agent cannot accept bribes – e.g. From prospective tenants


* Agent must not make a secret profit – e.g. From contractors employed to undertake work on behalf of the landlord by way of inflated invoices or paying commission to contractors


What does the fiduciary duty have to do with the payment of advance rent? I would suggest that as part of an agents ‘highest duty of care’ they should pay the landlord monies the agent receives on their behalf as soon as possible after the agent receives them minus any agreed deductions. Why would a landlord want to delay receiving money? Why would a landlord want to employ an agent to delay receiving money when they would otherwise receive the money much quicker without an agent?


Finally the fiduciary duty covers secret profits – if an agent withholds the landlords money and and it earns interest, they should pass this on to or declare it to the landlord otherwise it becomes a secret profit and is a fundamental breach of contract.

Posted in Landlords | Leave a comment

Landlords should beware of cannabis farms

The extraordinary story of former Bath Tory councillor Donal Hassett who used false names, references and cover stories to rent homes to create a network of cannabis farms is a reminder of the problem this can be for landlords. Read the full story here


Cannabis farms in rented accommodation have been a problem for landlords for several years. Criminals spread farms around multiple locations to ensure that production continues even when one farm is discovered and closed. It is this need for multiple locations which leads the criminals to rented or squatted property.


For landlords, the discovery of a cannabis farm can be devastating and frightening. Under S.8 of the Misuse of Drugs Act 1971 a landlord (or anyone managing the property) can receive a maximum of 14 years in prison and/or a fine if they knowingly permit the production of controlled drugs to take place in rented accommodation. Arguably, “knowingly permit” could include turning a blind eye to the production of cannabis to ensure that their rental income continues. A further complication for landlords is that they could then find any rental income received seized under the Proceeds of Crime Act.


Landlords and their agents should therefore take steps to minimise the risk of cannabis cultivation in rented accommodation. Some signs to watch out for include:


• Tenant’s paying a large amount of rent up front;
• Tenant’s refusing or making excuses to prevent regular inspections or restricting access to parts of the property during inspections


Landlords should always carry out regular inspections or instruct their agent to and should look out for:


• Strange smells;
• Excessive heat;
• Blacked out or sealed windows;
• New ventilation units;
• Signs of meter tampering.


If there is a suspicion that cannabis is being grown at the property landlords should not address the matter directly with their tenant but should report it to the police. The landlord is then advised to serve the tenant with a Section 8 notice.


If the police discover a cannabis farm they will attempt to arrest the tenant and the landlord will need to co-operate with any investigation. Unfortunately, while removing the cannabis plants from the property the police will often leave behind the pots, soil, heat apparatus and any other paraphernalia connected to the cultivation of the cannabis. This can leave the landlord with a substantial clean-up bill and a lengthy delay prior to gaining possession.


Despite the tenant’s conduct, landlords cannot simply take back possession they will need to wait for a county court order for possession upon the expiry of the Section 8 notice. Where all the tenants have been arrested, and are not to be released on bail then landlords may be able to treat the property as abandoned however, prior to taking any steps in this respect legal advice should be sought.

Posted in Landlords | Leave a comment

Why the Homelessness Reduction Act is good news for landlords

The Homelessness Reduction Bill has received Royal Assent and become an Act of Parliament. The Act places a new duty on Local Authorities to help prevent the homelessness of all families and single people, regardless of priority need, who are eligible for assistance and threatened with homelessness.


Positive News for Landlords


Until now a common problem for landlords was when a section 21 notice was served, the tenant went to the Local Authority with the notice and the tenant was told that they must wait for a court order and possibly bailiffs before they would be deemed to be homeless and therefore eligible for assistance.The Homeless Reduction Act prevents Local Authorities issuing this advice.


The Homeless Reduction Act amends the Housing Act 1996 adding a new definition of threatened with homelessness:


“(5) A person is also threatened with homelessness if—
(a) a valid notice has been given to the person under section 21 of the Housing Act 1988 (orders for possession on expiry or termination of assured shorthold tenancy) in respect of the only accommodation the person has that is available for the person’s occupation, and
(b) that notice will expire within 56 days.”


Two possible pitfalls to be aware of:


1. The duty only arises if a valid section 21 has been given – landlords need to ensure any section 21 notice they serve is definitely valid.


2. Local Authorities have struggled making decisions on the validity of section 21 notices even before this Act – Local Authorities commonly try to find reasons why a section 21 notice is not valid and no doubt given the fact that some courts struggle with this, this problem will persist.

Posted in Landlords | Leave a comment

Legal Update – April 2017

The legal landscape for landlords and letting agents is ever-changing and here is a summary of what we have encountered in the last month:


Landlords lose mortgage interest tax relief – Effective April 5th 2017, landlords lost the right to claim full tax relief for mortgage interest payments.


Despite a year of protests and a High Court legal challenge, the government has stood firm on the proposals made by former Chancellor George Osborne and has resolutely refused to even water them down.


The Government estimates around 440,000 landlords will pay more tax because of the change.


HMRC plans new tax burden for landlords with licences – Landlords face a new regulation threat as anyone letting a property with a local authority licence may have to prove they file tax returns before moving in a tenant.


HM Revenue and Customs (HMRC) is moving forward with efforts to tackle the black economy with a new compliance tool called ‘conditionality’.


The idea is any landlord who must apply for a house in multiple occupation licence or register with a landlord licensing scheme must show they are also tax registered with HMRC before the licence is granted.


Part 3 of the Housing and Planning Act – Expected to come into force in October 2017, Section 216 of the Act will permit private landlords in England of properties let under an Assured Shorthold Tenancy to seek possession without a court order where the tenant has abandoned the premises.


Part 5 of the Housing and Planning Act – Will allow for regulations to be made requiring Electrical Safety testing by landlords.


At present under the Landlord and Tenant Act 1985 landlords only need to keep in repair and proper working order the installations in the dwelling-house for the supply of water, gas and electricity. Under the new provisions in Part 5 of the Act this will change.


The Electrical Safety Standards that the Secretary of State may impose are in relation to:


the installation in the premises or the supply of electricity; or
electrical fixtures, fittings or appliances provided by the landlord.


The landlord’s obligations are expected to include duties to ensure that a suitably qualified electrician has checked that the standards have been met, that they obtain a certificate confirming this with a copy provided to the tenant or any other relevant person.


Homelessness Reduction Bill – Expected to come into force in early 2018 this provides real hope that one of the most frustrating issues for both landlords and tenants, that of local authorities insisting on eviction before offering alternative housing, will be eliminated by this Bill.


As the private rented sector adapts to new pressures hopefully the Homelessness Reduction Bill will help landlords to have confidence in their investment and help tenants to feel more secure in their homes.


Banning letting agent fees paid by tenants – The Government has published its consultation paper on banning letting agent fees paid by tenants. The consultation is expected to last for 8 weeks until the 2 June 2017. My personal take on this is the ban is going to happen (probably not until late 2018) and that in order to compensate for the loss of income many agents will pass on some or all of the fees to landlords and this will ultimately put upward pressure on rents. For those agents who were making lots of money from tenant fees they will require a paradigm shift if they wish to flourish.


Compulsory money protection on the way for letting agents – Housing minister Gavin Barwell has confirmed that the government is ready to consult on compulsory money protection in the letting industry after years of misery for renters and landlords who have seen a succession of rogue agents run off with their money.


Tobacco tax evasion – In February, HM Revenue and Customs published a consultation paper on further measures to help tackle tobacco duty evasion and other excise duty evasion.


Part 6 of the consultation paper discusses imposing a statutory duty of care on landlords where a tobacco offence has been committed. A tobacco offence includes the importation and sale of illicit tobacco, which is tobacco that has been imported without the proper declarations being made or duty paid.


With so many changes in the industry it is more important than ever that landlords use a letting specialist to let and manage their property or have some means, such as membership of a trade association, to keep up-to-date with the changes.


This article is provided for information only and does not constitute legal advice.

Posted in Landlords | Leave a comment

DPS Landlord Responsibility to Third Party

Third Party means a person who has paid a Deposit in respect of a Tenancy to a Landlord on behalf of a Tenant and who is a relevant person for the purposes of Sections 212 to 215 of the Housing Act 2004.


The DPS Terms and Conditions covering the landlord’s responsibility to any Third Party are:


• 8. a.
• 8. d.
• 8. e.
• 10. d. x.
• 14. b.


Looking at each of these in turn:


8. a. Where there is a Third Party registered on a Deposit, the Landlord must manage the relationship between the Tenant and the Third Party


DPS Explanation: We would recommend that the Landlord promotes open communication between all parties as much as possible with regards to the deposit, keeping each party informed.


8. d. It is the responsibility of the Landlord completing the Deposit Submission Form to ensure that the responsibilities of the Lead Tenant are fully understood by any Third Party, and that the Lead Tenant is nominated by all of the Joint Tenants and any Third Party


DPS Explanation: All parties (including Joint Tenants and Third Parties) should agree on who will be nominated as the Lead Tenant, as the individual listed as the Lead Tenant will have full control over the release of the deposit with the Landlord on the behalf of Joint Tenants and Third Parties.


8. e. The Landlord will be required to confirm, on the Custodial Deposit Submission Form, that they have explained to any Third Party, the role and responsibility of the Lead Tenant


DPS Explanation: As detailed above, if the Third party has paid the deposit, they should be registered as the Lead Tenant. You are then able to indicate during the registration process that you have made the Lead Tenant aware of their responsibilities.


10. d. x. The full name and title of any Third Party must be included on all Deposit Submission Forms


DPS Explanation: The details of the Third Party can be submitted in the Lead Tenant details.


14. b. The Landlord is responsible for providing confirmation of deposit submission to any Third Party


DPS Explanation: Once The DPS have received payment, the payment will clear within 3 to 5 working days. Deposit Submission Certificates will then be issued to all parties, either by email or by post to the property address. If an email address has not been provided for Joint Tenants and any Third Parties, we will send the Certificate to the property address.

Posted in Landlords | Leave a comment

Minimum level of energy efficiency – a guide for landlords

The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 set minimum levels of energy efficiency for private rented property.


From 1 April 2018, all rented property (both domestic and non-domestic) which is to have a new tenancy must have an energy efficiency rating of at least “E”.


This requirement also applies to all renewal tenancies to the same tenant for the same property on or after 1 April 2018. The duty is also triggered by any periodic tenancy arising on or after 1 April 2018 after expiry of any fixed term because the duty is not only triggered by a renewal but also “an extension”.


From 1 April 2020, all domestic property (including existing tenancies) must have an energy efficiency rating of at least “E”. Non-domestic properties have until 1 April 2023 (including existing tenancies) to ensure they meet the “E” rating.


There are several proposed exemptions for the minimum standard where -


• the property is unable to be brought up to the standard
• the tenant refuses consent
• the landlord is unable to obtain consent from a third party
• works required to bring the property up to the “E” level would devalue the property by more than 5% of market value


Penalties


Where a domestic property has been let which does not meet the minimum standard, the tenancy remains valid between the landlord and tenant but a fine will be payable by the landlord of up to £5,000. Fines can be much greater for non-domestic properties depending on their size.


Minimum rating may rise in the future


Suggestions have been made to increase the minimum rating to “D” in 2025 and to “C” in 2030. From all the Energy Performance Certificates (EPCs) collated in 2014 over half of all properties recorded currently have an energy efficiency rating of “D” or below.


What landlords should do now


Check the EPC for your rented property to see what the current energy efficiency rating is. If the current rating is an “F” or “G” you should act as soon as possible to improve the energy efficiency of your property to at least an “E” rating – the skills for improving the energy efficiency of properties are in short supply and as we approach the deadline, they are likely to get even harder to find. Suggestions on how to improve the energy efficiency of your property can be found in the EPC in the section called ‘Top actions you can take to save money and make your home more energy efficient.’


If you do not have a copy of the EPC available, download a copy from the EPC Register using Retrieve Report Using Property Address option. If an EPC for your property does not exist, commission a Domestic Energy Assessor to provide one. Domestic Energy Assessors can be at the EPC Register website here using Find Energy Assessor option.

Posted in Landlords | Leave a comment

Right to rent checks – a quick guide for landlords

Why


It is a criminal offence for a landlord to allow a person who does not have a ‘right to rent’ to occupy premises in England. If a landlord does allow a person to occupy who doesn’t have a right to rent, they may be liable to a fine of up to £3,000 per adult in occupation.


Who


Applies to most types of occupation such as a tenancy or licence where the occupation is:


- for residential use, and
- for one or more adult occupier (18 years or over), and
- it is to be the occupiers only or main home, and
- for the payment of rent, and
- not excluded


The provisions of the legislation apply regardless of how well or how long a landlord has known the occupier who they are providing accommodation for.


What and When


1. Conduct initial right to rent checks before authorising an adult to occupy rented accommodation;

2. Conduct follow-up checks at the appropriate date if initial checks indicate that an occupier has a time-limited right to rent, and;

3. Make a report to the Home Office if follow-up checks indicate that an occupier no longer has the right to rent.


In the vast majority of cases landlords will only need to perform step 1 – initial right to rent checks. Steps 2 and 3 are only required if a prospective tenant is found to have a time-limited right to rent.


Further Reading


A short guide on right to rent


Check your tenant’s right to rent


Right to Rent Document Checks: a User Guide


Copying Right to Rent Documents: Landlord’s Obligations

Posted in Landlords | Leave a comment

5 things landlords must do on the first day of a new tenancy

OK so you have done all the hard work and preparation for the new tenancy but what must you do on the first day of a new tenancy…


1. Give the tenant a copy of the energy performance certificate


Reference: Part 2, Regulation 6, (5) of The Energy Performance of Buildings (England and Wales) Regulations 2012


2. Give the tenant a copy of the last record of the safety check of the gas appliances and flue (Landlord’s/Landlord Gas Safety Record)


Reference: Part F, Regulation 36 of The Gas Safety (Installation and Use) Regulations 1998


3. Give the tenant a copy of the latest version of the How to rent: the checklist for renting in England


Reference: Regulation 3 of The Assured Shorthold Tenancy Notices and Prescribed Requirements (England) Regulations 2015


4. Give the tenant a copy of the required documents (to include name and postal address of the manufacturer and importer), instructions and safety information for the electrical equipment supplied


Reference: Regulation 26 of The Electrical Equipment (Safety) Regulations 2016


5. Check the prescribed alarms (smoke and carbon monoxide) are in proper working order


Reference: Part 2, Regulation 4, 1 (b) of The Smoke and Carbon Monoxide Alarm (England) Regulations 2015


6 things we recommend you do…


1. Get the tenant to sign a document to prove items 1-5 above have been carried out


2. Check the property against the Inventory and Schedule of Condition Report with the tenant and get the tenant to sign a copy of the report


3. Give the tenant Legionella control information


4. Give the tenant manufacturer’s instructions for any equipment or product supplied


5. Take photographs of the meter readings


6. Show the tenant where to isolate the utilities


Have we missed anything? do you have any questions? ask a letting specialist.

Posted in Landlords | Leave a comment