Category : Property

The government intends to introduce a Tenants’ Fees Bill before the end of the year. The Bill will ban landlords and letting agents from requiring tenants to make any payments as a condition of their tenancy, with the exception of:

• – Rent;
• – A capped refundable security deposit (currently proposed to be no more than one month’s rent);
• – A capped refundable holding deposit (currently proposed to be no more than one week’s rent); and
• – Fees for management services carried out as a result of a tenant’s default (such as repairs arising from deliberate damage to the property or a breach of the tenant’s obligations).

What is the Current Position on Letting Agents’ Fees?

Currently many agents charge prospective tenants a fee for carrying out work associated with the grant of a tenancy such as:

• – Preparing a tenancy agreement;
• – Conducting reference checks;
• – Ensuring a tenant has the ‘Right to Rent’;
• – Preparing an inventory and agreeing the inventory with the tenant; and
• – Handling a renewal of a tenancy.

The average amount paid in fees is currently £223, according to government figures. However, housing charity Shelter reports that one in seven renters pays more than £500. Some tenants in London have been charged fees of up to £2,000.

The Government’s Aim

Lettings agents in England and Wales have been required since May 2015 to publicise a list of the fees they charge to landlords and tenants. The fee tariff must be displayed prominently at the agent’s premises and must be published on the agent’s website, if they have one. But the government feels that more needs to be done to tackle the ‘unfair’ fees charged to tenants. It hopes that the ban on fees for tenants will improve competition in the rental market and drive up standards by encouraging landlords (who will now bear the agents’ fees) to shop around for more competitive fees.

Are Landlords and Agents Concerned?

Within the property industry concerns have been raised that the fees ban will:

• – Cause job losses for lettings agents;
• – Lead to a lower service level for tenants;
• – Make buy-to-let investments less attractive for landlords who will have to pay the agents’ fees instead of the tenants; and
• – Lead to increases in rent as landlords pass the cost of the fees onto their tenants.

There are also concerns that the proposed cap on the security deposit of one month’s rent is too low. The current average deposit is equal to six weeks’ rent but sometimes a higher deposit is sought from higher-risk tenants. If this option is not available to landlords, they may simply decline to offer their properties to such tenants.

Implementation

While the Bill is expected to be published before the end of 2017, the new rules are not likely to come into force before late 2018. Lettings agents and landlords need to keep up-to-date with developments and ensure they are ready for the new regime.

How Does This Affect You?

Are you a landlord or letting agent who will be affected by the fees ban? Will the ban achieve the government’s aim of improving service provision for landlords and tenants or does it just add to the burden on landlords and agents and make investment in the private rented sector increasingly unattractive? Let us know what you think by commenting below.

On 6 April 2017, parts of the Housing and Planning Act 2016 came into force affecting residential landlords in England (but not in Wales). Further parts of the Act are expected to take effect in October 2017.

The recent and forthcoming changes target so-called “rogue landlords”. Landlords who do not comply with their obligations under the Housing Act 2004 and other legislation may have to repay rent to their tenant or repay universal credit to the local housing authority. In addition, local housing authorities have new powers to impose financial penalties for certain offences as an alternative to prosecution.

In October 2017, we expect to see the introduction of banning orders for landlords and agents who have been convicted of certain (yet to be specified) offences.

Responsible, well-advised landlords should have nothing to fear from these new provisions which are designed to catch landlords who deliberately and persistently fail to comply with their legal obligations. But all landlords (and agents) need to make sure they know what their duties are and ensure they comply with them. Here are 10 key areas for compliance:

1. Ensure that any tenancy deposit is protected in an approved Tenancy Deposit Scheme within 30 days and that the Prescribed Information is given to the tenant.

2. An Energy performance certificate (EPC) needs to be commissioned before the property is marketed and a copy needs to be given to the tenant.

3. If there are gas appliances at the property, have them checked annually and give the tenant a copy of the gas safety record.

4. The tenant needs to receive a copy of either the Department for Communities and Local Government’s How to Rent: the checklist for renting in England or the Welsh Government’s publication A Home in the Private Rented Sector – A Guide for Tenants.

5. Carry out checks to ensure that each smoke and carbon monoxide alarm at the property is in proper working order on the day the new tenancy begins and confirm this to the tenant in writing.

6. Carry out regular health and safety inspections to identify hazards and deal with problems as soon as they arise.

7. Comply with any notices received from the local authority environmental health department.

8. If property is a House in Multiple Occupation (HMO), ensure compliance with The Management of Houses in Multiple Occupation (England) Regulations 2006.

9. Ensure the tenant is given up to date information about your address for service. Keep any data you hold about the tenant safe in accordance with the Data Protection Act.

10. Use the correct procedures to terminate the tenancy. A residential tenant cannot be evicted without a court order. Serve a valid Section 21 or Section 8 notice to seek possession.

Local authorities will now find it simpler and cheaper to impose financial penalties than to prosecute landlords. We can expect to see more enforcement action. Now is a good time for landlords and agents to review their systems and ensure that they are compliant with the law.
What do you think about the new penalty regime? Will it be an effective means of dealing with rogue landlords? Are “good” landlords coming under too much pressure from recent government reforms? Please comment below!

According to a recent article in The Guardian, seven in 10 landlords do not understand their obligations under the controversial new ‘right to rent’ rules. Effective as of this February, the new right to rent laws mean that the onus to check tenants’ right to live in England is now placed firmly in the hands of landlords. Announcements concerning implementation of the rules in Scotland, Wales and Northern Ireland are expected at a later date.

Under the new law, landlords that fail to comply and monitor the immigration status of their tenants could face penalties of up to £3,000. So, what do people up and down the country think about the law changes? Read on to find out.

The West Midlands Trial

Before the new law was rolled out across the country, it was trialled in the West Midlands. From 1^st December 2014, private landlords in the region were required to check whether prospective tenants had the right to live in the UK before granting them a tenancy.

As a result, landlords were expected to request proof of identity documents, such as a passport, or face the prospect of being fined if their tenants were found to be living in the UK illegally. Within six months of the trial being launched, the first West Midlands-based landlord received a fine of £2,000 for failing to check a tenant’s immigration status.

Speaking to the Property Industry Eye, Phil Stewardson, owner of 135 rental properties in the West Midlands, accused the authorities of using landlords as “free labour” for border control. So, even before the new laws came into full effect, it was clear that at least some landlords were unhappy with the changes.

Are Landlords Doing the Job of Border Control?

Landlords like Phil Stewardson are essentially arguing that the new right to rent law is a thinly veiled attempt by the Government to pass some of the burden for monitoring immigration on to everyday people. And it’s a point of view that has gathered some political support.

Writing about the subject on the Politics Home website, Baroness Hamwee, a Liberal Democrat Peer, had this to say:

“I find it a bit rich that landlords should risk imprisonment for housing an illegal immigrant when it is the Government’s failure in their duty to protect the borders of this country that has resulted in the illegal immigrant being here in the first place.”

On the opposite side of the fence, however, there are landlords who are happy to comply with the new right to rent laws. Supporters of the changes argue that the right to rent checks are quick and easy to perform, and that there is an abundance of supporting documents and Government published literature to help any landlords that are struggling.

Furthermore, the new laws will also make it a lot more difficult for people to stay in the country when they have no right to do so. Plus, they will act as the first line of attack against an increase in criminal landlords that exploit illegal immigrants by renting out unsafe and often overcrowded accommodation.

A Huge and Difficult Market

It’s no secret that the rental market is huge in the UK. In fact, research suggests that, by 2025, there could be more people renting than who have a mortgage in the UK. In part due to the growing size and complexity of the market, there is doubt whether landlords are sufficiently able to carry out checks on tenants’ right to live in the UK.

In an article published by the Financial Times, policy director of the Residential Landlords Association, David Smith, raised concerns about landlords’ lack of expertise verifying documents:

“How familiar are you with a passport of Liechtenstein? Can you spot a forgery? I certainly can’t. But that is what landlords are being asked to do and if they don’t they will be at risk of a financial penalty.”

Some Landlords Could Be Exploited For Profit

In addition to securing the relevant data, the extra costs of performing the initial checks are going to place a significant burden on the shoulders of many landlords. It is entirely feasible that many landlords will now prefer to pay for the services of independent companies to perform tenant checks on their behalf.

A recent article in The Telegraph highlighted that a handful of companies are already charging £100 for bespoke immigration checks in an effort to profit from the law changes. However, the same article warns that certificates from such companies are not official documents, and it is unclear if the Home Office considers these services to be legitimately recognised.

As a result, the only way for landlords to legally escape liability for these checks is to pay a letting agent to do them on their behalf. Therefore, the right to rent laws could force more DIY landlords to hire the services of letting agents, which, in turn, will increase the costs involved in running a rental property.

The Course of Least Resistance

The new laws have also drawn criticism because they could, potentially, increase the chances of some landlords flouting anti-discrimination laws. With the introduction of right to rent, The Telegraph wrote an article stressing that campaigners against the law changes might only “rent to white tenants with British-sounding names” in a bid to avoid red tape.

When you add the prospect of a £3,000 fine into the mix, in theory, the chances of this happening probably increase. Therefore, even sub-consciously, some landlords may take the course of least resistance to ensure they avoid fines and the likelihood of additional Home Office bureaucracy.

Final Thoughts

Are you a landlord? What are your thoughts on the new right to rent laws? Are they a necessary burden or an example of the Government relinquishing its responsibilities? Join us in the comments section below for a discussion.

At Simply-Docs, we provide a wide selection of ready to use property template documents and legal contracts for DIY landlords. For more information, contact one of our expert team today.

Houses in multiple occupation (HMOs)can be an excellent source of income for the buy-to-let landlord. HMOs tend to yield a higher rent than a home let to a single household. However, owners of HMOs have a heavier management burden and must comply with more legal requirements than other residential landlords.

If you are the owners of a HMO, or are considering adding a HMO to your investment portfolio, here are 10 essential tips to help you.

1. Engage with the local housing authority

Some HMOs need a licence, either because they are large HMOs affected by mandatory licensing or because the local housing authority has introduced additional licensing for certain types of smaller HMO. Check what the rules are in your area.

Also check what standards, rules and regulations apply locally. Each local housing authority will have requirements as to safety, room sizes and facilities.

If you are converting a family home into a HMO, check whether planning permission is required. Generally, no planning permission is needed for a HMO housing 3-6 residents but larger HMOs require a specific planning permission. Take advice from the local authority planning department at an early stage,

2. Obtain or renew your HMO licence

If a licence is required, be sure to obtain one before letting any rooms in your HMO. The local housing authority will carry out an inspection before granting (or refusing to grant) a licence. A fee will be payable. Licences usually last 5 years.

A criminal offence is committed if a landlord does not have a licence for a HMO that should have a licence. A fine of up to £20,000 can be imposed. It is also an offence to allow overcrowding or to breach a condition of the licence.

3. Check that your mortgage permits HMO use

Not all buy-to-let mortgage products are suitable for HMOs. Some standard buy-to-let mortgages will allow “small HMO” use, i.e. 3 or 4 tenants, but owners of larger HMOs will need a specific HMO mortgage product.

Shop around and consider using a broker to source the most suitable product. Lenders tend to offer the best products to experienced property investors.

4. Obtain specialist insurance

Insurance is essential to protect your investment but many insurers do not offer policies for HMOs as they are perceived to be higher risk. As with mortgage products, landlords need to shop around or use a broker.

Ensure that your insurance covers the buildings, any landlord’s contents and loss of rent if the property is damaged or destroyed.

5. Attend to safety & maintenance

HMO landlords have various duties under The Management of Houses in Multiple Occupation (England) Regulations 2006. These are listed below. Landlords should ensure that the property is up to standard before allowing any tenants to occupy.

Landlords must:

• Provide the landlord’s contact details to the occupiers and displaying them in a prominent place in the property
• Take fire safety and other safety measures
• Ensure a supply of water and drainage
• Maintain a supply of gas and electricity and testing gas appliances annually and electrical installations every 5 years
• Maintain common parts, fixtures, fittings and appliances
• Make sure living accommodation is clean at the start of a tenancy
• Provide waste disposal facilities.

6. Monitor safety & maintenance

Landlords need to carry out regular inspections of the HMO to keep the safety and maintenance issues above under review. If tenants report faults, the landlord should respond promptly.

7. Choose tenants carefully

All landlords need to take care when taking on a new tenant. HMO landlords need to be particularly careful. In many cases, HMO tenants are young professionals looking for economical accommodation in a convenient location. However, HMOs can also attract unreliable tenants and tenants with financial problems.

As well as checking on reliability and creditworthiness, Landlords need to consider whether a new tenant will fit in with the other tenants in the HMO. Landlords should seek references and do financial checks. Click here to see our Simply-Docs template reference request letters.

8. Have a written tenancy agreement

Having a written tenancy agreement will ensure that both landlord and tenant know what to expect and will reduce the scope for disagreements during or at the end of the tenancy.
Click here to see the Simply-Docs range of bedsit agreements and other assured shorthold tenancy agreements and here to see our student letting agreements.

9. Keep detailed records

Make sure you keep a written records of any inspections, correspondence and conversations with tenants. This will provide evidence of your actions in the case of a future dispute.

Also keep detailed financial records. These will be essential when it comes to filling in your tax return.

10. Connect and keep up to date

Connect with other local HMO landlords or join an online forum to learn from others and share your experiences of being a HMO landlord. Make sure you know about any planned changes to HMO legislation so you are well prepared.

How can Simply-Docs help?

Simply-Docs has a huge range of template letters, forms and documents in our Residential Landlords folder, including tenancy agreements for HMO and non-HMO properties. Our documents are customisable and easy to edit.

Our new HMOs and Licensing documents help HMO landlords to comply with the HMO Management Regulations.

For more information about our services, please do not hesitate to contact one of our expert team today.

From 1 April 2018 it will be unlawful for landlords in England and Wales to grant a new lease or tenancy agreement of a commercial or residential property with an energy performance certificate (EPC) rating of F or G. There are some exceptions – which we mention below – but for the most part landlords will need to ensure that their properties have a rating of E or higher by 1 April 2018. In this blog we look at different aspects of the law on energy efficiency standards and consider what steps landlords should take between now and 1 April 2018.

Energy Performance Certificates (EPCs)

EPCs were introduced in 2007, with the regime applying to all residential and commercial properties by October 2008. An EPC must be prepared and made available to potential buyers and tenants when a property is being sold or rented.

An energy assessor visits the property and assesses the energy features such as heating, insulation and glazing. A report is generated giving the property a rating from A (the highest) to G (the lowest).

Green Deal

The green deal was introduced in 2013 to help owners of residential and commercial properties to make energy efficiency improvements at no up-front cost. Take-up levels have not been as high as was hoped and the Government stopped funding the Green Deal Finance Company last year. It is still possible to get funding from other providers.

Property owners can request a green deal assessment. The assessor will produce an advice report recommending energy efficiency improvements and giving an estimate of likely savings on energy bills. The “golden rule” is that any recommended improvements must pay for themselves through reduced energy costs.

If the property owner proceeds with the improvements and uses a green deal finance plan (rather than self-funding the improvements), the loan repayments will be made via the energy bills for the property. The energy company passes the payments to the loan provider. There should be no increase in the energy bills for the property because of the “golden rule”.

Tenants’ Energy Efficiency Improvements

From 1 April 2016, assured shorthold tenants (and some other residential tenants) in England and Wales have the right to request their landlord’s consent to make energy efficiency improvements to rented property. Landlords must not unreasonably refuse consent to improvements.

The new rules apply where the tenant wishes to make a “relevant energy efficiency improvement”. Relevant energy efficiency improvements are those that either qualify for Green Deal funding or are measures taken to connect a property to mains gas.

The improvements must be financed at no cost to the landlord. They may be financed through a Green Deal Finance Plan, provided free of charge by an energy company, financed by a grant from central or local government or another source or funded by the tenant (or a combination of these methods).

Minimum Energy Efficiency Standards (MEES)

The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 introduce the concept of a “sub-standard” property. This means a commercial or residential property with an EPC rating of F or G.

From 1 April 2018, it will be unlawful for a landlord to enter into a new letting (or extend or renew an existing letting) of such a property. From 1 April 2020 it will be unlawful to continue to let a residential property with an F or G rating and from 1 April 2023 it will be unlawful to continue to let a commercial property with such a rating.

There are exemptions from this prohibition on letting, the main exemptions applying where:

  .      The landlord has in the previous five years already made all relevant energy efficiency improvements or there are no relevant energy efficiency improvements that can be made.

  .      The landlord has in the previous five years been unable to increase the energy performance rating of the property to E or above:

  .    due to the tenant’s refusal of consent or refusal to give a confirmation required under a green deal finance plan;

  .    due to a third party’s refusal of consent or granting of consent subject to unreasonable conditions; or

  .     because an independent surveyor has advised that this would result in a reduction of more than 5% in the market value of the property.

Steps for landlords to take between now and 1 April 2018

Landlords need to have a strategy in place to comply with the law on energy efficiency standards. Landlords should consider taking some or all of the following steps:

• Carry out an audit of your rental properties to identify any with an F or G rating. Consider extending this to properties with an E rating as the “sub-standard” definition may include E rated properties in the future.
• Take advice on energy efficiency improvements. Consider whether any exemptions apply. If they don’t, take steps to make the recommended improvements. Liaise with tenants to arrange access or arrange to do the works when the property falls vacant.
• Respond to residential tenants’ requests for energy efficiency improvements.

Further Information

Landlords and tenants can access our guidance notes and template documents relating to tenants’ energy efficiency improvements here. For more information about the 1 April 2016 changes please see here.

On 1 October 2015, significant changes were made to housing law in England (properties in Wales are not affected). The changes which are set out in the Deregulation Act 2015 increase the level of protection afforded to tenants, while placing extra burden on landlords.Buy-to-let investors are still coming to terms with the budget bombshell concerning the reduction of tax relief on mortgage interest payments. How much will these 1 October 2015 changes add to their woes?

What has changed on 1 October?

The most important changes affect landlords’ ability to recover possession of their premises at or after the end of the term of an assured shorthold tenancy. Section 21 of the Housing Act 1988 allows landlords to remove tenants on a ‘no fault’ basis, provided they serve notice correctly and there are no factors that serve to invalidate the notice.

From 1 October there is a longer list of invalidating factors – or, in other words, there are more obstacles in the way of landlords seeking possession. There are also changes to the timing of a Section 21 notice and the timescale for issuing possession proceedings. And there is a new prescribed Section 21 notice which landlords must use.

Readers should note that the changes referred to below only affect tenancies that start on or after 1 October 2015. Tenancies granted before that date are not affected. However, from 1 October 2018, the new provisions will apply to all tenancies, regardless of when they were granted.

Validity of Section 21 Notices

Until 1st October 2015, there were two factors that could invalidate a Section 21 notice: failure to protect the tenant’s deposit in an approved tenancy deposit protection scheme and failure to comply with HMO licensing requirements.

On 1 October, several more restrictions came into play. Landlords are now unable to serve a valid Section 21 notice if:

1. The tenant has made a valid complaint about the condition of the property and, instead of addressing the complaint, the landlord serves a Section 21 notice. This is known as ‘retaliatory eviction’. This restriction comes into play where the local authority has served an improvement notice or an emergency remedial action notice under the Housing Health & Safety Rating System (HHSRS).

2. The landlord has failed to provide the tenant with any of the following: a valid energy performance certificate, a current gas safety certificate or a copy of the publication ‘How to rent: the checklist for renting in England’, published by the Department for Communities and Local Government.

To clarify because this is important: failing to give your tenant a copy of the ‘How to rent’ document means you can’t serve a valid Section 21 Notice!

Timing issues

Prior to 1st October 2015, some landlords and agents liked to issue a Section 21 notice at the start of the tenancy. This was deemed to be unfair to tenants, so from 1st October it is not possible to serve a Section 21 notice in the first four months of a tenancy. Therefore landlords and agents will need to make and keep accurate records if they want to obtain possession at the earliest possible stage – i.e. after six months.

There is also a new deadline for starting possession proceedings if the tenant does not vacate of his or her own accord. Proceedings must be started within six months of the date of service of the Section 21 notice, otherwise a new Section 21 notice must be served.

Prescribed form of Section 21 Notice

A new prescribed form of the Section 21 notice needs to be used to terminate tenancies that start on or after 1 October. Use of the prescribed form is optional for existing tenancies but it is likely that landlords will adopt the new form for all tenancies. From 1 October 2018, the new form must be used for all tenancies.

Any other changes?

As well as the changes to the Housing Act discussed above, landlords and agents need to be aware of the new Smoke and Carbon Monoxide Alarm (England) Regulations 2015 which came into force on 1st October.

Carbon monoxide incidents are more common in rented property than in privately owned homes, and these new regulations are part of a wider effort to improve fire safety in the UK.

The regulations require a smoke alarm to be installed on each storey of premises on which there is a room used wholly or partly as living accommodation (this includes bathrooms and toilets). They also require a carbon monoxide alarm to be present in any room that is used wholly or partly as living accommodation and contains a solid fuel burning combustion appliance. On the first day of a new tenancy, the landlord or their agent must check that each alarm is in proper working order.

Local housing authorities have enforcement powers.

Many properties, particularly those built in recent years, will already be equipped with alarms that comply with the regulations. However, landlords and agents should carry out an audit of their properties to identify deficiencies and remedy as soon as possible.

What should landlords and agents do now?

Landlords and agents should familiarise themselves with the new rules relating to termination of tenancies. A range of new and updated template documents is available on the Simply-docs website.

A range of consumer protection laws apply to estate agents, lettings agents and property managers. In this blog post we look at the laws that apply and the steps agents and managers can take to ensure compliance.What are the relevant consumer protection laws?

The Consumer Protection from Unfair Trading Regulations 2008 prohibit businesses (including estate agents, lettings agents and property managers) from engaging in unfair commercial practices in their dealings with consumers.

Other relevant legislation includes the Unfair Contract Terms Act 1977 and the Unfair Terms in Consumer Contracts Regulations 1999 (both of which outlaw unfair terms in contracts with consumers) and the Supply of Goods and Services Act 1982 (requiring services to be provided with reasonable care and skill).

Agents and managers who breach these laws can face:

•   Criminal penalties (fines or in serious cases imprisonment)
•   Unfair contract terms being unenforceable in the civil courts
•   Action by the Advertising Standards Authority
•   Disciplinary action by their professional body
•   A complaint being made to a redress scheme (Ombudsman)

What do I need to do?

Remember that the laws are relevant to every aspect of the agent’s service, including face-to-face interactions and the preparation of written materials. Therefore estate agents, lettings agents and property managers should take the following practical steps to ensure they are compliant with consumer protection legislation:

•    Make sure written information given to sellers, prospective buyers, landlords and prospective tenants is expressed clearly in plain English and is not capable of misleading them. This applies to contracts with sellers/landlords, particulars provided to buyers/tenants and tenancy agreements and related documentation.
•    Make sure that no relevant information is omitted from contracts, particulars or other documents.
•    Have draft particulars approved (in writing) by sellers and landlords. Draw their attention to the need for particulars to contain complete and accurate information.
•    When handling enquiries, ensure that the information given is clear, complete and accurate.
•    Ensure that sellers, buyers, landlords and tenants are given full details of any fees that will be payable. Make sure this information is provided in an accessible format. Ideally, quote the VAT-inclusive amount.
•    Make sure tenants are fully appraised of all fees, charges and other sums that are payable in addition to the rent (e.g. agent’s fees, cleaning costs, tenancy deposit).
•    Give material information at the appropriate time rather than waiting for the person to request it. For example, if you become aware of new information about a property, tell prospective buyers/tenants at the earliest opportunity.
•    If you spot a problem or a potential problem, e.g. you have concerns about the legal rights of access to a property you are marketing for sale, or there is a maintenance issue at a property you are managing, ensure it is investigated and that appropriate action is taken.
•    Do not act aggressively, e.g. when dealing with difficult tenants.
•    Be professional and act in accordance with the rules of your professional body.
•    Advise sellers, prospective buyers, landlords and prospective tenants of your complaints procedures, including details of any redress scheme to which you belong.

Further Information

The Competition and Markets Authority has published guidance for lettings agents on compliance with consumer protection legislation. See https://www.gov.uk/government/publications/consumer-protection-law-for-lettings-professionals.

Simply-Docs offers a range of professionally drafted template documents to help meet the needs of your estate agency business. Please click here for template terms and conditions, agency appointment forms and complaints handling documents.

On 15 April The Town and Country Planning (General Permitted Development)(England) Order 2015 came into force, introducing new permitted development rights. The changes are designed to promote growth in the economy by allowing land and buildings to be put to the most appropriate use.

 What are the new permitted development rights?

The following changes of use may now be made without the need to obtain planning permission:

• A change from Class A1 (retail) to A2 (financial and professional services)
• A change from Class A1 or A2 to A3 (restaurants and cafes)
• A change from Class A1 or A2 to D2 (assembly and leisure uses)
• Until 15 April 2018, a change from Class B8 (storage and distribution) to C3 (residential).

Do any conditions apply to the exercise of these rights?

Whilst planning permission is not required for these changes, most of them are subject to conditions and require prior notification of the details to the local planning authority. So the right to make a change of use is by no means unfettered.

You can read more about the permitted use of land and buildings and how to change the use on our Property Information Pages here:

http://simply-docs.co.uk/Commercial_Property_Overview/Different_uses_of_commercial_property

Troublesome Tenants: What can Landlords Do?

Sometimes even the most careful Landlord will encounter a “Problem Tenant”. If this happens, the Landlord needs to take prompt action. Leaving an issue unresolved will usually only make matters worse. For the purposes of this post, we are looking at a short-term letting of residential property on an Assured Shorthold Tenancy basis.

Common problems

Problems typically relate to:
• Money – such as late payment or non-payment of rent
• Treatment of the Property – for example, the Tenant is causing damage or neglect
• Behaviour towards other people – leading to complaints from housemates or neighbours.

Rent arrears

If the Tenant is late with rent payments, or is failing to pay rent altogether, the Landlord should issue a written reminder. If payment is still not forthcoming, the reminder can be followed up with a more strongly worded letter which raises the prospect of legal action being taken. See our Landlord Management Letters for a selection of templates.

Unacceptable behaviour 

If the Tenant is behaving in a way that causes concern to the Landlord or to other people, this again needs to be documented. The Landlord should write to the Tenant describing the unacceptable behaviour and reminding the Tenant of the relevant terms of the Tenancy Agreement. A follow-up letter can then be sent if the offending behaviour does not stop. There are useful templates in our Landlord Management Letters.

Legal action

If the problem persists despite the Landlord raising the issue via a series of letters, the Landlord can consider taking legal action to evict the Tenant and obtain payment of any sums owing. The position is different according to whether the fixed term of the Tenancy is still running or has expired.

• During the fixed term – the Landlord would need to use the procedure in Section 8 of the Housing Act 1988. The Landlord must prove fault on the part of the Tenant, such as rent arrears or another breach of the Tenancy Agreement. Our Guidance on Section 8 and Section 21 Notices has more information.
• When the fixed term has expired – the Landlord can use the “No Fault” eviction procedure in Section 21 of the Housing Act. See our new Residential Possession Proceedings folder for detailed Guidance Notes and Template Forms.

Are you aware that, following a Court ruling in December 2014, Residential Tenancy Deposits must be protected in an approved Tenancy Deposit Scheme even if they were received before the Tenancy Deposit legislation came into force in April 2007? Landlords will be unable to serve a valid Section 21 Notice to obtain possession of a property if the Deposit has not been protected.What do Landlords need to do with Deposits?

When a Landlord receives a Deposit from an Assured Shorthold Tenant, the Deposit must be protected in an approved Tenancy Deposit Scheme within 30 days. This protects Tenants by keeping Deposits safe and ensuring that Landlords act fairly when making deductions from the Deposit.
There are two types of Scheme: Custodial (where the money is held by the Scheme) and Insured (where the Landlord retains the deposit and pays an insurance premium to the Scheme).

What happens if a Landlord fails to protect a Deposit?

If a Landlord fails to protect a Deposit there are financial penalties and, perhaps more significantly, the Landlord will be unable to serve a valid Section 21 Notice to obtain possession of the property.

What does the new Case Law say?

Prior to the recent Court ruling in Charalambous v Ng it was understood that the requirement to protect Deposits applied to:

Deposits received since April 2007 and Deposits received before April 2007 which have been retained because, in or after April 2007, either a new tenancy was granted or the original tenancy became periodic.

In December 2014 the courts confirmed that there is a further situation in which Deposits must be protected: Deposits received before April 2007 in respect of a tenancy that became periodic before April 2007. In such a case, a Landlord is unable to serve a valid Section 21 notice if the Deposit has not been protected. (However, no financial penalty applies in this case.)

What should Landlords do?

Landlords affected by this Court ruling should either protect the Deposit before serving a Section 21 Notice or return the Deposit to the Tenant. To refresh your mind on the subject of Tenancy Deposit Protection, have a look at our Guidance on Tenancy Deposit Protection for Assured Shorthold Tenants and our Guidance on Section 8 and Section 21 Notices which reflect the new law.