Chris Horne

Recent Posts by Chris Horne

• Landlords should say NO to the proposed landlord licence
• Landlords getting possession & your buy-to-let property back!

Subjects Covered by Chris Horne

• Money
• Currency
• Tax
• Insurance
• Mortgages
• Retirement
• Property
• Property Investment
• Buy to let
• Project Launches
• Property markets
• Property advice
• Auctions
• House prices
• Renovation & DIY

• Social
• Celebrities & Gossip
• Quirky & Amusing
• Rankings & Ratings
• Social trends
• Travel & Tourism
• Environment
• Professional
• Economics
• Transport & Infrastructure
• Land Development
• Legal Issues
• Commercial Property
• Industry News

Chris Horne's Blog

Landlords should say NO to the proposed landlord licence

The latest government proposals mean that Instead of landlords being treated as decent honest people they will only be judged 'fit' to be able to let their own property to willing tenants if they first obtain a licence and are granted a licence number by the government.

The landlord licence was put forward in a Green Paper launched appropriately enough on the 13th May by Margaret Beckett the Housing Minister.

Property Hawk the website I write for has responded to the anger felt by many landlords at the prospect of having to get a licence to let their own property by petitioning the Prime Minister to abandon the idea.

We think it is wrong and here are the reasons why.  See if you agree.

Property Hawk says ‘NO'
Property Hawk says ‘NO' to the landlord licence. We think it is unacceptable, in any shape or form. Here are six reasons why it is simply WRONG!

1. Letting property is a right.  Fundamentally I, as a landlord and law abiding citizen should be able to let my property to a willing tenant as a right.  I shouldn't need to go cap in hand like a cowed child to some trumped up bureaucrat to get permission.

2. A landlord licence is no measure of competency. The concept of having a licence should not be confused with a measurement of competence or quality.  It is a licence.  This is neither useful to a landlord or to a tenant.  Really bad landlords will simply evade the licence or let their property even if they are banned which negates the whole purpose of having it.

3. It duplicates control.  The proponents of the licence have suggested it is a way of weeding out the really bad landlords by ensuring that only competent landlords will be kept on the register.  They suggest that two areas where landlords could be struck off the list are where they ‘bodge' repairs or intimidate their tenants.  Again WRONG.  For a start most landlords who have property will use professional contractors to do work.  Will this mean where a plumber fails to fix a leaking toilet correctly that the landlord has to pay the price of no longer renting their property? If a tenant is unhappy that the landlord has not keeping the property in good repair they can already legally withhold their rent.  Intimidation of tenants has been used as another justification.  Landlords have been subject to strict legal control on intimidating tenants since the introduction of the 1977 law against tenant harassment.  
Why force landlords to have a worthless and costly piece of paper to duplicate control in a less effective manner?

4. It will restrict supply of rental accommodation.  Any restriction on ability of a property owner being able to let their property will inevitably serve to restrict the supply of rental property as some potential landlords will be put off from doing it, and some will move out of the rental market.  This is happening at a time when with increasing tenant unemployment, falling housing completion rates and struggling housing associations and the most difficult mortgage market in a generation means that the demand for affordable rental housing is stronger than ever.

5. Its' a back door way of collecting more tax.  A landlord licence would simply be a tax on letting and renting resulting in either a landlord receiving less net rent by incurring the charge or the landlord passes the charge on to the tenant in the form of a higher rent. The fact that each landlord would have an individual licence number would make it easier for the Inland Revenue to cross check their records to see if the landlord is paying sufficient tax.  In other words it would be a back door way of snooping on a landlord's accounts.

6. A landlord licence is costly and a waste of money.  Does any landlord who does their property management on a tight budget such as Property Sparrow think that any new landlord licensing authority will be as careful with their pennies?  The fact is the authority will employ a chief executive on a six figure sum and none contributory pension.  It will need a grand London office, PR staff, human resource department, bodies to monitor process data, finance managers, middle managers.  The list goes on.  Whilst landlords struggle to make ends meat a whole needless worthless band of bureaucrats will be dining out on our money!

Landlords - say ‘NO' to a landlord licence

This government is devoid of direction and sense.  To cap it all they are determined to leave landlords with yet another piece of useless legislation. Priceless! Unfortunately it's not, it will cost at least £50 and that will just be the start.  Just as previous Labour administrations almost killed the private sector with regulation and rent control.

‘New' Labour in their dying breath is finally showing their true colours.  They believe that the state always knows best!

My message to landlords who believe in the principle that they should be able to rent out their property to a willing tenant as a right and not as some earned privilege should support Property Hawks petition on the No.10 website.

Go to the landlord-licence petition and sign.

Landlords should say ‘NO' - to the landlord licence today before it's too late.

Landlord insurance - it pays to negotiate

Landlords know that one of their biggest costs is landlord insurance.  Trying to find the best landlord insurance deal ain't easy.  Do you use your lenders policy?  How about going to google and using a landlord insurance broker from the hundreds that appear in the search results.  Or should landlords just stick with the policy they've got ?

Property Hawk recently got one of their reporters who's landlords insurance was due to pose as the undercover landlord to find out how to get the best deal on his buy-to-let insurance.  This tale of his experience has some useful lessons looking to buy landlord insurance:

"My portfolio landlord insurance was up at the beginning of April. My existing landlord insurance broker Alan Boswell sent me my renewal quote. This was just under £1000 despite the discount of £104. Considerably more than last year which I managed to negotiate down to £850.

I thought I'd try a few insurance brokers before yielding to the inevitability of having to pay over the dosh.

Alternative quotes for one of my properties
I started by enquiring about the RIKY insurance scheme. This is because I remember seeing them quoting £1 per £1000 of cover. I thought if they could get near that I'd be well pleased. I phoned up and explained I wasn't a member of the scheme but wanted a quote. Eric of Cover Sure was very helpful. He took my details for just one of my properties. It always takes ages. A good 15 minutes. Then explained he was going to have to phone back with a quote as he was putting it out to the different brokers.

In the mean time I thought I'd try another landlord insurance broker to get the recommended 3 quotes before plumping for the best. Going to google I thought I go for one of the most popular landlord insurance websites. I elected for Endsleigh having recognised them from my student days. I proceeded to fill in their online form and was very impressed with it's simplicity and speed. From start to finish the quote for landlord insurance was not much more than 5 minutes and decidedly quicker than working through a quote with Eric on the phone.

The quote for my landlord insurance when it came back was not so good. £237 significantly more than my renewal quote of £154. They sent me an automatic email of the quote just in case they were able to tempt me.

Mean while Eric had come back with his quote. This was interesting. He had two figures one for non members of RIKY, the other was for members. The members quote was pretty attractive at £135 and below my renewal quote but at £1.31 per £1000 cover above their quoted headline rate. I didn't really want to splash out on membership of the RIKY scheme nor did I want to go through the laborious task of having to real of the property details of my portfolio to Eric.

Landlords it pays to ask
Instead, I thought I'd be cheeky. Lets try negotiating. So I phoned Alan Boswell with my pitch. I explained that I had received my renewal quote but had a lower quote from another landlord insurance broker which was kinda true. I put forward my scenario and explained that the alternative quote from cover sure was £910 (little bit of a white lie). Could they beat this? The very nice young woman at the other end didn't seem phased about this. You always worry that they are just about to interrogate you to test the validity of your story but no. Calmly she explained she was going to have to phone the landlord insurers to see what they could do but she would get back to me later that afternoon. I went off made a cup of tea and continued with my filing. Twenty minutes later, the call. The landlord insurers have said they can do it for £900. Great job done. I paid there and then with my card. Happy that I was covered for another year, saved myself £90 into the bargain and hadn't spent weeks filling in endless forms on the Internet or repeating my details to numerous landlord insurance brokers."

Free property management software, Free tenancy agreements

Landlords getting possession & your buy-to-let property back!

As the Editor of the landlord website Property Hawk one of the most frequent questions I get asked is how do I get my property back.  This is often prompted by the tenant stopping paying the rent.  The answer is that it's not difficult providing you follow the correct steps.  Most importantly a landlord need to get the dates right when issuing the notices.  I've set out below some of the common questions I get asked when looking at issuing what is called a section 21 notice.  This is the notice landlords need to use to get what is called non fault based possession.

What is a section 21 notice?

Under the Housing Act 1988, a landlord who has granted an assured shorthold tenancy has a legal right to get his property back at the end of the tenancy.  In order to invoke this right, the landlord is required to follow the correct legal procedure which includes service of a notice (under Section 21 of the Housing Act 1988) on their tenant.  Section 21 is divided into subsections with different rules applying to notice served during the fixed term of a tenancy and notice for possession that is served during a periodic tenancy.

Am I eligible to use a Section 21 notice and is it valid?

A landlord needs a signed Assured Shorthold Tenancy agreement (AST). If a landlord renewed or issued the tenancy agreement after the 6th April 2007 any tenancy deposit taken must have been protected under one of the approved tenancy deposit schemes and the tenant notified where the deposit held prior to the Section 21 Notice being served. If an HMO the landlord must have a licence.

If you are unable to use a Section 21 see the Section 8 process
 

When can I serve a section 21 notice?

A landlord can actually serve the Section 21 Notice (Notice Requiring Possession) at any time during the tenancy. This means that you could get the tenant to sign the Section 21 Notice at the start of the tenancy, just after the tenancy was created. In this case it's probably worth getting the tenant to sign an acknowledgement that the Section 21 Notice was signed after the tenancy was created. You know what these lawyers are like. The advantage of this for you is that as the landlord you have an automatic right of possession at the end of the fixed term tenancy, should you want to get rid of your tenant. If they are OK then you can just ignore the Section 21 Notice and either create a new fixed term tenancy or let the tenancy run on and become a statutory periodic tenancy.

What notice period do I need to give my tenants?

Section 21 of the Housing Act 1988 requires that the landlord provides tenants of an Assured Shorthold Tenancy (AST) with a minimum of two months' notice in writing that he/she wants possession of the property.  Extra days should be added if the notice is to be sent by post as the two months starts when the tenant receives the notice. See the section below on serving the Section 21 Notice.

The notice must be served before possession action can be started.  In the case of joint landlords the notice can be given by any one of them.  Possession under this section cannot take place during the initial six months of the original tenancy.

Which section 21 notice do I need?

There are 2 Section 21 Notices. The first is a Fixed Term Notice or s 21 (1) (b) which should be served at any time during a fixed term tenancy. The other Section 21 Notice the Section 21 Notice is the S.21 (4) (a) applies to tenancies that are periodic.

Section 21 Notice dates

This is the vital bit and one which many landlords get wrong resulting in them having to serve the Section 21 Notice again. In fact the Chairman of the London Association of District Judges recently commented that 7 out of 10 of Section 21 Notices are being thrown out of court because they are wrong.

Remember landlords need to give a minimum of 2 months notice and this should allow 3 days for the tenant to receive the notice by post if the Section 21 Notice is posted.
 

When it comes to comes to Notices month means Calendar Month in tenancy agreements (Law of Property Act 1925 s61 (a). Tenancy agreements run from a day in one month to the day (date) before in another month. For example, a six month tenancy signed on the 5^th March (5^th day of March) will end on the 4^th day of September, AFTER which day a landlord will seek possession.

Serving the Section 21 Notice

If the tenancy was for a fixed term, the date specified cannot be any earlier than the expiry date of that fixed term. For example a six month tenancy commencing on 1^st May, ending 31^st October will seek possession after 31^st October providing there is a full 2 months notice given (allowing 3 days for postage if the notice is being posted).

If this notice is given within the fixed term but the full 2 month period runs outside the fixed term a landlord just needs to give a full 2 months notice. It is always a good idea to give a notice date AFTER which possession is sought but technically this is not necessary.

If the tenancy was periodic or the fixed term has expired (statutory periodic tenancy) before the notice is given, the date specified must be the last day of a rental period.  Therefore if the tenancy is a monthly tenancy and the rental day is the 15th of the month, the date specified must be the 14th of a subsequent month at least 2 months after the date of service.

Will I get my rent back and any money owed if successful?

The Section 21 Process is a claim for possession only. If the tenant is in rent arrears or has caused damage to your property you are still entitled to sue the tenants but you will have to take a separate course of action to get your money back.

How should I serve a section 21 notice?

A Section 21 Notice may be served by post or in person.   The courts will recognise the day of postal service as the day on which the letter would normally have arrived.  Sending the Section 21 Notice by mail is an acceptable method. A landlord should allow 3 working days for delivery and use recorded delivery or proof of postage. This means the Post Office will give receipt of postage and the address to which it is sent. Recorded delivery can cause problems if the tenant refuses to sign and the Section 21 Notice is returned.

Therefore the ideal method of service is by hand directly to your tenant; alternatively the notice can be served at the property through the letter box. In both cases the landlord should have a witness who completes a witness form confirming this.

The burden of proof that the Section 21 Notice was served falls upon the landlord and direct service by the landlord is always preferable.

How to get and produce a FREE section 21 notice?

Bookmark This Page

Tag, share or bookmark this page: