Rayner's attack on Landlords. TIme to rebalance the relationship in favour of Landlords.

 Exit anti-Landlord Conservative - only to be replaced by the very anti-Landlord Labour.  Government attacks on Landlords are set to continue. This feels like this Zombie attack cannot die.

Angela Rayner makes unqualified statements about their forthcoming equivalent to the Renter Reform Bill such as “rebalance the relationship between tenant and landlord.".  

Really?

The law favours the Tenant way more than the Landlord. I thought it would be interesting to go through just how imbalanced things have got and how easy it is for a Landlord to get fined and get a CRIMINAL record.

Let's start with the basics. 

If a property has gas then the Landlord has to have a gas safety certificate.  Failing to get a gas safety certificate is a £6,000 fine and  a CRIMINAL record and potentially 6 months in prison.  This is not if the system is unsafe or kills someone.  Simply to not have the paperwork.  Most home owners do not have annual checks on their systems but Landlords have a duty of care.

If a property has electricity (which it probably has) then the Landlord has to have an EICR certificate for the electricity installation.   Failing to have a valid EICR certificate at commencement of the tenancy is a £30,000 fine. Again it doesnt matter if the system is safe or not.  This is the fine for not having the correct paperwork.

To rent a property you need a valid EPC (Energy Performance Certificate). If you don't provide a copy at commencement of the tenancy then you've can't evict them.  Failing to obtain an EPC is a £5,000 fine. 

Now you need an EPC to prove the property has an EPC of E or better since it is illegal to rent a property that does not have a good enough energy rating. Renting a property with and EPC less than E is a £5,000 fine for 3 months of rental, rising to £50,000 maximum fine.

Now interestingly there are huge double standards here. A good friend of mine lives in a council house [Castle Point Council].  There is no EPC for the property. There is no insulation in the loft so the property will not be E or better energy efficiency rating.  Double Standards.....

Many councils has introduced Selective Licencing - basically a tax on Landlords.  The fine for failing to register for Selective Licencing is £30,000 and a CRIMINAL record.   

Again double standards.  Labour MP Jas Athwal owns 15 properties in a Selective Licencing area yet has not registered any of his properties - he blamed the agent..... Not a good enough excuse - it's the Landlord that goes to prison not the agent. Mr Athwal should be fined with a  £450,000 fine (£15k x 15) and a CRIMINAL record.  Killjoy Starmer - former Director of Public Prosecutions  - should clearly take such CRIMINAL activity in his team seriously but has done nothing.

Interestingly my own experience of Selective Licencing in Great Yarmouth is they tried to fail me on things which their own council properties did not comply with.  Double standards.  It's amazing what information you can get with the Freedom of Information request made to councils.

When a Landlord rents a property it would be normal to ask the Tenant for a deposit.  The Landlord must secure the deposit in a registered scheme within a specific timeframe. The Tenant is entitled to upto 3x the value of the deposit for failing to secure the deposit in the correct timeframe or failing to secure the deposit.

When a Landlord rents to a Tenant they have to provide the document "How to Rent".  Failing to do so means the Landlord cannot evict the tenant.

When a Landlord rents to a Tenant they have to perform "Right to Rent" checks on the tenant to verify they are legally allowed to rent the property to the Tenant. Failing to perform these checks and renting to illegal Tenants means the Landlord is fined.

First breach: £5,000 per lodger and £10,000 per occupier

Repeat breaches: £10,000 per lodger and £20,000 per occupier 

OK these are the basics. We haven't got to the point where we have a problem Tenant. 

Now if the tenant fraudulently obtains a tenancy by using fake documents or lying then the courts don't care.  Raise it with the police and they will treat it as a civil matter despite being fraud which is a CRIMINAL activity.

Now if a tenant obtains a tenancy with the deliberate intent of not paying any rent then again the courts and police treat this as a civil matter despite being THEFT which is a CRIMINAL matter.

Now if a tenant doesnt pay any rent and the Landlord takes action to remove the tenant from the property eg changing the locks or removing tenant property then it's a CRIMINAL offence which the Landlord has committed.

A Landlord can only legally evict a tenant from a rented property after obtaining a court order and having it enforced by a county court bailiff or high court enforcement officer.  This costs money to do this. If the Landlord evicts you without following this proceedure it's a CRIMINAL offence with a prison sentence.

Now interestingly when I had a tenant that wasnt paying I discussed it with a lawyer friend and he said "just remove them from the property" - I had to explain to him that it was illegal - he was genuinely surprised. 

Pretty much anything the Landlord does wrong is a big fine and/or a criminal record.

Pretty much anything the Tenant does WILL NOT result in a fine or criminal record.

Now Labour (like the conservatives) wants to ban Section 21 evictions.

What are Section 21 evictions?  Basically a Section 21 is a simple method of eviction where there is no fault with the tenant -  "No fault". 

There are constraints in using Section 21 - basically it can't be used in the first six months of the tenancy. 

So if a tenant hasnt paid rent and the Landlord believes they will never pay any rent even if ordered by the court then using a section 21 makes sense - you can get rid of them quickly (OK within 6 months) and cap your lost rent exposure at about 8 months. 

Why do the government(s) want to get rid of Section 21?  Because the fake charity - Shelter - told them to.  Shelter is basically a team of expensive lawyers that helps dodgy tenants live rent free.

Shelter is funded by Legal Aid which is given to dodgy tenants.  Shelter is also funded by charity donations but there have been numerous requests for Shelter to be struck off as a charity.  

Landlords are not eligible for any Legal Aid.

So if Section 21 is scrapped that leaves section 8 which has to result in a court hearing.  Section 8  is basically the tenant has done something wrong.  If a tenant isn't paying rent you can't even serve notice for Section 8 eviction until rent is 2 months in arrears.  Typically you have to give more than 2 weeks notice in the section 21 that action will be taken.  So we are roughly 3 months in rent arrears.  The Landlord now needs to pay the £350 fee to apply for a Possession Claim. We now wait for a hearing. 

The UK court system is terrible.  It's supposed to be 8 weeks from application for a hearing.  Not my experience.  I had a hearing scheduled 12 weeks after application (now 6 months in rent arrears).  My hearing was cancelled. I had to apply for an emergency hearing otherwise it was another 12 weeks away for the next hearing date  (9 months).  I got another hearing in 6 weeks (7.5 months in rent arrears).  Hearing came - Shelter's legal team made up some lies which resulting in a second hearing in 8 weeks time (9.5 months in rent arrears).  This was then delayed because it would have been Christmas time and the judge  decided there should be an embargo on evictions at the time of year (OK I get that but dont move the hearing, delay the date of the judgement enforcement).  Finally got to the hearing - more lies from Shelter.  Now set to go to trial. Another 12 week delay.  (14 months in rent arrears). I eventually got possession some 1.5 years later.  Welcome to Section 8.

I would welcome the removal of section 21 if there were strict timelines that the courts had to comply with and consequential damage payments to Landlords  or default judgements in favour of the Landlord if they failed to meet the deadlines.  Landlords are paying for the service after-all.  But no such luck. Like all government delivered services the Court system is slow, bureaucratic and unaccountable to it's customers. I would also say the court system is not impartial.  Judges are clearly biased against Landlords.

I never got any of the 1.5 years rent or £20k in damages my tenant had caused or £5k in legal costs incurred.  The Judge was sympathetic to me - she at least said "You can offset these losses against tax". I would rather have had the money and paid the tax....  

Now a Possession Claim against the tenant should automatically result in a CCJ (County Court Judgement) against the tenant.  That doesnt actually happen.  I do know I would have had to pay more money for a CCJ to be issued against my dodgy tenant but the real problem was I couldnt figure out the legal process to get this to happen and I wasnt about to pay a lawyer £250 per hour to make it happen. Pouring good money after bad.

In short the tenant got away Scott free.  Enjoyed living rent free in my property for 1.5 years and had fun smashing the place up.

I spoke to the police about the damage to my property as in my mind it was Criminal Damage to my property.  Not interested.

The Tenant had been sub letting and running up lots of other debts which resulting in debt collectors hassling me. The Tenant continued to use the address after being evicted.  I had the Police call for various misdemeanours such as driving dangerously.  Impossible to get the address removed by the DVLA etc. 

Tenants can do pretty much anything they like and get away with it.

The Government hates landlords.  They abolished mortgage relief (Section 24) so Landlords pay tax on the income not the profit. You can actually make a pretty big loss yet still have to pay tax.  The government wins even if the Landlord is losing...No other type of business has this rule about finance costs not being tax deductible.

Anyway Labour are going to the following:

- Make it impossible to evict tenants

- Make it very difficult to increase rents

- Allow judges to decide if the tenant would be worse off if you evicted them [if they are not oaying any rent of course they would be worse off if evicted].

Needless to say I have exited the Landlord game as far a possible. I have made sure my tenants are thoroughly vetted before allowing them to live in my property and have made sure they have guarantors whose house I can seek possession of if they turn out to be dodgy tenants.  So far they have been amazing tenants but you need security just in case the situation changes.

One final thing on my dodgy tenant.  Despite the tenant not paying rent for 1.5 years, I was still responsible for ensuring the heating worked. Failing to do so would have meant I could be counter claimed for damages.  

So when the heating went wrong I still had to pay for the repair.  Later when it was time to renew the gas safety certificate my dodgy tenant wouldn't allow the gas engineer into the property to perform the gas safety check.   Remember right at the beginning I said that's a "£6,000 fine and  a CRIMINAL record and potentially 6 months in prison" for failing to have a gas safety certificate.  After 2 attempts where the tenant refused entry to the gas engineer (which he videoed) , I instructed the engineer to turn off the gas and cap it.  If there's no gas to the property then I cant be responsible for it.  Tenant ended up with no gas.  Sadly they kept living there but at least they had less comfort and I covered my ass. 

You make up your mind.  Who has more rights? The Landlord or the Tenant.