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Good news for landlords

Good news for landlords

There is a lot of Good News For Landlords Around As PRS rents Increase, Tenancies Last Longer And Demand Remains Strong

Good news for landlords as monthly PRS rents have increased by 1.1% year on year to average £845 (GBP) per calendar month (pcm). Scotland has witnessed the greatest rental price increase at 6.7% compared with the first quarter of 2013.

There has also been an increase in the number of older private rented sector tenants according to the latest quarterly index published by Countrywide lettings agency, who noted a 6% annual growth in the number of tenants over the age of 50 renting property in the UK private rented sector (PRS). The lettings agency also report that there has been a 7% annual decline in the number of tenants aged under 25 in the second quarter of 2013.

Buy-To-Let yields are strengthening across the UK, with the average yields being recorded in 3 regions:

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Landlord Details Must Be Included In Prescribed Information

Landlord Details Must Be Included In Prescribed Information

All UK Landlord details should be correct
before being included in Prescribed Information

The information must be included, even when the rental property is fully managed by a managing agent, to avoid any possible legal problems with tenancy deposits.

Linda Howard, of Shoosmiths solicitors has warned that individual judges could make different interpretations on the wording of requirements after the news that a possession order was overturned because the legally required Prescribed Information gave the letting agent’s details instead of the landlords.

She said: “The Housing (Tenancy Deposits) (Prescribed Information) Order (2007) seems to make it clear, at 2, (g) (iii) that the name, address, telephone number and any email address or fax number of the landlord, not the agent, must be given.”

Ms Howard also pointed out that in another case in the county court, a duty solicitor raised exactly the point of an agent’s rather than the landlord’s details being given and the judge subsequently adjourned those proceedings because of seeming non-compliance with the Prescribed Information Order. However, the case went through on the second hearing because the landlord argued that Rules of Agency applied.

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Private Rental Sector Void Periods and Rent Arrears 

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Rent Guarantee Insurance Helps Landlords Avoid Rent Arrears

Rent Guarantee Insurance Helps Landlords Avoid Rent Arrears

UK private rented sector landlords are reaping the rewards of the development of specialist products and services designed to ease the burden for landlords and the UK lettings industry.

According to data from the National Landlords Association (NLA), private rented sector void periods have fallen to their lowest level in over 12 months, with only 33% of landlords experiencing vacant periods in the last three months. The figures are down 13% when taken year on year.

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Government want to ensure tenants in the

Private Rented Sector are not illegal Immigrants

Landlords Warned Over Illegal Immigrants

Landlords Warned Over Illegal Immigrants

Government ministers want to ensure tenants in the Private Rented Sector (PRS) are not living in the UK illegally and are already working with local authorities to tackle rogue landlords who exploit immigrants by housing them in ‘beds in sheds’.

Many private sector landlords already take the correct measures by tenant referencing all applicants to check the tenants’ identity and credit status, making it difficult for illegal immigrants to rent properties from them.

However, despite numerous calls from UK property industry specialists, not all landlords bother with tenant referencing, and a small minority of rogue landlords knowingly target illegal immigrants who would not be in a position to complain about any sub-standard rental accommodation.

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Landlord Possession Orders And Tenant Evictions Increase

Tenant Eviction Figures Increase Again

Tenant Eviction Figures Increase Again

There has been a dramatic increase in the number of PRS landlords seeking to evict bad tenants and the volume of possession orders doesn’t look like abating any time soon according to data released by the UK Government.

Government figures show that there were 103,329 landlord claims for tenant eviction and orders for possession made last year, the highest recorded rate over the last five years and continues to represent an upward trend.

It is estimated that between 67% and 80% of claims led to a possession order being granted by the courts.

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Specialist Insurance can help landlords profit from property

Specialist Insurance can help landlords avoid tenant rent default

In the UK private rented sector, the average rent for a residential property now stands at a staggering £777 (GBP) per month across the whole of the country but there are some regional differences.

Private sector rents in Greater London rose by 6.7% during the last 12 months to reach a regional average of £1,224 (GBP) per calendar month (pcm).

In stark contrast, PRS tenants in the North-East living in similar sized properties are paying an average rent of just £512 (GBP) pcm.

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Fall in the number of tenants in severe rent arrears

Fall in the number of tenants in severe rent arrears

The number of tenants in severe rent arrears declined by 15.6% during the final quarter of 2012, according to data released by Templeton LPA, part of the LSL Property Services group.

The data indicates that in the last quarter of 2012, almost 16,000 fewer tenants faced severe rent arrears of more than 8 weeks rental costs, compared with the previous quarter of 2012.

The number of tenants in this situation has dropped for the first time in over a year and could in part be due to the development and availability of Rent Guarantee Insurance products.

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More PRS tenants are struggling with rent arrears

The latest UK Court Statistics released by the Government continue to indicate a steady rise in the number of claims for possession by landlords that have resulted in orders for tenant eviction being made.

Tenant Evictions Still Increasing

Tenant Evictions Still Increasing

The continued rise in severe rent arrears have lead to more than 25,000 landlords making successful claims for possession of rental property from tenants in the second quarter of 2012, and it is thought the third quarterly report due out imminently will show similar, if not higher results.

The number of tenants experiencing severe rental arrears is at its highest level since 2008, with over 100,000 tenants behind with their rent payments.

Sim Sekhon, spokesman for Legal 4 Landlords, the UK’s leading eviction specialists, said “Unfortunately it is unlikely that the problem is going to improve in the near future, and as a result an increasing number of landlords are now opting for rent guarantee insurance products in addition to their normal forms of insurance. Legal4landlords have seen a sharp increase in demand for rent guarantee insurance as landlords and their appointed managing agents look to find ways to protect rental income. The problem of tenants getting into financial difficulties is not going to go away and with the Government’s welfare reforms and additional austerity measures still to come, we expect tenant arrears and tenant eviction cases to continue to rise well into 2013 and beyond.”

Section 8 - Grounds For Eviction

Section 8 – Grounds For Eviction

Taking the professional tenant eviction route may sound expensive to many UK landlords, but it can actually work out to be the cheaper option because professional tenant eviction specialists, like Legal 4 Landlords, know what they’re doing and work fast.

Many landlords try to tackle the eviction process themselves by serving a Section 8, but there a few details that must be 100% accurate and many landlords attempting to evict tenant’s themselves unknowingly serve an invalid notice, consequently delaying the entire eviction process, which ultimately may result in more lost rent for the landlord.

A Section 8 notice to quit, sometimes referred to as a Section 8 possession notice has to be completed and served correctly on the tenant(s) of the rental property, allowing the landlord to seek possession of the rental property from the tenant during the term of the Assured Shorthold Tenancy (AST).

The Section 8 notice needs to show that the tenant has breached the conditions of the tenancy agreement, any term or condition of the tenancy agreement that is seen to have been broken constitutes a breach. The most common type of breach is the non-payment or late payment of rent, however, damage to the property, unsociable conduct, and subletting are also grounds for a possession order.

To make a Section 8 form valid, the landlord must state which grounds the tenant has breached according to Schedule 2 of the Housing Act 1988

All Section 8 forms require the landlord to specify the grounds they are citing as reason for eviction.

These grounds for possession, under Schedule 2 of the Housing Act 1988, fall into 2 main categories and are listed below

  • Mandatory Grounds – this covers Grounds 1 to 8 and if one of these grounds is cited on a Section 8 form the court must grant possession to the landlord.
  • Discretionary Grounds – this covers Grounds 9 to 17 and in these cases the court will only grant possession if it feels it is reasonable to do so.
Ground Short Description
Ground 1 The landlord requires the property in order to use it as their main residence. This ground can only be used if the landlord used the property as their main residence prior to the tenancy beginning.
Ground 2 The mortgage lender on the property has served notice to foreclose. In this case the mortgage in question has to predate the start of the tenancy.
Ground 3 The property was previously used as a holiday let and is required to return to the status of holiday let. For the exact conditions that apply to this Ground please see the Housing Act 1988.
Ground 4 The property is being let by an educational institution and is now required by students of the educational institution. Written notice that this may happen must be served before the tenancy begins.
Ground 5 The property is owned by a religious body and they require possession for a member of their church i.e. a Minister of Religion.
Ground 6 The landlord wants to demolish and reconstruct, or redevelop all or part of the property. The tenant needs to have refused to live in all or part of the property while work is carried out for this ground to be feasible. If granted the landlord is required to pay all reasonable moving costs to the tenant.
Ground 7 The current tenant is a tenant heir and is not named on the original tenancy agreement. The landlord must serve a Section 8 notice within 12 months of the death of the named tenant.
Ground 8 The tenant has failed to pay more than 8 weeks rent in the case of weekly payments, 2 months in the case of monthly payments or 1 quarter in the case of quarterly payments. Ground 8 is often cited in conjunction with Grounds 10 and 11 so that a partial payment by the tenant just prior to the court hearing doesn’t render the possession order obsolete. Note: When claiming possession under this ground, it is advisable to cite more than one ground since, if the tenant pays off part of the arrears shortly before the hearing, this ground can no longer be proved and possession proceedings will have to be abandoned. It is, therefore, common practice to cite more than one ground for rent arrears (i.e. grounds 8, 10 & 11), if applicable, and to also wait until at least two months’ rent (or eight weeks in the case of a weekly tenancy) is unpaid before issuing the Section 8 Notice.
Ground 9 Suitable accommodation of the same type and quality has been offered to the tenant and refused. The landlord is required to pay all reasonable removal costs if possession is granted.
Ground 10 The rent is in arrears but by no more than 8 weeks in the case of weekly payments, 2 months in the case of monthly payments and 1 quarter in the case of quarterly payments.
Ground 11 The tenant is repeatedly late with payments or repeatedly fails to pay their rent until prompted by the landlord.
Ground 12 The tenant has breached any of the terms listed in the tenancy agreement.
Ground 13 The tenant has neglected or damaged the property, or they have sublet the property to another individual who has neglected or damaged the property.
Ground 14 The tenant is considered a nuisance to neighbours or other tenants and has received complaints concerning their conduct.
Ground 15 The furniture listed on the property inventory has been misused, damaged, broken or sold by the tenant or any individual living with them.
Ground 16 The property was let to the tenant as a condition of their employment but the employment has now come to an end.
Ground 17 The property was let on the basis of false information provided by the tenant or one of their referees/ guarantor.
Grounds For Eviction

Grounds For Eviction

How much notice is given in a Section 8?

  • The amount of notice a landlord is required to give differs according to the grounds they are citing on the Section 8 form. Ground 2 for example, requires a minimum of 2 months’ notice but grounds 8, 10, 11, 12, 13, 14, 15, 16 and 17 only require 2 weeks’ notice.

What happens after the Section 8 Notice has been served?

  • All Section 8 forms must clearly state the date on which the notice expires. This is the date that the tenant has to have paid their rent arrears by, or have vacated the property by, and in nearly 80% of cases the tenant leaves or pays before this date arrives.
  • If the tenant refuses, the landlord can start court possession proceedings on the day following the date cited on the Section 8 form.
  • To do this the landlord has to acquire forms N5 and N119 from their local county court and pay the appropriate court fee. This then starts the process of gaining a possession order.

Will a Section 8 guarantee that a possession order will be granted?

  • In simple terms, NO!.
    The likelihood of being granted a possession order is dependent on the Grounds cited on the Section 8 form, and as mentioned earlier some grounds are mandatory while others are discretionary.
  • Grounds 2 and 8 are always granted the order but the circumstances surrounding the other grounds are carefully considered by the court before a decision is made.
  • The evidence of the landlord and any evidence submitted by the tenant is looked at closely and factors such as hardship and extenuating circumstances suffered by the tenant are taken into consideration.
  • If a possession order is granted it normally takes effect within 14 days, but in cases of true hardship on the part of the tenant this can sometime be extended to six weeks.

Tenant eviction can be a bit of a minefield for the uninitiated landlord and the safest and fastest way to evict a tenant is to use a tenant eviction specialist, like Legal 4 Landlords who take care of all the paperwork and appoint trained legal teams to deal with the hassle.

The UK's leading tenant eviction specialists

Legal 4 Landlords

knowledge of tenant evictions is second to none, that’s why they are the UK’s leading tenant eviction specialists!

70% Rise in Tenant Evictions over last 3 years

70% rise in Tenant Evictions over 3 years

The Residential Landlords Association (RLA) and homless charity Crisis say that UK court orders to evict defaulting tenants in the Private Rental Sector have risen by more than 70% over the past 3 years.

Homeless charity Crisis analysed Ministry of Justice figures to reveal that within the last 12 months some 36,211 landlords have been granted a court order to evict bad tenants, an increase of 12% on the previous year and 70% higher than the 21,351 court orders granted in 2009.

Duncan Shrubsole, director of policy at Crisis, said: “Sadly it is no surprise that we are seeing thousands of private tenants facing eviction. They face a dreadful combination of high unemployment and underemployment, draconian cuts to housing benefit and soaring rents. Our concern is that many of these people will have nowhere to turn, and end up falling victim to homelessness. In fact the Government’s own statistics point to this already happening. We are calling on the Government to rethink cuts to housing benefit that will inevitably leave increasing numbers of people unable to pay the rent. We are also in desperate need of more social and affordable housing in order to rein in the soaring rental market.”

The RLA want more done to prevent tenants getting into rent arrears and are currently lobbying the Government to change the way that the housing element of the new Universal credit system will be paid.

Latest Government figures show that between 2009 and 2011, the number of people approaching their local authorities as homeless due to the end of an Assured Shorthold Tenancy or due to rent arrears increased by 42% to almost 10,000 households.

Sim Sekhon spokesman for the UK’s leading Tenant Eviction specialists, Legal 4 Landlords, said “Landlords who do not have specialist insurance in place to protect rental incomes face the prospect of rent default by tenants as they in turn face increasing financial pressures. At Legal 4 Landlords we provide the complete tenant eviction service for landlords with a success record that speaks for itself, that’s why we are the UK’s leading tenant eviction company”.

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