Month: July 2020

TLA Landlord Survey Q2, 2020 (TLALS)

TLA Landlord Survey Q2, 2020 (TLALS)

Introduction and main findings

  1. The 2019-20 TLA Landlord Survey (TLALS) is a survey of landlords and letting agents who own and/or manage privately rented properties in England.
  2. The aim of the TLALS is to provide understanding of the characteristics and experiences of landlords and how they acquire, let, manage and maintain privately rented accommodation.
  3. Since 2010, the private rented sector has undergone substantial growth and change. The number of households in the sector rose by 25% between 2010-11 and 2018-19, from 3.6 million to 5.5 million households.
  4. The private rented sector is now the second largest tenure in England, and is home to over a fifth of all households.
  5. The private rented sector is characterised by diversity, containing a wide range of different sub-markets, serving a wide range of different types of households across all incomes, including an increasing number of families.
  6. In 2019, 46% of households in the private rented sector included dependent children (2.6 million households, up from 1.1 million in 2010-11).
  7. There are high rates of turnover in the private rented sector, with the number of house moves significantly higher than in the owner occupied and social rented sectors, both within the sector and between it and the other sectors.
  8. Since 2010, there have also been a number of policy changes affecting private landlords. These include tax changes for Buy to Let landlords, changes to the Stamp Duty Land Tax, tightening lending criteria on Buy to Let mortgages and the growing role of the Build to Rent sector.

These changes were made as part of the government’s wider efforts to make the housing market work for everyone and to ensure the housing market delivers the homes the nation needs.

The survey involved agents who let and / or manage property on behalf of landlords. For brevity, the term ‘agent’ is used throughout the report to describe agents who let and / or manage properties.

This report provides an overview of the private landlord population in England.

The first chapter covers the characteristics of landlords, why and how they became a landlord and how they view their current role.

We also include an overview of private rented dwellings and the households living in them, including the types and location of rented homes and the types of tenants. It also explores how landlords and agents set rents and the circumstances around how tenancies end.

Our survey examines landlord and agent attitudes, including the willingness of landlords and agents to let to different types of tenants and views on longer tenancies. It also presents findings on landlord and agent compliance with current legal requirements.

Other chapters provide evidence regarding the likely future of the private rented sector by setting out findings about landlords’ stated future plans, attitudes towards landlord insurance, boiler care issues and other landlord trends and habits – both past, present and in the future.

Full details of the survey sampling, weighting and reporting conventions are in the technical notes at the end of this report.

Briefly, the TLALS is an online survey of almost 8,000 landlord members of The Landlord Association and 550 lettings agents – all of whom are registered with The Landlord Association or partnering without profit or monetary gain.

All statistics were gathered between December 13th 2019 – January 22nd 2020 and reflect results for the period between January 20th 2019 to December 1st 2019.

Main Findings

These correspond to an estimated 1.8 million landlords operating in the private, residential property rental sector.

Most landlords operate as private individuals rather than as part of a company or organisation.

94% of landlords rent property as an individual, 4% as part of a company and 2% as part of some other organisation.

While almost half of landlords own just one property, half of private rented sector tenancies are let by the 17% of landlords with five or more properties.

45% of landlords have just one rental property. This represents 21% of the private rented sector.

A further 38% own between two and four properties (representing 31% of the sector). The remaining 17% of landlords own five or more properties, representing 48% of the private rented sector.

Ignoring the methodological differences, since 2010, the proportion of landlords with just one property has declined from 78% to 45% or from 40% to 21% of the sector. Meanwhile, the proportion of landlords with five or more properties increased from 5% to 17% or from 39% to 48% of the sector.

Landlords are, on average, older and less ethnically diverse than the general population. Most have been landlords for some time.

Over half (59%) of landlords are aged 55 years or older. Not surprisingly, given the older age profile, a third (33%) of landlords are retired. The majority (89%) of landlords are White.

70% of landlords have let property for 6 years or more. The average (mean) length of time that landlords had let property was 11.5 years.

Landlords most commonly reported that they had become landlords because property was preferable to other investments and/or to contribute to their pension.

46% of landlords became a landlord because they preferred property to other investments; 44% did so to contribute to their pension. Only 4% became a landlord to let property as a full-time business.

Although 53% of landlords bought their first rental property with the intention of renting it out, 32% did so to live in themselves.

Landlords who had been letting for longer were more likely to have used a mortgage to fund their first rental property and more likely to currently use a Buy to Let mortgage compared to more recent landlords.

Almost two thirds (63%) of those who had been a landlord for three years or less had used a mortgage to fund their first rental property compared to three quarters of those who had been a landlord for longer (73% of those who had been a landlord for between four and 10 years, and 75% of those a landlord for 11 or more years).

About half (49%) of those who had been a landlord for three years or less had a Buy to Let mortgage to fund their current property/ies.

This increased to 58% of those who had been letting for between four and 10 years, and 54% for those letting for 11 or more years.

Landlords, on average, report a gross rental income of £15,000 per year (before tax and other deductions). For most landlords income from rent makes up two fifths (42%) of their total gross income.

The average (median) gross rental income (before tax and other deductions) is £15,000. Three in five (61%) landlords had gross rental income of less than £20,000, while a further quarter (26%) reported between £20,000 and £49,999.

Thirteen percent reported a gross rental income of £50,000 or more.

Using their annual reported gross income (before tax and other deductions and excluding rental income) and their gross rental income, it was calculated that landlords received 42% of their total gross income from rental property.

Over the next two years, half of landlords plan to keep the number of rental properties the same, with similar proportions planning to increase the number of properties as those planning to decrease or leave the rental business.

53% of landlords planned to keep their number of rental properties the same, with 11% planning to increase the number of properties they own. This compared with 10% of landlords who planned to reduce the number of properties (representing 18% of tenancies) and 5% planning to sell all their rental property and leave the
rental business (representing 5% of tenancies).

Letting practices vary between landlords and agents. For example, agents are more likely than landlords to increase rent for a new tenant and for a tenancy renewal. They are also more likely to require a larger deposit.

50% of agents increased the rent for their last letting to a new tenant compared to 42% of landlords. For their most recent tenancy renewal 70% of landlords kept the rent the same compared to 63% of agents. A third (31%) of agents increased the rent for existing tenants, compared to 22% of landlords.

For their last letting, 61% of agents took a deposit of more than four and up to six weeks’ rent (45% of landlords took a deposit of this size). Almost half (47%) of landlords took a deposit of up four weeks’ rent (compared with 29% of agents).

Meanwhile, landlords are less willing than agents to let to certain groups, including those in receipt of Housing Benefit and Universal Credit, non-UK passport holders and families.

52% of landlords and 37% of agents reported that they would be unwilling to let to tenants in receipt of Housing Benefit. Similar proportions reported that they would be unwilling to let to anyone on Universal Credit (47% and 33% respectively).

The most commonly reported reasons for not letting to this group included the risk of delay in payment or unpaid rent and the risk that benefits would not cover the rent.

A quarter (25%) of landlords and 10% of agents are unwilling to let to non-UK passport holders. Reasons for this were not explored.

18% of landlords and 6% of agents are unwilling to let to families.

Most often this was because their property or properties were unsuitable for families and also because of the greater risk of damage to the property.

Landlords were asked how many rental properties they own in England.

  • In 2019, 45% owned one rental property, representing 21% of tenancies.
  • A further 38% owned between two and four rental properties, representing 31% of tenancies.
  • The remaining 17% of landlords owned five or more properties, representing almost half (48%) of tenancies,
  • The portfolios of individual landlords were considerably smaller than those of companies and organisations.
  • Most individual landlords (85%) owned between one and four properties, with just under half (47%) owning only one
    rental property.
  • The remaining 15% of individual landlords owned five or more
    properties.
  • By comparison, 46% of companies owned between one and four properties, with only 10% owning one rental property.
  • Just over half (54%) owned five or more rental properties, including 14% who owned 25 or more
  • Landlords with a Buy to Let mortgage were more likely than landlords with another kind of loan, or with no debt or borrowing, to own multiple rental properties.
  • About a third (37%) of landlords with a Buy to Let mortgage owned one property, with two thirds (63%) owning two or more properties.
  • Of landlords with another kind of loan, the proportion with one property alone increased to half (51%), while half (49%) owned two or more properties.
  • Among landlords with no debt or borrowing to fund their rental property, more than half (55%) owned one property and less than half (45%) owned two or more properties
  • Landlords who had been letting for longer tended to have larger portfolios. Of landlords with 11 or more years’ experience, 70% had two or more properties, compared with 48% of those who had been letting for four to 10 years and
    22% of those who had been a landlord for three years or less
  • Between 2010 and 2019, there has been a significant decrease in the proportion of landlords with just one property, from 78% to 45%. This decrease may in part be a function of the different methodology, e.g. such landlords may have longstanding tenants.

Ending a Tenancy and Tenant Eviction

  • Three quarters of landlords and agents were willing to offer longer tenancies of more than 12 months.
  • 40% were willing to offer longer tenancies.
  • An additional 38% of landlords and agents were willing to if there was a break clause in place to enable tenants and landlords to break the contract if required.
  • Landlords and agents who reported a tenancy ending within the last two years were asked why this tenancy (or these tenancies) had ended. The findings are reported for both landlords and agents together because agents are likely
    to be responding on behalf of a number of landlords that they represent and it is not appropriate to compare the responses of the two groups.
  • The most common reason, selected by half (50%) of landlords and agents, was that it was the end of the tenancy and the tenant decided not to renew. A quarter (25%) of landlords and agents reported that tenancies ended because the tenant moved out before the end of the tenancy
  • Other reasons for tenancies ending included the landlord or agent asking the tenant to leave (3%), the landlord or agent evicting the tenant (15%)

Eviction Numbers Increasing

Where landlords and agents reported that they had chosen to end a tenancy in the last two years either by asking the tenant to leave, not renewing a tenancy or evicting a tenant, they were asked to select the reasons for this

  • The most common reason for landlords and agents to end tenancies, selected by over half (58%) of landlords and agents, was that the tenant was in arrears.
  • Less than half (45%) of landlords and agents chose to end a tenancy because the property was not cared for.
  • Other reasons for ending the tenancy included to refurbish the property and relet it (18%), to sell the property (10%) and that the tenant had too many complaints about the property (13%)

Landlords and agents were asked what would encourage them to offer longer tenancies.

  • They most commonly reported that they would if it was easier to remove problem tenants (70%).

In most cases, landlords and agents report that it is the tenant’s choice to end a tenancy.

  • 50% of landlords and agents reported that, in the last two years, they had ended at least one tenancy because the tenancy ended and the tenant did not want to renew.
  • A quarter (25%) ended because the tenant had moved out before the tenancy had ended.
  • Meanwhile, 7% of landlords and agents asked the tenant to
    leave, 7% evicted the tenant and 4% decided not to renew.
  • The most common reasons for evicting, asking a tenant to leave or not renewing a tenancy were due to rent arrears (58%) or due to the tenant not caring for the property (45%).
  • In relation to the last tenancy that ended, 60% of landlords and 54% of agents returned the full deposit to the tenant. A quarter (24%) of landlords and 30% of agents returned some of the deposit.
  • Landlords and agents did not return the deposit (either in part or at all) due to damage to the property or contents (65% of landlords and 60% of agents) and to clean the property for the next tenant (65% of landlords and 65% of agents).

Profile of private landlords

This chapter presents findings on the types and characteristics of landlords, their finances, their motivations for becoming a landlord and their perceived role as a landlord. These questions were asked only of landlords and so this chapter does not include agents

Landlord types

  • Landlords were asked how they currently let their property. The majority (94%) let property as an ‘individual or a group of individuals’, with 4% ‘as part of a company’ and the remaining 2% as part of some ‘other’ organisation. (For track, The Landlord Association is not represented as an ‘other’ organisation. We are exempt from the options to avoid confusion when sumissing landlords as individuals when also part of a collective entity)

Landlord population by landlord type

  • Most (83%) tenancies were represented by individual landlords, with companies representing 13% and other organisations 4%,
  • In 2010, 89% of all landlords in England were private individuals, with 5% company landlords and 6% other organisation landlords.
  • Individual landlords represented 71% of all private rented dwellings, with companies representing 15% and other organisations 14%
  • Landlords were asked how many rental properties they own in England. In 2018, 45% owned one rental property, representing 21% of tenancies.
  • A further 38% owned between two and four rental properties, representing 31% of tenancies.
  • The remaining 17% of landlords owned five or more properties, representing almost half (48%) of tenancies
  • The portfolios of individual landlords were considerably smaller than those of companies and organisations. Most individual landlords (85%) owned between one and four properties, with just under half (47%) owning only one
    rental property. The remaining 15% of individual landlords owned five or more properties. By comparison, 46% of companies owned between one and four properties, with only 10% owning one rental property. Just over half (54%)
    owned five or more rental properties, including 14% who owned 25 or more,
  • Landlords with a Buy to Let mortgage were more likely than landlords with another kind of loan, or with no debt or borrowing, to own multiple rental properties. About a third (37%) of landlords with a Buy to Let mortgage owned one property, with two thirds (63%) owning two or more properties. Of landlords with another kind of loan, the proportion with one property alone increased to half (51%), while half (49%) owned two or more properties. Among landlords with no debt or borrowing to fund their rental property, more than half (55%) owned one property and less than half (45%) owned two or more properties
  • Landlords who had been letting for longer tended to have larger portfolios. Of landlords with 11 or more years’ experience, 70% had two or more properties, compared with 48% of those who had been letting for four to 10 years and 22% of those who had been a landlord for three years or less
  • Between 2010 and 2018, there has been a significant decrease in the proportion of landlords with just one property, from 78% to 45%. This decrease may in part be a function of the different methodology, e.g. such landlords may have longstanding tenants for whom they have not taken a
    deposit.

Age, ethnicity and time spent as a landlord

  • Individual landlords were asked questions about their personal characteristics and landlord journey
  • Landlords were, on average (median), 57 years old. This is older than the general population. At the time of the 2011 Census, the median age for the population of England and Wales was 39 years.
  • Over half (59%) of landlords were aged 55 or older, representing 62% of tenancies
  • In 2010, 70% of landlords had been landlords for 10 years or less, representing 48% of tenancies. The difference between 2018 and 2010 suggests that the average length of experience as a landlord has increased since then, but this could reflect changes in methodology

Financing & Buy to Let Mortgages

  • Compared with longer standing landlords, recent landlords were more likely to have bought their first rental property to live in themselves and less likely to have bought it with the intention of letting it. Over a third (37%) of landlords that had been a landlord for three years or less bought their first property to live in themselves, compared with 28% of those who had been a landlord for 11 or more years. On the other hand, half (49%) of those who had been a landlord for three years or less bought their first rental property with the intention of letting it out, compared to two thirds (58%) of those who had been a landlord for 11 or more years
  • Landlords who had bought or built their first rental property were asked about the sources of funding for this purchase or build. Almost three quarters (72%) reported using a mortgage, 37% used personal savings and 8% used an inheritance
  • Recent landlords were less likely to have used a mortgage to fund their first rental property, compared to longer standing landlords. Almost two thirds (63%) of those who had been a landlord for three years or less had used a mortgage. In comparison, around three quarters of those who had been a landlord for longer had used a mortgage (73% of those who had been a landlord between four and 10 years, and 75% of those a landlord for 11 or more years),
  • In 2018, 29% of landlords were employed full-time and 11% part-time. A third (33%) of landlords were retired. Less than a fifth (16%) of landlords were selfemployed (not as landlord), with a further 13% self-employed as a landlord
  • Over half of tenancies were represented either by landlords who were retired (28%) or those self-employed as a landlord (30%)

Property values and borrowing

  • Landlords were asked the approximate value of their total rental property portfolio. The average (median) total market value of landlord rental portfolios was £400,000. Nearly a quarter (23%) of landlords had portfolios they valued at less than £200,000. A further 36% had portfolios they valued from
    £200,000 to £499,999. Nearly a quarter (22%) had a portfolio they valued from £500,000 to £999,999, with the remaining 18% having rental property portfolios valued at £1 million or more
  • The longer the time spent letting, the more likely landlords were to have a higher value portfolio. Of those who had been a landlord for three years or less, only 15% had a portfolio valued at more than £500,000. This rose to 32% of those who had been letting for between four and 10 years and to over
    half (54%) of those letting for more than 10 years
  • The average (mean) estimated value per rental property for all landlords was £261,900 with the average house value £243,000
  • Landlords who reported using borrowing or loans to fund their rental property were also asked the approximate value of such borrowing. The average (median) value of loans or borrowing was £180,000. One in three (29%) landlords using borrowing had loans of less than £100,000, with a further 38% having loans of between £100,000 and £300,000. The remaining third (33%) had loans of £300,000 or more
  • The longer a landlord had been letting the higher the value of their loans or borrowing. Only 3% of landlords who had been letting for three years or less had borrowing of £500,000 or more. This rose to 12% for those who had been letting for between four to 10 years and to 27% for those who had been letting for more than 10 years
  • The median equity or net value of landlord rental portfolios was £220,000, calculated from the median value of landlord rental portfolios minus median value of loans or borrowing.
  • For those who had existing loans or borrowing, the loan to value ratio of the borrowing was calculated using the landlord’s estimate of their portfolio’s market value. The median loan to value ratio for these landlords was 50%.
  • Over a third (34%) of landlords with debt or borrowing on their rental properties had a loan to value ratio of 39% or less, with another third (32%) one of 40 to 59%. A quarter (25%) had a loan to value ratio of between 60 to 79%, with a further 9% having a loan to value ratio of 80% or more. Of these
    landlords, 4% had an estimated loan to value ratio of 100% or more,

Portfolio loan to value ratios for landlords with debt

  • Landlords were asked which, if any, types of loans or borrowing they currently have to fund their rental property. Over half (55%) of landlords had a Buy to Let mortgage, representing 61% of tenancies. More than a third (39%) of landlords had no debt or borrowing, representing 30% of tenancies. Smaller proportions had a commercial loan (4%) or a loan from family or friends (3%),

Extent and type of borrowing for funding of rental property

  • Landlords who had been letting for longer were more likely to have a Buy to Let mortgage. Of landlords who had been a landlord for three or less years, almost half (49%) had a Buy to Let mortgage. This increased to 58% of those who had been letting for between four and 10 years, and 54% for those letting for 11 or more years
  • Of recent landlords (three years or less), 43% had no loans or borrowing to fund their rental property, compared to 34% for those who had been a landlord for between four and 10 years and 42% for those landlords who had been letting for more than 10 years

Type of rental property currently let or managed by landlords and agents

  • Landlords with larger portfolios are more likely to be letting a wider range of property types. As such, the proportion of landlords with each property type increased with portfolio size
  • For instance, the most common type of property for landlords with portfolios of all sizes were terraced houses. A third (32%) of landlords with one property had a terraced house, while half (48%) of those with between two and four properties had at least one, as did 70% of those with five or more properties in their portfolio. However, the distribution of types of properties was similar for landlords with different sized portfolios

Gas and Boiler Issues in let property

  • Landlords reported a rise (10%) from 2018 in boiler repairs with 12% of property requiring a repair on a gas boiler within their let properties during 2019. Furthermore, an increase of 2% from 2018-19 required a replacement gas boiler (6%)

Types of Gas Boiler by replacement type

  • Types of gas boilers by replacement type
    • Combi – 44%
    • Regular – 40%
    • System – 16%

By regional breakdown

  • The most boiler repairs were needed in London with 6.08% of boilers estimated to have broken down during this period. This was closely followed by the West Midlands at 6.04% and the North East at 5.59%.
  • Boilers are least likely to break down in Yorkshire with 4.27%, Scotland at 4.38% and the North West at 4.79%.
  • These results, at an average of 5.1% nationally, suggests 30,000+ boiler repairs were undertaken on property within portlofios managed by landlords under the guidance of The Landlord Association

Landlord Insurance

  • up 12% on 2018, 79% of landlords reported having landlord insurance cover for their properties, by type popularity
    • Buildings Insurance
    • Contents Insurance
    • Boiler Care Cover
    • Public Liability Insurance
    • Landlord Emergency Cover
    • Rent Guarantee Insurance
    • Unoccupied Property
  • A further 18% of all landlords indicated that they were either thinking of or actively seeking to insure their properties currently uninsured, up 7% on the previous year
  • Landlords with a single property were less likely to have a insurance policy (68%) than those with a portfolio of two properties or more (87%)

Boiler Cover Insurance

22% of landlords indicated that they have boiler care cover (up 12% on 2018) suggesting that over 130,000 property are insured with some kind of cover to protect their boilers for repair and replacement

of those without boiler care cover, 15% suggested they were either thinking of getting cover or were actively seeking to get cover (90,000 properties).

Of the reasons given for not having boiler cover (1) Not enough time (2) too expensive (3) not important (4) Did not renew previous policy (5) portfolio cover options minimal (6) No gas in property (18%).

© TLA copyright, 2020. 

This survey may be republished in part or full without permission. If you require any further information regarding the collation of this survey or indeed any of the information and statistics included please email dean@landlordexpert.co.uk.

This document/publication is also available on our website at www.landlordexpert.co.uk. All rights reserved by The Landlord Association.

Goverment Guides For Landlords Introduction

The definition of House in Multiple Occupation (HMO) changed under the housing act of 2004, with most student shared houses being included as HMOs for the first time. Also landlords of HMOs that are three storeys or more and are occupied by five people of more will need to apply for a licence. In line with this change a few guide were produced to give landlords greater awareness of their responsibilities and the additional responsibilities that have been proposed for the future.

HMO licensing guide for Landlords

This guide provides information regarding the laws and regulations governing Houses of Multiple Occupation and the requirements for licensing HMO’s.

 Download PDF

AST Guide for Landlords

 From the department for Communities and Local Government comes a guide for Landlords and Tenants rights and responsibilities if the letting began on or after the 15th of Jan 1989.

 Download PDF

Proposed Law Changes for Renting Homes

Published by the Law commission, an indepandant body set up by the government, this paper outlines the proposed law changes for renting a home and how the suggestions of the commission will effect landlords.

 Download PDF

Landlord Acts & Regulations Introduction

Landlord Acts & Regulations Introduction

Acts and regulations impose duties and responsibilities on landlords to ensure that the property is completely safe and that all electrical appliances installed are safe throughout the life of the tenancy…

You’ll need to inspect your appliances regularly and ensure that you keep records of all periodic inspections. It is important to be aware of them to ensure that you are compliant and to avoid penalties. Acts and regulations such as the Housing Act 2004 cover a range of issues and introduced regulatory systems such as the Housing Health and Safety Rating System.In additional legislation such as Consumer Protection Acts place liability on landlords to ensure that their property complies with 29 categories of hazard under the Housing Health and Safety Rating System. Therefore to ensure that your property is fit for letting under these acts and regulations, you should follow a series of measures such as providing valid gas safety certificates and taken reasonable precautions to ensure that your premises are free from dangerous defects.

The Housing Act 2004

These explanatory notes has been prepared by the Office of the Deputy Prime Minister to assist the reader in the understanding of the 2004 housing act.

Download PDF

Electrical Equipment Regulations 1994

Provides informations regarding the measures and levels of safety and consumer protection in respect to electrical equipment as laid down in law by the secretary of state.

Download PDF

The Gas Safety (Installations and Use) regulations 1998

This summarises the main changes of the Gas Safety Regulations 1998 and their effects for enforcement.

Download PDF

The Regulatory Reform (Fire Safety) Order 2005.

View Reform

Landlord and Tenants Covenant Act 1995

An act that makes provisions, in some circumstances for those under a tenancy agreement to be released from it and the circumstances surrounding such a proceedure.

Download PDF

The Unfair Terms in Consumer Contracts Regulations 1999

When adding your own terms to a tenancy agreement, we recomend that you familiarise yourself with this regulation.

Download PDF

Liability for land and premises legislation

Covers the:

  • OCCUPIERS’ LIABILITY ACT 1957
  • OCCUPIERS’ LIABILITY ACT 1984
  • DEFECTIVE PREMISES ACT 1972
  • OCCUPIERS’ LIABILITY ACT 1984

Download PDF

More to come July 2020 >

Energy Performance Certficates

These certificates are for all buildings and will be required whenever a building is constructed, rented or sold.
The Energy Performance Certificate (EPC) is broadly similar to the labels now provided with domestic appliances such as refrigerators and washing machines.Its purpose is to record how energy efficient a property is as a building. The certificate will provide a rating of the energy efficiency and carbon emissions of a building from A to G, where A is very efficient and G is very inefficient.
EPCs are produced using standard methods with standard assumptions about energy usage so that the energy efficiency of one building can easily be compared with another building of the same type. This allows prospective buyers, tenants, owners, occupiers and purchasers to see information on the energy efficiency and carbon emissions from their building so they can consider energy efficiency and fuel costs as part of their investment.
An EPC is always accompanied by a recommendation report that lists cost effective and other measures (such as low and zero carbon generating systems) to improve the energy rating of the building. The certificate is also accompanied by information about the rating that could be achieved if all the recommendations were implemented.

When are assessments required?

An Energy Performance Certificate is only required when a building is constructed, sold or rented out. An EPC is valid for 10 years, except for sales of homes which are subject to the Home Information Pack Regulations 2007, where a Home Information Pack (HIP) is required. In these cases an EPC must be no more than 12 months old when the property is first marketed.

On RentWhen buildings are to be rented out, the landlord is responsible for ensuring a valid certificate is made available to all prospective tenants. For guidance on property particulars and when certificates need to be made available, seeProperty particulars and making EPCs available to prospective buyers and tenants. Homes require an EPC on rent from 1 October 2008. See ‘When the measures being introduced’ for more details.What happens if you don’t comply?

When the construction of a new building is completed, the builder or person responsible for the construction is responsible for obtaining the certificate and providing it to the owner. This is a duty under Building Regulations. This will also apply if a building is converted into fewer or more units and there are changes to the heating, hot water provision or air conditioning/ ventilation services.On Construction

Homes were required on an EPC on construction or such conversion from 6 April 2008. Some commercial buildings require an EPC on construction or such conversion from this date.

On Sale

For existing buildings that are to be sold, the building’s owner is responsible for ensuring a certificate is made available to all prospective purchasers at the earliest opportunity. For guidance on property particulars and when certificates need to be made available, see Property particulars and making EPCs available to prospective buyers and tenants

Homes sold without marketing for sale e.g. by private treaty between family members or Local Authority housing  will require an EPC on sale from 1 October 2008.

Gas Safety Introduction For Landlords

If you are a landlord letting a property equipped with gas appliances you need to understand and comply with the law relating to gas safety.

Understanding the law for rental accomodation and annual checks

As a landlord, you are legally responsible for making sure that a Gas Safe registered engineer checks the gas appliances in your rental properties every 12 months and gives you copies of the gas safety certificates.

Gas Safety Certificates

When your Gas Safe registered engineer has checked the gas appliances in your rental property they will give you a gas safety certificate. This certificate confirms the gas appliances have been checked and are safe.

If you let a property, you must make sure that pipe work, appliances and flues provided for tenants are maintained in a safe condition. You need to have a gas safety check every year. A Gas Safe registered engineer must carry out the safety check in your properties in Great Britain and the Isle of Man. You must give your tenants a copy of the gas safety certificate within 28 days of it being carried out or before they move in.

Landlord Electrical Safety Legislation

There is no statutory requirement to have rented property formally inspected for electrical safety at set periods but a landlord is required to provide a dwelling that is safe…

The electrical safety laws affecting landlords letting property include:

The Electrical Equipment (Safety) Regulations 1994 The Plugs and Sockets (Safety) Regulations 1994 The Consumer Protection Act 1987 The Low Voltage Electrical Equipment Regulations 1994 The General Product Safety Regulations 1994 The Health and Safety at Work Act 1974 (this Act inflicts an implied liability on letting agents and those who gain from self employment, as is the case with most landlords)

Some of these regulations only effect letting agents and those who rent property commercially or for business. There is debate about whether individual landlords letting a single dwelling without an agent must comply with all of them. However, as failing to comply can result in fines of up to £5000 per offence, up to six months’ imprisonment, being sued by the tenant for civil damages and, in the event of a death occurring, possible manslaughter charges, it is better to observe them and feel confident that your letting is legal and lawful to your fullest extent.
A wise landlord will employ a qualified electrician for an initial and further periodic inspections, producing a test report which can later be attached to the inventory. Ideally, the inspection should be carried out prior to each tenancy commencing, or at least annually. To become compliant, the following are recommended:
  • Check that all appliance manuals, instructions, safety notices and labels are available so that copies can be issued to tenants.
  • Have a qualified electrician check that all appliances are safely wired and operate properly.
  • Do not buy second-hand electrical goods unless you can prove they are safe and have the appropriate instructions.
  • Check that appliances have no damaged, worn or loose cables and that plugs are securely fitted and properly fused.
  • Check that plugs and sockets conform to BS1363 or BS1363/A.
  • Make certain that appropriate appliances are earthed.
  • Have a qualified electrician inspect the property wiring (power and lighting), earthing, sockets, switches and fusing system, to ensure they meet current regulations and operate properly.
  • Remember to inspect all areas of the property, including any attic or loft space, garage, outbuilding, shed and garden, and any appliances in then.

Tenancy Desposit Schemes

As of 6th April 2012 all new tenancy deposits must be protected in a government-authorised scheme. This new rule applies if the tenancy is an assured shorthold tenancy.

The Government wants to make sure tenants’ deposits are protected so that:

  • Tenants get all or part of their deposit back, when they are entitled to it
  • Any disputes between tenants and landlords or agents will be easier to resolve
  • Tenants are encouraged to look after the property they are renting

Most tenancy agreements for self-contained residential property since 1997 are assured shorthold tenancies. With an assured shorthold tenancy, the tenant usually has the right to stay in the property for at least six months, although a landlord or agent can agree a longer stay. At the end of the tenancy, following adequate written notice, a landlord or agent can seek possession of the property. If a landlord or agent needs to seek possession earlier than this, they can only do so for one of the reasons specified in the Housing Act 1988. A tenant who refuses to leave cannot be evicted without a court possession order.

A landlord or agent will lose their automatic right to regain possession of the property at the end of the tenancy unless they have protected the deposit in a scheme and given the tenant information about how it is protected.

At the beginning of a new tenancy agreement, the tenant pays the deposit to the landlord or agent as usual, who must ensure it is protected. There are three schemes to choose from. There is a single custodial scheme, where the money is held by the scheme until the end of the tenancy. The custodial scheme is free to use. The landlord or agent simply puts the deposit into the scheme at the beginning of the tenancy. There are two insurance-based schemes that insure the deposit.

Under the insurance-based schemes the landlord or agent keeps the deposit, and pays a fee to the scheme to insure against their failure to repay money due to the tenant. Within 14 days of taking the deposit, the landlord or agent must provide the tenant with details of how the deposit is being protected including:

  • The contact details of the tenancy deposit scheme selected
  • The landlord or agent’s contact details
  •  How to apply for the release of the deposit
  •  Information explaining the purpose of the deposit
  •  What to do if there is a dispute about the deposit

Tenants also have a responsibility to return the property in the same condition they took it on. To reduce the likelihood of disputes it is recommended that the following actions are taken before signing the tenancy agreement:

  • Agree a detailed list of contents (furniture and fittings
  • Record the condition of the property and its content (photographs are a good idea)
  •  Agree expectations of cleaning and wear and tear at the end of the tenancy
  •  Understand the circumstances in which the landlord or agent could have a claim on the deposit

At the end of tenancy, the condition and contents of the property should be checked against the tenancy agreement. The landlord or agent should agree with the tenant how much of the deposit will be returned. The agreed amount should be received by the tenant within 10 days.

There are three government-authorised tenancy deposit schemes offering tenancy deposit protection. Landlords and agents should find out about these schemes and their legal obligations before taking a tenancy deposit.

There is one custodial scheme:
 
The Deposit Protection Service
www.depositprotection.com 0870 707 1 707
 
and two insurance-based schemes:
 
Tenancy Deposit Solutions Ltd
www.mydeposits.co.uk info@mydeposits.co.uk
 
The Tenancy Deposit Scheme
www.tds.gb.com 0845 226 7837
 

 If no agreement can be reached about how much of the deposit should be returned, there will be a free service, offered by the scheme protecting the deposit, to help resolve disputes. The disputed part of the deposit will be held by the scheme until the dispute is resolved.

The tenant can apply to the local county court. The court can order the landlord or agent to either repay the deposit to the tenant or protect it in a scheme. If the landlord or agent has not protected the deposit, and they fail to do so within 14 days, they will be ordered to pay the tenant three times the amount of the deposit.

Penalties

Failure to protect a deposit can result in the following penalties should the tenant decide to take action:

  • You will be unable to obtain a Court Order to regain possession of the property (under Section 21 of the Housing Act 1988) unless and until the deposit is protected.
  • You will be required to either return the deposit to your tenant or to lodge the full amount with the authorised custodial tenancy deposit scheme.
  • You may be instructed to pay your tenant compensation between one and three times the amount of the deposit within 14 days of a Court Order
Tenant Vandalism Guide – Your Landlord Insurance Should Cover It

Tenant Vandalism Guide – Your Landlord Insurance Should Cover It

Vandalism is the cause of a third (32%) of malicious damage claims to landlord’s properties, an analysis by Direct Line for Business has found (Survey of TLA Members January 2020)

Police forces across England and Wales investigate 283 incidents of criminal damage to properties every day, the equivalent of one every five minutes.

Criminal damage includes issues such as vandalism, graffiti and even arson.

Sarah Larkin, landlord product manager at Direct Line for Business, said: “The scale of vandalism, arson and property damage across the country is frightening.

“Not only are property owners faced with the cost of repairing damage, there is the emotional stress that a home has been attacked.

“We need the enforcement of tough penalties to discourage people from vandalising properties and ensuring those that commit these crimes feel the full force of the law.”

The number of landlord insurance claims resulting from malicious damage has risen by 37% over the past five years.

 

The highest number of incidents of malicious damage to property in the first half of 2019 were investigated by the Metropolitan Police Service, with 6,014 cases recorded in London.

This was followed by Greater Manchester Police with 5,170 cases investigated and West Yorkshire Police with 4,207.

Former and current tenants are responsible for causing damage to a property in 31% of incidents.

Larkin added: “Landlords can reduce the risk of criminals targeting their properties by installing security measures such as CCTV and motion sensor lighting.

“However, our analysis shows that rogue tenants are also a cause of significant damage to properties.

“To reduce the risk of renting a property to someone that won’t treat it responsibly, landlords should complete comprehensive checks before signing a contract.

“These checks would identify irregularities such as if an individual has any CCJs against them, will confirm their current address, search for any aliases used and verify bank account details amongst other checks.”

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