Posts with tag: tenancy agreement

Case of letting agent fraud described as ‘shocking and alarming’

Published On: July 19, 2017 at 1:22 pm

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A case of a rogue letting agent convicted of £200,000 worth of fraud involving deposits has been described as ‘stunning and alarming.’

Mr Timothy Shinners of Bolton failed to put any of the deposits he received from tenants into a tenancy deposit scheme over a six-year period. Instead, he spent the money himself.

Shockingly, the case went to private prosecution after the police failed to investigate.

Deposits

A director at Platinum Properties in Bolton, Mr Shinner took at least £76,352 of company money. He was last week sentenced to three years behind bars and banned as acting as a director for the company for at least eight years.

The jury at Bolton Crown Court found Mr Shinner guilty of:

  • Failing to comply with statutory requirements surrounding the registering of tenancy deposits in a Government approved scheme
  • Fraudulently adapting tenancy protection documents to cover-up irregularities

The court heard that Shinners knowingly received deposits and did not transfer them into one the three Government approved schemes.

These deposits totalled at least £200,000 and were only registered and protected following a cash injection from another company director. This was described as an ‘act of decency’ by the Judge.

Reports

This matter was reported to the police, only for them to decline to investigate.

A police statement said: ‘There are fewer police officers investigating reports of fraud at a time when the volume of fraud is increasing significantly,’ citing difficult decision that, ‘may not be satisfactory to the victim.’[1]

It added: ‘Due to the changing face of crime, we are not in a position to investigate each report of fraud.’

Case of letting agent fraud described as 'shocking and alarming'

Case of letting agent fraud described as ‘shocking and alarming’

‘Alarming’

Deposit reform campaigner Ajay Jagota, founder of deposit-free renting platform Dlighted, offered his response to the case:

‘This case is stunning and alarming. £200,000 of fraud involving deposits taking place over six years – and not even the police could stop it. Some people are trying to convince us that nothing needs to change in the tenancy deposit system. Cases like this are proof things do. How many more times does this need to happen before something is done?

My real concern is that it appears there are countless agents who under current schemes are allowed to keep these deposits and appear to use this money for their person or day-to-day business use because they think it’s a handy pot of cash lying around. This money legally belongs to the tenants and should not be left unregulated – not least when we are talking about overall deposits which will soon be close to £6 Billion. No wonder the police don’t have the resources to police it all.

What happens when the money supposedly held in a segregated account runs out? They evidence suggests that these companies close shop and go under. And where does that leave their landlords and tenants?

We keep a running total of the deposits crooked letting agents are convicted of stealing each year, and will be publishing figures for the second quarter of 2017 next week. But all the indications are that this year’s figure will exceed the £1m recorded last year. In a sector which many are desperate to raise standards these incidents which are far too frequent do little to demonstrate it is changing for the better.’[1]

[1] http://www.propertyreporter.co.uk/landlords/letting-agent-jailed-three-years-for-deposit-fraud.html

 

What are the strangest items tenants have stolen following tenancies?

Published On: October 13, 2016 at 11:31 am

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A concerning new investigation conducted by Direct Line for Business has revealed that almost one in three renters have taken items that do not belong to them at the conclusion of their tenancy agreement.

Items that tenants have removed from their rental property include fridges, freezers, light fittings, televisions and sinks!

Taking items illegally

Some of the most common reasons for tenants taking items for properties include:

  • believing the landlord wouldn’t notice
  • taking items by accident
  • forgetting the item(s) was not theirs

However, more than one fifth of respondents to the survey who owned up to stealing valuables said that they simply wanted to take them!

The overall cost to landlords of replacing these items is not cheap, with the report indicating that tenants believe the overall value of items they have stolen amounts to more than £500. This underlines the need for a good landlord insurance policy!

Nick Breton, Head of Direct Line for Business, stated: ‘The range of items that tenants feel that they can take with them when vacating a property is quite amazing. It isn’t even just small items that go missing; our research found that renters are helping themselves to beds, sofas and cupboards once their tenancy agreement comes to an end. These are expensive to replace and could have a knock-on effect for future tenants of that property. Plus a tenant could find that they lose their deposit.’[1]

What are the strangest items tenants have stolen following tenancies?

What are the strangest items tenants have stolen following tenancies?

Importance of inventories

Additionally, the research shows that 21% of respondents to the survey who had pinched items said they did not complete an inventory when moving into a property.

Nearly one quarter of tenants who had signed an inventory said the items they had stolen were on this list, but they were undeterred!

Some more unusual items taken were coconuts and a bee hive!

Concluding, Mr Breton said: ‘The research highlights the importance of having a thorough inventory before your property is vacated. Building a relationship with your tenants is a bonus and can open up communication which could minimise issues further down the line. If the property is furnished then make sure you have the right insurance in place so you’re covered should things go missing – like the kitchen sink!’[2]

[1] http://www.propertyreporter.co.uk/landlords/what-are-the-strangest-items-tenants-have-taken-when-moving-out.html

15% of tenants admit to breaking rules

Published On: September 21, 2016 at 10:26 am

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Interesting new research has revealed that one in seven tenants have broken one or more rules outlined in their tenancy agreement.

Data from the report conducted by Direct Line Landlord Insurance shows that around 15% of renters admitted to breaking conditions of their contract. Somewhat alarmingly, 9% said they don’t have a contract at all!

11% said that they were unsure if they had broken any rules or not.

Breaking the rules

Of those renters who admitted to breaching terms of their agreement, the most common was failing to pay rent on time. Next came smoking inside a property and having a pet without permission.

The full list of most common rules flaunted by tenants were found to be:

Activity Percentage of tenants
Failing to pay rent on time (or at all) 25%
Smoking in the property 21%
Keeping a pet in the property 18%
Damaging or making alterations to the premises 17%
Changing the locks 16%
Caused disturbances or a nuisance to neighbouring properties 14%
Sublet a room without notifying the landlord 14%
Failed to clean accessible windows 13%
Redecorated without permission 12%
Failed to check smoke or carbon monoxide alarm 10%

[1]

15% of tenants admit to breaking rules

15% of tenants admit to breaking rules

Sanctions

The most common sanctions for tenants found to be in breach of their agreement include:

  • losing some or the entirety of their deposit (52%)
  • having to pay for damages (22%)
  • being evicted (4%)

However, 21% of tenants say that their landlord hasn’t found out about their actions…yet!

Nick Breton, Head of Direct Line for Business, noted, ‘the relationship a tenant has with their landlord can be crucial in the smooth running of a rented property. It is therefore of utmost importance for tenants to keep in touch with their landlords should anything arise that may be in breach of their rental agreement.’[1]

‘Many landlords may be accommodating of requests to have a pet or to make changes to the property, but it is always safest to ask before doing anything to ensure that you are not breaking your contract in the process. Tenants who break the rules of their contract can face anything from the loss of their deposit to eviction, so for peace of mind, landlords should ensure they have a watertight legal contract in place to fall back on should anything happen to their property,’ he added.[3]

[1] http://www.propertyreporter.co.uk/landlords/1-in-7-bend-tenancy-rules.html

UK rents up 4.9% in Q1, outside of London

Published On: April 13, 2016 at 10:51 am

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Rents for new tenancies in the UK experienced more growth in the first quarter of 2016, according to new research.

Latest figures from the HomeLet Rental Index show that rents on new agreements signed for properties outside of London were 4.9% greater than in the first three months of 2015. Average rents now stand at £755 per month.

In London, those signing new tenancy agreements were faced with average rents 7.7% greater than those one year ago.

Greater than inflation

Data from the HomeLet report indicates that rents continue to rise well ahead of inflation, with demand still showing no signs of cooling. These results however come ahead of reforms, such as increases in Stamp Duty, which are forecasted to have a substantial impact on the buy-to-let sector.

In addition, results from the report show evidence that residential landlords soared to the market ahead of the changes. HomeLet recorded a marked increase in enquiries for landlord insurance. 37% of insurance policies taken out by landlords were few new properties, in comparison to 24% in the same period in 2015.

London saw average rents for new tenancies rise to £1,536 and the region has once again seen prices increase more quickly than in other areas of the country. The gap between the capital’s rent rises and that of the rest of the UK is 2.8%.

Only the North West of England saw rents fall in the three months to March.

UK rents up 4.9% in Q1, outside of London

UK rents up 4.9% in Q1, outside of London

Continual increase

Martin Totty, Chief Executive Officer at Barbon Insurance, said, ‘we’ve continued to see increases in rents on new tenancies in almost every part of the UK during the first quarter, as the private rental market has responded to the pressures of an imbalance between demand and supply.’[1]

‘External factors may now come into play: the stamp duty increase has already had an impact and that surge in the acquisition of property by landlords could now cause a short-term increase in the supply of rental property in some areas of the country. In the longer term, changes to rules around buy-to-let mortgage interest being offset against tax bills, coupled with the Bank of England’s instruction to lenders to apply more exacting criteria on buy-to-let lending, may have a limiting effect on supply,’ Totty added.[1]

Concluding, Totty said, ‘despite these factors, we expect the private rental sector to continue to play a crucial role in a housing market where population growth will continue for the foreseeable future according to official projections.’[1]

[1] http://www.propertyreporter.co.uk/landlords/new-rents-outside-the-capital-rise-49.html

 

Deposit disputes reach highest ever level

Published On: April 4, 2016 at 9:24 am

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Categories: Landlord News

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Concerning new figures released from the Tenancy Deposit Scheme reveals that deposit disputes are at their biggest level since records began.

The figures indicate that in 2015, year-on-year adjudications rose by 11% to 27,816. This was 2,787 more than in 2014. In the past five years, adjudications have jumped by 36%.

Reasoning

Further data from the TDS indicates that damage, cleaning and redecoration are the biggest reasons given for a deposit dispute. In cases given to the TDS during 2014-15, cleaning was highlighted in 58% of cases, with damage appearing in 52%.

The table below shows how the number of adjudications completed has risen over time:

March 2008 458
March 2009 8,098
March 2010 20,363
March 2011 18,156
March 2012 20,279
March 2013 24,448
March 2014 25,029
March 2015 27,816

[1]

Deposit disputes reach highest ever level

Deposit disputes reach highest ever level

Worrying

Jane Morris, Managing Director of PropertyLetByUs.com notes that, ‘these statistics are worrying and send a clear message to landlords and agents-this problem is not going away until they are better protected at the start, during and at the end of a tenancy agreement.’[1]

‘It is vital that landlords and agents ensure they get all the paperwork right at the start and at the end of a new tenancy agreement. The reality is that some landlords are failing to put a letting contract in place, or they have very unfair clauses in the contract. Other landlords don’t conduct an adequate check-in and check-out, or don’t keep copies of correspondence with the tenant which could provide important evidence in a dispute,’ Morris continued.[1]

Concluding, Morris said, ‘landlords are agents also have a thorough and detailed inventory which will enable both parties to be treated fairly and reasonably. This documentation will help resolve potential disputes and prevent them reaching the courts.’[1]

[1] http://www.propertyreporter.co.uk/landlords/deposit-disputes-at-highest-ever-levels-recorded.html

More information on energy efficiency needed, MP’s claim

Members of the House of Lords and MP’s have called for private rented sector tenants to be given better information on energy efficiency and utility bill charges, before signing a tenancy agreement.

In addition, information on their right to change energy suppliers should also be provided, according to these peers.

Complex

The All Party Parliamentary Group for the private rented sector feel that schemes intended to improve energy efficiency of rental accommodation are too complex. As a result, the Group claims a large number of properties will be unlikely to meet energy efficiency standards required by 2018.

From April 2018, all privately rented homes will be legally required to have a minimum energy performance rating of E on its Energy Performance Certificate (EPC). These changes are causing concern, as they are likely to bring about significant challenges to landlords, with privately rented homes generally being older and harder to maintain.

A report from the Group concludes that landlords, energy companies and local authorities must work harder to identify vulnerable tenants who will benefit most from energy efficiency alterations.

More information on energy efficiency needed, MP's claim

More information on energy efficiency needed, MP’s claim

Solving the problem

To solve these issues, the Group is calling for further incentives to be offered to landlords for them to carry out improvements through being able to offset their fees against rental yields.

Additionally, the report from the Group says tenants should be given more transparent information on the likely cost of their bills before a tenancy begins. Energy companies have also been told to look at bringing in lower-rate tariffs aimed at less-wealthy consumers.

Group chair, Conservative MP Oliver Colvile, said, ‘the Government has set ambitious targets for improvements to the energy efficiency of private rented housing and rightly so. To meet these it is clear that much clearer information is needed for both landlords and tenants to understand their rights and responsibilities and the help available to improve the energy efficiency of the rental housing stock.’[1]

‘Tenants especially need much clearer information on their rights to change energy suppliers whilst energy companies, local authorities and landlords need to do more together to identify vulnerable tenants in need of most help to keep the cost of their Bills down,’ he concluded.[1]

[1] https://www.lettingagenttoday.co.uk/breaking-news/2016/2/mps-want-more-energy-info-given-to-renters-before-tenancies-are-signed