Common Claims Against Landlords and How to Avoid Them

No landlord wants to hear complaints, but if you don’t deal with them, they could land you in legal hot water

There are a few things as a landlord you’ll be sick of hearing (mainly centred around new legalisation at the moment) but one thing you never want to hear is your tenant making a complaint, especially when it escalates to a legal issue. 

Whilst it’s true that you can never predict the future, there are certainly plenty of safeguards you can take to put yourself, and your tenants in the best position possible. 

In this episode:

  • Common legal issues landlords face. We speak to Carly Jermyn, CEO and founder of Woodstock Legal Services and specialists in tenancy law, about the legal issues that she sees landlords come up against most frequently
  • Who’s at fault? We figure out how to prove who’s at fault if things do go wrong, and Carly outlines the procedures you should have in place to cover your back
  • Worst case scenarios. It’s best to understand them and get the legal standing on what to do should the worst happen
  • Protect your investment. We check in with Mashroom’s George Sinclair about how you can best protect yourself using insurances and preparation products
  • Understanding your insurance policy. We also catch up with Chris Potts, an insurance specialist, who gives us the inside track on how to make sure you’re keeping on the right side of your policy once it’s in place

The biggest legal concerns for landlords

‘The biggest concern at the moment, and I think it will only continue to get more of a concern, is housing disrepair’, explains Carly. 

‘We’ve definitely seen an increase in claims by tenants, whether that’s a standalone claim, or a counterclaim, when they [the landlord] go to claim for rent arrears or trying to seek possession. The tenant will respond and explain that the reason they hadn’t paid their rent is because of their property not being up to standard and the landlord not complying with their obligations.’

This sort of issue is becoming increasingly common, with a marked increase during the pandemic. Whilst many of the claims were genuine, a lot of them are a little far-fetched, and it can be a difficult negotiation. 

‘It’s a tricky area to navigate if you don’t have good systems and processes,’ said Carly. ‘I think the reason we saw lots of them off the back of the pandemic is where there were high rent arrears, and people needed a reason to try and reduce those arrears or get rid of them completely. For many reasons, people were not able to pay their rent and therefore needed a reason to avoid having to pay it back.’ 

Rent arrears wasn’t just a problem facing landlords during the pandemic. With the current cost-of-living crisis, rising rents are not being met by increasing salaries, so landlords should learn from the situation we saw during the pandemic and ensure they have all the cover needed to protect their investment.

How do you ensure your property meets the regulations? 

Some wear and tear in a property is entirely normal, after all, you can’t expect anybody to live in a property and keep it showroom pristine for the duration of a twelve-month tenancy, it’s just not realistic. But when does wear and tear cross over into disrepair? There’s no danger of legal action for simple wear and tear, is there?

‘Normal wear and tear is not included, and they (the courts) will always look at what’s reasonable,’ reassures Carly. ‘That also applies to if a tenant comes to you with complaints about disrepair. You are allowed a reasonable amount of time to get those works done – we all know how hard it is to get contractors in.’

Courts will also look at the age of the property. For example, the condition of a Victorian property compared to a new build would be very different.

Is the landlord or tenant at fault?

One of the major niggles with maintenance is who is to blame for the issue. Damp is a particular concern, with many landlords called up to manage a damp problem in properties, only to find that the tenant’s lifestyle is a contributing factor. How does this work with regards to the legal standpoint? 

‘Damp at the property is a very common one. An expert’s report will show whether it’s the property, or tenant use – often it’s a little bit of both. And it’s really important that landlords educate their tenants, to make sure their tenants know how to deal with the damp and help get rid of those issues,’ explains Carly. 

There’s some great technology out there that can monitor moisture in the air in properties, so you can see what’s going on in the property. Lawyers love that sort of thing because it produces nice, clean and tidy reports that I could present to a court or to a solicitor on the other side. I can evidence that, prove it, and deal with things quite quickly.

What if your tenant fails to comply?

Worst case scenario – your tenant is being less than cooperative and won’t allow you access to the property (as they are allowed to as per the terms of a contract).  Frustrating, but also can land you in hot water legally, with regards to not only maintenance issues, but also compliance, such as your Gas Safety Certificate.  

‘You’d be surprised how often that happens when they (tenant) complained about disrepair, and that can be a real challenge for landlords,’ said Carly. ‘I would say, where they’ve complained about disrepair and you having issues getting in make sure you document your efforts to get in because that happens really regularly.’

How can landlords protect themselves?

Prior preparation prevents poor performance, and that is certainly true when you are preparing a property for rent. 

Making sure you have all the proper procedures in place can really help safeguard your asset. Mashroom’s George Sinclair joined us to talk through a few of the key elements that he believes every landlord should have in play before signing on the dotted line:

Access to trusted tradespeople

Maintenance hiccups happen, it’s par for the course. But it’s how you deal with them that matters. We’ve got access to over 70,000 tradespeople, and it’s very easy to get in touch with them. From painters and decorators, to someone to sort a leaky kitchen sink, there’s a person to deal with any maintenance issue you have niggling away.  

The Mashroom platform is set up so you just pop in your postcode, give a short overview of the issue and our team will organise a professional to head to your property, get in and do the work (to a standard that we are prepared to put our name to, no cowboy builders here!). Sorted.  

Emergency issues

But what about things that are a little more of a panic? Decorating is one thing, a burst pipe is another… don’t stress, there’s a solution for that too. 

‘Home Emergency Insurance is a real must have for landlords,’ explains George. ‘Some emergencies could have the potential of causing tens if not twenties of thousands of pounds’ worth of damage, so you really do need to get someone in there quickly to make the property safe. That is what home emergency insurance can help with.’ 

Deposits

Deposit management can feel like a tricky area for landlords, especially when considering damages. As is proper, there’s lots of legislation surrounding the correct handling of deposits, and it is important to get this right from the very start. 

Trusting your agent to correctly manage and register your deposit is a no brainer (we can help with that here at Mashroom) but did you know there are other options to the traditional lump sum up front, which go down fantastically with tenants, and offer landlords amazing protection?

Mashroom’s Deposit Replacement Product (DRP) is a insurance based scheme, costing the tenant only one weeks’ rent, but offering the landlord cover for any damages the tenant makes to the property. It doesn’t interfere with any other insurance, and provides a great financial incentive for your tenant, and another safety net for you as a landlord. Win win all round, we think!

‘Our DRP has some fantastic positives both the landlord and the tenants, certainly contact one of our lettings team if you want to find out some more about the scheme,’ said George.

Tenant Referencing

You’ve heard it time and time again, but the best protection is preparation! You can’t predict how a tenant will behave (or maintenance issues, obviously) but you can give yourself the very best prior knowledge of who is going to be living in your property with a rock-solid referencing procedure. 

‘By referencing someone properly in the first place, a lot of the problems we see can be alleviated’, stresses George. ‘We can find out their incoming first out and making sure they can actually afford the rent as well, as normally one of the biggest problems is affordability’.

Inventories

Once your tenant is referenced, ink is dry on the insurance and your deposit is sorted, you’re ready to go, right? NOT WITHOUT AN INVENTORY! This vital step in the lettings process provides you with a clear and legally solid document showing the state of your property when your tenant took it on and will stand you in good stead should you need to make any claims later down the line. 

Remember, an inventory should always be:

  • Thorough and include every room and don’t skimp on the detail
  • Include time stamped images
  • Signed by all tenants
  • Clearly dated 
  • Sent to all parties included on the tenancy agreement

What if something still goes wrong?

Of course, even with the best laid plans… sometimes, you can still find yourself in a bit of a pickle. 

Mashroom’s insurance guru Chris Potts, explains how even with the best protection in place, landlords can fall foul of insurance, finding that it fails to pay out when they have a claim. 

Non-disclosure

‘The number one reason would be non-disclosure of a material fact,’ explains Chris. ‘This would be knowingly providing incorrect information when they start the policy.’

It’s important to stress that this is often an entirely honest mistake. Nobody wants to do anything that will invalidate their insurance, but generally, people are unaware of the loopholes within policies that make them useless. 

Potential issues that could invalidate your insurance if not communicated include:

  • Flat roof. A flat roof means the property may be more likely to have a claim for ingress of water
  • Tall trees. If they are within a short distance to the property (distance varies insurer to insurer) trees could be potentially dangerous in poor weather/subsidence
  • Structural changes. If you have made any changes to the structure of the property (inside or outside) these should be disclosed
  • Unoccupied. If the property is being left empty for any length of time – usually over 30 days, but this varies between providers, so be sure to check with them! 

‘I would always look to err on the side of caution,’ warns Chris. ‘That’s why if you keep the communication up with your broker, then we can talk you through the terms of the small print.’

Always read the small print particularly conditions and endorsements and warranties, they will be listed on your policy schedule. If you’re ever unsure, speak with your broker. There are no silly questions and insurance.

Landlord Licensing Fines

Licensing is a necessary evil for many landlords – they’re a legal requirement in some areas of the country and that’s that. Frustrating as they may be, licensing is in place to improve the standard of rental properties, and that is something we can all get behind.

However, there are of course some landlords that take the risk and don’t organise their licences, so what happens then?

Landlord Muhammer Ahmed failed to properly licence his property in Burnley Council’s selective licensing area, resulting in a hefty fine of £1,000

The licence, had he arranged it properly, would have only cost him £715, (reduced to £640 for licence holders who have previously held a licence in Burnley). He could even have shaved off a little more if he had made an early application or was a member of the council’s Good Landlord and Agent Scheme (GLAS).

Council licensing is not always well publicised, so to avoid getting stung like Mr Ahmed, make sure you check out your council’s website and make sure you’re not missing anything in your local area. 

Are you aware of rental reform?

If you watched the last episode of the Mashroom Show with Carly Jermyn, you’ll be fully in the loop about the upcoming rental reforms. However, many landlords are still in the dark according to property bridging finance broker Finbri, who revealed that at least 40% of UK landlords are not aware of it!

Almost half of the 1,000 UK landlords surveyed were ‘concerned’ or ‘strongly concerned’ that

  • The reform would make it illegal to refuse to rent properties to people who receive benefits
  • That it stops ‘no fault’ evictions
  • That it introduces a private rented ombudsman to help enforce renters’ rights
  • That they would be legally required to register their property on the new property portal 
  • That tenants have the right to request a pet in their house, which the landlord must consider and cannot unreasonably refuse.

But it’s not all bad, a total of 35.16% of landlords said they were Optimistic or Very Optimistic about the landlord register.

Finbri also surveyed 1,000 UK renters and found that 19.38% had experienced unaffordable increases in rent. A combined 73.93% of the tenants surveyed said they were ‘Concerned’ or ‘Strongly Concerned’ about rent increases, so the changes that are due this year will be of some relief to tenants. 

Most concerning though is the fact that the survey found that 40.83% of landlords are not even aware of the Renters’ Reform Bill. As it is set to come into force this year, that could mean many landlords won’t be up-to-date with the changes they need to make.

Check out our previous episode on Preparing for Rental Reform to find out more about what is on the cards and be sure to join our Facebook Community to stay up-to-date with the latest changes and let us know your thoughts about the upcoming reform.

Comments 0

Loading...

Tenancy deposit
Money shield
Local heroes
Token
Approved code
MIBP
Property ombudsman
Open banking
RICS
Mashroom is an appointed representative of Adelphi Insurance Brokers Ltd. Adelphi Insurance Brokers Ltd is authorised and regulated by the Financial Conduct Authority (FCA). Their Financial Services Register number is 594620, with permitted business activities being introducing, advising, arranging, dealing as agent, assisting in the administration and performance of general insurance contracts and credit broking in relation to insurance instalment facilities. You may check this on the Financial Services Register by visiting the FCA’s website, register.fca.org.uk or by contacting the FCA on 0800 111 6768