Landlords Owing Tenants Money
It seems there’s a bit of an epidemic of landlords owing tenants money – we’ve got TWO for you today!
Being fined is a landlord’s worst nightmare and the landlords in today’s video ended up owing their tenants almost £10,000 in rent repayment due to their errors.
If you are facing large debts, consolidating is a good idea. If you own your own home, then a secured loan could help you with this. If this sounds like something that would work for you, let us know!
Story Time: Mr Din
Landlord Robert Rafiz Mohammad Khan Din was off on a working holiday to Australia. That’s a pretty long way away, so kinda tricky to be a hands-on landlord from that distance.
So, according to Mr Din, he relied on his tenants to pay the rent on the property in Southcote Road, London, and look after the house. Are alarm bells ringing for you?
Being so far away meant that Mr Din had no oversight whatsoever on the property. This means that should there be any emergencies, or even minor issues that he would be able to nip in the bud, it would be much harder for him to handle and probably a much slower response time.
And that is… pretty much what happened.
The tenants allege that the property was in a dangerous condition and that there were plumbing problems. There had been a council inspection, but no report was disclosed. But Mr Din was also found to have failed in his duty to get a proper licence for the property.
Mr Din found himself facing a A First Tier Property Tribunal for a number of issues, including ‘not realising’ that his property fell under Islington Council’s additional licensing scheme. He claims two of the three tenants told him they were a couple, but the reality was that it was three separate single people sharing the property. While he did apply for a licence as soon as he found out, the tenants denied the claims they had stated being a couple – and anyway, even if they had been, Mr Din would still have needed a licence because it would have been two households within the property
However, it turns out that both sides were at fault, with the judge explaining that:
The tribunal finds that the applicants [meaning, the tenants] demonstrated less than perfect conduct in paying rent late, leaving furniture to be disposed of after they moved out, and making unsubstantiated allegations that the property was in a dangerous condition.
The tribunal finds that the respondent [meaning, the landlord] demonstrated less than perfect conduct in failing to apply at the start of the tenancy for an additional licence and failing to provide the tenants with a gas safety certificate.
In the end, Mr Din was slapped with a rent repayment order at 50% of the net rent claimed, a total of £9,745.
Story Time: Mr Ifeayni
We are back in London with Mr C Ifeayni renting out in a lovely three-bedroom garden flat on Odessa Road. Doesn’t that sound idyllic?
Well, not when you throw in the fact that his HMO was brimming with mould and also boasted ‘lamentable’ fire safety.
Which is the nutshell summary, shall we dig into the details?
- Despite falling under the local additional licensing scheme, it was unlicensed until March 2023
- There was a bad leak in one of the bedrooms
- They did not have bedroom keys and, on top of that, the locks made it easy for them to lock themselves out
- There were no adjustable thermostats on the room radiators
- There were no working fire alarms
- There were no door, let alone a fire door, between the kitchen and the rest of the property
- There was a lack of emergency lighting
- The landlord did not supply a gas safety certificate and EICR to the council when requested
And we haven’t even gotten to the mould, yet!
Remember that bedroom leak mentioned? It went on and on and on… There were visits by a contractor – often with less than the required 24hrs notice – and attempts to spot repairs, but as you can probably guess… that persistent leak resulted in black mould.
Black mould can cause coughing and itchy eyes, but can also lead to respiratory issues including restricted breathing. So the room became, understandably, unsuitable for use.
Despite the state of the property, the tenants hadn’t been in rent arrears and they hadn’t had any complaints. Like Mr Din, Mr Ifeayni seemed to be abroad, although it is believed that he lived abroad, rather than just being away on a working holiday.
Mr Ifeayni didn’t take part in the tribunal and it was left to conclude: “Our conclusion is that this is at the higher end of the spectrum of seriousness. The state of the fire safety provision was lamentable…these are very serious defects in what must be the most important single responsibility of a landlord.”
Mr Ifeayni was given a rent repayment order of £10,060, which the three tenants will share.
So… what can we learn from this?
How to handle additional licensing
While this may not be the most dramatic tale we’ve ever shared, there is a LOT to be learned from this story.
Let’s start with licensing because it’s a contentious issue. There is HMO licensing nationwide, which you can learn more about in our HMO video. So let’s focus here on where Mr Din fell down – selective licensing.
What is selective licensing?
Well, it’s selective because it’s NOT nationwide. Only some areas across the country require these additional licenses for landlords, regardless of whether you’re renting a HMO or not. The idea is that it gives the local council power to regulate the PRS in areas that suffer from low housing demand or high levels of anti-social behaviour or deprivation, in an bid to improve conditions across the board.
If you’re a new landlord, one of the things on your list should be reaching out to your local council to check if there is selective licensing in your area and what the rules are around – and applying for a licence if you need to as soon as possible!
If you’ve been a landlord for a long time, you need to be aware of what is going on in your local area. Councils aim to spread the news of impending licensing months in advance and occasionally they will offer a small discount if you sign up sooner rather than later. It takes a couple of minutes to use an online property licensing postcode checker or property licensing map checker, so do that fairly regularly and you should be aware before you’re caught out.
What to do if you’re a landlord abroad?
If you, like Mr Din, have the opportunity for a working holiday in Australia, we would be the last people to tell you to turn it down! But what about your rental property or properties back home?
Well, here are the things you need to consider:
- How are you going to keep an eye on the property and do regular checks?
- How will you organise annual gas safety inspections?
- What will you do in the event of an emergency?
- How will you handle necessary works required?
- What will you do about tenant issues, like rent arrears?
You COULD continue to manage this yourself, on the understanding that it would be more stressful and time consuming than if you were in the same time zone or country.
Another option is asking a trusted friend or family member help while you’re away. However, this could potentially be a big ask if something untoward were to happen and could create issues between you. We tend to think you shouldn’t mix business with friends and family if you can help it!
Alternatively, you can look into getting an agent, if you don’t have one already. Not only do they take things off of your hands while you’re IN the country, they can keep everything ticking over nicely while you’re OUT of it too. We never ever recommend that you eschew all responsibility, you should definitely know when your gas safety is coming up for renewal, for example, and check in to ensure that it is being dealt with.
But an agent really can make life easier, whether you have a full time job, a large portfolio or just fancy some winter sunshine.
