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All about landlords rights to go into their tenants property

Landlord Law Blog - 9 September 2014 - 9:52am

Whether or not a landlord can enter his tenant’s property to carry out inspections, repair work etc even if the tenant is unhappy about this, is a hotly debated issue.

In this post I examine the various options and situations that may arise, to try to provide some clarity.

Lets take a look at the law first.

What the law says

It is an established rule that all tenants enjoy what is rather confusingly called ‘the covenant for quiet enjoyment’.

This does not mean that they are entitled to a noise free property or that they are entitled to enjoyment.

It means that they are entitled to live in the property without interference from the landlord or anyone acting on his behalf (such as his letting agent).

There is also another legal rule which says that  “a landlord may not derogate from his grant“.

This means, effectively, that a landlord cannot grant a tenancy and then expect to  be able to treat the property as if it was his.

So the law is (or should be) on the side of the tenant if he wants to keep his landlord out.

“But”, I hear you say, “landlords DO have a right to go into the property. It is theirs after all.”

Then there are times when they will have to go in – for example when carrying out the annual gas safety check or to do the quarterly inspection. What about that?

Is it the landlords property or the tenants?

Lets take a look at the first issue first. Is it the landlords property?

Well it is and it isn’t. Confusingly it is possible for several people to ‘own’ the same property at the same time, in different ways. So for example:

  • Fred can own the freeholder
  • Leslie can own a long lease (from Fred)
  • Tanya can own a six month AST (rented from Leslie)
  • Nish (the neighbour) can own a right of way over the garden and
  • Megabank Ltd can own a legal charge or mortgage on the property

So Fred and Leslie will ‘own’ the property in a way, but this will be subject to the rights of their tenants.

For example, with the AST, Tanya will have the right to use and live in the property. Leslie will have given this away in exchange for the right to receive rent and get the property back when the tenancy ends (known as the ‘reversion’).

In the same way that you cannot have your cake and eat it – you cannot rent out your property AND retain the right to go into it when you want.

Always excepting that a landlord can enter the property in a case of genuine emergency – such as a fire.

What about legal rights of access?

But what about those circumstances when the landlord is given a statutory right to do something – such as s11(6) of the Landlord & Tenant Act 1985 which provides for landlords to be authorised to enter the property after giving not less than 24 hours written notice?

Or clauses in the tenancy agreement which provide for the landlord to have a right to enter, to (for example) carry out the annual gas safety check or show round tenants during the last month of the tenancy?

Lets start off by looking at the notice.

The notice

Any right the landlord has to go in will be dependent (save in a case of genuine emergency) on the landlord giving the tenant written notice first.

Indeed, any clause which authorises the landlord to go in whenever he likes will be void under the Unfair Terms in Consumer Contracts Regulations 1999 – as it will be taking away a right which a tenant normally enjoys.

The general rule is that the notice must not be for less than 24 hours.  However I would suggest that preferably the tenant be given considerably more than this.  Ideally a couple of weeks.  Then if the tenant wants to be present, he will have more time to arrange for this.

If you send the letter by post, you may also want to back this up with an email – just so the tenant can’t claim that the letter got lost in the post.  And also of course because sometimes letters DO get lost in the post and you want the tenant to have a proper warning.

Its important that you and your tenant are on good relations, and being considerate about things like inspection visits (which many tenants feel are a bit of an intrusion into their home) is an important part of this.

Assuming the notice has been given – lets now look at some scenarios.

Some scenarios

(For ‘landlord’ please read ‘landlord or his agent’).

1. If the landlord gives notice and the tenant specifically confirms that they agree or that they have no objections.

In this case, unless the tenant retracts this, the landlord can use his keys and go in.

If he has no keys, then he will be dependent on the tenant letting him in.  Note that there is no right per se for the landlord to hold (or demand to be provided with) a set of keys.  It is assumed in these scenarios, that the landlord does hold keys.

2. If the landlord gives notice and the tenant does not reply, but has not objected in the past when the landlord has gone in.

Here there will be a ‘course of dealing’ and the landlord will be entitled to assume that he can still use his keys to enter and do the inspection (or whatever).

3. If the landlord gives notice and the tenant does not reply – where this is the first inspection visit.

Here, if the landlord has made it clear to the tenant at the start of the tenancy that they will want to gain access for inspections or if this is very clearly flagged up on the tenancy agreement, it is probably safe for the landlord to use his keys to go in.

However it might be prudent to try to contact the tenants first, maybe by phone or email, just to check.

4. If the tenant gets in touch and says that he does not want the landlord to go in

Here the landlord should not enter. He should try to re-arrange the appointment. If the tenant is persistently obstructive he can:

  • Write to the tenant and point out that he (i.e. the tenant) will be liable for any deterioration in the property due to the landlord being unable to carry out repairs and
  • That if the tenant is injured by something damaged in the property, he will not be able to bring a claim against the landlord, as it is his fault the landlord was not able to get the damaged item repaired
  • The landlord may also want to consider threatening to apply to the court for an injunction and/or serving a section 21 notice and evicting the tenant in due course
5. If the tenant does not get in touch but refuses to allow the landlord or his workman in to the property at the appointment time

Again, the landlord will not be able to enter the property against the tenant’s wishes. The points made in 4 above will apply.

In addition the landlord may also be able to claim against the tenant for the costs of the wasted appointment.

Some tenancies will specifically provide for this, but it is arguable that in some situations it is chargeable anyway – if the landlord is able to show that this is a financial loss he has suffered as a result of the tenants’ breach of contract (i.e. by failing to allow access at the proper time) – and that the tenant was aware that this would happen.

For example the landlord will probably have to pay a call out fee to any workmen or gas installers attending to do work or carry out an inspection, whether or not they are allowed into the property.

Reasons why the landlord should not go in against his tenant’s wishes

Even if the landlord were legally entitled to enter a property against his tenants expressed wishes (and although my view is that he is not entitled, it is possible that I could be wrong) there are some very good reasons why he should not do so.

For example if you are a landlord and your tenant was upset to find that you had used your keys to go in:

  • This could trigger the start of a deterioration in landlord / tenant relations and your tenant may develop a hostile attitude towards you in future
  • The tenant may claim that you have broken or stolen something which belongs to him – for example he could claim that a valuable watch or necklace has gone missing and seek to blame you and claim compensation.  You may find it difficult to prove otherwise, if you were there on your own, against the tenant’s wishes.
  • The tenant could complain about you to the Local Authority tenancy relations officer – if you are an HMO landlord requiring a license this could affect future license applications
  • Your tenant may decide that he does not want to stay at the property beyond the end of the fixed term, putting you to the expense of finding a new tenant and the risk of a void.

These are all undesirable!

Rooms in a shared house

The situation is slightly different if the tenant rents his own room and has the use, together with the other tenants, of the shared parts of the property. Such as kitchen, bathroom, lounge, hallway, passages etc.

Here the tenants’ rights to keep out the landlord will apply to his room.  They will not necessarily apply to the shared parts – as he does not have ‘exclusive occupation’ of those areas.

So a landlord will be able to enter the shared parts to inspect, do repairs and show round new tenants, preferably with notice, but possibly even without it.

My view has always been that the landlord will have the right to enter the shared parts to carry out any ‘lawful’ activities but not otherwise.

So a tenant will be entitled to complain, maybe to his local TRO, if the landlord is constantly coming into the property for apparently no good reason but to spy on the tenants, but not if the landlord has come in to fix the taps or do an inspection visit with a new tenant. Whats your view?

I think that sums everything up, but if you disagree or think I have left something out please leave a comment below.

Note – if you are a landlord and your tenant is preventing you doing the annual gags safety check, you will find help and guidance in my Gas Access Kit

Buy a home in John Constable country

Daily Telegraph - 9 September 2014 - 7:00am
Caroline McGhie discovers the pastoral delights of East Anglia that inspired one of our greatest artists






Categories: News feeds

Winkworth Salisbury office

Estate Agent Today - 9 September 2014 - 1:00am

Winkworth has announced it’s opening a new office in Salisbury, adding to its expanding number of offices in the country, which now totals 35.

The office will be owned and operated by Matthew Hallett, who has a wealth of property experience having worked in agency for nearly 30 years both in London and the country.

The new office should prove to be very successful for the company, as data shows that there have been record levels of migration out of London, particularly to locations in the south with good commuter links, and the trend for relocation out of the city is set to continue. In certain locations in these regions, transaction levels have increased by as much as 19% compared to the previous year.

Dominic Agace, CEO of Winkworth, said: “The Salisbury office is in a fantastic location and helps to bridge the gap between our nearby offices of Devizes, Winchester and Romsey to give the Winkworth network wider reach to existing and new clients. We are extremely pleased to be continuing our expansion into this area of the country, following the recent opening of our office in Ramsbury, and believe that Winkworth is becoming a name synonymous with country property.”

Matthew Hallett, director of Winkworth Salisbury, said: “Having owned my own agency for many years I'm delighted to be opening an office in Salisbury with Winkworth. I believe that the values the agency and I share - especially as a resident of Salisbury myself with a great passion for country houses - will ensure that we’re able to offer bespoke marketing plans to suit individuals, expert local knowledge on the area and market conditions, as well as a unique perspective on property. I look forward to helping local residents and those looking to move to this great city and the surrounding area with all their property needs.”

  • Winkworth
  • salisbury
  • new office
Categories: News feeds

Transactions between £2m and £5m up, says WA Ellis

Estate Agent Today - 9 September 2014 - 1:00am

Estate agent WA Ellis has released its latest commentary on the Prime Central London (PCL) residential sales market.

It says activity across all price ranges is ‘stable’ as research shows a reduction in transactions of just 3.5% from January to August 2013 compared with the same period in 2014.

It found that transactions between £2m and £5m increases by 11.7% this year; although sales above £5m went down by 5.5%.
 
Richard Barber, partner at WA Ellis, said: “Commentators regularly compare the market, both in terms of capital values and transaction levels with the glory days of 2007 where, pre-Lehman Brothers, we enjoyed a soaring market fuelled by domestic and foreign investment into Prime Central London.
 
“If we compare the current year’s activity (January to August 2014) with the same period in 2007, within our area of expertise (Chelsea, Knightsbridge, Mayfair, Belgravia and Kensington) we see a 35% diminution in activity. However, when one factors in the inflation that the capital has enjoyed over the last four years (18.5% in the last year alone according to Land Registry data), a more interesting picture emerges. 
 
“Property transactions between £2m and £5m have increased by 17.5% and those in excess of £5,000,000 have increased by 72% on 2007. Whilst the media are reporting more bearish sentiments across the market and reduced levels of new buyer registration, we should not necessarily predict that the bubble is about to burst. Activity across all price ranges is very stable, and our research suggests that between January and August 2013 there were 1,288 transactions, and in the same period in 2014, 1,242 – a reduction of only 3.5%.

“Whilst the Damoclean sword of mansion tax continues to hover over the PCL market, the figures suggest that it has not as yet impacted. Indeed, sales between £2,000,000 and £5,000,000 have increased by 11.7% this year. However, sales of properties over £5,000,000 have diminished by 5.5%. The reduction in activity over £5,000,000 is perhaps indicative that the foreign investor may tolerate a tax of £15,000 per annum (based on the current ATED charges) but not the more punitive £35,000 charge per annum currently applied to properties held in company names with values in excess of £5,000,000.
 
“Whilst a combination of the strengthening pound, mansion tax, CGT for foreign investors and the Mortgage Market Review introducing tougher lending criteria for borrowers may dampen market sentiment, there is always a healthy appetite for the right product, and if vendors’ expectations are realistic, there is no reason why we should not enjoy a ‘normal’ market.”
 

  • WA Ellis
  • Mansion Tax
  • Prime Central London
Categories: News feeds

68% of estate agents are willing to diversify their marketing services

Estate Agent Today - 9 September 2014 - 1:00am

Sixty-eight per cent of high street estate agents are willing to consider introducing a range of tailored services for home movers in addition to providing the traditional services, according to a new survey.

The research was carried out by Move with Us who polled more than 100 independent estate agents across Britain.

Of the estate agents prepared to diversify their services, 88% revealed that they would offer a bundle of services, allowing homeowners to pick their preferred option and to have greater control over the services they receive. These include a combination of listing a property for sale on Rightmove and/or Zoopla only, taking professional photos, writing the property description as well as handling viewings and negotiations if required.

Seventy per cent of estate agents have seen competition increase in their local area with a rise in the number of new offices opening in the last three months. Move With Us says estate agents offering this added level of flexibility are more likely to remain competitive in the face of increased high street competition.

Robin King, director at Move with Us, said: “The property market is a long way behind many other industries in terms of providing customers with choice, flexibility and convenience.

“The market is evolving quickly and high street estate agents are starting to look at providing a range of marketing packages for home movers. This approach will provide home movers with greater benefits and attempt to keep moving costs down. They’ll receive flexibility and the security of face-to-face contact to support them through one of the biggest transactions of a lifetime.”

 

  • Move with Us
  • diversify
  • marketing
  • robin king
Categories: News feeds

Property price gains slowing

Estate Agent Today - 9 September 2014 - 1:00am

The average price of a property in the UK now stands at £186,270, 9.7% higher than a year ago, according to the latest Halifax house price index.

However, house price momentum has slowed since July when it saw a 10.2% year-on-year jump.

Halifax said there were “tentative signs” that a better balance between demand and supply might be emerging which, if sustained, would help to dampen the pace of price growth.

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “The combination of more property coming up for sale and the prospect of an interest rate rise at some point in the future is applying the brakes to the runaway market. However, with a number of lenders reducing their two- and five-year fixed-rate mortgages in the past couple of weeks there are still some excellent deals available for buyers who are concerned about rate rises and want to lock in. Assuming you can meet stricter lending criteria, it could be a great opportunity.”

Guy Meacock of buying agency Prime Purchase, said: “On balance the next few months will be the time to buy a home rather than sell. Vendors who want to exchange by Christmas are coming to market at an unfashionable time of year and may need to be more flexible on the price if they want to meet that deadline. Prices are already softening so there are good opportunities for buyers.”

Jonathan Samuels, chief executive of Dragonfly Property Finance, said less momentum and more moderation in house price growth is what the market needs.

"Increased supply on a consistent basis will further temper the rate of price growth and offer hope to prospective buyers. Growing consumer confidence, a strengthening jobs market and economy, and historically low mortgage rates have kept demand ticking over.

"But at the same time, a number of factors have combined to slow the market down slightly, from weak wage growth and the growing anticipation of higher interest rates to tougher mortgage criteria.

"As ever, there is no single narrative for the UK property market. In some areas of the country, prices are looking dangerously inflated, while in others the market is still relatively weak.

"Prospective buyers should remain on their guard and factor rate rises into the buying equation."

 

  • Halifax
  • house price growth
  • house price index
  • buyers
  • sellers
Categories: News feeds

Ch ch ch ch changes

Nearly Legal - 8 September 2014 - 11:41pm

When is a Secure Tenancy Agreement not a Secure Tenancy Agreement?

News has reached us of an interesting case in Bow County Court involving the right to succeed to a secure tenancy and the operation of s.103 of the Housing Act 1985: London Borough of Waltham Forest v Mahmood.

S.103 may be an unfamiliar provision to some so this is what it says:

(1) the terms of a secure tenancy which is a periodic tenancy may be varied by the landlord by a notice of variation served on the tenant

(2) before serving a notice of variation on the tenant the landlord shall serve on him a preliminary notice-

(a) informing the tenant of the landlord’s intention to serve a notice of variation,

(b) specifying the proposed variation and its effect, and

(c) inviting the tenant to comment  on the proposed variation within such time, specified in the notice, as the landlord considers reasonable;

and the landlord shall consider any comments made by the tenant within the specified time

(3) Subsection (2) does not apply to a variation of the rent, or of payments in respect of service or facilities provided by the landlord or of payments in respect of rates

(4) The notice of variation shall specify—

(a) the variation effected by it, and

(b) the date on which it takes effect;

and the period between the date on which it is served and the date on which it takes effect must be at least four weeks or the rental period, whichever is the longer.

(5) The notice of variation, when served, shall be accompanied by such information as the landlord considers necessary to inform the tenant of the nature and effect of the variation.

 

Mr M was the son of the late Mrs M, who held a secure tenancy of a 3 bedroom flat with LBWF from 1982 until her death in September 2011. Towards the end of her life, Mrs M became increasingly infirm and dependent on a Social Services care package and family support.

At some point in the months prior to her death, Mr M moved in with his family to assist with this support and upon her death, he applied to succeed to the tenancy. The local authority refused his application on the grounds that he could not show 12 months continuous residence prior to his mother’s death. Notices to quit were served on the property and on the public trustee and possession proceedings began.

This is where it becomes interesting because Mrs M’s 1982 agreement allowed for a 6 month qualifying period for family members. Over the course of 2008 and 2009, LBWF planned to alter its terms and conditions (including bringing the succession provision into line with s.87 of the 1985 Act) and this process culminated in fresh T&Cs, which were intended to take effect from May 2009.

Mr M argued that the 1982 agreement was the effective agreement and that he was entitled to succeed to the tenancy by virtue of 6 months continuous residence. This required LBWF to prove that the preliminary notice and notice of variation were duly served on Mrs M. Over the course of the proceedings, it became apparent that LBWF were encountering some difficulty in locating those notices. Nothing could be found in connection with Mrs M and there was no trace of the specimen notice of variation. LBWF gave evidence that, following completion of the exercise in 2009, the documents had been placed in storage and an office move in 2013 was delaying discovery of the notices.

The case was effectively put on ice for approximately 12 months until it was heard by DJ Dixon at the beginning of September this year. The council did not produce any further evidence and they argued that the court could conclude on the balance of probabilities that a diligent exercise had been completed in a diligent manner and that the notices had been served on Mrs M (applying the principles in Entrust Pension Ltd v Prospect Hospice Ltd [2012] EWHC 3640 at paras 39-40).

DJ Dixon disagreed. It was a matter of concern that the notices of variation had disappeared en masse and the only inference the court could reasonably draw from the fruitless search of the files was that the notices had never been served on Mrs M. The 1982 agreement therefore applied and, having found Mr M to have resided at the property from December 2010, the possession claim was dismissed.

Comment

This is clearly a case with significant ramifications not only for LBWF’s secure tenancies pre-dating May 2009 (of which there were roughly 13,000) but also for those other local authorities who may need to carry out due diligence into their variation procedures. It has perhaps been taken for granted during litigation that secure tenancies have been properly varied, particularly when following the correct procedure is not as critical to the outcome of a case as it was in this case. However, unless variation documents have been properly catalogued and recorded, councils will have to think twice before pleading that their tenants’ T&Cs have been successfully varied.

The post Ch ch ch ch changes by Giles Peaker appeared first on Nearly Legal: Housing Law News and Comment.

How much do London's landmark properties sell for?

Daily Telegraph - 8 September 2014 - 4:46pm
From Harrods to Battersea Power Station, how much can the capital's landmark buildings fetch in price?






Categories: News feeds

Should I invest in BTL with a 4 year time frame for my retirement

Property 118 - 8 September 2014 - 2:19pm

We live overseas and will return to the UK on retirement in 2018. We are cash buyers about £500k, but not yet ready to invest in our retirement home – we’ve only narrowed the area down to the SE We are looking for an investment to park funds allocated for the 2018 house purchase. We... Read more

The post Should I invest in BTL with a 4 year time frame for my retirement appeared first on Property118.com.

Categories: News feeds

Job Ads

Nearly Legal - 8 September 2014 - 2:10pm

Well, one job ad and an interesting funded PhD opportunity.

 

Coventry Law Centre

Practice Area: Housing

Location: Coventry, West Midlands

Job Type: Housing Caseworker/Solicitor

Employment Type: Permanent Full Time

Salary: Negotiable up to £29,410 (caseworker) or £31,942 (solicitor) based on experience

Closing Date: 10.00am, Friday 26th September 2014

Interview Date: 10.00am, Monday 6th October 2014

Job Description:

With a reputation for excellence, we provide specialist legal advice & representation to combat disadvantage, discrimination and exclusion. We also influence local and national policy to improve public services for the most vulnerable – we use the law to achieve change.

We cover nine areas of social welfare law and we hold a Legal Aid contract in Housing in Coventry. We are also contracted to operate the Housing Duty Solicitor Scheme at Coventry Combined Court.

If you are motivated by the chance to make a difference and would like to work in a team that combines specialist knowledge of housing law and be at the forefront of the provision of specialist legal advice in a unique setting. We are seeking a caseworker ideally with experience of housing law and experience of handling a caseload although we are prepared to train you if you demonstrate the necessary skills and attributes.

You will be part of a team that is trying to make a difference. You will handle a manageable caseload, but in addition will be expected to spend some of your time on other work, such as seeking to influence policy within local government and public services and working with voluntary organisations and others to increase awareness of legal rights.

We operate from city centre offices, and our terms and conditions include 28 days holiday plus 8 statutory days, flexible working hours and pension scheme membership.

For an application pack go to www.covlaw.org.uk/jobs/current.html or email recruitment@covlaw.org.uk

Birmingham City University

Funded PhD

Housing and Dispute Resolution: social wellbeing and bottom up forms of community engagement

The housing crisis across much of Europe, and indeed other parts of the world, shows no sign of abating. The issue is particularly pressing in high-density urban settlements where the further problems of low income, immigration and lack of community engagement are often found. The solution is often deemed simply to be more housing, but this is often not achievable especially in the short term. There are further issues that are intimately linked to urban housing including anti-social behaviour and the creation of sustainable communities. Rather then than focussing purely on material housing it is a question on focussing on tenant wellbeing through empowerment and engagement.

This PhD will be based around an empirical study of the attitudes and perspectives of tenants in urban Birmingham. It will also seek to examine the views of key stakeholders such as housing associations, charities and legal experts. It aims to consider the question of housing from a social science perspective by considering the concept of ontological security and drawing on geographical theory in attempting to examine the sense of place.

The candidate:

Candidates should have a good first degree (2:1 or above) and ideally a Masters and experience of qualitative research would be helpful. Candidates must be able to demonstrate good communication skills, both for undertaking the research and disseminating its results. We also expect him/her to contribute to BSBE’s overall strategy of exploring cutting edge practices and research informed teaching.

For further information and informal enquiries please contact Julian Sidoli del Ceno (Julian.sidolidelceno@bcu.ac.uk)

The post Job Ads by Giles Peaker appeared first on Nearly Legal: Housing Law News and Comment.

How could I convert my property so it is no longer an HMO?

Property 118 - 8 September 2014 - 1:00pm

Sometime ago I purchased a large property in Portsmouth. I have converted the property so it has 6 bedrooms but it behaves largely like two flats. 3 bedrooms, a lounge, bathroom, toilet and kitchen are on the ground floor. The ground floor has its own front and rear access as well as a door to... Read more

The post How could I convert my property so it is no longer an HMO? appeared first on Property118.com.

Categories: News feeds

Council opts out of licencing scheme

Residential Landlord - 8 September 2014 - 12:36pm
Despite many councils across the country opting for selective licensing schemes, Sandwell council in the West Midlands has decided against the introduction of one. Notoriously unpopular
Categories: News feeds

Britain's top 20 places to raise a family

Daily Telegraph - 8 September 2014 - 10:51am
As William and Kate announce they are expecting a sibling for Prince George, we look at the best places to raise a family - and not just a royal one. Julia Flynn reports
Categories: News feeds

Britain's top 20 best places to raise a family

Daily Telegraph - 8 September 2014 - 10:51am
As William and Kate announce they are expecting a sibling for Prince George, we look at the best places to raise a family - and not just a royal one. Julia Flynn reports






Categories: News feeds

Vanessa Warwick of Property Tribes speaks up for landlords #landlordlawlive

Landlord Law Blog - 8 September 2014 - 8:03am

As a former TV presenter, and interviewer on Property Tribes TV, normally it is Vanessa asking the questions.

Here she is the person giving the answers, and talks to me about Property Tribes, the popular online forum she set up with her husband, and how it can help landlords.

Vanessa also gives some good advice on topics such as due diligence and eduction and has pungent views on ‘property gurus’.

You can listen to the talk via the player below:

Note that you can also find us on itunes >> here. >> Click here to be kept informed of new Landlord Law Live events

>> You can also listen to the podcast here

Confused by podcasts?  See our >> podcast guide.

If you have enjoyed the podcast – please leave a rating in iTunes – the podcast guide will show you how

My space: Lisa Faulkner

Daily Telegraph - 8 September 2014 - 7:00am
Actress and cook Lisa Faulkner shows us the kitchen which convinced her to buy her home in Barnet






Categories: News feeds

Elements of buy-to-let lending to be regulated under new EU rules

Estate Agent Today - 8 September 2014 - 1:00am

In a shock announcement from the Treasury, parts of the buy-to-let mortgage market will be regulated to meet EU rules.

The new rules, which are set out in the EU Mortgage Credit Directive, set common standards that EU members need to meet in order to protect consumers taking out loans to buy a residential property.

The Government says the legislation includes “introducing a new set of regulations for buy-to-let lending, where the lending is to consumers rather than for business purposes.”

The Council of Mortgage Lenders says the rule change will have an “unintended impact” on buy-to-let lending and says it’s disappointed that the Treasury has found it necessary to make a “U-turn” on buy-to-let.

The CML offered the following explanation about which buy-to-let loans will be regulated:

“The Treasury considers that, to meet the requirements of the Directive, it is necessary to put a regulatory framework in place for those cases where borrowers are not making an active decision to acquire a property to become a landlord, and where they do not seem to be acting in a business capacity ("consumer" buy-to-let). Examples might include cases where the property has been inherited, or previously lived in by the borrower, but the borrower is unable to sell it and so lets it instead. The proposed new regulation will only apply to relevant new loans (not existing loans), and not until March 2016.”

CML director general Paul Smee said: "With the mortgage market review out of the way, we now enter round two of regulatory change as a result of the European Mortgage Directive. We are hopeful that most of the impact should be modest, as much of it was anticipated and helpfully built in to the new rules in the first place.

"It is frustrating though that, despite earlier assurances, the buy-to-let position turns out not to have been adequately resolved, resulting in a new proposal for regulating part of the buy-to-let mortgage market. The regulatory regime now being proposed is based not on any evidence of a need for additional consumer protection, but purely on ensuring that the European legal requirements are met."
 
The changes will not come into effect until March 2016, but the Government is consulting now in order to give mortgage firms and customers as long as possible to prepare for them. The consultation will run for eight weeks.

 

 

  • European Union
  • mortgage regulation
  • CML
  • council of mortgage lenders
  • Landlords
Categories: News feeds

Property Alert service proves popular in the fight against property fraud

Estate Agent Today - 8 September 2014 - 1:00am

Six months on from the launch of Land Registry’s Property Alert service, more than 12,000 people have signed up to the free service which provides an early warning of suspicious activity on someone’s property.

Alasdair Lewis, director of legal services at the Land Registry, said: “We introduced Property Alert to help people to protect their most valuable asset – their home. We’re glad that Property Alert has proved so popular. However, there are still many homeowners who are unaware of the risk of property fraud and how to protect themselves so we are asking people to share our advice and video with their friends and family to spread the word.”

The Land Registry provided the following example of where Property Alert could have raised the alarm earlier:

Mr Q rented out his property using letting agents while he lived overseas. His letting agents were approached by someone claiming to have bought the property. This was a surprise to them, so they contacted Mr Q.

Mr Q then contacted Land Registry’s property fraud line. Upon investigation, it was found that an application to transfer Mr Q’s property into the name of a buyer had been received. A staff member also spotted discrepancies between Mr Q’s signature and previously scanned documents. We sent a letter to the buyer’s solicitor requesting confirmation of the steps taken to verify Mr Q’s identity.

Mr Q’s solicitor also contacted Land Registry to confirm that he had known the family for over 20 years and that Mr Q had not sold his property. He referred the matter to the police on Mr Q’s behalf.

As we had not received sufficient evidence from the buyer’s solicitor in respect of the signature verification for Mr Q, we cancelled the transfer application and the sale wasn’t registered.

If Mr Q had signed up for Property Alert he would have received an email alert when Land Registry had first received notification that a transfer of ownership would be arriving. He could then have looked into the matter sooner.

What is property fraud?
Property fraud can happen in many ways. For example, fraudsters may steal someone’s identity and attempt to acquire ownership of a property by using forged documents. The fraudsters may then raise money by mortgaging the property without the owner's knowledge before disappearing with the money, leaving the owner to deal with the consequences.

Land Registry has stopped fraud on properties worth more than £66 million in the last five years. In a recent case, two fraudsters managed to pocket £50k by selling an empty home they didn’t own. Staff at Land Registry spotted the fraud before it was registered but the fraudsters got away with the money and are still wanted by police.

To use Property Alert homeowners and landlords can set up a free online account with the Land Registry.

Members can monitor up to 10 properties. Email alerts will be sent when Land Registry receives an application to change the register as well as for official searches.

Users can then judge whether or not the activity is suspicious and if they should seek further advice. For example, if you receive an alert that a bank has lodged a search on your property but you haven't applied for a mortgage, you may want to seek legal advice, contact Action Fraud, or contact the bank in question to tell them you are the owner and have not applied for a mortgage. Investigations into the authenticity of the mortgage application can then begin much earlier in the process.

The Land Registry says properties most likely to be at risk from property fraud include tenanted properties, empty properties, properties where there are family disputes, or properties without a mortgage.

 

  • land registry
  • Property Alert
  • Fraud
  • Property fraud
Categories: News feeds

Zoopla to launch new radio campaign

Estate Agent Today - 8 September 2014 - 1:00am

Zoopla Property Group (ZPG) has announced that it is about to launch its biggest ever national radio campaign across over 40 radio stations in a partnership with Global Radio.

The news comes as ZPG is also reporting record lead levels being sent to its members from its websites. 
 
The new radio campaign which will run for the next six months will encompass both the Zoopla and PrimeLocation brands and includes sponsorships, advertisements and competitions across the Global network of stations including Capital, Heart and Classic FM.
 
And in a sign that the market is hotting up following the summer break, ZPG has set multiple new records for traffic and leads across its platform over the past couple of weeks. The record lead levels are a positive sign of things to come in the property market as portals provide a leading indicator of consumer activity and appetite to transact.
 
Alex Chesterman, founder & CEO of Zoopla Property Group, said: “We are delighted that we continue to grow our market share and set new records of performance for our customers. And we are very excited about our new marketing initiatives including the radio campaign set to launch imminently.”
 

 

  • zoopla
  • radio
  • global radio
Categories: News feeds

The public sector equality duty and priority need

Nearly Legal - 7 September 2014 - 9:57pm

We are (or more accurately I am) a bit late on this one. It is quite important though and the fact I have only just written it up should not detract from that.

In Kanu v Southwark LBC [2014] EWCA Civ 1085, the Court of Appeal considered whether the public sector equality duty added an additional obligation on housing officers when they came to consider whether an applicant had a priority need. As you will all know the public sector equality duty is an obligation placed on public authorities by s.149, Equality Act 2010 to have due regard to the need to eliminate discrimination, harassment, victimisation; advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it; and foster good relations between persons who share a relevant protected characteristic and persons who do not share it. Broken down, when someone is disabled, the duty further requires an authority to have due regard to the need to take steps to take account of a person’s disability.

As you will also all recall in Pieretti v Enfield LBC [2010] EWCA Civ 1104 (our note here) the Court of Appeal held that the duty (under the previous equivalent provision s.49A, Disability Discrimination Act 1995) required a reviewing officer to carry out inquiries into an applicant’s disability that the Housing Act 1996 had not previously required, i.e. where the applicant had not raised the issue but the reviewing officer was on notice that there was a possibility that the applicant’s disability would be relevant to whether they were intentionally homeless or not.

In this case Mr Kanu suffered from a mental disorder which had caused him to experience psychotic depression. On occasions he had also had suicidal thoughts. At the date of his application he was receiving treatment for this disorder as an outpatient as well as medication. A medical adviser, employed by the authority, was of the view that his mental disorder would greatly inhibit his ability to care for himself. Mr Kanu relied on two additional medical reports from two consultant psychiatrists.  One thought that Mr Kanu was exaggerating his symptoms and could not be certain as to the extent of Mr Kanu’s mental disorder. The other was satisfied that Mr Kanu was suffering from psychotic depression but agreed it was hard to diagnose precisely because Mr Kanu’s accounts were not always consistent.

The authority none the less were not of the view that he had a priority need because, with the assistance of his family, he could cope with day to day living and would be able to fend for himself. This decision was subsequently overturned on appeal but the authority reached the same conclusion after the second review. Mr Kanu successfully appealed again to the county court. The Recorder found that decision was flawed because (1) the reviewing officer had failed to consider the fact that Mr Kanu’s mental health was deteriorating, (2) irrationally decided that Mr Kanu could access medication while homeless when there was no evidence that he could, (3) the evaluation that Mr Kanu could cope with the help of his family was “unfair” as opposed to irrational and (4) it failed to properly consider the public sector equality duty.

The authority successfully appealed to the Court of Appeal. The Court of Appeal dealt with the first three points relatively quickly. The evidence did not demonstrate that Mr Kanu’s mental health was worsening and also demonstrated that Mr Kanu could continue to access medication from his GP and the hospital where he would continue to be an outpatient. Moreover, the evaluation that the applicant would be able to cope if street homeless with the assistance of his family was not irrational and therefore could not be interfered with.

In respect of the public sector equality duty, the Court of Appeal accepted the authority’s contention that in a priority need case the public sector equality duty did not require it to do anything more or extra than it was required to do so under s.189 anyway, i.e. it had to consider whether the person’s disability meant that they were vulnerable. It added nothing to the duty under Part 7 to consider whether he had a priority need. By applying the Pereira test (i.e. considering whether an applicant is less able to fend for themselves when homeless than the ordinary homeless person so that injury or detriment will result) the authority is taking due steps to take account of the applicant’s disability. Section 149 did not require any additional analysis to that which was required by Part 7.

More controversially, in response to a submission by Mr Kanu’s counsel, the Court of Appeal also held that s.149 did not require the review officer to seek further medical evidence as to the effect of an applicant’s disability if the reviewing officer would not be required to under Part 7. This was because the duty added nothing to the obligations under Part 7.

Comment

I am frustrated by this decision. I am in complete agreement that the public sector equality duty added absolutely nothing to this case. What more inquiries could there have been? He already had two consultant psychiatrists giving an opinion. I would also go so far as to say the same for the vast majority of priority need cases. I am less certain, however, that it is right to say that in every case it won’t ever be relevant. In R (Brown) v Secretary of State for Work and Pensions [2008] EWHC 3158 (Admin), at [85], it was held that s.49A (now s.149) requires the public authority to “have due regard to the need to take steps to gather relevant information in order that it can properly take steps to take into account disabled persons’ disabilities in the context of the particular function under consideration.” This has become known as the duty of enquiry.

There is an interesting point (which appears to have been raised by Mr Kanu’s counsel although the judgment doesn’t do it justice if it was) as to whether the duty of enquiry under s.149 is more onerous than the duty under Part 7. The Court of Appeal, however, completely ducked the issue finding that the duty under s.149 added nothing to any obligation under Part 7.

I am not so sure that is correct though. The one crucial difference between s.149, 2010 Act and s.184, 1996 Act is that it is for the authority to determine the extent of its inquiries under the 1996 Act, subject to a Wednesbury challenge. While an authority must make all “necessary” inquiries it is for them to decide what those inquiries are and a court will not interfere with the decision even if further inquiries may have been sensible or desirable if the decision is not irrational. In contrast it is for the court to determine if s.149 has been complied with; the authority cannot hide behind a defence that it has acted reasonably. If the court thinks a further inquiry was necessary and it hasn’t been undertaken then the duty under s.149 has not been complied with. Does that mean that in practice s.149 may require more extensive inquiries than under Part 7 in certain cases? Apparently not. We have no idea why though. In my view that’s a shame because it is not obvious and it is not even clear that the Court of Appeal took the point.

We deserve better.

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