Landlords spend a lot of time working with letting agents or by themselves to attract the best calibre tenants possible.
Letting out a property does involve an element of risk and selecting the right tenant is perhaps one of the major decisions that many landlords have to make. Concerns range from the tenant’s financial ability to pay rent to the care they will take of the property. As a result, landlords ideally target tenants with stable, well paying jobs who are more likely to stay in a tenancy for the long term.
The case of the Wilson’s
Landlords have been in the national news recently with due to the case of Fergus and Judith Wilson. They are one of the largest private landlords and rent over 1,000 properties spread throughout the South East of England. The Guardian have branded them
‘Britain’s most controversial landlords’
as they have begun to evict tenants who have more than two children, tenants on zero hours contracts and tenants where the grandmother has come to stay, while they have previously evicted tenants on housing benefits.
In a released statement, Mr. Wilson said:
“I have taken the decision to evict all families with more than two children and also three-generation households
Most of our houses go to childless couples. However, after a couple of months there are four, five, six children and I have to evict the family. The tenancy has been taken by deception”
It would appear that their aim is to sell their entire rental portfolio with the expected windfall anticipated to be in excess of £100m.
Tenants on Zero Hour Contracts
This recent coverage raises an important question for landlords as to whether they will accept new tenants on zero hour’s contracts and also should they evict existing tenants in the same situation.
The fact that many people on zero hour contracts will encounter difficulties when searching for a rental property or retaining their rented home does not really tell us anything new about landlords in general.
From the perspective of the landlord, those on zero hours contracts are not guaranteed work hours and consequentially there is no guarantee that they will have any money at the end of the month and therefore they are likely to find it difficult to pay the rent.
Unlike the Wilson’s, there are many landlords who let out a single property or just a few flats. Non payment of rent in this scenario will inevitably impact any mortgage payments or bills that the landlord is liable for. These landlords will as a result be particularly keen to attract tenants not on zero hour’s contract but rather those in full time stable employment.
What does the law say?
Landlords evicting tenants has made headline news in the past. In the early 1960’s, Peter Rachman was a notorious landlord who rented out properties in the Notting Hill area of London. He was so notorious for his poor treatment of tenants that a word was added to the dictionary. That word was ‘Rachmanism’ and it was defined as ‘The exploitation and intimidation of tenants by unscrupulous landlords’
The actions of the Wilson’s are not comparable to those of Mr. Rachman. What Rachman was accused of doing was in fact illegal while what the Wilsons are doing is clearly legal.
Rachman drove out what were then called “sitting tenants”, who had legal protection from their landlord and filled his properties with immigrants from the new Caribbean communities that were settling in Britain at the time. Those immigrants did not have any legal protection and as a result, Rachman could charge them what he wished.
Under current legislation the Wilsons do not have to justify their actions and are more than entitled to evict tenants from properties that they own. However it is precisely because what they are doing is legal that has so many people calling for changes in the law. (see discrimination in rented property)
One result of Rachman’s actions, and the public anger it generated, was the Rent Act of 1965 which gave far greater security to tenants.
Changes to the law
Landlords are already witnessing changes to legislation with many local authorities now making it mandatory that rented properties have licences. This is a requirement in the London Borough of Newham and it is spreading to other parts of the country.
In addition to this, the Immigration Act Landlords Scheme which comes into affect from 1st December 2014 is a scheme where landlords are required to check the immigration status of prospective new tenants.
At first all new tenancy agreements starting on or after 1 December 2014 in Birmingham, Walsall, Sandwell, Dudley and Wolverhampton will be covered under the scheme. The landlords in these areas will need to check that prospective tenants have the right to live in the Britain before letting a property to them. The act also covers those with lodgers and those who sub-let their properties.If a landlord or sub-letter breaks the rules, they can be fined up to £3,000.
The government has also recently given its backing to a bill, the aim of which is to prevent landlords from evicting tenants who have complained about disrepair in the property they rent. The draft bill (in its current form) seeks to prevent a landlord from serving a s.21 notice on a tenant within 6 months of receiving a notice of repair. The details are still under discussion but it is something that is being watched eagerly by those in the letting industry, many of whom have voiced concern over how such a law would be made work-able
Looking to the future
There are many landlords who believe that the rented sector already has a number of protections and far too much “red tape”. However, what is clear is that this is likely to increase over the coming years and stories such as those focusing on the Wilson’s are only going to become more common and increase the calls for greater regulation.