When landlords lose out

Mira Bar-Hillel5 April 2012
The Weekender

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As people become increasingly disillusioned with conventional financial investments, they are buying property and becoming landlords. However, few are given proper advice about what can go wrong. Letting agents, anxious to get their fees for finding tenants, sometimes do not take proper references, allowing unsuitable individuals to occupy properties.

Around one in 10 lettings goes wrong, according to figures compiled by landlord insurance organisations, and a clever tenant can easily take advantage of the law to delay eviction at the landlord's expense. Jonathan Chippeck of Landlord Action (020 7267 3344) says tenants are advised by solicitors, local councils and Citizens Advice Bureaus on how to delay or defend eviction notices. The notices are often too complicated and are easy to get wrong, which can work in the tenant's favour.

"Many councils are advising tenants not to leave at the end of their assured shorthold tenancy until they have received the eviction notice, or they will not be rehoused," Chippeck says. "This is not true, but allows the council to save on rehousing.

"When a court summons arrives, all the tenant has to do is write a false defence on the court form or turn up at court with a false claim. Busy judges will readily adjourn the hearing for up to two months, during which time no rent is paid.

"Some tenants don't turn up at court at all, but when an order has been made against them they put their defence in, which will get them another few months rent-free. Court bailiffs are over-worked and many tenants know they can get the bailiff's warrant suspended just before the eviction day, which will also buy them more time."

THE WADDELLS: DISCOVERED THEY WERE HOMELESS

Phillip and Mary Waddell let their onebedroom flat in Croydon when they went abroad to work for a charity. When they returned in August 2001, they discovered they were homeless. Their tenant owed £6,000 in unpaid rent and refused them access to the property, which he had damaged while living there with eight of his relatives. The letting agent had failed to collect the rent and failed to serve proper eviction notices when he refused to leave. The Waddells sought advice immediately, but it still took them three months to get rid of the tenant who left in October, the day before the bailiff was due to evict him.

What they should have done:

It is dangerous to trust a letting agent, especially when you are going abroad. However, an agent who is a member of the National Approved Letting Scheme (01926 866633) or the Association of Residential Letting Agents (0845 345 5752) will at least have a complaints procedure. It also makes sense to sign an agreement making the agent responsible for rent and damage.

BERNARDO DE QUIRO: HIGH RENT DID NOT GUARANTEE SECURITY

A letting agent found a tenant for Bernardo de Quiro's Pimlico flat, for which he was asking £3,250 a month in rent. In September 2000, When the rent arrears reached £15,000, Mr de Quiro decided to began eviction proceedings. However, he didn't get a judgment and a bailiff date until March 2001, by which time the tenant had disappeared.

Mr de Quiro lost more than £19,000 and is now facing financial hardship.

What he should have done:

It is easy to assume that anyone offering to pay a high rent will have the resources to do so. In this case, proper references should have been taken and the agent should have been made legally responsible for the rent.

DANNI AND SARA CAINE: TENANT DID NOT PAY

Sisters Danni and Sara Caine work for letting agents and thought they would have no problems when they let a flat in Northwood, Middlesex, in November 1999. However, their tenant worked for a legal firm and used his knowledge of the law to his advantage when they started eviction proceedings after he defaulted on the rent.

He delayed his eviction by six months by promising the sisters, and the court, that he would pay. It took the Caines six months to get a date for the bailiff to take action. The tenant left at the end of October 2001, the day before the bailiff was due. The sisters are trying to sell the property, and to recover the tenant's £10,000 rent through his employees.

What they should have done:

Not much. It is depressing that people working for letting agents can become victims.

THE BRADYS: NOW BELIEVE THEY RENTED TO A PROFESSIONAL CONMAN

In July 2001, John and Aileen Brady let a flat in Pinner, north-west London, to a man they now suspect was a professional rent conman. When the rent arrears reached more than £5,000 they tried to evict him. However, he filed a false counterclaim in court and delayed the action by promising to pay up, which he then failed to do. He did, however, gain an extra three months in the flat, rent free. He was finally evicted at the end of October 2001, but it had cost the Bradys £6,000 in rent arrears and £2,000 in damage, which they have no chance of recovering.

What they should have done:

It is likely that proper vetting of this tenant would have exposed him. Credit-rating agency Experian will carry out vetting for landlords. Visit its site at www.tenantverifier.com or call 0115 992 2493.

ALEXANDRE BRADBURY: TENANT REFUSED TO MOVE

Alexandre Bradbury thought she was letting her flat for 14 days in December 1999, but ended up with a nine-month battle and losses of more than £18,000. She allowed a tenant to move into her Earls Court flat without a written agreement. When the fortnight was over he refused to move out or pay rent. Her original lawyers issued incorrect proceedings for squatting, which the tenant successfully challenged. Correct proceeding were then issued, but the tenant produced a defence which won him an additional three months in the flat, during which time he refused to pay rent. He was finally evicted in September 2000. As a result of the experience Ms Bradbury has sold the flat.

What she should have done:

Never let anyone into a property without a clear legal agreement. When in trouble with a tenant, choose a solicitor or agent with a specialist track record in dealing with this problem, because mistakes by lawyers will be expensive.

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