Buy to let and not to be let down

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If you are a landlord, including perhaps a buy to let one (ever conscious of the recently less beneficial tax position and further consequent need to try and minimise rent voids arising from problem tenants), here are a few reminders on some legal things to look out for in relation to your residential tenants who are on Assured Shorthold Tenancy Agreements (i.e. the default position for new tenants).

This is not least increasing the number of hoops that a landlord has to jump through to be able to serve the no fault minimum 2 months’ section 21 notice to quit on a tenant expiring on or after the end of the fixed term of the tenancy agreement.

Deposits

Deposits and Section 21 notices

Landlords will not be able to use the section 21 notice to quit against tenants (i.e. a minimum 2 month’s notice in prescribed form expiring not earlier than the end of the fixed term of the tenancy) if the landlord has not complied with the tenancy deposit protection rules, which are:

  • The deposit must be kept in a government backed scheme.
  • The deposit must be put in such scheme within 30 days of receiving it (or, if the deposit was received before 6 April 2007, by 23 June 2015).
  • The tenant must be given the required information about where the deposit has been placed.

If the rules have not been complied with then it would be safest to return the deposit to the tenant before the section 21 notice was served.

Deposits generally

If the tenancy deposit protection rules have not been complied with, and depending to an extent on how much they already know about letting properties, the landlord may also be liable for paying a fine to the tenant at up to three times the amount of the deposit.

The adjudicator of the scheme (or the court if a landlord or tenant has made a court application for this) deals with disputes about the return of the deposit.

Section 21 notices/section 8 notices

Section 21 notices

The Assured Shorthold Tenancy Notices and Prescribed Requirements (England) Regulations 2015 brought in with effect from 1 October 2015 a new prescribed form for the section 21 notice. The legislation also says that if the landlord does not provide:-

  • a copy of the gas safety certificate;
  • energy performance certificate; and
  • government produced ‘how to rent’ booklet;

to a tenant then a landlord will not be able to use the section 21 notice to quit. This is in addition to the need for the deposit protection rules to be followed by the landlord.

Section 8 notices

Fairly recent caselaw (Masih v Yousaf 2014) has confirmed the importance of the correct form and wording being used for section 8 notices. Section 8 notices are used when a landlord wants to get a tenant out for tenant breaches of the lease, including rent arrears.

Repairs

Whatever the terms of the tenancy agreement might say, under sections 11 to 15 of the Landlord and Tenant Act 1985, landlords are responsible, for residential tenancies with a term of less than 7 years, for keeping the structure and exterior of the property in repair, and also for its sanitary and heating facilities.

Under legislation tenants can also get local authorities to bring enforcement action against landlords for breaches of these obligations by serving improvement notices.

Since 1 October 2015, a landlord cannot serve a section 21 notice if there is an improvement notice that has not been complied with.

This also shows the continued importance for a landlord to make sure that there is a good check in /out report prepared for the property. Not least to show when disrepairs are as a result of tenant caused damage going beyond fair wear and tear. Such a check in/out report is also helpful with the resolution through the deposit scheme adjudicator /court of any post tenancy dispute about the amount of the deposit which is to be returned to the tenant.