Regulation & Law
News articles looking at national legislation and local regulation and the application of law to the residential property industry.
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Lettings sub-contractor jailed for eight years after huge cannabis farm network found
A man who worked as a lettings manager and builder has been jailed in Liverpool for eight years after using his network of 33 properties to set up a cannabis farm that turned over £7 million. For a period of two and a half years beginning in February 2015, 52-year-old Robert Zielinski sub-let the properties off legitimate letting agents and landlords in the city and promised to either find tenants for them or do them up, Zielinski got access to the properties by saying he could find a large supply of tenants from the Polish community and help rent out properties on a large scale. But instead Zielinski (pictured, left), who is from the Toxteth area of Liverpool, began growing cannabis at many of the addresses and, when arrested in July, some 9,500 plants were discovered at the houses with a street value of £7 million. “The growing of cannabis brings dangers to neighbouring properties because cannabis farms pose a very serious fire risk,” says Superintendent Mark Wiggins. “There will generally be a number of hot lamps hooked up to dangerously overloaded electricity sockets as well as an extensive watering system. “Clearly, electricity and water are never a good combination, and…
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Private Members Bill debated to force houses in UK to meet EPC Band C minimum
Agents may one day have to ensure homes sold in the UK meet a minimum EPC rating, as rental properties already do, it has been revealed. From April this year rented homes must meet the minimum Band E rating, something agents will soon have to police when advertising properties, but it appears likely that the proposed legislation for all domestic properties may lead to the same requirement for properties offered for sale. As “many homes as practical” will have to reach a minimum Band C Energy Performance Certificate if a debate in Parliament later today goes the way of green campaigner David Amess, MP. The conservative backbench MP has been granted time to debate a Private Members’ Bill to bring in the measure, which would come into effect in 2030 for ‘fuel poor homes’ and for all properties by 2035. Under parliamentary rules he will have ten minutes to argue his case for the new legislation, while an MP opposing the motion will then speak, also for ten minutes. MPs will then be allowed to vote on whether the Bill Amess proposes should proceed into law. Domestic Energy Efficiency Bill The MP for Southend recently spoke at a meeting of…
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Fake letting agent who scammed £10k off tenants is tracked down after going on the run
A fraudster who posed as a fake letting agent and pocketed £10,000 in deposits for properties he did not have permission to rent has been arrested after more than a month on the run. As we reported in December last year, James Bennett (pictured, right) was sentenced to six years in jail at the Inner Crown Court during a trial at which he faced 17 counts of fraud. The 32-year-old had listed numerous properties on SpareRoom.com over a 12-month period ending in December 2016, asking potential tenants for deposits for properties he did not own or manage, and pocketing the cash. Many tenants did not find out about the scam until they turned up at the properties to move in, only to discover that they were not available to rent. The listings were for four properties Bennett had lived in within south London and had fraudulently advertised to rent out while he was waiting to be evicted. In total Bennett took 17 deposits each worth £725 from tenants who were often so desperate to find accommodation in the capital that they made easy targets for his scam. Bennett was arrested in November 2016, made a full admission during a police…
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Rising cost of rental property licensing schemes revealed
In November last year The Negotiator revealed that the number of selective licensing schemes in the UK had swollen to 533 with a further 25 in consultation. But now the ‘lottery’ of fees that landlords face has also been highlighted, this time by the National Approved Lettings Scheme (NALS). Based on research it commissioned from independent information service London Property Licensing, NALS reveals the costs faced by many landlords in the capital to license their properties. It says these rising costs will force even more landlords out of the market, causing more pain for agents. For example, NALS says the licensing fees for a three storey House in Multiple Occupation (HMO) with five unrelated occupants can range from £125 in the City of London to £2,500 within Lewisham. Higher fees Faced with dwindling central government funding, councils also appear to be ramping up their licensing fees both for HMOs and selective ‘all property’ schemes. The London Property Licensing data reveals that in 23 of London’s 33 boroughs licensing fees are over £1,000 for HMOs. Also, average fees have climbed every year since 2014 and the average cost has risen by 12.9 per cent in 2016/17 and a further 5 per…
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Two property company’s websites investigated by advertising watchdog
How creative can an agent get about its company’s history? That question has been put under the spotlight after an agent in North London was reported this week to the Advertising Standards Authority (ASA) for claiming on its property website that it has been in business for a decade even though it was not incorporated until October 2015, Companies House records show. Huddletons, which operates out of an office above a restaurant in Camden and one director, appears to have changed its website to reflect the ASA request to amend its claim, now stating the more subtle point that it “has developed organically over the past decade from concept through to where it currently stands as a business”. Huddleton is not listed on either the NAEA or ARLA websites as a member but it is signed up to the Property Redress Scheme. But the company is not the only one investigated this week by the ASA over claims made on its website. Builder Crest Nicholson had an advert for one of its developments challenged by a complainant, who said an image was misleading because it showed a detached property when, on further investigation, it turned out to be semi-detached. “The…
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Tenant Fees Bill is last thing sector needs, Residential Landlords Association tells MPs
A group of MPs leading an investigation into the private rented sector and the draft Tenant Fees Bill got more than they bargained for yesterday afternoon when David Smith (pictured, right), Policy Director at the Residential Landlords Association (RLA) came in to give evidence. The Ministry of Housing, Communities and Local Government Select Committee had convened to hear from the RLA but also the National Landlords Association, a build-to-rent company called PlaceFirst, campaigning group Generation Rent and Citizen’s Advice about how best to police the private rental sector. It’s other task was to find out what the wider world thinks of the proposed lettings fees ban Blunt language David Smith, during a sometimes tour-de-force performance, told the MPs – who included former housing minister Mark Prisk – his views in sometimes blunt language during a two-hour session. His main points, some of which were echoed by the other people giving evidence, were: Fees charged by agents are charged at different levels and employed in varying ways all around the UK, so a blanket ban will be a blunt tool. It’s not true to say fees have been banned in Scotland – they’re now just post-loaded into tenancies, rather than being…
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Revealed: how much rogue estate agents are damaging the industry
The extent to which rogue estate agents are damaging the industry’s reputation has been laid bare today by new research. The problems are most acute in the private rental sector,but affect all of it. For example, 41% of tenants who used an ‘approved’ letting agent signed up to a professional body said problems with their property were fixed within a week, but only 25% of those used an ‘unapproved’ agent received the same service. The research, which covers transactions over the past five years and was completed by Propertymark, highlights the most common problems tenants encounter including poor property management, the slow replacement of faulty furnishings and white goods, and a reluctance to return deposits fast enough. Propertymark’s research also highlights a key challenge faced by the industry as a whole. Rogue estate agents Over a third of buyers and sellers, and 42% of renters don’t bother to check if the agent they are using has signed up to the key regulatory bodies or is a member of a professional organisation – leaving the door open for rogue estate agents. This is creating significant problems for the industry’s reputation, the research shows. Over half of all the buyers, vendors and…
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Two agents investigated by ASA over misleading online property ad complaints
Two agents have been investigated by the Advertising Standards Authority (ASA) this week for misleading online property ads following complaints from the public. The more serious of the two was a complaint about two digital adverts by Lincoln-based agency Mundys Property Services. One featured the claim that it offered “100% tenant satisfaction – Let with confidence – 100% of our tenants would be happy to let through Mundys again” and a second that included the text “Mundys… A customer survey about our services produced a 100% satisfaction rating”. The claims were based on a 2013 survey of tenants moving into properties let by the company. The complainant challenged whether the “100% satisfaction” claims were misleading because the survey didn’t canvass the tenants about the company’s overall service. After being approached by the ASA, Mundys said they would removed the ads and would not use the claims again – although at the time of publication the ad remains on one of its website home pages (pictured, left). Online property ads In a less serious case, Reeds Rains Ltd was referred to the watchdog after a complainant spotted a listing on Rightmove for a rented property that featured an expired 50% discount…
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Rogue agent: Ombudsman bans firm for 10 years over unpaid £181,000 award
In a shocking case of a rogue agent, a firm in Luton has been banned from The Property Ombudsman for ten years after failing to pay an award of £181,254 after it was found to have ‘deliberately’ not passed on substantial amounts of money to a landlord. Altavon Property Managemnet Ltd (APM), which was dissolved late last year but had been trading for three-and-a-half years prior to the award, was asked by a local landlord to manage 31 properties on their behalf based on a two-tier agreement. The landlord rented the properties to APM in return for a fixed return over a set period, leaving APM to manage and rent the properties to whoever they saw fit. By December 2016 APM was behind in rent payments to the tune of £57,000 and continued to miss payments, eventually leading the landlord to complain to TPO. Rogue agent After finding in the landlord’s favour, a large award was then agreed, based on the monies owed plus £200 for each missed payment and compensation for aggravation, distress and inconvenience. But APM failed to pay the award and, after being referred to its Disciplinary & Standards Committee, has now been expelled from TPO for ten…
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Letting fees ban will NOT become law until at least Spring 2019
The recently-renamed Ministry of Housing, Communities & Local Government (MHCLG ) does not expect the letting fees ban to come into force until Spring 2019, it has confirmed. In written evidence made this week to both the Select Committee hearings that scrutinised the draft legislation, and to the National Approved Letting Scheme (NALS), MHCLG has revealed that it will be at least 15 months before letting agents and landlords will no longer be able to charge fees to tenants. Introduced by Sajid Javid in November last year, the draft legislation was given a thorough savaging by experts during the hearing on Monday and will now go to a third reading in the House of Commons before moving to the Lords. letting fees ban MPs were told at the hearing by experts from Shelter and the University of York’s Centre for Housing Policy that a letting fees ban could easily lead to higher rents as banned fees were added by landlords to the rent over the length of each tenancy, and also reduce the quality of rented accommodation as landlords tightened their purse strings. “We’re pleased to see more clarity on the timetable for implementation of the ban – it’s much…
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