On the announcement of the recent Tenant fee ban there was further blow to Landlords and Agents on hearing that from the 1st of June 2019 we will no longer be able to hold more than 5 Weeks Rent as a Deposit. This will now be the law and we must also refund any surplus on deposits we already hold at renewal stage which is just an administrational nightmare. This is for all Agents and Landlords and any person failing to follow this will be breaking the law and susceptible to very costly fines.

With this now in place Landlords and Agents will have to protect themselves better from the offset and ensure we are choosing the right Tenants to look after our properties.

How do we do this?

Firstly, I can’t see Landlords being as flexible on accepting pets with the new cap in place, most contracts would state that professional fumigation would be required by Tenant at end of tenancy which can be pretty costly in itself and that’s before any other cleaning or damage that might need to be accounted for. I can’t see there being enough room in the deposit, especially on the lower end monthly rental figures. For this reason, Landlords may have to restrict renting to Tenants who have pets.

The reason why 6 weeks rent worked for most is because we had a 1 month’s rent for potential rent arrears ( some Tenants decide to not pay the last month’s rent despite being told they need to)  plus a couple of weeks left for minor repairs and or cleaning. Two month’s rent would have been the norm for pets to allow for fumigation plus the above and in other more risky tenancies we may have charged more to protect ourselves.

Another area we might need to look at is ensuring rent protection is put in place for every tenancy, this would mean Landlords have peace of mind that they will get their rent payment no matter what and also be able to use this at the end if the Tenant doesn’t pay their last month’s rent, leaving the full deposit for any dilapidations. We could further protect our financial risk by also having a guarantor, this is really as much as we can do as Landlords/Agents before taking full rent in advance for the whole term.

Make sure you have an agent who has your best interests foremost and that is fighting to find you the best tenant not fighting for personal commission. In an industry full of young negotiators all on a low basic with strict targets it’s hard to avoid the “let and forget attitude” as I call it. I feel for the trainees as it’s a very tough and target driven industry but at the same time it’s no good for Landlords. This was one of the reasons I chose to leave agency and set up on my own, none of my colleagues I work with now are on personal commission or targeted, we all work as a team and only want the best for the landlords we look after.

The dispute centres are set up to protect tenants therefore it is fundamental that Agents and Landlords are setting up new tenancies accurately and ensuring Tenants understand their checkout obligations.

There are plenty of Landlord’s out there who take the mick when it comes to deposit deductions and those wanting to charge tenants need to first of all make sure they have offered the property in the best condition at the start of the tenancy. They also need to make sure they have done their job as managing agent by paying regular visits to their tenants and to advise the tenant throughout the duration of any issues they may face at the end.

Paper trail is crucial for this, without it you might as well not even hold a deposit.

There are lots of cases in which the dispute centre has (in my opinion) favoured a tenants case too one sided, for example only last week I had a landlord who lost a claim for replacement carpet on a brand new carpet that was supplied to a tenant of which they burnt badly with an iron. With her high standards as a Landlord she chose to replace this for the new tenancy again and was only awarded a £50 contribution towards the cost of her new carpet from the dispute centre, something of which I will never understand nor agree with.

Its normally always better for a landlord to try and settle outside of arbitration so communicate with your tenants and try to reach an agreement yourself!

It’s hard to not feel that as a Landlord you have little protection and the only way to deal with that is to accept it for what it is. Don’t have unrealistic expectations that your Tenant is going to leave your property immaculate and don’t assume you will win your disputes regardless of how black and white it might be, assume the opposite and hope for the best.

Also remember no Agent in the world can guarantee a risk free Tenancy, don’t expect them to provide the impossible…. us Agents can’t wave a magic wand and get your Tenant to pay rent or have them keep the house clean and damage free, its simply unrealistic!

Remember it’s a business, it’s not personal. No business is plain sailing, no tenant or tenancy is perfect and you may have trouble along the way. If you can adjust to this mind set and remember that the tenant that may have left a burn mark on one of your new carpets has also paid your mortgage for the last few years you will be a much happier and content Landlord.