RESIDENTIALlettings
Letting update
The letting business can throw up an endless variety of troublesome issues. Here’s some useful answers to some real life problems.
CounCil Deposit Guarantees
Q I have been contacted by my local authority to provide a tenancy for one of the people on their housing waiting list. They will not be taking on the tenancy themselves, as has happened in the past; it will
be directly between the tenant and the landlord. But they have offered to provide a council backed tenancy deposit guarantee as the tenant is unlikely to be able to pass any form of referencing. She has a small child and will probably be on Housing Benefit. Are there any potential problems?
A Setting aside the problems associated with the payment of the Housing Benefit (local housing allowance) which are significant, the direct tenancy is not nearly as good for the landlord as a tenancy with the local authority. You should be aware of any limitations on the extent of the council’s guarantee. Is it limited to arrears of rent, does it have any limitations on the amount that they will pay in the event of a breach of the tenancy? You have to be aware that it is unlikely that you will be able to recover anything not covered by the council guarantee from the tenant. In these cases an agent needs to make a commercial decision as to whether the clear risks in these types of cases are worth the risk to the landlord and then advise the landlord accordingly.
a Granny flat
Q I have been approached by a potential landlord who converted part of his house into a ‘granny flat’ for his wife’s mother. Unfortunately she has recently died and he wants to rent it out. There are no separate utility meters and access to the flat is through a common hall. Are there any problems that I should be aware of in creating such an agreement?
A I think that the first thing to do before you proceed any further is to request the landlord to get confirmation from the local authority planning department that when the original ‘granny flat’ permission was granted it was not limited in any way and that there is no planning problem in letting it as a separate dwelling. We have come across cases where, in similar circumstances, the local authority objected to the letting as it no longer comprised a ‘single dwelling’ for planning purposes. Once that is clarified, a tenant could then be sought and the
tenancy will likely to be out with the Housing Acts 1988 & 1996 as there is a resident landlord. A common law or general tenancy agreement should be used and the deposit, if taken, would not be covered by the Government’s tenancy protection schemes.
52 MARCH 2010 PROPERTYdrum
Gas barbeCue
Q One of my landlords has asked me what regulations might apply where a landlord leaves a gas barbecue at a property that he is proposing to rent out. I don’t know. Can you help?
A Portable or mobile gas appliances supplied from a cylinder must be included in the maintenance and annual check; however they are excluded from other parts of the Gas Safety (Installation and Use) Regulations 1998. The Gas Cooking Appliances (Safety) Regulations 1989 relate to the supply of all equipment for cooking purposes by means of burning gas. Included is all equipment designed or suitable for domestic use in a dwelling, ship or caravan. The Regulations require that all gas cooking equipment supplied in the rented property is safe, and that where the safe use of the equipment relies upon the user being aware of any particular characteristic, suitable information or instruction booklets must be provided. The necessary information may take the form of markings or recognised graphic symbols on the equipment itself, or where this is not practicable, on a notice accompanying the equipment. The Regulations include provisions concerning risk of injury arising from: the combustion or escape of gas; the surface temperature of parts of the appliance; the breakage of any glass components; and the stability of the appliance Inadequate instructions, markings and warnings should be
given where such information is necessary for the safe use of the appliance. The instructions should be given in the English language. The easiest action, of course, is to remove the gas barbecue from the property!
CommerCial or resiDential tenanCy?
Q One of my landlords has asked me what would happen where a previous agent had removed the clause restricting the tenant from running a business from the tenancy. The landlord was concerned that he will not be able to obtain possession of the property at the end of the tenancy with the standard section 21 notice. The landlord’s solicitor has served a section 25 notice requiring possession under a commercial tenancy.
A Unless there is more to this, I believe that the landlord’s solicitor’s advice is incorrect. The Landlord and Tenant Act 1954 Part II applies to “any tenancy where the property comprised in the tenancy is or includes premises which are occupied by the tenant and are so occupied for the purposes of a business carried on by or those and other purposes.” However, the business use must be significant and not incidental to the residential use. Unless this is the case, and that will depend on the individual facts of the case, you should continue to use a section 21 notice to terminate the tenancy.
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