LETTINGSnews
TENANCY DEPOSITS
TDS Announces new CEO
Steve Harriott has been appointed Chief Executive Officer of The Dispute Service, which runs the Tenancy
Deposit Scheme (TDS). The TDS says that Steve has
significant experience as a management consultant and as a housing association chief executive at Origin Group in North London and at AmicusHorizon, a 28,000 unit housing group based in the South East. He said, “I am delighted to be
appointed as Chief Executive of TDS and am looking forward to creating a customer focused and efficient organisation in partnership with our key stakeholders in lettings”. This will not be an easy task;
following the debacle with fee increases and the management of related complaints by members of the scheme. Several significant members left the TDS, taking their business to the MyDeposits or the DPS, others question the financial security of the organisation. Professor Martin Partington, who took over as Chairman in
INSURANCE
Tenants’ damage and distress dissolved! A new Tenant’s Content
The risk of expensive delays in re-letting rental property caused by substantial dilapidations
found at the end of a tenancy is set to grow as tenancies last longer and the probability of time- consuming damage replacement increases. Many problems, such as damage to carpets, are seldom reported by tenants as they happen but are left to show up at the inventory checkout. Shocks at checkout are bad for
everyone’s cash flow. Landlords and agents need to re-let quickly and tenants need their deposit back as soon as possible.
52 SEPTEMBER 2010 PROPERTYdrum
insurance with an easy payment plan has been designed to encourage tenants to report problems well before it is time to re-let. The cover, launched this month by Let Insurance Services, is tailored to the needs of both landlord and tenant and is highly competitive within the general insurance market. This is important factor because
tenants insuring their own possessions are tempted to take out low cost policies from supermarket providers. However, these rarely provide proper cover for the tenant’s liability for accidental damage to the landlord’s property under the terms of the tenancy agreement.
Tenants also gain from taking
out the specialist cover. It encourages them to report accidental damage so enabling repairs and replacements to be organised before the end of a tenancy. This makes for fewer delays in settling the negotiations for the return of deposits. Not having to pay upfront is a
further aid to tenants’ cash flow. Tenants have found it difficult to commit to a fixed period of insurance and paying for it in advance. The additional cost of insurance at the start of a tenancy has been a major cause of tenants going to cheap providers. Now there is a cover with a monthly payment plan, automatic renewal and which can be continued if the
tenant should move to another rented property. Launching the new Tenants
Contents policy, Michael Portman, MD of Let Insurance Services explained, “Proper cover cuts down on check-out shocks. We have designed this new policy to be easy to set up with no renewals to worry about, to provide easier checkouts and quicker re-letting if there has been damage and an additional income stream for agents,” Let Insurance Services also provides advice and guidance on marketing the policies to comply with OFT regulations. There are promotional
incentives for agents to launch the new policy.
May, has made great efforts to apologise to members for the problems and taken action to rectify the ‘short term financial position’ of the scheme. In a letter to members Prof. Partington said that, “We are committed to improving transparency”. There is more work to do to balance the number of disputes received and the costs of reviewing those disputes, alongside the even more crucial task of ensuring that the TDS will manage to renew its franchise next year. Prof. Partington says, “We are in
constant dialogue with the CLG. They have been made fully aware of our difficulties and have understood the plans which have been implemented to address them. CLG has not given us any indication that TDS will not be invited to tender for the contract renewal in 2012. We have been told that they do not expect the form of that tender process to be decided until this Autumn, so we are unaware whether the renewal will be open to new applicants or with the existing providers”. Steve Harriott sounds like an able man for the job and we wish him every success in his new role.
RENT ARREARS Councils to blame for rent arrears
Recent reports by the NLA (National Landlord Association) found that fewer landlords
are experiencing rent arrears, suggesting that more private tenants are keeping up with their rent payments. However, FCC Paragon, the tenant referencing arm of Paragon Advance, is finding a growing number of LHA (Local Housing Allowance) tenants falling into arrears through no fault of their own. With a cap on housing benefit from April 2011, there is a fear that the situation will get worse. With high demand and low supply of rental properties, Kerry-Anne Dowdell, Credit Management Manager for FCC Paragon’s warranty products, believes councils are not doing enough to assist private landlords and LHA tenants, “Due to how local housing allowance is paid, many LHA tenants can find themselves two to four weeks in rent
“Councils encourage tenants to stay put until the bailiff comes!”
arrears. Whilst landlords blame tenants, quite often tenants have submitted the relevant paperwork but it is the council who are holding up the process due to protocol. The problem we are encountering, is that local councils encourage tenants to stay put until a bailiff or possession date comes through, which creates growing tension between tenant and landlord, and as a result we are having to intervene much more in order to resolve issues for our clients. “Our advice to landlords is
to contact your council as soon as your tenant is in arrears so that the investigation process can get underway.” However, councils will not talk to a landlord about a claim unless the claimant has given written permission to do so, so if a tenant believes the council are holding up the process, landlords need to seek permission from the tenant so that they can intervene. Landlords are advised to
take out adequate rent warranty and legal expenses cover to avoid a potentially stressful and costly situation. “We have found that building a relationship with both tenant and landlord to offer timely mediation can resolve an issue” says Kerry-Anne.
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