How to ensure you don't appear on any 'rogue landlords' database
We recently shared the updated legislation and penalties for criminal landlords, which includes a new 'rogues' register of blacklisted landlords and agents, held by the Department for Communities and Local Government (DCLG). In this article, landlord expert Kate Faulkner explores what steps can you take to stay well away from appearing on this 'rogues' database.
1. Get help from a letting agent
The best solution is to have your property professionally managed by a letting agent who is a member of a self-regulating organisation, such as the Association of Residential Letting Agents (ARLA) Propertymark, UKALA or the Royal Institution of Chartered Surveyors (RICS).
A member agent will take time to know the legalities associated with your buy to let and will advise you of any steps you need to take yourself. They will also have:
- High standards, operating under a code of conduct. Without regulation, the 'good guys' have so far tended to 'self-regulate' by joining trade organisations that lobby on their behalf and also provide training for their members. They also require their members to meet minimum operating standards and typically to abide by a code of practice to protect consumers.
- Knowledge of local and national lettings legislation. The organisation they belong to will keep them up to date with all upcoming changes to the law and most have a legal helpline that provides information and advice if the agent is confronted with a situation they haven't come across before.
- Client money protection (CMP). This is an insurance policy taken out by the agent, which covers both you and your tenant in case the agent goes bust or runs off with your rental monies. Having CMP will soon be a legal requirement, so if an agent still doesn't have it, it may be an indication that they have not been 'accepted' by an insurer and they are therefore are best avoided.
2. Be ready for upcoming regulation of all agents
In October last year, the Government announced that it will change the law so that all letting agents and property management companies in England (such as those that look after leasehold flats) will be regulated. Although no date has been announced, it may come in this year or early in 2019.
Every company will have to register with 'an appropriate organisation' (such as ARLA Propertymark, RICS and UKALA), and adhere to a minimum set of training standards, which, for letting agents, will include understanding the 150+ laws and 400+ rules and regulations governing the sector.
The Government also intends to make membership of a CMP scheme mandatory for letting and managing agents in England – again, that may come into force later in 2018.
Good agents will belong to an approved industry organisation, which means they are already compliant with this new legislation. However, if your agent doesn't currently comply, it is advisable to switch to one that does.
As well as the cost implication, agents who wish to join an organisation have to demonstrate that they meet certain standards in the way they operate their business and can satisfy insurance companies' requirements for CMP. As such, some agents will almost certainly be forced out of business; those that do get approved are likely to pass on the cost of compliance directly to their landlords.
3. Keeping up with your legal obligations as a self-managing landlord
If you decide not to use an agent, you need to have a way of keeping up with the law yourself so that you can be sure your lets are always legal. There are a lot of new rules and regulations coming into play over the next few years, so make sure that you join a landlord association, such as the Residential Landlords Association, which provides regular training programmes and legal updates.
To make sure you don't fall foul of the law and end up on a database, it's vital you understand your responsibilities for maintaining a legally let property that's safe for your tenants. That includes:
- Carrying out a condition check at the start of the tenancy
- Ensuring electrical circuits and appliances are safe
- Having a gas safety check carried out each year
- Maintaining heating and water systems
- Keeping the property free of damp, condensation and mould
- Ensuring furniture meets fire-safety regulations
- Testing smoke detectors at the start of each tenancy
You must also adhere to any national and local licensing requirements and carry out 'right to rent' checks to ensure your tenants are living in the UK legally.
Kate Faulkner is one of the leading, independent property experts in the UK and regularly features in major newspapers; on BBC, ITV and regularly co-hosts the Property Show on LBC.