UK Landlord Forum / Life

Hi

I'm a newish landlord and am hoping for some advice please.

My tenants are pretty good so I've repaired/replaced where needed and things tick along nicely while I work full-time.  A few years passed and I noticed I was renting well under market value so met with my letting agents and agreed that I'd do 2 smaller increases 6-months apart rather than 1 to help the tenant to manage them.  I followed this up with the agents in writing by email.

The first increase was implemented a couple of months late so I chased them and finally it was dealt with.  I got lost in work but being on a short career break right now I'm looking through financials and agreements and realised the 2nd increase was long overdue (April 2018).  I met with the agents (the new Area Manager) and produced the emails and was told that the previous administration was poor and it had never even been discussed with my tenants.  He apologised and said all he could do was offer me a 3-month upgrade to the full management service to allow them to prove what it's normally like (I have the rent collection service per month usually).  In addition, the contract is wildly outdated and one of the tenants had even moved out a couple of years previously though a new contract has not been drawn up.  They've now offered to do this free of charge following me pointing it out at the meeting.

What are my rights here as I'm sure this must be part of the service I'm paying them for?  Not only have I lost the backdated increase in payments but the property is still below market value so should've been increased again this year and now I can't as it's not my tenants fault that this has happened.

I realise I should've been on top of this but work fully took over and I (wrongly now it seems) thought that the agent would be doing their job properly.

At no time have they ever advised that the income is under market value either although it was around £500 under per month.

Any advice would be really appreciated as I cannot find any online and I don't yet have the benefit of past experiences.

Many thanks all.

I would see this as an opportunity to change agents.The fact that they have not advised you of potential attainable rent for your area would be sufficient grounds.Your legal rights are zero in this situation,you can only vote with your feet.You could use another agent to find tenants,maybe protect deposit and do documents,but collect rent and do the rest yourself.You are not the first person to end up feeling let down by agents.As a general rule,you won't be able to play catch-up with the rent,but you could certainly start moving in the right direction.

Thank you so much for the reply.

It's really disappointing.  These tenants have been with us for around 6 years with just one party moving out leaving the other to continue the tenancy alone.  It doesn't seem that the necessary paperwork at that time was raised though the agents were aware.

Is it possible to keep the tenants and just leave the agents as they haven't done their job properly and have admitted that fact too?

If I were to go down the Ombudsman route there wouldn't be any compensation for loss of earnings due to the agents not carrying out their part (and only part at that) of collecting the correct rent?

Thank you so much for the advice.

I think as far as keeping the tenants and ditching the agents,you are on solid ground.If they tried it on,I would mention a complaint to any professional associations they belong to,and the Ombudsman.Both of these are a joke of course,but it might shut them up.Really,learn from this and move on,the only way to get your own back is to stop paying their commission.They sound even more useless than most.

If you did engage them on a Rent Collection offering, why do you think this should be part of the service they're supposed to be doing for you? From the description / name I don't. Possibly if you are on the all-singing all-dancing Full Management offering. Anyway, what they do for their (your money) should all be detailed in the Terms of Business you signed your name to - check it out.

Secondly, doing 2 increases a year "to help people out" is a bit of a no-no... rent increases should be limited to once per year, but - obviously - the best way to go about this is by agreement... not usually by you, or an Agent, dictating the increase... especially if more then once per year.

You realise, of course you do, that you've not kept on top of things and - ultimately - that responsibility lies with you. If it matters enough to you you'll show enough interest in your income... obviously you let it all pass you by, so it's fair to conclude that you didn't really care that much back then. You do now... but you should have back then. It's easy to find excuses for why it's someone else's fault.

Thanks for the replies, really helpful.

I'll be more vigilant with  agents in future and keep my eye on the ball properly - of course I realise I should've but that still doesn't excuse poor service from the agent. I was obviously a little naive thinking they would do what they said they'd do and what I was paying them for.

The area manager has openly admitted the service and paperwork on their part was awful and they've let me down. He did offer to speak to my tenants himself and hike the rent up a larger amount to what it should have now got to in one go.  I declined that offer as it's not fair to my tenants and I don't think they could afford that increase in one hit either. Instead, I've spoken to the tenants directly about a smaller increase with the intention of bringing it nearer to market value but still remaining a bit below it to be affordable for them.  They're good tenants so it's in my best interests as well as theirs..

My question was more around whether there is any comeback on the agent but it seems there's not so I'll just be far more vigilant hereon.

Many thanks!

There is a school of thought - from many Landlords (although I do not subscribe to it myself) that having Tenants who generally look after the property, generally pay their rent on time and generally are nice enough folk is worth more than hiking up to market value... it's like having a cash-cow, right? Many Landlords claim they do not increase the rent on these kinds of Tenants because they value them being there more than a changeover... better the devil you know? I think it's probably more down to a Landlord's inherent laziness in most things.

Which you have also fallen foul of, a bit.

Push Tenants too far and they'll move on... that's when you have a void period, that's when you have to pay more fees out, that's when you have to cover the bills, that's when you're getting no rent at all. Balance, in all things. Remember... you can only increase the rent >1 per year with agreement... if your Tenants know the law in this regard they may push back.

My approach? Generally speaking it is modest annual rises... the Tenants grow to expect it and can handle it... one property example - started at £570, then £590, then £600, then £615, then £625 and now £640. Modest and regular. This year it will go to £650. I don't expect the Tenants to balk at that. If they did, and that last £10 per month was too much - I'd probably back down to be honest. However, that said, for new tenancies I am starting to really appreciate less churn... so I am offering Special Conditions in my AST that say things like - "the rent will remain the same for a period of at least 2 years" - even though the fixed term of the AST is still 6 months... so far I am having OK results, some Tenants stayed a lot longer than normal (for that property) and some others left at exactly 2 years!!!

It is a balancing act.Voids cost money,and a rent increase can make tenants start to check out other properties.I also go for the modest increases,but sometimes have gone as long as 3 years for some tenants, before imposing them.I  currently have 2 studios on the market,one still occupied,the other vacated last week.The rent has been 495 for each,but both sales and lettings in this area have been hit by Brexit and jobs cuts at JLR,so I am going to lower one to 475 if not let by the weekend.It sticks in the throat,but if that does not work I will go down to 450,back to what they were a few years back.I don't have mortgages on them,but the council tax meter is running,plus standing charges.Needs must. 

Thank you both for taking the time to write replies, I really appreciate it.

Hippogriff, even though I did ouch a bit at some of your comments you make valid and useful points so thank you for calling it as you see it.

I know where to head to now in future! For now though I'm going to get things in order and ask the agent to put their response to our meeting in writing so that I have the paper trail to put with the original contract.

Thanks again.