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Letting agent problems again, sorry to be a pest

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« on: November 28, 2019, 01:27:11 AM »

I have a tenant who had a 6 month tenancy but the letting agent  undercharging on rent, grossly undercharged at that, and as I am selling the place I want these people out at the end of their tenancy.  They have caused a couple of problems and neighbours have made complaints so I wouldn't be sorry to see the back of them.  The agent said they could issue a letter to increase the rent but as the rent is low and would have to be considerably increased to be anywhere near comparable properties, it would open the floodgates for this tenant to appeal a rent increase and probably win.  I would be back to square 1 of not making a bean because of this letting agent and I'm not prepared to put up with that

I instructed the agent to issue the relevant notice but now the agent is telling me they can't issue the notice until 2 months before the end of the tenancy.  From what I have been told, notice can be issued at any time in the tenancy as long as the date to end the tenancy is not less than 4 months after the start of the tenancy and as long as the termination date is the date of the contract end which would be  2 months from that 4 month dateline.  That's not what this agent is telling me but it is what most other agents have said so who's right? According to this agent they can't issue the end of tenancy notice until after the 4 months have passed, The 4 months is 30th November, which is a Saturday, not a working day, so they are saying they can't issue this notice until after that. It would mean the notice would be issued on the following Monday, assuming they got around to it and allowing for post etc., that would be sometime next week and allow the tenant extra days. According to this agent, the tenant has to be given 2 full months notice even if the AST finishes on the last day of the month.  Too complicated for me to cope with.

I've already told this lot I am terminating the letting contract at the end of this tenancy and after looking at their contract I have followed instructions to the letter.  I know these people want to keep landlord business so they can keep ripping us off  but this is ridiculous.  It's like being held captive, do they have any rights to manipulate dates of tenancies to suit themselves or is this just what agents do to keep business?  Never been a landlord before and don't like it, very very reluctant landlord and I don't like being ripped off by a letting agent.
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« Reply #1 on: November 28, 2019, 08:44:24 AM »

But you've stated... it'll be a few days, maybe a month longer... focus on the big win, getting your property vacant and ready for sale. Why are you agonising over small bits of procedure? We could - obviously - tell you that your Agent is wrong... so what? It just becomes another fight for you, another Landlord-related to-and-fro, back-and-forth. Better to just grin and bear it for the short period of time you're talking about.

I mean, your great plan is already to inform someone they need to look for a new home over Christmas. And is early in the new year, with potentially Brexit, a great time to sell?
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« Reply #2 on: November 28, 2019, 12:49:44 PM »

It has always been my understanding that you cannot issue notice until end of month 4.A day or so extra due to weekends will hardly make a big difference.I am no huge fan of letting agents myself,but you presumably had the last word on the rent that was charged to the tenant?
Personally,I would not be trying to sell any property at present,you might be better off getting some rent a bit longer,while keeping an eye on what the market is like in your area.
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« Reply #3 on: November 28, 2019, 01:43:09 PM »

You are right, I did have the last word on the amount of rent to be charged.  The agent completely ignored it and I had no idea this agent had charged the wrong amount, against my instruction, until 24 hours before the tenant was due to move in.  That's when I was sent a copy of the tenancy agreement to sign so I refused to sign it due to their mistake.  They agreed to offer a reduction in their fees to cover the shortfall in rental and as this was at the very last minute, tenants were moving in, I had little or no choice but to accept.  Since then it's been a constant battle with this agent to have things done properly, in accordance with regulations etc.  They are now quoting issues on regulations that simply don't exist and are expecting me to simply accept what they tell me and after the amount of trouble they have caused so far, it may only be a few days discrepancy but I'm not going to accept it.  I've already accepted their excuses about other issues and now I just feel they are taking the proverbial and making me pay for the privilege.

I realise it isn't a good time to sell due to Brexit etc., and having some rent coming in is better than nothing but when you have the opportunity to at lease try and remove problem tenants then I think the agent, regardless of whether they like it or not, should support the landlord they are supposed to be working for and not favouring a tenant; unless that is they have some sort of agreement with the tenant which unfortunately in this case may be an issue.

I have looked at all the regulations and nowhere in those for either 2015 or 2018 can I see any reference to the fact this agent has now come up with.  They are telling me they have to give 4 months and 2 days which is pushing this situation further into February.  It is pretty obvious, given this agents previous actions, they will not charge these tenants for the extra days so regardless of anything else I stand to lose out on that.  It may only be a few days but it all adds up.

The quicker I can get shot of this agency the better and they can take their tenants with them.  It's the second lot they've stuck me with, first lot did some damage and this agent told me it was fair wear and tear and I was told to give the deposit back.  It was only when I listed all the damage plus the anti social behaviour, police reports and every thing else they finally agreed they may have got it wrong.  They are the absolute pits.

As far as the post from Hippogriff is concerned, I appreciate what you are saying but unfortunately even if it is a month extra, there is no way this agent will ensure I get the rent for that month so I will lose out on that anyway and that is exactly what I do not want.  Agreed it isn't a good time to sell but neither is it a good time to be held to ransom by some agent who is simply trying it on, probably because they have some sort of deal with this tenant who has already caused complaints from other residents.  Their tenancy ends on 30th January, I want them out on 30th January, not a month later.
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« Reply #4 on: November 28, 2019, 03:10:36 PM »

You can want what you want. Of course you can.

But you need to be sure, right? You shouldn't just go serving notices on Tenants if they're not going to be valid in the long-run - that's called "shooting yourself in the foot". You'll be sitting happy, thinking you're golden, then get a nasty surprise further down the line.

https://england.shelter.org.uk/housing_advice/eviction/section_21_eviction/how_to_check_a_section_21_notice_is_valid

You giving them a Section 21, or not renewing their tenancy beyond the fixed term, does not remotely mean they'll be out on the 30 January. You need to be prepared for the worst. I am a big fan of tenancies ending amicably... if you end up with someone staying-on against your will then you're in a long, expensive, frustrating ride.

https://england.shelter.org.uk/housing_advice/eviction/section_21_eviction/staying_after_a_section_21_notice

It seems like your Agent does a lot for you... collecting rent is obviously one... let's hope if you took a Deposit it has been protected correctly, on your behalf.
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« Reply #5 on: November 28, 2019, 03:16:01 PM »

You are right, I did have the last word on the amount of rent to be charged.  The agent completely ignored it...

Kinda by definition this is the opposite of having the last word. You had a word, sure, but obviously not the last one.  ;D
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« Reply #6 on: November 28, 2019, 03:21:32 PM »

I instructed the agent to issue the relevant notice but now the agent is telling me they can't issue the notice until 2 months before the end of the tenancy.  From what I have been told, notice can be issued at any time in the tenancy as long as the date to end the tenancy is not less than 4 months after the start of the tenancy and as long as the termination date is the date of the contract end which would be  2 months from that 4 month dateline.  That's not what this agent is telling me but it is what most other agents have said so who's right? According to this agent they can't issue the end of tenancy notice until after the 4 months have passed.

I forgot you wanted a black-and-white answer, really...

https://www.gov.uk/evicting-tenants/section-21-and-section-8-notices

Your Agent is correct. They are working well for you - stopping you from making silly mistakes. Maybe you should re-assess? The other Agents (or whoever has told you something) is probably telling you what they think you want to hear.

Quote from: 1614lindi
I have looked at all the regulations...

I'm particularly curious what you looked at.
« Last Edit: November 28, 2019, 03:24:59 PM by Hippogriff »
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« Reply #7 on: November 29, 2019, 12:55:54 AM »

I looked up the Government publication of Deregulation 2015 and 2018 plus bona fide agents who did not just tell me what they thought I wanted to hear, they have their own legal staff.  This agent I have is now telling me that there is a statutory requirement of 2 months and 2 days notice required for the service of a Section 21 notice.  All the legislation says is that the expiry date cannot fall on the same date as the end of the tenancy but it can be the day after.  Nothing about a statutory 2 months and 2 days regulation.

This agent collects the rent every month.  This agent takes a chunk out for their fees, which I agreed to but it doesn't make it a good deal but when they are given an instruction, such as rent to be charged, they just ignore it.  I gave instructions which needed to be put on the tenancy agreement, they ignored that as well even though it was the leaseholder who said I had to make sure certain conditions must be on the agreement.  It took several calls before they actually listened and even then they didn't do it properly.

I appreciate all the replies given, I am trying not to make mistakes  and I can see that the agent may, in this respect, be appearing to be working well for me.  However, various issues raised with this agent have given cause for concern that they are not fully committed to ensuring that they are acting in my best interests.

The rent, because this agent undercharged to these tenants, needs to be increased.  Thanks to this agent, the rent being charged is considerably lower than any comparable properties so I now have a stark choice and another dilemma,  If this tenant's agreement ends at the end of January but the Section 21 expiry date is February, what happens about the rent assuming they stay until the expiry date?  Can I notify an increase giving the required months' notice before the end of the tenancy so that it becomes effective on the first rent day after the end of tenancy contract? Can this tenant just pay another month at the current rate so setting a precedent that the rent remains at the same rate as long as they want? It's a complete mess and I hate it.
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« Reply #8 on: November 29, 2019, 10:33:42 AM »

You're fretting because you don't have a good grasp of the situation.

Firstly - your desire to serve a Section 21 now is, if followed-through, something that would backfire on you - so why continue carping on about it? We've clearly told you that you cannot serve a Section 21 in the first 4 months of the tenancy... that is also what your Agent told you... but you didn't believe it, you've listened to other people - who don't work for you currently, or aren't kind like we are. These other people will say anything! To them you're just a nuisance. Your own research has obviously fallen-short... claiming to have looked at "all the regulations" and still not finding the Government web page or the Shelter web page which both clearly validate what the Agent told you about 4 months if, frankly, incompetent of you. You must agree? You're running around, chasing ladies, like a Benny Hill sketch. We've told you what the state of play is - you need to accept that and move on to the other issues.

Secondly - the rent being charged. So while it may indeed be the case that the Agent charged a lower rent than you'd instructed, you always had the option available to you to back-out. No, it would not have been kind - and you may have been way to embarrassed to do it at the time, for fear of upsetting way too many people - but you've ended up upsetting yourself. But it may also have been the case that you didn't make your wishes wanted clearly enough - God knows, you can write well, but you're all over the place to a reader! Your thoughts don't appear clear. You're calling this a "complete mess", but it really isn't. Trust me before you go crazy. This is small beer! You need to split apart the big problem into smaller manageable ones. So... let's just assume the following - that you've relaxed on the tenancy ending, a bit - and you're focusing, instead, on trying to get the rent back up to what you consider a market rate... well, you can do that at any time after the fixed term ends. You can do it once per year (by convention)... it doesn't have to happen at the exact crossover from AST fixed term to SPT (monthly rolling)... so if you miss out, then it's not the end of the world - you just do it the following month.

Hopefully, that makes sense? You would do this (and I mean - you, not everyone else who self-manages) via your Agent... and you would be clear. It would help us if we knew what the rent currently was, and what you believe the market rate is... then we could give an objective view as to whether you're on a flight-of-fancy... because you may be able to get what you want.

Even if you don't get the market rate you're wanting, you might be able to get something you're happy with. And, finally, if you don't get the market rate, you might be able to be very subtle in getting your Tenants to leave, effectively of their own accord... by raising the rent to a level that might not still be market rate, but is unmanageable for them!

For me - I think I would focus on this aspect. Additionally, surely the last thing you want to be worrying about (and, respectfully, your Tenants too) is property issues over the festive period? Once you're into 2020 your hands become much freer.

Don't let the Agent give the Tenants a new fixed term AST... a renewal! This is the key thing for you. Ensure - beyond any doubt - that the tenancy they currently have will automatically move over to a SPT (Statutory Periodic Tenancy, rolling, month-to-month, same terms and conditions as the existing except for notice periods). This is the key for you.

Then sit back, enjoy Christmas and go into 2020 fighting fit. You can do whatever you want with a much freer hand in 2020... either issue a Section 21 with no worries about timeframes, at all, or increase the rent (once) to a level you'd be more happy with... or your Tenants would not be happy at all with... working this way may be a kind of back-door approach to you getting what you eventually want.

But patience is often key. Rushing around like a mad-thing, railing against everything, isn't going to be beneficial to your mindset. We've all been here. Ask heavykarma - she has stories.

Lastly, please don't ever - ever - expect a Letting Agent to have your best interests at heart. You might think this is the way it should be... it just isn't. It never is. You're probably thinking you're really unlucky having gotten into bed with a really bad one... but you could be mistaken... they're all pretty bad. It takes no training, no qualifications and no experience to set yourself up at a Letting Agent, you realise that? Anyone can do it. And, to your Agent, a feisty Landlord with a single property - well, you're small-fry to them. Have realistic expectations... but always remember they work for you - so they must follow your instructions... but they are supposed to know more than you (and it seems they might here) so you should also, maybe, listen to some of their advice.

If you had managed to persuade them to serve a Section 21 on your behalf, and the Tenant had stuck it out and you'd ended up in Court, say sometime in early 2020 - it would just have been thrown-out and you'd need to start all over again. Be thankful for small mercies and stop trying to save the odd day here, there and everywhere. A Landlord wins when he plays the long-game.
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« Reply #9 on: November 29, 2019, 10:34:57 AM »

I am maybe being a bit thick here,so apologies if that is the case.You mentioned in your first post that you want this tenant out in order to sell the house.You are now talking about needing to get the rent increased,so have you changed your mind? If notice is served on Monday,they will be due to move out by Feb.2nd.Notice is often served by hand by agents,so there may be no delay in the post.
Can't you claim the extra couple of days from the deposit if they refuse to pay it,or just write it off?
Are you fearing that they will refuse to move out,and try to stay on at the current rent? I really would let it go onto periodic for a bit longer,with the rent increase if they accept it,then think again in the spring.I can understand how frustrating this is,and how you want to get a troublesome tenant out,but you could be cutting off your nose to spite your face.
 
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« Reply #10 on: November 29, 2019, 10:39:38 AM »

P.S. - there are so many rational reasons for the recommendations you've received for relaxing on the end of tenancy aspect.
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« Reply #11 on: November 30, 2019, 11:10:58 AM »

God,do I have stories.Don't get me started.I was once relatively sane.
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« Reply #12 on: December 02, 2019, 01:04:53 AM »

As far as selling this place is concerned, yes of course I would prefer to sell it and get rid of the stress but as it's leasehold I don't think there's much danger of that at the moment. 

As far as the rent is concerned, the rent agreed for this current tenancy was £495 pcm. The previous tenancy from last year was £475 pcm.  Both amounts were less than the comparable rates for these flats.  The agent, instead of following instructions and charging £495 pcm, ignored that and charged the lower amount.  There was absolutely no way they would allow me to back out when I only found out they were charging the wrong amount less than 24 hours before the tenant was due to move in.  The agent adopted bully boy tactics and said that as it was such short notice to cancel the tenancy, the tenant would be homeless and having arranged removals would claim his charges back along with compensation for being homeless. Being unsure of what could happen and not wanting to have any more expense, I had no choice but to reluctantly agree to what this agent was throwing at me.  This agent then told me as a gesture of goodwill, they would make up the shortfall of £20 a month for the 6 month duration of this tenancy.  They would deduct that amount from the set up fees but they couldn't even get that right and still tried to overcharge.  I did manage to get that over payment back but the tenants moved in before I had signed the tenancy agreement. 

Comparable flats, 2 bed, parking, secure entrance, modern, were being let last year at £525 pcm now raised to £560.  Flats now in the same area with the same features are letting at £575 to £600 with £600 becoming the norm.The intention was, had the agent done as they were asked, charge £495 for the 6 month tenancy then increase to £530 with the tenancy going to periodic.  Had these tenants behaved I may have thought about letting them continue to rent it but there have been several complaints about noise especially in the early hours of the morning.  The agent is supposed to have tackled this but the tenant appears to have taken no notice.

Although I was told a Section 21 could be served at any time during the tenancy, that was only on the basis that the dates on the notice had to comply with legislation i.e. giving 2 months clear notice on or after the date of 4 months into the 6 month tenancy, In case there was any discrepancy, I did instruct the agent to issue this notice on or as near as possible to 30th November, that was never in doubt.  This agent is now telling me that there is a statutory regulation saying notice must give 2 months and 2 days.  That would take the date to 4th February at the earliest but I can't find that regulation anywhere.  I have read, thoroughly, both the Government and Shelter website information but the only reference I can find to anything over and above the 2 month expiry is that the expiry date must not fall on the same date as the rent due date, it must fall on the following working day.

I have instructed the agent that the rent must increase to £530 as from 31st January.  I have instructed them to ensure that this increase notice is issued to this tenant on 31st December which is a Tuesday and not a Bank Holiday but I can guarantee they come back with I can't issue a rent increase notice until after the end of the tenancy.  A rent increase has to have a clear 1 month notice and is allowed to be issued during a 6 or 12 month tenancy as long as the increase date is not during the 6 or 12 month period.  I think I have read that right but I'm open to correction.

Thank you for the advice of taking any underpaid rent, if the tenant stays on and doesn't pay, out of the deposit.  I didn't consider that.  I am not looking forward to trying to get this agent to do that, I had enough trouble with them over the last tenant who had clearly done some damage and was asked to move out after police were called due to continual anti-social behaviour.  The agent had photographed and catalogued damage, added notes to the final inspection but then told me they found nothing wrong so advised me to release the deposit.  When their inspection report was referred to, all of a sudden they agreed and dealt with the tenant so as far as getting extra rent out of the deposit they're holding, it should be interesting to say the least. 

Thanks for all the advice, it is much appreciated and is going some way to keeping me sane at the moment
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« Reply #13 on: December 02, 2019, 10:20:12 AM »

It pleases me that you now seem to be at-one with the world.

I thought you were going to go down the route of greedy naïveté for a moment or two... £495 to £530 is a 7% increase... heady, but not unheard of... you can say you wanted their long-term profitable business by drawing them in with a loss-leader. Haha. It might end up with the outcome that they decide to move on. If they decide to pay, and you decide to keep the tenancy going (remember - as a SPT) then whether it's one month or the next isn't going to matter too much - again, my advice would be stop fretting over the smallest things. It may be the case that they agree the new rent and stay on for 18 months more - that'd be £595 of 17 months vs. £630 at 18 months - not enough to get worked-up over. Your Tenant may try to negotiate - keep an open mind. Remember the frog that was boiled alive, slowly? There's nothing wrong with a slow, but consistent, ramp-up. £495, £520, £540, £550 (reward year), £575... before you know it, it'll be £1,000 per month and they won't even have noticed! Yay!

Your sentence - "There was absolutely no way they would allow me to back out..." - is interesting, because you are the decision-maker. You are the one handing over the asset. You may have given your Agent too much responsibility, leeway, leash. You must always be able to say "no", and mean it.
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« Reply #14 on: December 03, 2019, 12:37:49 AM »

Correction, the agent literally threatened me with 'the tenant will claim compensation for being made homeless and will claim his expenses so far in anticipating the move'  They were pretty definite about the outcome of refusing to allow the tenancy to continue.

Now I have been told they have issued the end of tenancy notice and told the tenant the expiry date is 4th February which makes a mockery of a 6 month tenancy ending on 30th January.  On top of that, despite me telling them the rent has to increase so that I can pay fees I need to pay, they have assumed the tenant will carry on paying the low rent they made the error with in the first place.  No way will they tell this tenant any extra rent incurred up until the 4th February must be at the higher rate.  They've actually told the tenant the rent stays the same. The problem is if they decide to stay and pay the lower rent it will then be deemed I have accepted this.  The notice also actually says that I cannot recoup unpaid rent from their deposit.  I thought that was one of the reasons for the deposit along with damage etc?

It may only be a small amount to you but I am afraid it is quite a lot to me.  I am only renting this damned place out because I can't use it due to health issues and because it's leasehold I can't sell it either.  I can't even just walk away without being harassed for legal fees when forfeiture is invoked for not paying fees so I am afraid at this point absolutely every penny counts and the mistake this agent made in the first place hasn't helped at all
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« Reply #15 on: December 03, 2019, 10:36:54 AM »

Sorry,I am confused again.Have you now agreed that the tenant stays on,as long as they agree to pay the higher rent? Will this be,as I would strongly advise, a periodic tenancy,or are the agents trying to insist on a new AST being signed? I am also confused as to why you can't sell because it's leasehold? Nearly all flats,and some houses are leasehold.Is this because the remaining lease is very short (less than say 60 years) Have you had a valuation? It could be worth your while to look into buying the freehold,maybe others in the block are of a like-mind.In my experience,when one gets obsessed with a small aspect of a problem,like a dog with a bone,it is because the whole bloody mess is overwhelming,and it provides a focus to fixate on.The agents need to be reminded that they are working for you,unless you are asking them to break the law of course.They did at least admit their error about the rent,which is pretty amazing in my experience,and offered to make up the difference.If adequate notice is given,you can increase the rent if the tenant stays on a periodic  basis.They may decide they won't pay,and decide to leave.
I am still not sure what eventual  outcome you are seeking,and until you know that, you can't take the steps to lead you there.I do sympathise.
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« Reply #16 on: December 04, 2019, 01:43:04 AM »

No I haven't agreed that the tenant stays on but I had already told this agent, because they charged a far too low rent in the first place without my approval and directly against my instructions, this rent would have to go up to a level comparable with other similar places in the same area.  These tenants will be given the chance to remain but strictly on a periodic tenancy and at the higher rent.  I would prefer them to go but I suppose I have to be fair and make the offer.  I have had a valuation but no one wants to buy leasehold these days due to their toxic terms.

The tenancy would or should end on 30th January at this current incorrect rent.  However, because the agent has some policy I knew nothing at all about, I have now been told they only issue these notices 4 months and 2 days into the 6 month agreement, that takes the end date to 4th February.  The rent was always going to be increased at the end of this fixed AST as I told the agent right at the beginning when they made the mistake.  I have told this agent that they must issue a rent increase notice one month before it should be implemented.   Unfortunately the termination notice sent out to this tenant makes no allowance or reference to the increased rent and the fact that the days after their AST finishes on 30th January should be subject to the higher rent.   Yet again this agent hasn't done this nor had they advised the tenant when the tenancy started that they as agents had made a mistake and it would need to be rectified.

Leasehold property simply does not sell.  It depends on the freeholder in some cases and whether they allow corporate buyers to buy.  Leaseholders have to ask permission from the freeholder to sell and they have to pay the freeholder for the privilege of asking. It also depends on the length of the lease as corporate buyers are now insisting on a lease having in excess of 80 years remaining.  If it is less than that then they have to apply for a lease extension which is expensive.  Added to that, if an individual private buyer is interested in buying, there are very few if any lenders who will lend on leasehold property, certainly not without an uncompetitive interest rate.  With all leases there are covenants which really are toxic including the threat of forfeiture.  Any prospective buyer who has a decent solicitor will not only walk away from these terms, they will run as fast as they can so all this adds to the difficulty of selling even by auction.  Most auction houses are very reluctant to accept leasehold entries.   


In the absence of selling it, the only alternative is to rent the place out but obviously to suitable tenants.  So far this agency has accepted a man who caused continual complaints through anti-social behaviour and had to be 'encouraged' to leave. Then these latest ones who are again causing complaints and are paying far less rent than they should.  If these people stay in the flat, as in refuse to move out, and pay the current rate of rent then I can be deemed to be accepting the tenancy at the lower amount.  There is no way that they will be allowed any form of tenancy other than a periodic tenancy and at the new rent but if they refuse to pay and refuse to leave i have a problem again.
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« Reply #17 on: December 04, 2019, 07:57:29 AM »

Leasehold property simply does not sell.  It depends on the freeholder in some cases and whether they allow corporate buyers to buy.  Leaseholders have to ask permission from the freeholder to sell and they have to pay the freeholder for the privilege of asking. It also depends on the length of the lease as corporate buyers are now insisting on a lease having in excess of 80 years remaining.  If it is less than that then they have to apply for a lease extension which is expensive.  Added to that, if an individual private buyer is interested in buying, there are very few if any lenders who will lend on leasehold property, certainly not without an uncompetitive interest rate.  With all leases there are covenants which really are toxic including the threat of forfeiture.  Any prospective buyer who has a decent solicitor will not only walk away from these terms, they will run as fast as they can so all this adds to the difficulty of selling even by auction.  Most auction houses are very reluctant to accept leasehold entries.

Sigh. All of this is factually incorrect. I don't understand what "corporate" has to do with anything here, maybe you can explain? Any buyer would insist on a suitable number of years remaining and it is possible to either extend (not the buyer, you as current owner) or purchase the Freehold reversion. What you say about Lenders is misguided, again. In certain areas of the country (Sheffield actually being one) Leasehold is more common (than you'd hope) and I have mortgages on 2 Leasehold properties, one with NatWest, one with Yorkshire Building Society - what you are saying is simply untrue. None of this is to claim Freehold isn't preferable to Leasehold, it is, but your characterisation here is just wrong... if there are issues then you, as current owner, can work to resolve them for the potential buyer... at some cost, yes, but they should have the outcome of making the property more appealing. I should be clear... I am not saying I'd select Leasehold over Freehold, just that the darkness you describe as factual isn't actually how it is... at all.

But - after all that - it appears you've given-up on the idea of selling, now, and you'll be continuing to let the property - this clarity is not a bad thing... get all your ducks lined-up for this outcome in early 2020 and then, hopefully, you can start to feel better about it. All you need to do is issue clear instructions and have your Agent implement them. Timing, as I've repeatedly said (but you fret over) isn't your biggest issue... getting things how you want them, once and for all, is. It would be nice for everyone involved to not be worrying about this over Christmas.
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« Reply #18 on: December 05, 2019, 01:24:34 AM »

I hate to burst your obviously misguided impression of leasehold property and the issues that go with it, but I can assure you what I have put in my post is, unfortunately, very accurate.  You may have mortgages for leasehold property but I would guess these were taken out some time ago before the implications of leasehold became apparent.  Also if you are a property speculator who owns several properties to rent out, then this is a completely different scenario to those who just buy somewhere to live in and is always looked upon more favourable by lenders.  Leasehold I am afraid is not owning anything, it's a tenancy which is exactly why lenders now are reluctant to offer loans to private buyers. 

Yes the lease can be increased but in some cases, including my own, only by a limited number of years, usually 60 or 80.  The property is worth in the region of £100,000 with no mortgage but it is not increasing in value.  To extend the lease means the leaseholder pays for valuation, freeholders legal fees, leaseholders own legal fees and in the case of flats anything between £300 and £700 for a management pack.  Only when this is all agreed  and you've paid for some of these elements, money you never get back, do you get to know the actual price for the lease extension.  In this case anything between £9,000 and £30,000.  I have already paid for this flat once, why should I have to pay a considerably amount out for it again?  Dependent on who the freeholder is, if for example it is a housing association or council, objections are more often than not raised to prevent any corporate buyer obtaining the property.  Terms in the leases are referred to and rigorously upheld.  Added to that, leaseholders have to ask and pay for permission to even change a door lock for example and including permission to sell the place and it isn't cheap.

Getting things as I want them, and wanted them in the first place, is not going to be easy as there is no guarantee these tenants will move out when they are supposed to.  If they don't and they continue to pay the lower rental, then I am stuck with them, there is very little I can do other than go to court which is again going to cost me money I simply don't have.  If I then issue a rent increase notice it has been made clear that they can and probably will appeal the increase, this agent has already suggested that will happen due to the amount of increase necessary.


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« Reply #19 on: December 05, 2019, 05:11:52 AM »

I understand Leasehold. The things you are saying are wrong... categorically. You appear, at least to me, to be a person who simply doesn't listen. Best of luck. You know what you need to do. Come back when you've done something.
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« Reply #20 on: December 05, 2019, 02:25:29 PM »

I have to chip in and correct you LINDI,because this could cause worry to some people with leaseholds.I do agree that there has been bad publicity in the last couple of years,relating to estates of leasehold houses,where buyers were told they could purchase the freehold in time,only to end up with new landlords who have demanded much higher sums than those quoted. There have also been complaints about huge increases in ground rent and management fees.
Are you saying this is the case with your flat ?
Four of  my five (modest) rentals are flats.There was another which I sold with no problems around 15 years ago.I paid cash for one, the original lease was 999 years,so I am not bothered about getting the freehold.The others were mortgaged,with no problems.My solicitor at the time was real old school,anal in his attention to potential pitfalls.
In the past couple of years I have bought the freehold of the 3 studios,as have the owners of the other 13 in the blocks.The total costs ended up around £28-30k,including all fees.The lease is now 999 yrs,having been around 60 before.The flats would have been valued around £110 before,now estimated £125.Well worth it.I have no mortgages now,but those who have were charged around £100 by their lenders,plus we all paid a few hundred each to the landlord (in this case,The Crown)
Leasehold flats are currently being bought and sold in my area,mortgages being granted,some for landlords.Are you saying no one in your block can sell,whether to a private or "corporate" buyer,unless it is cash? That just does not hold up.I am wondering if you are getting various bits of hearsay lodged in your brain,and creating a whole load of obstacles.Leasehold is not best,but does not have to be a millstone round your neck for ever.



 
 
 
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« Reply #21 on: December 06, 2019, 01:55:37 AM »

Sorry to disappoint, I am not getting hearsay, I am speaking from bitter experience.

One flat in the block sold - after being on the market for 2 and a half years and being reduced 4 times.  1 has been on the market almost 4 years, mine was on the market for 2 years.  Every time there has been a prospective buyer, it got as far as permission from the freeholder who is a housing association/council they dragged their feet, charged an extortionate fee for some management pack and by the time they got around to any sort of agreement, after of course they had taken their fee, the buyers had pulled out.  This was more often than not because they couldn't get a mortgage at a favourable rate.

We cannot purchase the freeholds, we can enfranchise but the cost is prohibitive.  We could extend the lease by a further 80 years but again the cost is far too prohibitive and the less time left on the lease, the higher the price to extend.  It was very easy to sell 15 years ago, that's about when I bought this one but the terms of these leases were unfortunately never discussed with prospective buyers which is where the problems now lie.  Buyers used the developers solicitor who very conveniently failed to give full information and now it's too late to take any action against them for mis-selling.  No one in their right mind would knowingly sign up to one of these leases with the covenants carried on them, but unfortunately at the time I bought, these were neither discussed nor disclosed. 

Heavykarma, you say that you have bought the 'freeholds' for your studios along with the owners of the other studios in the blocks.  You say the lease is now for 999 years so how can this be freehold? Freehold does not carry a timeframe, Freehold means just that, free of all hold by any other person, company or organisation.  I think you may need to have a good look at what leasehold means.  Leasehold is a tenancy, a right to occupy for a prescribed length of time, it is not ownership of any physical property, it is not the ownership of any asset, it is the right to live in what you thought was your own property but with the proviso that you comply with all the demands on your lease as failure to do so results in forfeiture.  Leaseholders have to ask permission, and pay for that permission, in many cases to change the simplest of things even down to door locks on flats.  Basic tenants have more rights than leaseholders

In any leasehold document, there is always a clause of forfeiture.  This basically means that if you own a property and you have paid up in full for it with no mortgage you stand to lose the property if you owe anything on it.  For example, if the property is worth say £100K with no mortgage and you fail to pay your ground rent, which could be say around £250 PA and with a flat you fail to pay service/management fees of say £1500 PA then the freeholder can invoke forfeiture procedure and you lose your property.  The freeholder does not take the property and sell it giving you whatever is left after the debts have been paid, you get absolutely nothing.  Added to that, whatever fees the freeholder trumps up also lands on you to pay so no only do you lose an asset you thought you had but you end up in more debt than you know what to do with and where this has happened, and it has happened, leaseholders end up bankrupt. 

If the property was freehold and you owed mortgage payments and council tax, the property would be sold to recoup debts with any money left after debts were paid being returned to the owner of the freehold property.

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« Reply #22 on: December 06, 2019, 11:09:18 AM »

We all formed a limited company, of which we are all directors,which is the standard procedure.We could choose any length of time to reset the lease,so picked 999 years.I think you are being a bit pedantic here in saying we therefore do not actually have the freehold.I don't think anyone should be trying to sell at present unless they are desperate.Buying the freeholds was a very long and complex procedure,down to the fact that the landlords had gone into voluntary liquidation and passed ownership to the crown.Nonetheless,it was done eventually.You appeared to be making a blanket statement,that selling leasehold  property is impossible.It is not.I am not a lawyer,but I did quite a bit of research over the  4 years from start to finish,talked to people and got anecdotal accounts.In my experience the biggest drawback of leasehold is the fact you have to get cooperation from the others,which is like pulling teeth.   
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« Reply #23 on: December 06, 2019, 11:09:21 AM »

Forfeiture is not a well-travelled path... you are bringing things to the fore that shouldn't be concerns.

What I would say, though, is this... this very simple thing... you appear to have settled on not selling. This is much needed clarity from you. Please remember you started off this thread by clearly stating you are selling. Not planning to. Not thinking about it. Not worrying about the challenges - but selling. As in, a person could assume a transaction was kinda underway. Now, you appear to be coming down on the side of continuing to let - and trying to pull out some profit from the situation.

As I say, this is some much needed clarity. I applaud this, because I think it's the right decision. While the property may be a lemon in certain respects, it may provide an income. So concentrate only, and simply, on one thing for now - rent incoming.

Even though it's one thing... you need to be careful, because you need to temper your desire to raise it to, say, £999, with the chance of the Tenant leaving because of it - ideally, I think (even though you may not be ecstatic with these Tenants) if you can set it to a rent level where they stay and pay, and you are in the black - you should start to feel better. I'd concentrate on this one thing. This single aspect. Forget all of the other stuff that tomes have been written about - Section 21s, Leaseholds - everything.

If you agree, let us know... if you're still all over the shop, let us know.
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« Reply #24 on: December 06, 2019, 11:45:47 PM »

Correction, I am selling, I never said I wasn't.  I said selling was difficult due to the nature of the property ownership and I need to rent out to pay the fees I have to pay but it is still for sale.

Forfeiture is a concern if you have a lease with this term on it, most of leaseholders do

The rent was under sold to this tenant by £20 a month through the agent not doing as it was told.  I am quite clear on what is happening, what I want and how this agent is behaving.

I have already been put out of pocket by this agents' mistakes and I have no intention of being taken for granted by some tenant and its agent who think they can get a cheap rent by continually raising difficulties just to get the tenant a longer stay at the cheap rate.  That isn't going to happen, Section 21 served and will not be retracted.  The current tenant will be advised of the amount of rent to be charged should they wish to stay and if they don't like it then they can go simple as that. 

The forfeiture issue was only brought into the fore due to queries about the whole leasehold issue and it was brought to the fore along with other issues of leasehold to show just how much of a problem this can be and often is, no other reason.

Heavykarma, you still have a lease whichever way you look at it.  As I said, selling leasehold property in our area is almost impossible.  We have figures to prove it beyond any shadow of any doubt.  The flat is still up for sale, even though it will be rented out to pay the monthly fees but I don't anticipate it selling anytime soon.

The agent I had problems with has been notified that at the end of the 6 month AST, my agreement with them will cease as per their own terms of business.  I am just waiting now for them to come up with yet another statement to say I'm not allowed to do this, but the flat is still for sale and will be rented out at the correct rent
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« Reply #25 on: December 07, 2019, 09:47:45 AM »

Quote from: 1614lindi
I have already been put out of pocket by this agents' mistakes...

Ultimately your mistake.

Quote from: 1614lindi
...Section 21 served and will not be retracted.

Hopefully valid, otherwise it'll be retracted for you.

Quote from: 1614lindi
The current tenant will be advised of the amount of rent to be charged should they wish to stay and if they don't like it then they can go simple as that.

You continue to demonstrate an amazing, and baffling, lack of understanding regarding this situation. Rent increases are best done by agreement. Otherwise you should be looking at a Section 13 to enforce it, and possible reversion to tribunal to assess for reasonableness. The Tenant could just ignore you (I kinda relate). Maybe you'll get away with it... you seem to do things off-the-cuff. If it's £20 you're talking about per month then I'm simply aghast at the word count we've spent on this.

Quote from: 1614lindi
As I said, selling leasehold property in our area is almost impossible.

No, it probably isn't... other factors will play into the whole.

Quote from: 1614lindi
We have figures to prove it beyond any shadow of any doubt.

No, you don't.

Quote from: 1614lindi
The agent I had problems with has been notified that at the end of the 6 month AST, my agreement with them will cease as per their own terms of business.

That's the ticket - go it alone. I couldn't recommend this more for you... if your Agent hadn't advised you - correctly - you'd have already gone ahead and served an invalid Section 21 then be crying into your cornflakes when it all fell down around you... I mean, after all - you did read all the relevant legislation.

What a giant waste of time.
« Last Edit: December 07, 2019, 09:50:37 AM by Hippogriff »
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« Reply #26 on: December 07, 2019, 12:24:25 PM »

I don't know what game you are playing,but this is doing my head in.Are you for real,or a tenant with a twisted sense of humour trying to send landlords round the bend? I'm done.
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« Reply #27 on: December 07, 2019, 04:08:52 PM »

Thank you both for your input, some of it was appreciated.
I am not a tenant, I did read the regs,, the section 21 is valid and I am not and never have been playing any games.  Perhaps you should make sure you know your facts regarding leasehold and the difficulties associated with it before having a go at me and please don't tell me I don't have figures relating to selling problems with leasehold properties.  I do, thank you.
If I've, as you put it, done your heads in, I can assure you I have followed all the rules, I have listened and I did and do fully understand the situation. 
Basically I picked a rip off agent, I sorted out what I needed to sort out, with some thanks to comments on here, I appreciate everyone has their own understanding and opinion of a situation so leave it at that.
 
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