8:54 AM, 5th May 2011, About 12 years ago 3
By Paul Shamplina, founder of @LandlordAction
Since founding Landlord Action in 1999, we have encountered many tenants who have had to be evicted on more than one occasion. They are, what I like to call, Serial Bad Tenants.
A Serial Bad Tenant goes from one property to another with no intention of paying any rent. Often, they will know more about Landlord and Tenant Law than your average solicitor. They know how to play the system to their advantage (which usually means that the landlord is going to be the one losing out).
They tend to target amateur landlords, or, landlords with little time to actively manage their property portfolios – including overseas landlords. The Serial Bad Tenant will tend to avoid finding rental property via a reputable letting agent (for example, with accreditation from ARLA, RICS, The Property Ombudsman, etc) because these sorts of agents are usually able to identify them.
Typically, they will go through online portals, where it has become easy to rent a property without ever meeting the landlord (TIP: landlords should always have a face-to-face meeting with their tenant prior to letting their property to them). This suits the Serial Bad Tenant. They usually want as minimal contact with the landlord as possible.
Their tactics involve using false referencing to get access to the property. They will then often dangle the carrot of rent in advance (anything from 2 months to one year – always be weary), etc, to rope the landlords in. When they have, you can guarantee that future rent payments will not be as forthcoming.
When this does happen, there will be a medley of excuses as to why they haven’t paid any rent. However, in many of the Serial Bad Tenant cases that we have handled, the tenant often claims that there is a fault with the property. They can then use this as a basis for a defence if the landlord takes action against them under Section 8. Because they know the law well, they are looking for ammunition to try and drag the case out for as long as possible and staying in the property at no cost.
One of the largest rent arrears cases that we have been instructed on involved a Serial Bad Tenant who managed to rent a property on The Bishops Avenue (a very prestigious road in North London, where the rent was £9,000 per month – the cheaper end). The referencing was falsified and the landlord (and agent) didn’t complete enough due diligence to uncover this.
In this case, the Serial Bad Tenant claimed to be a Computer Programmer earning in excess of £300,000 per annum. Of course, he wasn’t. And, when we had a glance through the tenant referencing, we managed to poke many holes in the tenant’s reference. Shortcuts were taken and, as a result, the landlord ended up being owed in excess of £50,000 outstanding rent.
Once these sorts of tenants are in your property, there is no telling what they can do. Landlords have been targeted by criminal gangs over recent years. We have seen cannabis factories, prostitution rings etc. However, there can be other ways, such as identity fraud, obtaining finance, etc, which has the potential to cost a landlord a lot of money if they are caught out.
The message should be pretty clear: Traditional methods of tenant referencing need to be supplemented with out-of-the-box thinking. We have put together this free guide that helps landlords and agents by offering practical tips for tenant referencing.
In the coming blog posts, I will be writing more about Serial Bad Tenants – the scourge of the PRS – with some practical tips on identifying and dealing with them. Stay tuned.
Paul’s articles will cover the following subjects over the coming weeks:
Previous ArticleUK interest rates may not rise for years, says BoE governor
Next ArticleHouse price surveys confuse the market again