Can landlords charge for managing end of tenancy cleaning and repairs?

Can landlords charge for managing end of tenancy cleaning and repairs?

16:11 PM, 24th November 2016, About 5 years ago 29

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My AST states that tenants agree to pay the landlord a management fee equivalent to a 10% of the cost of deductible cleaning and repairs required at the end of the tenancy. charge

I have never implemented it but wondered whether folk consider it a valid term?

Many thanks

Monty



Comments

by Sean Graveney

13:10 PM, 25th November 2016, About 5 years ago

Reply to the comment left by "Dr Monty Drawbridge " at "25/11/2016 - 12:14":

Apologies, I misread your original post. I thought it was 10% of the admin etc.

by Gary Nock

13:37 PM, 25th November 2016, About 5 years ago

Monty you will need to read the Acts and contrast them with your AST terms. If a clause is in detriment to the consumer and gives an unequal advantage to the trader, then it may be determined as unfair. I can only point you in the general direction and advise. It is up to you to look at the legislation and compare it with your AST and deposit protection processes. Section 61 and the subsequent sections of the Consumer Rights Act 2015 are quite detailed- far too detailed for in depth explanation and discussion on this forum. There is also stated case law on Unfair Terms under the old Unfair Terms In Consumer Contracts Regulations 1999 Act which was repealed by the Consumer Rights Act 2015 which would give you some indications of what is construed as an "unfair term"

by Romain Garcin

15:37 PM, 25th November 2016, About 5 years ago

I'd really like to have the opinion of an experienced lawyer on this because this does not strike me as an unfair term a priori.

Indeed, it is a fee that is only charged when the tenant breaches the tenancy and the landlord has to incur extra work, and I would guess that the figure tends to undervalue that work.

Another issue to consider is the deposit scheme: Sometimes they seem to set stricter rules than courts on what they are prepared to accept.

by Gary Nock

15:58 PM, 25th November 2016, About 5 years ago

Romain being as the landlord would probably have to apply for a deduction from the deposit for his management fee to organise cleaning etc, then you are right about the DPS schemes. Unless you can prove that you have expended money to put a property right in actual cost terms then they knock it back. In leasehold property management a block management company can add something on for managing the work, usually 15% but that is a whole different world from normal residential letting.

by Dr Monty Drawbridge

16:07 PM, 25th November 2016, About 5 years ago

Hi Gary. Thanks for the reply. I've an ok understanding of how legislation works in principle. I was just trying to understand the basis for your confidence that that particular clause is actually in breach of legislation - in particular why agreement in advance on how to charge for the landlord's time might be considered unfair. I'm not sure I accept the suggestion that it's too complicated to go into here.

by Gary Nock

16:30 PM, 25th November 2016, About 5 years ago

Monty take it from me- and I am not legally qualified per se but I have spent many many hours in Courts and Tribunals over the last 35 years. I have seen barristers argue over the meaning of an "and" or an "if" in both criminal and civil cases. We could debate all day about applying the various acts I have stated to your AST. But you would only really know if it was challenged and a determination was made. I have seen a charge for a £12.50 letter sent to a tenant for late rent in a possession case thrown out by a Judge as he deemed it "unfair" to the tenant - even though it was in the AST. And in that case I was a landlord - not an agent. So my basis on considering the possibility on it being deemed unfair is based on both a knowledge of the law and seeing it practically applied. Of course I may be wrong and Romain - who I greatly respect- disagrees with me that it may be an unfair term. And when he states that it needs a lawyers advice then that usually means its not an easy one to decide on a forum. Lets put this into perspective. If you arrange a deep clean of a one bed property then that's about £120. I know because I have a cleaning and repairs business as well. 10% of that is £12. To be honest if I thought that would wind up a DPS adjudicator ( which it may) then I wouldn't apply for it as it may see the actual cleaning fee reduced. So what the AST says, what the law says, and what happens in practice can be three different things - none of which are worth asking for twelve quid.

by Denise G

16:35 PM, 25th November 2016, About 5 years ago

Reply to the comment left by "Dr Monty Drawbridge " at "25/11/2016 - 11:13":

My other half and BTL partner has always done most of the maintenance work for our small portfolio himself - we have been always been told that he can charge for the materials he uses but not for his time

by Dr Monty Drawbridge

17:48 PM, 25th November 2016, About 5 years ago

Reply to the comment left by "D D" at "25/11/2016 - 16:35":

Told by whom? And if that's the case, what is the logic behind doing the work himself (unless it's just minor bits and pieces)?

by Denise G

17:56 PM, 25th November 2016, About 5 years ago

Reply to the comment left by "Dr Monty Drawbridge " at "25/11/2016 - 17:48":

Our accountants - who are specialists in BTL.
Our Last 2 accountants also said the same.
And the rationale for doing the work himself if he can is that we aren't paying labour costs to someone else.

Have you been told different - and if so who by?

by Dr Monty Drawbridge

18:08 PM, 25th November 2016, About 5 years ago

Reply to the comment left by "D D" at "25/11/2016 - 17:56":

I think you're taking about tax rather than claims for dilapidations. Claims for dilapidations are tax neutral and are paid for out of the deposit (ie by the tenant). Therefore there is no benefit to the landlord in saving themselves money by doing the work themselves, unless they don't expect to be able to recover it all.


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