Most Landlords Don’t Think of Themselves As Landlords

by Mark Alexander

13:22 PM, 12th February 2012
About 7 years ago

Most Landlords Don’t Think of Themselves As Landlords

Make Text Bigger
Most Landlords Don’t Think of Themselves As Landlords

“I only rent out one property”, “I use a letting agent”, “I’m a passive property investor”, “I do buy to let but I’m not a landlord”.

Why do people say these things?

If you own a property, even if it’s only one, and you collect rent from it, YOU are a landlord in the eyes of the law, whatever you may think, whether you use a letting agent or not.

You can not delegate your responsibilities to an agent. Yes, you can pay an agent to do things for you but if the agent doesn’t do the job right, YOU, the landlord, remain responsible.

For example, if a letting agent fails to protect a tenants deposit and then goes bankrupt or disappears, YOU, the landlord, are responsible for giving YOUR tenant the deposit money back. You could also be fined up to three times the deposit. But that’s not fair if I’ve not had the money, I hear you cry. Well sorry, I don’t make the laws, I’m just telling you what they are.

You are also responsible for making sure that your property has a Gas Safety certificate. If your agent doesn’t get it sorted for you then YOU are responsible. If a tenant dies from a fire or gas poisoning it’s YOU, the landlord who could be going to prison.

Scary stuff hey?

Well that’s just the tip of the iceberg.

Some would say that pretty much the only thing that isn’t regulated in the lettings industry is letting agents. If they don’t perform you might be able to litigate against them, but you may have to find them first and when you do they may be bankrupt.

There are of course good agents but there are also plenty of bad ones enticing you with low fees.

Should letting agents be able to operate without any regulation, any licensing or any insurance to protect YOUR money and YOUR tenants money?  If you think not please read this and sign the linked government e-petition.

There are thought to be in the region of 1.5 million landlords in the UK providing over 4 million households. The two biggest landlord associations between them have less than 30,000 members!!!



Comments

19:56 PM, 12th February 2012
About 7 years ago

I think that people who purchase a BTL property should be handed a booklet by the lender detailing ALL their responsibilites in their additional job as A LANDLORD.
Perhaps this should be given out prior to taking out a BTLmortgage..
This booklet could be sponsored by ARLA who would be able to pitch for business on the basis of the efficacy of their members.
I think such advices to BTL enquirers might be a wake up call that when they obtain a BTL mortgage they become a landlord.
I think as you have quoted; for some reason this distinction is lost on some BTL purchasers.
Perhaps the BTL industry and this includes auction houses aswell as normal mortgage lenders should be obliged to inform anyone who is considering to rent out a property they purchase for rent and this includes cash buyers at auctions that if they rent out those properties the owner/s of the proiperty becomes a landlord subject to ALL the laws governing LL in the UK.
Obviously ignorance of the law is no defence; but I think you are absolutely correct in your assessment that for some peculiar reason some people don't think they are landlords when they rent out a property belonging to them!

Mark Alexander

20:28 PM, 12th February 2012
About 7 years ago

That's exactly how buy to let started Paul, ARLA invented the phrase in 1996. Prior to that all mortgages for residential investment property were commercial mortgages.

20:50 PM, 12th February 2012
About 7 years ago

When we took out our BTL mortgage with the Woolwich we did get a booklet from them.   However we did not any useful information from the Woolwich when we got permission to rent on the “home” mortgage.

So the time we most needed the information it was not provided.

Maybe a standard booklet that ALL ARLA must give out when asked to do a rental valuation would help.  Most people ask at least one ARLA agent round before renting out their home.


Leave Comments

Please Log-In OR Become a member to reply to comments or subscribe to new comment notifications.

Forgotten your password?

OR

BECOME A MEMBER

Open Letter to Landlords and Shelter

The Landlords Union

Become a Member, it's FREE

Our mission is to facilitate the sharing of best practice amongst UK landlords, tenants and letting agents

Learn More