Time to bail but I have a Council notice of improvement?

by Readers Question

15:59 PM, 6th February 2017
About 2 years ago

Time to bail but I have a Council notice of improvement?

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Time to bail but I have a Council notice of improvement?

Hi I have decided BTL is no longer for me. I wish to sell ahead of the upcoming accountancy changes (I.e. mortgage no longer deductible etc).bail out

Before I enlist an estate agent to sell the property, I have a few hurdles to overcome:

– Council has served an improvement notice with 2 mo this for compliance (to repair the heating situation).
– My tenants first signed a 12 month AST on 14th March 2016.

I am wondering if I should try sell my property before:

A) The council notice improvement deadline in April 2017

B) If the 12 month AST started March 2016 then when should I serve section 21? I imagine having to give 2 month notice period may mean I have to comply with the council’s notice

C) I imagine the tenant (rightfully) complained to the council and whilst I am regretful of the situation, I have provided “temporary” heating which has lasted much longer since the heating conked in after Christmas and between NY.

Coincidental but I don’t want it to appear as a revenge eviction, its simply the changes in today’s BTL world, which I would like to bail whilst minimising any negative consequences. Tenants seem happy with the explanation and are OK to start looking elsewhere, however I will call the council tomorrow to explain I will look to comply (worst case I recoup the cost of the heating repair from the sale).

Appreciate guidance as I am unsure whether I can evict without this appearing vengeful, are there any other aspects I need to consider. I have protected the deposit and prescribed in the first 40 days, have all the necessary checks and tests (per the initial on boarding of the tenant etc) so all in shape except recent events.

Kind regards
Terry



Comments

Simon Hall

16:30 PM, 6th February 2017
About 2 years ago

Terry,

Your first issue is that you have protected your Deposit within 40 days as opposed to legislative time limit of 30 days. Therefore your best port of call would be to return deposit in full to Tenant before you even think about serving a notice/evicting tenant as you will not be able to gain possession otherwise. Secondly, once you have returned deposit this does not release you from potential separate claim which could result in penalties. (1 to 3 times deposit amount)

Second issue, you will face, as Tenant has raised a complaint to Council and you have been served with improvement notice this will deemed to be seen as "Revenge Eviction" should your tenant decides to oppose your possession claim.

However, if your Tenant is content with possession claim and he does not object to possession claim then you could indeed go-ahead with possession without any difficulties. Finally, you must adhere to improvement notice served by Local Authority as failure to do so may result in hefty fines as well as possible prosecution. Moreover improvement notice is also registered against property at Land Registry therefore, unless you have complied with improvement notice, you may find it difficult to complete on sale of property.

Annie Landlord

16:45 PM, 6th February 2017
About 2 years ago

Whatever your motives are to take possession, I'm afraid to everyone else it will certainly look like a revenge eviction. I presume the tenant had asked you to fix the heating, properly, before they complained to the council? Why didn't you fix it? As Simon says, you will have difficulty selling until the council's order has been complied with. As you have to fix the heating anyway, maybe you would be better keeping your tenant and getting the rent in for a little longer? Have you calculated your CGT liability on the proposed sale?

Terry Lo

20:52 PM, 6th February 2017
About 2 years ago

Thanks for the response, I had meant to state 30 not 40 days (sorry mobile typed too quickly).

I was dithering as the repair for storage heaters seemed quite unattractive and given I had an inkling I was going to hang up my BTL boots was not committed to making the full repair and instead gave a few "temporary" heaters.

OK I will get the heating sorted to appease the tenant and council. Say I get this rectified by mid march...if the tenancy started 14th March 2016 then when should I issue section 21 please?

Whilst this is not a revenge eviction, the fact is has this appearance...what does it mean in practical terms? Am I unable to serve section 21 even though I have clearly explained to the tenant it is due to my own financial circumstances, I have not even mentioned the council notice to them at all. I just said I will implement the repairs as I will recoup this cost when I come to sell, so I am hopeful they will not object...

Simon Hall

21:49 PM, 6th February 2017
About 2 years ago

Reply to the comment left by "Terry Lo" at "06/02/2017 - 20:52":

Terry, you can issue Section 21 Notice 2 months prior to expiry of tenancy. In the event Tenancy has early break clause such as six months then you can issue Section 21 after 4 months in tenancy which should expire no earlier than 6 months in Tenancy. That's regardless of the fact whether you have 12 months tenancy or not.

In your case, assuming there is no early break clause, you could have issued Section 21 by 14th Of Jan 2017. (having regard to terms of tenancy). You can issue Section 21 anytime now, providing it gives minimum of 2 months notice without giving any reason to quit.

It is refreshing to know that you protected deposit within 30 days however there are raft of compliance with paperwork and you could easily fall foul of legislation which could potentially defeat your Section 21 Notice. In my opinion you would be better off returning the deposit before serving Section 21 notice. In the circumstances where you tenant seems clued up as he complained about you to the Local Council.

I would suggest that, you instruct professional Eviction company, the charges range from £40-£80 per notice. You can however do it yourself but the danger is that you could easily make it mistake and in addition, your tenant could receipt of notice. By using independent company you will benefit from Witness statement, Certificate Of Service and Accuracy.

H B

21:52 PM, 6th February 2017
About 2 years ago

"I had an inkling I was going to hang up my BTL boots was not committed to making the full repair and instead gave a few “temporary” heaters."

No wonder they complained!

Simon Hall

21:55 PM, 6th February 2017
About 2 years ago

Meant to say, your tenant could deny receipt of notice if you served yourself.

Ian Clifford

22:15 PM, 6th February 2017
About 2 years ago

Hi Terry

A few questions:

How much is the repair?

Have you sounded out any local Estate Agents or Lettings Agent with respect to selling with a tenant in situ?

Could the property be a viable proposition to someone else?

Despite the raft of changes not all landlords are battoning down the hatches.

Everyone's circumstances are different, but I'm not exiting the market and plan to extend my small portfolio, especially in the event of a slowdown in the market.

For many, despite the raft of changes BTL remains the most viable option of saving for retirement, or even for putting capital to use to gain a better income.

However, I feel somewhat disappointed in regards to the need for a Council Notice for action to be taken.

It's this kind of thing that gets landlords a bad name! And we need all the positive publicity we can get right now! I fear we're reaching the status of Bankers post-2008 right now!

Hope you get it sorted though!

Regards, Ian

Terry Lo

7:55 AM, 7th February 2017
About 2 years ago

Thanks I will give London Tenant Evictions a call for advice however I was thinking of downloading a section 21 template and giving it this Fri 10th Feb and having two copies, where one I kept and the other for the tenant. Both I will require her signature and dated.

Since her contract started 14th March 2016, I am tempted to give the section 21 on 13th Feb 2017 just so it's a clean 2 months from the contract date...am I allowed to give the section 21 on Fri 10th Feb but have her date these according to the 13th Feb 2017 just so the monthly cycle is cleaner (or is this just unnecessary)?

Hopefully by having her sign on my copy of the section 21 then she cannot deny reading either copy.

The cost varied from £350 to a complete change yo central heating (3 bedroom split level flat) at £3000. I will definitely comply with the council order before the deadline, but that's it...I don't want any further complexity with selling in tenant situ or having a council notice looming over my head.

Does this council notice have a tangible impact if recorded against the land registry or does this vanish after a period of time?

I'll revert back with the outcome, first thing is to get my ducks in order with section 21 whilst complying with the council order.

I will also discuss with the professionals whether it may be strategically better to just let the full 12 months run out before issuing section 21 (I.e. 13th/14th March 2017) as I may be opening a can of worms if she believes I am trying to evict her prematurely (although it sounds like it is within my right as I have break clause after 6 months)...however just thinking tactically maybe easier to comprehend a section 21 if issued after the full 12 month AST ends (from the tenant's perspective).

Terry Lo

8:02 AM, 7th February 2017
About 2 years ago

P.s. I am popping over to the flat this Friday to meet with a tradesman heater, that's why I potentially wanted to give the section 21 on that same day but simply date the form to coincide with the 14th of a given month.

Richard York

9:01 AM, 7th February 2017
About 2 years ago

With the revenge eviction law, you won't be able to evict for 6 months after the receipt of the council notice.

You can then issue a notice after that period has elapsed, so the earliest you can get them out is 8 months away. If they've got the council involved you've got not chance as the council is well aware of the law.

You might be able to offer them some cash to leave earlier (rent back?).

Frankly you deserve this. I wonder how you'd feel if a car you were leasing wasn't repaired for over a month and you were continuing to pay.

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