This year has seen updates to the laws governing landlords. This month, Stephanie Robinson highlights the two most significant changes to affect the rental property market...
I know there are rules relating to the retention of deposits, but I understand they were updated earlier in the year. What has changed?
At the moment, landlords and letting agents must protect bond money though one of the government-backed tenancy deposit protection schemes.
This applies to all assured shorthold tenancies that started or were renewed after April 6, 2007. Deposits taken against tenancies that began before this date and haven’t been renewed are not affected.
A change in the law earlier this year means that landlords and agents now have just 30 days to lodge bonds taken after April 6, 2012 with an approved scheme and provide tenants with the appropriate information about where their money is held.
If you do not meet this deadline, the courts can force you to pay the tenant between one and three times the value of the deposit.
Of greater concern to landlords will be the inability to recover possession of the premises if a bond is not protected lawfully.
An assured shorthold tenancy can normally be brought to an end by serving two months’ notice on the tenant, provided any fixed term has expired.
The recent changes restrict a landlord’s right to serve this notice if the deposit was not protected within the time limit. It would appear they remain in place, even if it is protected late.
You can, of course, choose not to take a deposit but this is not a good idea.
It gives the tenant an incentive to look after your property and makes it easier for a landlord to recover any losses for damage at the end of the lease.
I have heard new anti-squatting laws have been introduced. How do they affect my rights?
On September 1, squatting in a residential building was made illegal, punishable by a prison term of up to six months, a maximum fine of £5,000 or both.
This new offence was introduced under section 144 of the Legal Aid Sentencing and Punishment of Offenders Act 2012. It was designed to strengthen the law so that legitimate owners of residential property, who have been excluded (including landlords, local authorities and second home owners), can call the police and report a criminal offence if a squatter fails to leave when required.
The police can now enter your property and arrest the squatter, but to be found guilty of the offence, prosecutors have to prove that the person involved knew he or she was trespassing and intended to stay there.
Prior to this new legislation, section seven of the Criminal Law Act 1997 dictated that anyone who trespassed onto residential property and failed to leave, having been asked to do so, was guilty of a criminal offence. Unfortunately, simply entering an empty property was not considered illegal unless damage was caused.
Instead, the homeowner had to obtain an interim order for possession, incurring time and money, and only when the squatter ignored the courts could criminal sanctions be applied.
Housing minister Grant Shapps said: “We are tipping the scales of justice back in favour of the homeowner.” However, housing charities are concerned that the new laws could lead to a sharp increase in homelessness. In fact, the only person to be jailed so far for squatting, Alex Haigh, was a 21-year-old who went to London in search of work. He had been living in a hostel full of alcoholics and drug addicts, so began squatting in an empty housing association flat where he felt safer. He was arrested and jailed for 12 weeks on September 2 this year.
In the current economic climate, when jobs are scarce and rents are increasing, some argue that squatters represent vulnerable homeless people who need help, not jail. On the other hand, I am sure property owners will think that the new offence should act as a deterrent and will speed up recovery of possession.
Stephanie Robinson is a solicitor specialising in property and commercial litigation at Sheffield’s Taylor&Emmet LLP. Telephone 0114 218 4000 or visit www.tayloremmet.co.uk and www.landlorddisputes.co.uk.