Investment In Property Sees An Explosion In Popularity
Investment in property has seen an explosion in popularity over the past decade as a result of a sustained period of historically low interest rates.
Last year private rentals funded by buy-to-let mortgages accounted for around a fifth of the value of UK residential properties overall. However in the light of changes to tax reliefs for residential landlords more and more landlords are looking to cash in their investments.
Landlords need to recover possession of rented residential properties for a variety reasons. Many see the process of bringing the tenancy to an end as relatively straightforward, simply giving the tenant 2 months’ ‘Notice to Quit’. While it is possible to gain possession of a property quite easily, landlords must follow the correct rules and procedures.
Under Section 21 of the Housing Act 1988 tenants can be given 2 months notice to leave the property. Landlords do not need to give any reason for wanting to end the tenancy and nor do they need to show that any breach of tenancy has occurred. As a result, if the documentation is correct this can be one of the easiest ways to bring a tenancy to an end.
However, since new obligations were introduced on 1 October 2015, we have seen a rise in the number of landlords or agents who have a simple, but potentially very costly, technical error; either in the process of serving the notice or in setting up the tenancy in the first place. In either case this could render their notice invalid, presenting them with a real problem when they want to regain possession of the property.
One of the most commonly encountered issues relates to deposits. Where a deposit is taken, a landlord must protect it in a government approved deposit scheme and must also give the tenant information about how their deposit is protected within 30 days of the deposit being taken. If either of these requirements has not been met or is done outside the specified timeframe, the tenant cannot be given a valid Notice to Quit. In that situation, the landlord must return the deposit to the tenant before the notice can be served. This not only causes delay in securing possession of the property but also leaves the landlord in a vulnerable position and exposed to a fine of up to three times the original deposit amount.
For tenancies starting after 1st October 2015 a specific form of Notice to Quit now needs to be used, which cannot be served at all unless the tenant has been given an Energy Performance Certificate, a copy of the Gas Safety Certificate and information about their rights and obligations as a tenant.
For further advice on complying with your Landlord obligations or assistance with seeking possession of your property, please contact Nicola Mitchell-Rodd of Wolferstans on 01752 292278 or email@example.com who will be happy to assist with all Landlord and Tenant related matters.