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answered by Tessa Shepperson
of www.landlordlaw.co.uk
and LSA
What should I look out
for when buying a property with sitting tenants?
Ideally you will want any sitting tenants
to be assured shorthold tenants, because then you will be
able to evict them easily if you want to. You will need to
check therefore the status of all tenants in occupation. To
do this, find out when the tenant first went in (i.e. not
just the date of the last time the tenants were given a new
written agreement).
If they went in before 15th January 1989 then
the tenants will be a 'protected' tenants and not only will
it be almost impossible for you to evict them (unless you
provide them with 'suitable alternative accommodation'), but
you will also be unable to charge them a market rent, only
the 'fair rent' set by the Rent Officer.
If the tenants first went in between 15th
January and 28 February 1987 then unless a section 20 notice
(in the proper form) was served on them at least one day before
they went in, they will almost certainly be assured tenants,
and again you will probably be unable to evict them (again
unless suitable alternative accommodation is provided). You
may also have difficulties raising the rent, although you
will, in this case, be entitled to charge a market rent.
Note that if the rent is more than £25,000
per annum, or if the tenant is a limited company, then the
tenancies will be a 'common law' tenancies and slightly different
rules will apply to them. If the current landlord lives in
separate self contained accommodation in the same building,
it will currently also be a 'common law' tenancy but its status
will change once it has been sold.
If the property has lots of tenants, you will
need to find out whether it is classed as an HMO, because
if so you will have extra management responsibilities. Also
if you want to get rid of the HMO tenants and use the property
as a family home you may need to get planning permission.
These are perhaps the main legal problems
you might encounter, however every property is different and
can have different problems. Find out all you can about the
tenants, particularly their payment record and whether their
behaviour is good. Check also whether they have paid a damage
deposit and ensure that this is passed over to you on completion.
Note - these notes are for guidance
only. In all cases you should get further advice from your
solicitor relating to the particular property you are
What documents do I
need to get from the seller when buying a property with sitting
tenants?
You will need to get all the documentation
held by the owner in connection with all the tenancies in
the property. In particular you will need:
- A copy of the first tenancy agreement and
the current tenancy agreement (if there is more than one)
- A copy of the rent register for any protected
tenants (this will tell you the current rent and when you
can apply to have it increased)
- Copy of the section 20 notice served on
tenants whose tenancy started between 15th January 1989
and 28th February 1987, with proof of service.
- Copies of any possession notices that have
been served on tenants, again with proof of service Ideally
you should get a statutory declaration from the owner in
respect of each and every tenancy confirming these matters.
This is particularly important if there is no tenancy agreement
documentation available. A statutory declaration is also
a good idea when you need to have evidenceof service of
notices. Remember you may need to prove these matters in
court, and once the property is sold to you, the owner may
beunavailable or unwilling to assist you.
Note - these notes are for guidance
only. In all cases you should get further advice from your
solicitor relating to the particular property you are buying
Can I evict sitting
tenants once I have bought the property?
First of all, be aware that you can only ever
evict a residential tenant through the courts. If you evict
them without a court order you will be committing a criminal
offence.
If the tenants are protected tenants, i.e.
if their tenancy started before 15th January 1989, you will
normally only be able to evict them if you are able to provide
suitable alternative accommodation. However if the tenants
do not want to move (particularly if the property has sentimental
meaning for them) note that a court may be unwilling to find
that the property you have selected is in fact 'suitable'.
You should therefore only ever purchase a property with protected
tenants if you are willing for them to remain indefinitely.
- If the tenancy started between 15th January
and 28th February 1987 then you will need to be able to
prove that a section 20 notice was served on the tenants
before the tenancy was entered into (i.e.at least one day
before the start of the tenancy). If this cannot be provided
the tenants will be assured tenants. In which case, unless
the tenants are in arrears of rent of more than two months,
or unless you have suitable alternative accommodation available,
you will almost certainly not be able to evict them. Again,
think carefully before taking on a property with assured
tenants.
- If the tenancy started after 28th February
1987 then they will be assured shorthold tenants, and you
will be able to evict them aftertheir fixed term has expired,
provided a possession notice in the proper form has been
served on them at least two months in advance. If a notice
has already been served by the current landlord, your solicitor
should check to see that it complies with the legal requirements
and that you have proof of service.
- If the tenants are 'common law' tenants
then they will not be protected under the various statutory
codes and you should be able to evict them at the end of
any fixed term provided a notice to quit inthe proper form
has been served on them. These are the basic rules for the
main types of tenancy you are likely to encounter.Note
- these notes are for guidance only. In all cases you should
get further advice from your solicitor relating to the particular
property you are buying.
What can the landlord do if the tenant
is not looking after theproperty properly?
1/English and Welsh law
English and Welsh Law
A landlord has little control over the conduct
of his tenants once they are in occupation of the property.
This is why it is so important to be careful when choosing
your tenants. If the tenant is causing major damage to the
property, you may be able to apply for a possession order
after serving a two week notice. However as you will be claiming
possession under one of the discretionary 'grounds' your tenant
may be able to obtain legal aid to defend the proceedings.
You should seek legal advice from a specialist housing solicitor
before taking any action. Otherwise the best course of action
is to threaten to evict the tenant at the end of the fixed
term, if he does not improve his behaviour (note, this is
assuming that the tenancy is an assured shorthold tenancy).
You should also serve the proper form of notice on the tenant,
which cannot end before the end of the fixed term and must
give the tenants a notice period of at least two months. On
expiry of this notice, you will, if the tenants behaviour
has not improved, be able to evict the them under the 'accelerated
possession procedure'.Further information about possession
notices and the possession procedure can be found on the www.landlordlaw.co.uk
web-site.
How can the landlord
increase the rent?
1/English and Welsh law
English and Welsh Law
If the tenancy is an assured or an assured
shorthold tenancy, rent can only be increased by one of the
following methods:
- By agreement with the tenant, e.g. by the
tenant signing a new tenancy agreement with the new rent
or providing written confirmation that the new rent is agreed.
This is the best way to increase the rent.
- By serving the proper form of notice of
rent increase on the tenant. This can only be done after
the fixed term has expired, and the tenant has the right
to refer the rent to the Rent Assessment Committee, if he
feels that the rent is too high. For this reason increasing
rent by this method is best avoided. Note that the form
of notice changed with effect from June 2001.
- Pursuant to a rent review clause in the
tenancy agreement
Note the if the tenancy is a protected
tenancy under the Rent Act, and a fair rent is registered,
this can only be increased every two years by application
to the Rent Officer.
Further information on this and other matters
can be found on the Landlord-Law Online web-site at www.landlordlaw.co.uk.
What should the landlord
do if the tenant refuses to grant access for inspections?
1/English and Welsh law
English and Welsh law
If this happens landlord should try to talk
to the tenant to find out what the problem is. He should explain
that the inspections are for the tenant's benefit to check
the condition of the property so any necessary repairs can
be done, or to carry out the annual gas check. If the tenant
still refuses to allow the landlord access, the landlord will
have to abide by this. It is important that the landlord does
not just use his keys to gain access when the tenant is out.
This will be deemed harassment and is a criminal offence.
So far as the gas regulations are concerned,
non compliance with these is normally a criminal offence,
however the landlord will not be prosecuted if he has made
reasonable attempts to get the annual check done. To protect
his position though, it is a good idea for the landlord to
contact the local Health and Safety Executive (who police
the regulations) and inform them of the situation.
So far as the landlords general repairing
covenants are concerned, the landlord cannot be held liable
for breach of these, if he has not been
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