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SusanHyde
15-12-2011, 14:23 PM
I am purchasing a property that has tenants in with an AST from 2009 12 months.

I understand that it is now held over.

Rent is to be paid every Monday.

Do I need to supply a rent book. Where can I read about that?

I live quite far from the property, will I need to travel down every month to sign the rent book? or can I send receipts?

Thanks.

jta
15-12-2011, 14:30 PM
The law says you must supply a rent book. It seems to be immaterial whether it is kept up to date or whether rent is signed for. Get the rent book signed for and make whatever other arrangements you see fit.

thesaint
15-12-2011, 15:55 PM
A "rent book" can be a sheet of A4 that has the necessary information.
Just Google for one, print it out, send it, forget about it.

mariner
15-12-2011, 17:29 PM
Imm after prop purchase you need to formally notify Ts that you are their new LL. A new rent book 'or similar document' prescribed info will include your name and contact address 'for the service of documents'. You do not have to sign the rent book each week for receipt of rent, though Ts may use it as a record of rent paid with dates. You should be able to provide a corresponding rent statement regularly or when requested.
Pres you will meet with Ts soon after purchase. If Ts do not have an Assured Tenancy and wish to stay for at least 6 months, you could offer a new AST with fixed term of 6 months with rent payable monthly and re-calculated pro rata. They can still pay rent weekly if desired but no rent book required.

PaulF
15-12-2011, 20:48 PM
All OP has stated is that rent is "paid every Monday". That might be something the tenant actually physically does rather than how rent is reserved in the AST, which is what should prevail. Just a point worth consideration!

SusanHyde
15-12-2011, 21:39 PM
All OP has stated is that rent is "paid every Monday". That might be something the tenant actually physically does rather than how rent is reserved in the AST, which is what should prevail. Just a point worth consideration!

AST has it as £XXX per week in equal payments paid every Monday.

If I send a letter with all information on myself and rent etc. is that ok as 'or similar document' or do I need to give them the sheets with the chart of rent even if it will never be used?

SusanHyde
15-12-2011, 22:16 PM
Besides, whay would the ast have been made for weekly rent? Who does that help, LL or T?

45002
15-12-2011, 22:49 PM
I am purchasing a property that has tenants in with an AST from 2009 12 months.

I understand that it is now held over.

Rent is to be paid every Monday.

Do I need to supply a rent book. Where can I read about that?

I live quite far from the property, will I need to travel down every month to sign the rent book? or can I send receipts?

Thanks.

Hello Susan

Are you sure the tenants moved in in 2009 ?

SusanHyde
15-12-2011, 22:54 PM
Hello Susan

Are you sure the tenants moved in in 2009 ?

Details are difficult to come by as this is a repossesion, but I think tenants were there for some 15 years and previous LL drew up an AST in 2007.

Why do you ask?

Ericthelobster
15-12-2011, 23:12 PM
Why do you ask?Because it has a big impact on what the rights of the tenants are. The 2007 agreement potentially may not be worth the paper it's printed on. Did your solicitor fully investigate the status of the tenants before you exchanged contracts?
See http://www.landlordzone.co.uk/residential_tenancies.htm

SusanHyde
15-12-2011, 23:28 PM
I am a little worried now. I did mention to the Solicitor that I want him to check if I could get them out and he confirmed that yes as there was an AST from 2007, I dont know whether he checked more. Details were a little sketchy as it was a repossesion.

Why would there be an AST if not valid? Fraud? Is there a way to find out? 15 years would be just around 1996.

SusanHyde
15-12-2011, 23:40 PM
Ericthe lobster, why did you think of asking that? Is it because of the weekly payments, or is that just a standard observation?

45002
16-12-2011, 00:23 AM
I am a little worried now. I did mention to the Solicitor that I want him to check if I could get them out and he confirmed that yes as there was an AST from 2007, I dont know whether he checked more. Details were a little sketchy as it was a repossesion.

Why would there be an AST if not valid? Fraud? Is there a way to find out? 15 years would be just around 1996.

You need to make your Solicitor earns there Fee and find out exactly when theses tenants moved in.

Why do you mention 15 years in you post ?

If they moved in between 15 January 1989 and 27 February 1997 and the ordinary landlord did not give a notice saying that they would have an assured shorthold tenancy.

They would be Assured tenants.http://england.shelter.org.uk/get_advice/renting_and_leasehold/private_tenancies/assured_tenancies


It does sound odd that they are paying rent weekly (AST ?) and still living there after a repossession..

SusanHyde
16-12-2011, 00:32 AM
You need to make your Solicitor earns there Fee and find out exactly when theses tenants moved in.

Why do you mention 15 years in you post ?

If they moved in between 15 January 1989 and 27 February 1997 and the ordinary landlord did not give a notice saying that they would have an assured shorthold tenancy.

They would be Assured tenants.http://england.shelter.org.uk/get_advice/renting_and_leasehold/private_tenancies/assured_tenancies


It does sound odd that they are paying rent weekly (AST ?) and still living there after a repossession..

I did hear something about them being there for 15 years... thats why I asked Solicitor to check and he came back tha there was an ast.
In an assured tenancy do they never pay weekly? Why would a LL request to be paid weekly?

SusanHyde
16-12-2011, 00:33 AM
You need to make your Solicitor earns there Fee and find out exactly when theses tenants moved in.

Why do you mention 15 years in you post ?

If they moved in between 15 January 1989 and 27 February 1997 and the ordinary landlord did not give a notice saying that they would have an assured shorthold tenancy.

They would be Assured tenants.http://england.shelter.org.uk/get_advice/renting_and_leasehold/private_tenancies/assured_tenancies


It does sound odd that they are paying rent weekly (AST ?) and still living there after a repossession..

I did hear something about them being there for 15 years... thats why I asked Solicitor to check and he came back tha there was an ast.
In an assured tenancy do they never pay weekly? Why would a LL request to be paid weekly?

Regarding repossesion, why cant they stay? The repo was by a bridge loan company and they wanted a quick sale.

45002
16-12-2011, 00:47 AM
I did hear something about them being there for 15 years... thats why I asked Solicitor to check and he came back tha there was an ast.
In an assured tenancy do they never pay weekly? Why would a LL request to be paid weekly?

Regarding repossesion, why cant they stay? The repo was by a bridge loan company and they wanted a quick sale.

Don t worry about the weekly rent for the time beaning.

You need to find out this from your Solicitor

1st

The exact date they moved in

2nd

Did the Ordinary landlord give a notice to the tenants saying that they would have an assured shorthold tenancy at the start of there tenancy.

If the Answer is No and they moved in between those dates I posted early on,they are Assured Tenants and signing a AST would not be worth the paper it's wrote on

Make your solicitor earn there money your paying them

mariner
16-12-2011, 00:51 AM
I agree with 45002. If this was a mort lender repo and lender could not evict Ts for vacant poss, indicates Ts had Assured Tenancy,
Susan, you should require your Solic's to determine when Ts moved in and what Agreement was signed. You may have a claim against conveyancing solic for lack of due dilignce.

thesaint
16-12-2011, 09:14 AM
Why would there be an AST if not valid? Fraud? Is there a way to find out? 15 years would be just around 1996.

They may well have an AST from 2007, but it does not erode the rights they would have as a protected tenant.
Your weekly rent problem is nothing compared to the problem you may have as them as protected tenants.

Buying a property with protected tenants is not worth nearly as much as ones on a proper AST.

Ericthelobster
16-12-2011, 09:30 AM
Susan you say you are "buying" the property but have you actually exchanged contracts yet? If not you absolutely need to delay until this is nailed down...

SusanHyde
16-12-2011, 12:31 PM
Susan you say you are "buying" the property but have you actually exchanged contracts yet? If not you absolutely need to delay until this is nailed down...

I am gong to sound really silly but I have already exchanged early this week and put a 25% deposit.

I did this because I had asked my solicitor if this was ok and he advised that yes. He did point out certain issues, but these were not significant e.g no rent record and no original AST, it was a copy. I did ask him to check that the AST has no unusal clauses and he confirmed. Is this suable as undue diligence? I called today and he said I hadnt mentioned this about 15 years. I am sure I did, but it wouldve been verbal.

How much does it lose value if a assured tenancy?

Snorkerz
16-12-2011, 19:27 PM
How much does it lose value if a assured tenancy?That depends on the age of the tenants - assured tenants can stay there until they die or they do one of the few things that would allow you to evict them.

SusanHyde
18-12-2011, 00:26 AM
Does the tennant have to prove he is an assured tenant, or is the onus on me to prove he is not?

mariner
18-12-2011, 01:53 AM
I would suggest onus is on current LL requiring some investigation.
1. talk to Ts, ask when they moved in? Was weekly rent collected in person by LL or rent collector (LL agent)
2. Access Land Registry Deeds online (£4) or consult actual Deeds for prior ownwership of property, with dates
3. If property has been subject to previous Fair Rent determination (Rent Officer determination for Assured T), this should be avail online or on request.
Sitting Assured T could reduce market value of property by 25-50% as buyers may be limited to investment purchasers.
Old Assured Ts often had weekly rent payment requirements.

mariner
18-12-2011, 12:45 PM
botr, OP asked if it was Ts or her resp to prove T is Assured T. As OP has already 'exchanged', then legally she is the current owner/LL. Her conveyancing solic appears clueless and some investigation can be DIY'd online with Land Registry & Valuation Office Agency website (fair rent register).
Why would Ts be nervous & unwilling to co-operate if they are Assured Ts? I assume they would be keen to meet their new LL for a chat and vice versa.
There may be a current GSC and EPC. Elec safety check a good idea.
I agree with you that an Assured T of long standing on lower than market rent is pref to fly by night short term ASTs.

SusanHyde
19-12-2011, 13:58 PM
Thanks all for the advice.

@ Bandontherun, thanks for your kind words, it really was getting to me. I did indeed buy about 30% below market value, I was just worried that the value was say 50% of market value. The dwelling in in good order and well maintained by the occupants.

Why do you suggest so strongly the gas/electrical test?

BTW I have complted, due to exchange not being subject to AST.

SusanHyde
19-12-2011, 20:58 PM
Thanks. I have now confirmed that the tenant is an assured one. However rent is very healthy and although the AST was useless the rental sum was true and it is about 11%.

There are 2 tenents there in two rooms, and they arent related. What happens if only one had the assured tenancy, can he bring in/sublet to another person? Does the other person also get his rights? If I agree for hm to bring someone else so as to raise the rental income, does that give the other one rights?

Bottom line, is there anything I should make sure as of now that the tenant doesnt do so as not to prolong this tenancy for generations?



Prudence!

Repossessed properties tend not to have had their safety inspections carried out. Assume the gas inspection is out of date; and as a result that you as landlord is in breach (and liable for a stiff fine) arising out of the statutory obligation because no gas test has been carried out in the last twelve months. There is no such time table for the electrical installation check up but its worth knowing exactly where you are, as regards electrical safety and establish yourself with the tenants as being a landlord who is responsible toward the tenants welfare. If these people are assured tenants, disrepair of the house entitles them to apply to have rents reduced at the Rent Assessment Committee.

Buying at a discount of 30% to Market value; or rather market value with vacant possession (VP) sounds good.

It is the central paradox of investing in property that an empty property costs the landlord money, yet as soon as a property is tenanted its open market value is reduced as a result of the tenant's occupancy.

The rent acts provided tenants with tenure for, literally, generations. At one time rents for such lettings were payable at approximately a third to 40% of the market rent. Back then sitting tenant properties under the rent acts sold for 50% - 60% discount to VP. Nowadays even these much less attractive investments make 70% of their value with VP; yours however are either AT (assured tenants) or ASTs (assured shorthold tenants).

I was interested to notice subsequent to writing this that Grainger, the UK's largest quoted landlord reckons market value of their Regulated portfolio (rent act tenants) to be a similar discount for what you achieved for an AT or AST!

(from Grainger website)...
Regulated units owned 5,853
Market value £954m
Vacant possession value £1,280m

SusanHyde
20-12-2011, 16:50 PM
The council is paying both their rents direct to landlord so cant accept rent only from tenant. Why did you suggest only receiving from tenant?


There is no reason why an assured tenant cannot take in a paying lodger. The other person is unlikely to be a co-tenant although that is remotely possible. You should accept rent from your tenant only. As to the presence of the other "tenant" I say Live and let live. You are getting a fab return.

Ericthelobster
20-12-2011, 16:57 PM
The council is paying both their rents direct to landlord so cant accept rent only from tenant. Why did you suggest only receiving from tenant?Because then there's a clear relationship between the second resident and the landlord; it's difficult to assert that this person is a lodger of the original tenant if he's paying rent to the 'overall' landlord rather than the original tenant. The reasonable implication would be that the second person is a tenant too, with all the rights that go along with that.