LandlordZONE

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Jul, 2014

Tuesday

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  1. #1

    Default My landlord wants to make me, his tenant, into her agent. Things to consider?

    I'm in a situation where I would like to hear some advice what I should do since I'm certain that my landlord will try to take an advantage of me. I'm a university student living in Harrow (London). I have rented a room from my Landlord who I met two years ago when she was renting one of her rooms as a home stay option for an international students. So I was her customer once and when I got accepted to study at university (which is pretty much around the corner of her house) I asked her if she would be willing to rent me a room from the house. Well she was happy to do so and once I moved in she soon rented other rooms in the house as well since she realized that she could earn money by doing this.

    There are currently four people living in the house (+landlord). Most of this time my landlord has been living in an another country where here family lives and she has let an agent to take care of her property while she has been gone. This agent hasn't however done anything for the house, he just manages the money and is very keen not to fix anything in the house, he just makes me to take care of everything. I'm not lying when I say that have been the "real agent" in this house ever since I moved in. Till today I have taken care of all the problems this house has seen from a leaking bathroom to finding new people for the rooms. I haven't got any compensation for doing this all, I have only got £50 "finders fee" off my rent every time I have found my landlord a new person for an empty room. So I have done a lot charity for my landlord and the agent for over 1,5 years now so of course by now my landlord trusts me since I have taken extremely good care of her house and she knows that I will keep it in a good shape as long as I live here.

    Few days ago my landlord came back to the house and yesterday she told me that she is now planning to make me her agent and ditch our current agent. I would assume that she has realized that there is no point for her to pay this agent who doesn't really do anything, I do all the work for him and more efficiently and with less money! So my landlord has suggested that I take over the agent but I'm not sure what kind of compensation I should be receiving if I do that. I'm sure she will try to give me the smallest compensation possible because that's just the way she does things, but if I know more about these things before she offers me this deal officially, I have more room for negotiation.

    Based on the the things I have read from the internet and here on Landlordzone people seem to be saying that letting agents take about 10% of the total rent. Since I'm just an international university student who has no previous experience about being an agent of any kind, I'm not sure what should I do in this situation. My landlord has mentioned that she would give some money off my rent for acting as her agent but she hasn't mentioned how much. She is currently charging from four people in this house: £540, £540, £450, £450 (my rent is £540/month). So she earns about 2000 pounds every month. I have no idea how much she is paying for this agent but I'm sure she will save quite a lot money if she starts using me instead of him. I's almost guaranteed that she will draft this "act as an agent offer" in a way that she wins and I lose since she want's to gain more profit for her pocket. I wouldn't even be surprised if she would offer me something like let's say £20 off my monthly rent for acting as an agent. So what do you think about this situation and what advice would you give me? How much I should get compensation if I would agree to do what she wants?

  2. #2
    Join Date
    Feb 2005
    Location
    Hampshire
    Posts
    6,026

    Default

    Whoa there! Don't touch it at all. You should also look at the implications that the property is probably an HMO which has huge financial and legal implications which could cost you a lot of money as the collector of rent. This makes you personally responsible

    Also if the owner is living abroad then she will need to complete a tax exemption form (NRL1) otherwise you are legally obliged to deduct tax from rents received, and will be directly responsible for completing a tax return and the payment of tax on a quarterly basis.

    And I've only just started. You might all be living in an unlicensed HMO where fines for failing to register and be licensed are huge. You can check this with your local authority, but equally there has to be a notice in the hallway of the house or similar giving all such information about the licence, and if it's not there then it is not licenced. The fire precautions are only just the beginning. Take legal advice PDQ.
    The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.

  3. #3

    Default

    Thank you so much for your advice! My landlord comes back about 1-2 times a year and then she takes care of any issues related to the house. What I understood from her speech was that she would not make me to collect the rent, I would just be taking care of the house and finding new people once people leave. That's all. As far as I'm aware she has licensed our house as a place where more than one people live (I actually went to Harrow Council to clarify that) and she is paying all bills, taxes and council tax, so in that term she should be fine. Of course I would do more research about this if she would make me to collect rent etc.

    In a scenario where I would take her offer, how much do you think I should roughly get from her if she handles collecting the rent and paying all bills, and I'm just a person who looks after the house and finding people? Would that still require a lot of paperwork or could it be a simple agreement between me and my landlord? I would just like to know a some kind of figure (or percentage) I should get so that once she comes to talk to me next time I know right away is her offer something even worth to consider or should I turn it down right away.

  4. #4
    Join Date
    Jun 2008
    Location
    oop north
    Posts
    4,791

    Default

    As above, don't touch it
    I am renting a WHOLE 2 bedroom house, with drive and 4 cars.
    2 on drive, 1 behind gates on one in garage for the about same price
    as you pay. All to myself ! !!!

    For £ 2000 a month she can do her own lettings.

    I would walk away and find cheaper. Say £ 340 max per month if
    4 are sharing, that way you earn £ 200 a month for doing nothing,
    over where you are living now.

    She is making £ 2000 a month, and you are doing ALL the work.
    Walk away.

    R.a.M.

  5. #5
    Join Date
    Jul 2008
    Location
    help@tenancyservices.co.uk
    Posts
    15,864

    Default

    I agree with the others that this has the potential to become a disaster. It may not, but there are so many laws etc that you are unaware of that could really come back & become a problem. I know you think your landlady is doing things properly, and the fact the property is registered is good, but lets take tax for instance - although you say she pays tax now, it is YOU who HMRC would be coming after if she stopped paying - and you have no guarantee she wont. As the manager of the HMO, it is you who could end up in court if the property doesn't comply with the numerous legal requirements, and those can easily be 4-figure fines.
    What if you make a mistake & that costs the landlord money - she could sue you! Google the 'law of agency'. You already know she is not making this offer to benefit you - it is to benefit her.

    I think it is time to look somewhere else. You are already being taken advantage of, it sounds like the landlady intends to worsen that! I don't know rents in Harrow but a quick search found this at £450 http://bit.ly/WP9zyr and the only pressure on you would be to use the included sauna and possibly the gym provided in the garage!

  6. #6
    Join Date
    Jun 2008
    Location
    oop north
    Posts
    4,791

    Default

    As stated YOU are the HMO Manager. No doubt about that.

    Below are YOUR legal duties as of now, and failing to observe
    the rules can get you fined £ 5000.

    Regulations apply to all HMOs
    The management regulations apply to all HMOs. They address issues
    such as the maintenance and upkeep of existing amenities, rather
    than improvements.. They are an extremely detailed set of
    regulations covering the maintenance and repair of rooms,
    appliances, WCs, baths etc. They will require 5 yearly electrical
    tests.

    Duties under the Regulations
    The management regulations impose duties on the an HMO in
    respect of the repair, maintenance, cleanliness and good order of
    the house and facilities and equipment in it. They can also impose
    duties on persons occupying a house, such as tenants, for
    ensuring that the person managing the house can effectively carry
    out his duties.

    A person commits an offence if he fails to comply with a regulation.
    There is a defence of reasonable excuse. The person guilty of the
    offence is liable on summary conviction to a fine not exceeding level
    5 on the standard scale (currently a maximum of £5000) Previously,
    there was power to serve notice requiring works to be carried out
    to comply with the management regulations but this has been
    repealed and not replaced.
    One can expect a local authority to mount a prosecution especially
    if there is a serious breach (e.g. for failure to test a fire alarm
    system and a fire occurs or in cases of gross neglect).

    Converted blocks of flats
    As regards converted blocks of flats which are HMOs the old
    management regulations continue to apply for the time being
    rather than the updated version.
    The Government will be issuing new management regulations for
    these based on the existing management regulations but with
    modifications to deal with the different circumstances especially
    where they block has a mixture of owner/occupiers and rented
    properties.

    Scope of the Regulations for Landlords etc
    These duties include the following:
    1. Maintenance of common parts, fixtures, fittings and
    appliances

    Managers are required to maintain the following in repair, good
    order and a clean condition.
    Water, gas and electricity supplies and drainage facilities;
    Appliances such as cookers, heaters, washing machines
    Shared lighting and heating facilities, including hot water
    supplies
    Shared toilets, baths, sinks and basins;
    Shared cooking, food storage and other installations
    Staircases, handrails, halls and landings, including floor
    coverings;
    Windows and other means of ventilation
    Outbuildings, paths, yards and garden areas

    2. Maintenance of living accommodation
    Managers must ensure that:
    Each unit of living accommodation and any furniture
    supplied are in clean condition at the beginning of a
    person’s occupation of it;
    The internal structure of living accommodation and
    any fixtures, fittings or appliances supplied within it
    are maintained in good repair and clean working order,
    subject to the tenant behaving in a tenant-like manner.

    3. Safety Measures
    Managers must take reasonable safety measures to ensure that:
    Tenants are protected from injury;
    Means of escape from fire are free from obstruction
    and in good order;
    The fire alarm system and any fire fighting equipment
    provided are maintained in good order;
    Ensure that notices are displayed indicating means of
    escape in case of fire

    4. Supply and maintenance of gas and electricity
    Managers must:
    Not unreasonably interrupt supplies of gas or electricity
    Supply the local authority on demand the latest gas
    appliance test certificate for the HMO;
    Ensure that every fixed electrical installation is
    inspected and tested at intervals not exceeding five
    years by a person qualified to undertake such inspection
    and testing AND obtain a certificate from that person
    specifying the results of the test AND supply that
    certificate to the local authorities if requested to do so.

    5. Provision of information for tenants
    Managers must:
    Display a notice in the HMO giving the name, address
    and telephone number of the manager so that residents
    have someone to contact whenever necessary.

    6. Waste disposal facilities
    Managers must:
    Provide enough bins for refuse disposal, make sure
    rubbish does not accumulate and make arrangements
    for the disposal of refuse and litter having regard to
    any service provided by the local authority

    Duties of occupiers / Tenants etc must:
    Take reasonable care to avoid damage and disrepair;
    Co-operate in a reasonable way with the manager,
    and provide information to allow him/her to carry out
    their duties;
    Comply with any reasonable arrangements made by
    the manager regarding means of escape from fire and
    refuse storage and disposal;
    Allow the manager access to their rooms to carry
    out his/her duties.

    Prosecutions
    If a manager, or occupier, fails to comply with any management
    regulation without a reasonable excuse they may be prosecuted
    and liable to a fine of up to £5,000.
    Before prosecuting, the local authority will normally give an
    opportunity to remedy the breach and may monitor the situation
    to ensure continued compliance.
    However, the local authority does not have to give someone the
    opportunity to comply and may decide not to if it is satisfied the
    breach is serious or has caused harm, is persistent or has
    happened before.

    Converted Blocks of Flats which are HMOs
    Strictly speaking the old Management Regulations apply to blocks
    of converted flats which are HMOs. In time, new regulations
    will replace these. In practice, this does not make any difference
    since generally the same requirements apply.


    R.a.M.

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