Here is a question to the blog clinic from Patricia who is a disabled tenant
I am a tenant renting a property, I do not have a rent book but have lived here and paid the rent for 6 months (it’s a friends house). I am interested in updating the bathroom as I have a disability & wish to change the bathroom and put in a walk in shower.
The cost of this would be around £5000. I also wish to update the bedroom furniture costing approximately another £1000.
How can I ensure that the landlord does not evict me after I have made the improvements & how can I have a legal interest in the property.
Answer
You need to be very careful indeed about spending large sums of money on other people’s property, as the story here shows.
You already have a legal interest in the property as a tenant. What you need however, is more security of tenure than you have as an assured shorthold tenant, where you can be evicted on relatively short notice under section 21.
The best thing would be to get your landlord to agree to convert your tenancy into an assured tenancy (as opposed to an assured shorthold tenancy which is almost certainly what you have now).
This would give you long-term security and your landlord would find it hard to evict you for anything other than rent arrears, as section 21 will no longer be available to him.
However, very few landlords would be willing to do this and if he takes advice, most legal advisors would advise against it.
You may also be able to persuade your landlord to give you a long fixed term. However again, many landlords will be unwilling to do this.
It would also be against your interests to have a fixed term of more than seven years (which I suspect you would want) as then the landlords’ statutory repairing covenants would no longer apply meaning that you would be responsible for all repairs to the property, which could prove expensive for you.
However, if your landlord is aware of the work that you do and does not object to it you may have a defence if your landlord then proceeds to evict you within a short period of time. This would be under a legal doctrine called ‘estoppel’ which is where the law does not allow someone to rely on their strict legal rights if they have stood by and allowed someone to act on the basis that those rights would not be used.
So for example this could well work in your favour if you are able to show that your landlord allowed you to do this work, knowing that you believed you would be allowed to stay long term.
If indeed this was the case.
What about getting the landlords to use a “Deed of Assurance”?
“The basic principles are simple, a Deed of Assurance is a legally binding contract between the landlord and tenant which facilitates integrity. The landlord provides a compensation backed promise not to serve notice on the tenant for an agreed period of time providing the tenant complies with all conditions of the tenancy agreement. This serves as an alternative to providing a long term tenancy agreement which may well be in breach of a landlords mortgage conditions.”
See http://www.property118.com/deed-of-assurance-1/32440/
As I landlord I am not able to use anything other then a AST for 12 months or less, due to mortgage lenders. The eviction laws are so broken, and the court system so badly run, I would also refuse to grant a tenancy over 6 months even if my lender allowed it.
However I would consider a “Deed of Assurance” for the correct tenant, and you sound like such a tenant.
And presumably a Section 21 overrules any Deed of Assurance does it?
@Rent rebel. Yes it does, as I suspect you well know.
The deed of assurance does not grant a specific length of tenancy or prevent notice being served. In this case it is a promise to provide an agreed amount of financial compensation if the landlord does seek possession within an agreed timescale. It means that if the tenant does have to move out, they can ensure they are suitably compensated for the amount they have spent on the bathroom.
It is actually a good compromise in the situation.
@Rent rebel.
Yes a S21 does override a deed of assurance, and that is what makes a deed of assurance so great! The tenant once they have left may have to sue the landlord for the fixed amount of compensation sated in the deed of assurance. If the landlord claims the tenant did not keep to the tenancy, then the judge has to decide based on the balance of probability.
The deed of assurance will be written so that a tenant ignoring a S21 makes the deed of assurance void. Therefore the only way a tenant can get the payout is to move on the date the S21 says. This stops the tenant using the court system to delay the process with false claim, while still allowing incessant tenant to get a payout if they are asked to leave due to no actions of their own.
If one of my tenants was spending £5000 on the property, I would be happy to issues a deed of assurance (conditional on the standard of the work, and the work being completed) for £8000, reducing by £1000 per year after the 2nd year. So if I chose to sell within the first 3 years I would have to pay them £8000, but in year 9, I would only have to pay them £1000.
The rent level with then be linked to RPI or a local rent survey, or some other agreed index, and I will be able to sit back knowing I will not have a void for a very long time, and get a nice long fixed rate mortgage.
We just need a way for a third party to insurance the tenant against the landlord not paying out after a court ruling – this insurance should be at the cost of the landlord, like it is with deposit protection.
I would only consider a Deed of Assurance if the tenant was spending significant money on the property or was whiling to pay me a significant amount for me agreeing to a Deed of Assurance.
This could for example be, “pay me 6 months’ rent for the Deed of Assurance, get no rent increases for the next 5 years, and get 9 months’ rent back if I ask you to leave for no fault of your own.”
The deed of assurance is interesting. Although the tenant may receive compensation, if they are evicted through no fault of their own but they will then need to obtain another property that has been suitably adapted for their needs and also a place that is of sufficient size to accommodate their furniture or to store it or sell it.
A compensation payment can not really offset the need for a particular property need.