The business models of criminal landlords explained – Part 6
This short series is a guide to those landlords and professionals working in the PRS who might find it difficult to get their head around the vastly different way that the criminals view the market.
This is certainly the case in the four London boroughs that my outfit ‘Safer Renting’ operate in which is echoed by my experiences talking to officers in councils across Britain as a trainer.
Lesson #6: The accommodation
In previous pieces we looked at the preferred tenant profile for the worst offenders, the money scams and fake names, the proliferation of rent 2 rent and dodgy agreements, that makes up the business interests and practices of landlords and agents deliberately operating with criminal intent in the lowest and most desperate end of the private rented sector.
In this piece, I’ll explain how accommodation is adapted and utilised to wring more rental income from a single property.
Perhaps the simplest route is to get a normal house and just cram more people into it than it would contain if it were a family home.
Overcrowding even in the beds
These common overcrowding set-ups can vary from using all available space, such as lofts and dining rooms, to lean-to’s and vaguely defined outbuildings, often with more than one person per room. It is also common practice to rent out the beds in a room, which supports occupiers working night and day shifts, one hopping out to begin work while the night guy jumps in to take their place.
These sorts of arrangements are common amongst very low paid tenants. Those working in hotel cleaning jobs, cash in hand construction and agricultural gang work, as well as those on zero hours work contracts, unable to afford the rent even on a bedsit.
The more committed criminal sets about dividing even these meagre rooms into smaller units using stud walling. One regular give away from outside is seeing a piece of wood separating two halves of a window, so one tenant has the left-hand side and the other holding control of the right-hand side.
Usually, when you get in, you can touch both walls without having to stretch your arms and this also turns the internal structure into a plywood death trap with no fire resistance.
Then cram your new stud partitions with bunk beds and you see how you could get 32 people into a two bed flat, as I visited twice in Deptford, or a 6 bedroom ex-children’s shelter occupied by 47 people, as I also saw and happily shut down, in Forest Hill.
A lot goes unnoticed or they are hidden
These spurious and hidden conversion jobs proliferate in districts where there are lots of large, Victorian buildings with often the worst offenders being above shops. You can’t see into the windows because of the height and entrances are often around the back of a terrace, or just small a side door without a window.
Tracking them down is a matter of following up suspicions or complaints with a lot of intel gathering.
Beds in Sheds
In recent years the press has seized onto the term ‘Beds in Sheds’, why not?……it rhymes and the press do love that. But in actual fact they aren’t everywhere and fall into two camps.
A real bed in a shed, by which I mean literally just a shed or random wooden structure not meant to be lived in do exist, but there are also what could best be described as the ‘Uber shed’, which can be a strong brick building, replete with UPVC double glazing whilst still having no planning permission.
Sometimes they have their own toilet and sometimes facilities are shared with the house, along with access, that can just as often be found through the main building.
They can look solid to the uninitiated but they tend to be very jerry-built, prone to leaks, condensation and vermin infestation. Being unauthorised structures the council’s building control aren’t called in to sign them off.
Neighbours don’t report them because they look like something bought off the peg in B&Q and you can’t see them from the road. Train journeys are great for seeing what is at the back of houses though.
Finally, we have what is becoming known as the ‘Lockdown model’ where property developers buy, say, a three-bed family home and carves it up into 5 or 6micro-flats – and I mean ‘Micro’.
A few months back I appeared in a BBC one documentary about them where I was filmed trying to sit on the toilet, which I could only achieve by putting my elbow in the sink and my feet in the shower. You can see it here.
Council planning enforcement and housing benefit find it difficult to decide on the procedural irregularities of these conversions.
The permitted development ‘loophole’
The trick here is to keep a communal kitchen in place, the reason being that all London boroughs and many outside London, have planning prohibition on converting family homes into small flats, simply because of the shortage but there is a concept called permitted development, which the developers insist their properties are.
The micro flats are self-contained, as you can see in the BBC clip linked but planning officers say this is a breach, so as a get-out, the communal kitchen serves as evidence of a shared house and therefore it hasn’t been converted.
However, another part of the business model is that these flats are only rented out to people eligible for the full rate of housing benefit – but if the property is a shared house the rate of HB would drop by about half.
So the model is either breaching planning or breaching HB, they can’t have it both ways. As you can see again in the BBC clip, whilst the rooms have their own showers and cooking facilities there is also a sign on the wall saying:-
“No cooking in the rooms” to further blur distinctions.
To pin this down requires both planning and HB to decide jointly what to do and this doesn’t happen much, which is why the model flourishes all over the place.
Next time, in the final piece, I shall look at local authorities dealing with these problems.