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Article > Beware Of Rental Scams

Article kindly provided by Mike Clarke

With 3.4 million Private Rental Sector properties in England, Private Rental Sector Landlords and tenants are being warned to protect themselves against scams. Landlords and Lettings Agents are pushing rents ever higher with demand for rented property exceeding supply, even though the number of PRS properties has risen by a staggering 40% since 2006.

The 2nd quarter Royal Institution of Chartered Surveyors' (RICS) Residential Lettings Survey showed 25% of chartered surveyors reporting an increase in demand for private rented sector properties. The latest rental boom has seen PRS rents increase by 0.6%, the average property rental price in England and Wales is now £705 per month, according to the latest Buy-to-Let Index from LSL Property Services.

Tenants in London are finding life even tougher, with rents hitting a record £1,009 per month, marking an annual increase of 7.1%. With demand far outstripping the supply, it's a real challenge for tenants to secure the properties they want.

The current “Landlord's market” is making life tough for those trying to secure private rented accommodation. Rental properties in some areas of the UK are being let for more than their original asking prices. With so many people being forced to rent, both tenants and landlords are being warned to beware of unscrupulous practices. With some tenants in an extremely vulnerable position, the private rental sector is crying out for change.

Housing and homelessness charity Shelter has seen complaints about lettings agents and landlords increase by 23% over the past 12 months. September 2011 saw the launch of, SAFEagent, a government-backed kitemark scheme, designed to highlight to landlords and tenants which agents offer client money protection schemes. All agents displaying the SAFEagent mark will already belong, albeit on a voluntarily basis, to a protection scheme operated by National Approved Letting Scheme (NALS), the Association of Residential Letting Agents (ARLA), the National Association of Estate Agents (NAEA) and The Royal Institute of Chartered Surveyors (RICS). This means that any client money, including tenants' deposits, will be reimbursed in the event of insolvency, or misappropriation by any party.

Nick Cooper, Chairman of the SAFEagent steering group said, "There were so many high-profile letting agents that went bust last year, one of the biggest industry complaints was that they hold clients money, and if they went bust, how did people know they were going to get it back? SAFEagent is giving clarity to a really cloudy area."

Even though the main target of scams is usually the poor unsuspecting tenant, it is wise that every landlord (and their tenants) be made aware of what can happen if they end up dealing with some of the more undesirable elements within our industry…

Below is some of the advice to prospective tenants currently readily available on the internet on various tenant information sites.

Never hand over any money before viewing a property. Online scams have been uncovered on listings sites such as Gumtree, with fake landlords asking prospective tenants to wire across money to secure non-existent properties. Last year, scammers even pretended to be members of the National Landlords Association by using its logo.

Costs can quickly add up if landlords have to pay out for valid services such as inventories, cleaning, and renewing contracts, but landlords are warned to keep their eye on their wallets when paying fairly vague administration charges to agents that can run into hundreds of pounds for what can appear to be little more than photocopying a few contracts and checking references.

Watch out for agents that try to charge twice for the same service, such as an inventory, at the beginning and end of a tenancy. Also be alert for contract renewals that change the terms of tenancy. Some agents and landlords may even charge a tenancy renewal fee without prior agreement.
Always ask for a full breakdown of charges from the agent at the outset and get them or the landlord to do an inventory, including photos – so the tenant is only charged for damage that they caused.

If the letting or managing agent is registered with ARLA or NAEA the tenant can lodge complaints if the fee structure was unclear and/or unfair.

Tenants are advised to read the terms and conditions agreed in the contract. Most tenants are on assured shorthold tenancies (AST). With this type of tenancy, tenants can stay in the rental property for a fixed period such as six months, or on a rolling contract known as a periodic tenancy.

The tenancy can end only if the tenant and landlord agree to the surrender of the tenancy, if you serve a valid notice, or if the landlord evicts you. If the tenant is on a fixed term, they can leave from the date that term ends, but if they want to leave before the end of the agreed tenancy, they will be able to do so if the tenancy agreement says so. If tenants are on a periodic tenancy, they must give at least one month's notice in writing.

The landlord must give tenants written notice of at least two months if they want them out. However, under an AST, it's fairly straightforward for landlords to evict a tenant, and if there are any rent arrears or late payments they may be required to give the tenant only two weeks' notice to leave.

Most building repairs are the landlord's responsibility, except in the case of malicious damage. Before a tenant can move in, the property must be in a fit state; boilers, sinks and toilets should be in working order and gas, electrical and fire safety regulations must be met.

If the landlord refuses to carry out repairs during a tenancy, they run the risk of the tenant withholding rental payments. Tenants are advised not to risk withholding the rent as it can lead to eviction. Instead, they are supposed to collect as much evidence against the landlord as possible. This is not a good situation for landlords to find themselves in, prompt action to deal with any damage reports from tenants and good record keeping can mitigate any false claims made against them.

All letting agents and landlords collecting rents must protect the tenants deposit in one of three government-backed schemes:

• Tenancy Deposit Solutions (,
• The Dispute Service (
• Deposit Protection Service (

If landlords or their agents fail to protect the tenants deposit, they may be forced to pay three times the amount as punishment and all three deposit protection schemes offer a free dispute resolution service.

Kay Boycott from Shelter explains, "There are still some landlords out there who are flouting these rules," says Kay Boycott of Shelter. "It is vital that tenants are aware of some of the risks when privately renting and make sure their deposit is protected when they enter a tenancy. Increasing numbers of people priced out of the housing market, coupled with a chronic shortage of social housing, means that renting is fast becoming the only option for thousands more people. Unfortunately, this has led to a minority of rogue landlords who are taking advantage of this growing market."


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