The Property Unleashed Podcast

Section 21 Is Gone So Now What

• Mark Fitzgerald • Episode 378

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Section 21 used to feel like certainty. 

Now it’s deadlines, documentation, and a completely different risk profile for landlords and agents. We sit down for a practical landlord update on what the Renters’ Rights Act means in real life, including the awkward two-month tenant notice crossover that’s already creating void headaches and stalled move dates. If you’ve had someone try to give one month’s notice lately, you’ll recognize the confusion instantly.  


We also go deep on tenant deposits, because deposit compliance is one of the only areas where getting it wrong can’t be “fixed” later. We break down the five-week cap, the 30-day deadline that starts when you receive the money, and the difference between custodial and insured deposit protection schemes. Then we get into the evidence that actually holds up in a dispute: photo-heavy inventories, tenant sign-off, exit inspections inside 24 to 48 hours, invoices, and why betterment claims fail.  


Finally, we map out the current possession routes. If you served a Section 21 in time, the accelerated possession claim window has a hard stop, and the paperwork pack (N5B, prescribed info proof, safety records, How to Rent) needs to be flawless. With Section 21 gone for new cases, we explain how Section 8 grounds work now, why court hearings can slow everything down, and what this shift means if you’re planning to sell a rental with tenants in situ. We also share practical sale options, including open market, off-market investor sourcing, and auctions, plus a few HMO-specific planning considerations like Article 4. 


Subscribe for more landlord updates, share this with a landlord who needs a clean checklist, and leave a review if these practical breakdowns help you stay compliant. What part of the new rules is hitting you hardest right now?

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Welcome And What Changed

SPEAKER_02

Hello and welcome to this month's live session with our resident experts in lettings, property sales, and basically all things property as well. It's great to have Ali Allison and Anthony with us today. How are you both?

SPEAKER_00

Yeah, all good.

SPEAKER_01

Fantastic. Looking forward to the sunshine this weekend when it tries to come out again.

SPEAKER_02

You always love talking about the weather, don't you? I can't believe it. We're in the middle of like June or in June now and it hailstoned yesterday. Unbelievable.

Two-Month Notice Creates Awkward Voids

SPEAKER_02

Unbelievable.

SPEAKER_01

Anyway, anyway, the dust is settling after the renters' rights at. But um, yes, we've still got some future fun to look forward to.

SPEAKER_02

I was gonna say just on that, because we've got a couple of great topics that you guys are gonna go through today, which you always do, which we we appreciate a lot. But how are you finding it since the new rules and everything's come in?

SPEAKER_00

I think there's tenants that still don't understand what's going on. So I think we had the first one that's due to move in in the coming weeks and was querying why he's not got a fixed term and that security, so having to explain that to him. I wouldn't say we've really noticed any massive changes or problems. I think the biggest thing at the moment is this two months' notice for tenants. So tenants are giving notice based on one month's notice, and we're having to point out now the rules have changed, you've got to give two months' notice. Some landlords are being flexible, some are not.

SPEAKER_01

With that changeover period we're having at the moment, where tenants have had to give two months' notice to their landlord, they can't move into this property that's vacant now for two months. So it's a bit of that crossover period at the moment, is a bit difficult. Landlords are like, well, I don't want a property every day for two months, I want someone that's going to be available now. And I says, Well, unfortunately, we're going to have this crossover period. Admittedly, once it comes out in the washing of people being giving two months' notice, and people are in there already that have just given two months' notice, it'll all work out right. And the voids will be the same. Whereas at the moment, that crossover period from the one month to the two months is unfortunately causing one or two issues.

SPEAKER_00

Yeah. So I'm doing viewings and getting people that want to move in in August now. And it's available now, it's empty now. And the landlord's, oh, I don't really want to. Do I take it? Do I accept it?

SPEAKER_01

Do I So it's then the can they take it on and pay £100 for them first month and take on the council tax for that period, perhaps just so that they've got the security of them being in there a little while. There's different different avenues wearing to look down, but it it'll come out in the washing soon enough once people are in there.

SPEAKER_00

I think that's security as well. I think like the landlord that I spoke to said, you know, if I if I was waiting until August and could sign them up to a two-year contract, then he said I might do it. But they could we could I could wait two months for them to move in August and then they could leave straight away. I know. Unlikely, but his it's kind of got a point. He's like, I haven't really got any security there.

SPEAKER_02

Well, we we've said it before, we say it again, but now that we're in the trenches of it all, I'm finding that from the tenants' perspective, they feel like there's less security now and it's actually a hindrance to them. And obviously, as landlords and stuff ourselves, it's just muddied the water and made life more difficult for those crossovers when people are moving. I mean, obviously, I I deal more with HMOs, and that's quite a transient market compared to buy to let's and and everybody's a bit like, well, I don't know whether I'm coming or going now. I don't, you know what I mean? I mean, it's it's just like I I like to have an agreement that basically says I'm here for this amount of time, I know what I'm doing. And then I know that you know, if I am gonna leave, I let you guys know within a month or something like that, I can go and move wherever I like, and that's the way I like it. There's too many rules now.

SPEAKER_00

Yeah, yeah.

SPEAKER_01

Well, that's one thing I'm gonna be talking about a little bit later on is getting back to possession of your property this morning. I mean the different routes, the tools you've still got available to you, but there's certain dates and deadlines for this. Okay. And then Alison's then gonna be going into a bit more information about deposits and security deposits for tenants as well, and whether there's anything changing there for us.

SPEAKER_02

All right, well, brilliant then. I'll let uh I'll let Alison take it away. Let ladies go first. Uh Alison take it away.

Deposit Protection Deadlines And Evidence

SPEAKER_00

Um, so yeah, so I've got to talk about deposits. I think sometimes we're so focused on all the new stuff and what's coming in that we forget some of the older rules and rules in place. So, in terms of deposits, nothing's dramatically changed in terms of the Renters' Rights Act. So, but in terms of deposit, it's one of the only things that if an landlord comes to me and they haven't done what they needed to do properly with a deposit, it's one element that I can't fix. There's no fix to that. So there's always going to be some liability if you don't get this right. So, in terms of taking a deposit, the maximum you can take is the equivalent of five weeks' rent. You can take six weeks if you're taking in rents of over £50,000 a year.

SPEAKER_01

That would be nice. Very nice.

SPEAKER_00

I think that works out at over £4,000 a month. So if you're lucky enough to be getting that sort of rent role, um, then you can take a six-week deposit. But I think most people it will be five weeks is the limit on what you can take. In terms of registering it, there's three schemes that are government approved that you can register it with. So TDS, which is a tenant deposit scheme, DPS, which is the deposit protection scheme, or my deposits. And each of those schemes have two elements. So they have a custodial scheme and an insured scheme. So we use my deposits and we use the insured scheme. And so insured scheme is we keep the money. So we have a ring-fenced account where our deposit money is kept. We just like it that way because we have that little bit more control on things. We find it's a bit easier at the end of the tenancy that we can get things back a bit quicker. You're not reliant on the tenant doing something their end. We we just make those arrangements. The custodial scheme is kept by the deposit scheme, there's no cost for that, so that's free of charge. You can register your deposit. You don't have to handle it, so it's a very hands-off approach, which I think a lot of landlords would prefer. Custodial, there's usually a charge involved in registering that, and that would be I think it's a £50 of my deposits, but there is some kind of discounts depending on your accreditations and your memberships for doing that. But there is a charge for that. So that is kind of the downside of that side of the thing.

SPEAKER_01

For a sample for ourselves, we're members of something called UK, UK Association of Letting Agencies. So we're audited each and every year to make sure that our My Deposits Insured account echoes what our bank account does, or the ring fence bank account Alison was talking about. Now, as long as we're accredited, which gives us client money protection, as well as the redress scheme, as well as obviously all the things we need to have, we then get my deposits. I think it's £15 plus VAT, is what it costs us. So bearing in mind if you're not accreditation and all those sorts of things, you register for my deposit, you're talking more like £50. Whereas if you're accredited and they've looked at everything and anything that you do, they look at all the transactions and all sorts of stuff that goes on. As long as that ticks the box, which we've been accredited now for gosh, 15 years, if not more, you get the my deposits at £15 as fast. So that's the sort of God. Okay.

SPEAKER_00

Yeah. So, and in terms of doing the process of registering it and securing that deposit, you need to do that within 30 days of receiving it. Really important of receiving it. A lot of people think it's that within 30 days of the tenancy starting. That's not the case. It's within receiving it. So especially when you've got student tenants that you might be setting things up a little bit in advance, then that's then obviously you just need to be doing it 30 days from receiving it. And then in terms of deposit deductions and things like that, it's really, really important to have an inventory. So I still speak to landlords that don't feel they need an inventory and they set things like, oh, well, it's unfurnished, so I'm not worried. But yeah, I'd say your inventory is one of the most important documents, needs to be done within 48 hours of the tenant moving in. So it's no good doing it two or three weeks in advance. You you know, that's your snapshot of the condition of the property. So if you've done it two or three weeks ago, the chances are you might have cleaned it since, or something might have happened. So within 48 hours is usually what's advised. And then the tenant has seven days when they receive that report, or that's the standard, seven days to come back to you with any discrepancies. Because in terms of having an inventory done, it's difficult sometimes until you're living in the property, you're perhaps not testing every single element of that property. So seven days, they need to come back with anything that they don't agree with with that inventory. So you make to make sure that they're signing it, providing that information. On exit, then you need to do the same, kind of in reverse. So you need to do that exit inspection. Now we tend to go, we tend to get our inspections, inventories done by a third party organization, just because rather than the landlord doing it themselves or anything like that, it just has more kind of independent independence in terms of yeah, that's the word I was looking for when it comes to dispute. In terms of the exit inspection, it's the same sort of process. You need to do it within 24 hours, 48 hours of that tenant leaving. Because if you're leaving it two or three weeks, you can't really get any charges for cleaning because in two weeks the death dust's gonna settle, it's gonna be difficult to prove that it was like that when they left. So within 24, 48 hours. And then in terms of getting that deposit back, it's 10 days that you have once you've agreed the deductions of getting that deposit returned to the tenants. You need to kind of go through that process quite quickly and get a response out to the tenant. So ideally within kind of a week of them leaving, you need to go back to them with the deductions if you're proposing any deductions. It might then take you a little bit longer to get invoices and contractors to provide you quotes and things like that. So, but you need to have that communication within 10 days of them leaving the property. The common reasons why deposit claims might fail is that there's no inventory or it's a poor inventory. So photographs, really, really important. Date down as well. You know, I think back in the day when we we first started out, we were doing inventory, so it was just yeah, it was just a list of things. I mean, we still see that, but when we take over tendencies from other agents or a land or do it themselves, so just like list what's in there, like a carpet or brown carpet, like they don't say, well, is it like brown carpet? But I mean, if there's a burn on it, a condition or warn, like you're not going to get anything if you haven't got that detail at the start. So that's kind of like a downfall of many. Not getting a tenant to sign it or not getting the agreement from that tenant that if they agree with the opening inventory, sometimes that can throw a wobbly um up at the end. Having the invoices, and it's also, you know, if you're making a charge, for example, if you go in and you're making a charge because the mattress is stained or damaged, you need to prove the age of it. You're not allowed betterment. So if that mattress was two years old when that tenant moved in, you can't charge them for a brand new mattress.

SPEAKER_01

Contribution towards.

SPEAKER_00

Yeah, and it's kind of then it is difficult to judge like how long do you think a mattress should last? I mean, h mobile, so I think a mattress is gonna probably last less time than maybe a family property if you've got a tenant change over. But I think we say five years, a mattress life. So if it's two years when they two years old when they move into the property, you can only really charge them for three for well, three times that those three years of the rest of that life for that for that mattress, if that makes sense. So I think you you landlords can't get better than it. A lot of landlords think that that mattress was in okay condition when they moved in, it so it's now not I need to replace it, and they try and get the full charge. They can't do that. It has to kind of be fair wear and tear taken into consideration. You know, if there's marks on the walls and things like that, light marks, so maybe they've knocked their suitcase into the wall as they're leaving or stuff like that. You can't really charge for that. You've got to take into consideration some fair wear and tear. If they've got like a massive hole in the wall or they've um drilled a hole in the wall and there's or there's used Blue Tack, that's a landlord favourite, where it's difficult to repaint over it, then that is you can make charges and deductions for that. But yeah, I think the main takeaway is you need to depot protect that deposit correctly within the right time frames. You also need to do the prescribed information so different schemes will have different criteria. My deposits, we have to provide the deposit certificate, which gives them all of the details, and there's also a leaflet explaining about the deposit process and what they have to do if they wish to dispute at the end. So we have to serve that within the 30 days. We do it, tend to do it as part of the welcome pack, unless it's been given uh in advance the deposit. Have an exit inspection in an inventory. So still landlords don't have inventory, so make sure you've got a good inventory and that you've got a good exit inspection, ideally done by the same person if that's possible, or the same company, and just keep your evidence. So if you've got a furnished property, keep those receipts of the furniture so you know when you brought it and how much life that's kind of got in it, and also for any work that's done, you need the invoices. You'll need to, if it goes to a dispute, you'll need to provide all of the invoiced evidence.

SPEAKER_01

And that's one thing that's important to bear in mind the fact of how long they can come back afterwards. So, yes, making sure you've got all your proofs.

SPEAKER_00

Yeah. Sums up quite quickly, but yeah.

SPEAKER_01

Alrighty. Okay,

Section 21 Timeline And Accelerated Claims

SPEAKER_01

so over to me. Right. Unfortunately, these occasions happen and we've had all of our tools that have been taken away from us, which is the taking back possession of your property. Now, there's something that we've had for many, many, many years called the section 21, which is a no-fault eviction. Now, that is still a case of a tool that is available as far as down the line. Because here's the thing when the Renters' Rights Act came into play on the 1st of May, you could no longer issue a Section 21 eviction notice or a repossession notice as far as getting back possession of your property. So as of the end of April, you could have issued one of the end of April. That's all well and good. However, 1st of May, can't do it anymore. So for those people that have been able to actually issue those notices, come the end of that period, which is a two-month notice. However, typically for ourselves, we would give two months and two or three days. So it gives, if they say, Oh, I haven't given sufficient notice. Well, no, we've given a little bit, or for example, it was posted or something like that. You've covered all bases of reasons why they could say they haven't, they're given sufficient notice. When you were giving that notice, we would also deliver it by hand, get a state stamped photo if we could, or send it recorded mail, but we would also send it electronically as well. So you've got multiple routes of which you've got proof you've sent it to that tenant. Now, come the end of that period. Should it be the tenants are saying, and this is happening with a couple of tenants we're having at the moment, that they haven't wanted or not been able to actually vacate the property? So, for example, we've got a property where tenants are on universal credit. The council have told them sit tight, wait for a bailiff to come or wait for a possession order. So, because of that, the next stage, as far as having issued that section 21 notice, is getting back possession and applying to the council for possession or the courts, like the community court or the county court. So you have two routes you can go to. There's one route which is going to court for doing that, depending upon the notice you've issued. But if it's section 21, you've got something called an accelerated possession claim, which is something you can still do. However, as of the 31st of July, that is the date at which you can actually make a claim for possession back for your property through accelerated possession. Accelerated possession means you basically provide everything to the court to prove that that property and that tenancy was a compliant tenancy and that you want possession back of your property. So the key things you'll need to issue is something called an N5B form. You can look this up online. It's a long document you have to fill out. Lots of repetition, I have to say, as well. But what you'll need to provide with that is the tenancy agreement, the deposit protection certificate, the safety certification for the whole tenancy. So, for example, if they've been there for 10 years, 10 gas safeties, the EPC form, the EICR, all of these different things, as well as at the start of the tenancy, the deposit protection certificate, providing proof that you give the actual prescribed information to the tenants, the how to rent guide. Has that been issued to the tenants? All of these different things to prove that you have done that tenancy correctly. So you complete the N5B form. All of these proofs that you need to provide is a very big pack. And here's the thing how many tenants live in that property? So I've done one quite recently. There's four tenants living in the property. You need to give five copies of the N5B form as well as all of the other proofs. A nice big booklet full of documentation you've got to squeeze through the letterbox at the county court. So once you've done that, there's also a fee for that as well, which is £405. Correct me if I'm wrong on Richard.

SPEAKER_00

£404.

SPEAKER_01

Oh, sorry. £405. £404.

SPEAKER_00

It's not a really it's a weird amount.

SPEAKER_01

I know it's £404.

SPEAKER_02

So I'm surprised you didn't do £404 and £40 or something like that.

SPEAKER_01

So the check, if you're doing it that way, there is a way of doing it online, but typically you'll give a check for £404 plus five copies of all of the claims, one for the court, and these other four copies are then actually sent out by post to each of the tenants in the property. So if you've got two adults on a tenancy agreement, you'll need to give two copies plus the court copies. So three copies, they then get given to the courts. The courts will then send out that documentation plus their own documentation to each of the tenants, and they will then have a period of time to come back. It's quite funny. The tenants for this particular property where the landlords trying to get back possession. Well, we've we've paid our last 400 pounds of the arrears. I said that's all and good, but you've been an absolute what's it for the tenancy that you've been there. Erratic payments as far as your um rents are concerned.

SPEAKER_00

Yeah, I think the the background of this one is they won't meet the criteria for being in arrears. They don't let it ever go more than two months.

SPEAKER_02

Yeah.

SPEAKER_00

Now it's three months. So I'll continuously pay late and pay the game. Uh yeah, which having to chase them like on a daily basis, and you'll get like £200. And the rent's four $1,400. So it takes the best part of a month to get that up to date.

SPEAKER_01

Hence the notice, which I'll come on to in a minute, getting back possession of your property and the changes that have happened now. The section eight notice was a risk. Section 21, whilst we still had that tool, was the right way to go down it because it was fully compliant and it's all these different things. They moved in last September, and it was a group of international.

SPEAKER_00

You don't I think there's a mixture some street of it somewhere.

SPEAKER_01

So we're now at the point at which they've said, well, we've got until the 16th of June. Now here's the thing: once they've got that documents and they've been all sent out, so then they'll have a certain period of time to come back with a dispute of the actual claim for possession. And they've got until the 16th of June, I believe it is, to go back with any disputes they wish to provide. The actual landlord who's the claimant has also received a letter back stating that, right, we've received your claim. The tenants have until this point to come back. However, you also have a slip at the bottom of this actual letter that you've received that states you wish to get back possession of your property. You can provide this back to us, I think, at any point in the coming six months. I'm just like, yeah, get it back to the courts now. So that's that process. Now, should it be that the tenants then decide I'm not vacating? Of which I believe two out of the four have vacated already, but it's a joint and several tenancies. So they're all on the same tenancy agreement. So it's all well and good, two of you leave, but you're all the same. You've all got the same badge as such. If they don't leave, then the landlord then obviously apply, give these slips back to the court, and then the court will then apply possession order for the property itself. If the tenants still don't leave after that, then he's going to have to then get bailiffs. Bailiffs, again, it's going to be another couple of weeks potentially, it depends. What I will say, in the past, when I've done an accelerated possession, I've done many of these over the years, gosh, 15, 20 years now. Sometimes it's taken an absolute age for them to do that first letter out to the tenants. These guys got it very quickly. So all I can assume is they've got far, far less of these, or they're just trying to get them rid of them as quick as possible, the courts at the moment. So, yes, the stage for us at the moment is we're waiting now for the tenants to come back. If they don't come back, a possession order will be granted because the courts were happy that everything that had been provided, they were happy with. So that's the process we've gone through on that one. But the key thing is as long as you've got all of your safety certification, proof that you did everything correctly at the start, the tenancy agreement, the deposit cert, the how-to-rate guide, and all of the proofs. And this is where, if you're using electronic signature sites such as Cyrable or DocuSign, and you've got everything you provided at the start of a tenancy, and you've got proof of that, you've got the electronic signatures of all tenants, it covers all the bases. It's wonderful. And it's a really, really good way of doing it. So, as far as the section 21 notices and the accelerated possession claims, where you don't have to go to court, it can if they dispute, but realistically, the likelihood is you'll get your. Possession order. The last day in which you can do that deadline is the 31st of July. 1st of August, you can no longer do an accelerated possession claim. So if you've issued a section 21, can't do anything with them anymore. As of the 1st of August.

Section 8 Grounds And Court Hurdles

SPEAKER_01

So we now have the tools with the Renters Rights Act as the section eight notice. They are the only tools now to get back possession of your property. And you have to have a reason to get back possession now. So the no-faults section 21 is gone, so you can't issue them anymore. However, obviously the accelerated possession, if you've issued one prior to the end of April, you can still do those. Now we have the section eight notice. So, for example, you've got ground one, landlord or family moving in, you can give four months notice. Bear in mind the section 21 used to be two. We've got the landlord selling the property four months' notice. Now, the key thing for both of these to emphasize to you is once you've issued these notices, you can't then relet the property in the first 12 months. And you can't issue, in fact, you can't issue these in the first 12 months of a tenancy. And then if you're selling the property, you can't then relet the property. If you've, for example, a tenant's been there for 12 months, you issue them with a four months notice that you're selling it, and then after that four months they move out. You then, oh well, I didn't like those tenants that want to relet it. You can't do that. Okay. We then have other terms here, for example, serious rent arrears. The section eight notice, which you've had in the past, where the tenant has had serious rent arrears, is the ground eight, which is now three or more months, not two, unfortunately, three or more months rent in arrears, and it's four weeks' notice that you've got to give them. Any rent arrears, so you've got your mandatory grounds, which is that eight, which if they're three or more months' arrears. But if they've got some arrears, which is your discretionary grounds, which is ground ten, any rent arrears, four weeks' notice, or then you know the notice period. As far as ground eleven, persistent late payment, as we were just talking about the particular tenants we could have used. However, if we've gone to court again, it was a discretionary arguable ground.

SPEAKER_00

And if they're they're clearing it, yeah. So I think they would have just cleared it.

SPEAKER_01

So you've then got ground 11, which is persistent late payment, which is the grounds of which they've been there, or breach of tenancy terms and conditions other than rent, is ground 12. Property deterioration at two weeks, antisocial behaviour is immediate court application. But here's the thing: a number of these are discretionary. Damage to the furniture, ground 15, false statement, two weeks, two weeks, two weeks. You've got a number of other tools that are there available for you, but they're arguable. And your likelihood will be if you're doing section eights and now section eights will be the case, you will have to go to court for a hearing. And that then delays matters further. And if a tenant turns up, they will have legal advice, free legal advice. You will try their best to trip up the landlord or the agent that's there. Give me this, this, this, this, this, this, and this proof as part of the claim. Because section eight notice, you've got the actual PCOL possession claim online is the way in which you can apply as far as getting back possession or apply for a court hearing online. Unlike the accelerated possession, you just give them all the documents, they do it all for you. Whereas possession claim online, you'll have to have a hearing. Now, I must emphasize that if you've got rent guarantee insurance, which a number of our landlords have, the rent guarantee company will be le they will provide a legal representation for you to go to court. Typically, I will go to court and accompany the legal representative, or if they've got their own lawyer, a landlord, who'll represent them, that's fine. However, the letting agency can't represent the landlord, they're not legally qualified to do so. So the landlord will have to be there. I'll never forget it in the past. The landlord's asked us, please, please, please, get me back possession of my property. There's going to be a court hearing, no problems at all. Well, I can't be there. Well, you have to be there. Well, I can't be there. Well, somebody will have to represent you then of some sort of level. Well, that'll cost me. Well, yes, it will. But you are claiming that possession of your property. So, yes, there's a number of different hurdles that are coming into play now. If you've got a section 21 that's been issued, get your accelerated possession claim in once that two months' notice is up, but you've only got until the end of July to make that claim. As long as you get that and you prove it, but I would don't leave it till the 31st of July. Please do it on like the 24th. Because here's something that's happened in the past. I provided, I think, two or three copies of all of the documents to the courts, but they've then seen that there's been more tenants that were in the property. So they've sent the whole pack back and said, I need another copy. Oh, so yes, as the proof there, make sure if there's four tenants, you give four copies, one for each of the tenants, as well as a copy for the courts. It can be done. We haven't been through the process as far as the section eight notice with the new terms and conditions yet. However, those changes are in place, but we're still coming out in the washing as far as getting back possession of your property. But you have to have a reason now. It can't unfortunately be that. But if you do then say I'm gonna sell it or I'm moving back in, you can't do it in the first 12 months of a tenancy. And if you do so, in particular for the sales option, once you've got the person out, you can't then relet the property for 12 months after the notice has been issued.

SPEAKER_02

Nice, nice. Yeah, lots of changes, but yes, if you if you if you handed the notice to the tenant and said, I'm gonna sell a property, can you uh are you allowed to market the property whilst you're waiting those four months? Yeah, absolutely. Yeah, yeah, and of course, if you if you had somebody on and you go on, sorry.

SPEAKER_01

I wasn't saying you can, but it will probably cause delays in your gosh, the amount of time it's taken now for sales to go through is an absolute can you tell it's happened quite a few times. Solicitors, you have to be on their back day in, day out to make sure that things are processing as quick as they can do. But typically, three months was the olden days of being able to get stuff through of a typical sale. Four months now is probably likely to happen, depending upon how good each side of solicitors are. But the cheaper the solicitor, the longer it'll take, I must emphasize. So four months really is not too bad. If you, as you say, look, I need to sell the property, change of circumstances. Here's your four months' notice, the property we get on the market. And then it's then trying to be amicable with the tenants that are living in the property itself, and just saying to them, look, we'll probably need to do viewings because they could dig their heels in again, and you you've issued the notice, then but if they don't vacate, you're gonna have to apply for court to get back possession of the property. Uh there's a number of different things they could well say, Well, I'm not gonna pay my rent now, then if you're gonna be like that. There's a number of different things that could happen with this, it doesn't make it very easy. So, yes, this is what it is.

Selling With Tenants Plus Off-Market Routes

SPEAKER_02

And what what would you guys in your experience recommend if you were gonna sell the property with a tenant in situ, which I know is something you said before that you think more and more potential like buy-to-elect properties will be sold with a tenant in situ, you know, what are the sort of I know it could be a whole episode on its own, the pitfalls of what to watch out for and all of those sort of things. But if you wanted to, you know, you had a decent tenant, you they were paying and everything, but you just wanted to offload that property. What would, in your opinion, be the best way to go about that?

SPEAKER_01

We've got a number of avenues we offer now, because we we're seeing this more and more now, as far as long as well. I want my rent until I complete. I've got good tenants in there that are getting good rent. The key thing for a vendor is going to be that you're getting the right market rent. So issuing those section 13 notices as they are now, you can't renew a tenancy anymore. So section 13 notice, get your property up to the right market rent. But I will say to you, voids cost more than getting optimum rents at the moment. So be reasonable with your tenants. You know, if it's £1,200 for the house up the road that's on the market, you say, look, I'll do it for $1,150 for you, which is £600 saving a yeah. They look, you look after them, voids cost more than optimum rent. But as far as then trying to sell the property, as I say, yeah, getting the right rents is important because the return on investment, you and I will do the return on investment calculations, and they have to be reasonable year one. You can appreciate they might not be quite as fruity the year one as you want them to be, but you're getting a brand new property from day one to avoid is minimized. Well, you'd hope so at least, anyway. And then, but we, you know, other avenues you could just go to the open market, which is what fine we can offer those at the moment. We also do off-market sourcing. So we've got a number of investors that may be looking for properties that are ready-made, the turnkey opportunity where they've got rent from day one, they've got a proven return on investment, all these different things. So we do off-market sourcing for investors where the vendor's happy to you know accept a reasonable price. They're happy they're going to get their rent until the completion. The buyer's going to get rent from day one. So this is almost amicable. They'll pay a fee for it, the vendor doesn't pay an estate agency fee, the buyer pays a sourcing fee. But that will all be put into the calculations and it's it fits perfectly what they're looking for. The the key thing will be is that because in a lot of cases the properties will be properties we're managing, it's a compliant property. And if particularly if you've got a property in an article four area, are we we're going to be inheriting a licensed property? So the license is all well and good, but it's then the planning side of things. And Commentary Council, for example, have got something called Grandfather Writes that as long as you the property was compliant, HMO when Article IV arrived in September 2023, then you won't need to apply for planning. But we've just gone through a whole rigmarole with a person that was buying a HMO quite recently. The council website says you don't need planning. We had an email from the council saying you don't need planning, but his solicitor was still saying he needs to get an indemnity policy, which is costing him 250 quid, which he didn't need. He didn't need it. We gave the ASTs since 2021, proving it was a tenancy at HMO property, different surnames. But yes, the different things to consider as far as if you're buying a tenante property, but there's the assurances on one side, which is really good to have, and the fact that the rents justifying the rents that are available at the moment, justifying the fact that that is what's being achieved and has been for a long time, and you've got tenants in situ, it wouldn't have a HMO licence if it wasn't compliant, so you're gonna have that assurance in your head as well. And if it was in an article four area, the likelihood will be you'll have the planning permission, which will have value as well. So there's a number of boxes that are ticked there for you. But what I will say is that if you're buying a HMO, do your research on the Article 4 and the planning. Because if someone reconverted that property after Article 4 came in, they will need planning permission. They'll get a one-year HMO license in Coventry, they won't get anything longer than that, and they will get a one-year licence and have to get planning in that first year. Other options we do have, I mean, we we do that option, but there's also the auction option. We do auctions now as well, which is where, depending upon the circumstances, they they see them in an ideal situation because there's minimal fees that get charged for auctions, and we can auction their properties very easily, and when they the assurance there of when it's gonna get sold, if it gets sold. But being realistic on what a sale price could be is going to be important.

SPEAKER_00

In terms of you current tenants, if you're going to the open market, I would have a chat with them and explain what you're planning to do before going online because chances are they're gonna see if you even if you don't have a board up, they're gonna they might see it on right move or something and panic. So if you're explaining that you're gonna be trying to sell it with them in their tenancy still in place and nothing will change for them, having that conversation first is always better.

SPEAKER_01

If you just put it as a it's it's not a it's not a decision I wanted to make. So, for example, a mortgage situation's changed or moving away or different sort of situation, but it's it's out of my control and it's not a case of anything malicious. But as things stand now, if you wanted to sell a tenant property, tenants can give you two months notice at any point, can't they? So uh yeah, you want to get everything, all the wheels in motion before you do anything to tell your tenant. And this is the thing, and in a lot of cases, a lot of my investors all come to me and say, Listen, and see what you can do off market, see if any of your investors are interested, because there's no stamp, there's no imprint on the marketplace by doing that. Seeing what people's perception of the price is, if there's interest, great. And if we can sell it off market, as has happened quite recently, the vendor didn't want to tell his tenants what was happening until it was all officially going to be happening, which is fine because it's not gone to the open market. That was his decision. Unfortunately, we didn't manage the tenancy, it was his property, he was self-managing, so it was a case of okay, your decision. But yeah, it it's it's it's a difficult juggling act with these new regulations that have come in, but we are for the off market, then they can then say, right, you've got a crossroads. Now do you want to go to the open market or did you want to go to auction? Auction can be very cost-effective because they don't pay for the conveyancing, they don't pay an estate agency fee, they just pay an initial fee, which is for the company we're working with, £360, and they could sell their property no matter the value for £360, which is wonderful. That's no no solicitors, no estate agency fees, it could save thousands. But you may have to be a bit more flexible on the price that you're gonna sell it for on that basis. But you could go to the open market, a potential to sell for a lot more, but you're gonna have a state agency and you're gonna have solicitors' fees.

SPEAKER_02

Right, right. Okay. Oh, good stuff, good stuff. I mean, there's plenty of options out there, as we always say, speaking to the right people to find the right options for you. And with regards to the deposits and things, I think you know it's really, really important that people understand that if they get a deposit and then the person doesn't move in for a month or so because it's a holding deposit, they still need to make sure that they've put that in the right deposit scheme before their time runs out. Because uh what's the actual repercussions if if you didn't do that?

SPEAKER_00

Ooh, juicy. Yes, a tenant can claim up to three times the deposit amount back.

SPEAKER_02

Right. Okay, so it's very important.

SPEAKER_00

If you realize that further down the line and kind of then register it, see there might it depends on what your tenants like.

SPEAKER_01

If they know that they can claim back, then there's also you can't get possession back of your property that may well have that hurdle as well if you haven't because the key criteria, there's almost a tick box process that a court will go through. If, for example, it's a data possession, or even if you go to court with a section eight notice, that's the last thing you want to have happen. You go to court, and then the uh legal aides ticks his way through all the documents and says, Well, you didn't register it in time, right? Get this court case, truck note, and that's what will happen, which is why it's so critical you do things and do things right from the start, because it could come and trip you up at the end if not.

SPEAKER_00

And I have heard before, it's not it won't happen now because we don't have tenancy renewals, but I've heard of where they've taken a deposit, they haven't registered it, and they've renewed the tenancy a few times, and it's been charged three times for every single failure. So obviously they didn't register at the beginning, then they renewed it after six months, so they didn't register it again. So they were two separate. I have heard that that has happened. It shouldn't happen now because we don't have to renew. But yeah, if it's if you haven't registered a deposit, then I'd say register it as soon as possible. But yeah, that I can't we can't do anything retrospectively about that. So you could you have still got that liability.

SPEAKER_01

Hope that tenant moves out without knowing. Yeah, fingers crossed, fingers crossed.

SPEAKER_02

Brilliant,

Next Webinar And How To Get Deals

SPEAKER_02

brilliant. Oh well, thank you ever so much for today's session. Always appreciate your time and your skills and knowledge. You know, are you guys up to anything? Is there is there anything you'd like to tell the community about?

SPEAKER_00

Our next webinar on the 1st of July. Not sure what it's going to be about yet. Um yeah, it'll be the latest landlord update. So I'm sure there'll be something about rentlers' rights, how that's going, and things like that. So that'll be the latest update there.

SPEAKER_01

If there's anybody looking at investing in Coventry or the local area at the moment, we've got, oh gosh, I think I've got about 13 or 14 off-market deals that are available at the moment. And they've got a couple of properties in auction, a couple of properties that are both. It depends what you're looking for, but there's some really good deals out there at the moment, um, off-market as well as on market that may well be ticking the boxes. I know there's a couple of properties going into auction this morning and one going into auction tomorrow as well, which are at good prices. So, any queries, do please get in contact with us and myself and Natasha look after the sales side of things. So, is there any way of looking at those or just give you guys a call? Just a shout out with them. We can send over some links basically of the properties that we've got available. As far as people who they wish to actually see some of the off-market deals we've got available, what they need to do is register on our website. Again, they give us a call and just say we're interested be interested to look at some of your off-market source properties and what we can do if you can get them registered on the system. And then what we can do is I'll send them out to you. They get like an intro email from me. And with the deals that are available at the moment, it's free to register, free to get the deals. If they wish to learn anything more about any of the properties, they have to then sign an agreement that basically says if I buy any of your deals onto me, I'll pay you a fee. If I don't buy anything, they won't cost me a penny. And they don't have to pay that fee until completion as well. So again, it won't be anything that's going to be incurred until they get to the point of exchange and completion as well. It's just to cover my security, I'm sure you can appreciate on my end of handing out details of all our properties that are available without giving you any security. I have to have that in place. Not saying I mistrust people, but so I have to do that. I'm sure you can understand. Of course, of course.

SPEAKER_02

No, no problem, no problem. And is that all available on your Linktree link? Ooh, is it?

SPEAKER_00

Yeah.

SPEAKER_02

Yes. Or it soon will be.

SPEAKER_00

But yeah, just to register on the off-market list.

SPEAKER_02

Yes, yes, yeah. I was gonna say, if you've got any links like that, you just want to email them across to me, I'll get the team and everything. We can put them into these videos and anything that goes out there as well.

SPEAKER_01

Just so it has an awful lot of ways on there. And worst case scenario, if they can't find what they want on the link tree, then they can give us a call or we'll send anything over to them because there are lots and lots and lots of things going on and very exciting.

SPEAKER_02

Amazing, amazing. Well, once again, thank you ever so much for your time. I look forward to seeing

Closing Thanks

SPEAKER_02

you both again next month. Take care and bye for now.

SPEAKER_01

Cheers and