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Insuring Your HMO (And Other Precious Items!)

The end of the year heralds house insurance renewal. Every year I promise to apply myself, compare quotes and wallow for the next year in the knowledge that I’ve secured the most competitive deal.

The reality is, when the broker calls I groan with resignation and tell him just to get on with it. As he flicked through his computer information on my claim history, he came out with “Oooo, aren’t you a good client? You haven’t made any claims in the last 4 years so it’ll be easy to get you a good quote”.

“Excellent!” said I “And if I HAD claimed in the last 4 years I presume my quote would have risen to affect the amount paid out?”

Silence.

“Well, yes, that can be a problem” he replied.

Me: “And that’s why I don’t claim. Find me a quote, don’t bore me with the details and just let me know the telephone number for when a house burns down”.

However, how many houses do actually burn down? With HMOs, we are rightly governed by so many fire risk assessments and regulations that, according to my recent chat with a man in uniform, “you can stand in the hallway for 30 minutes without a fire affecting you”. Great, so I’ve informed all tenants that, should a candle set light to the curtains or a cigarette get lost under the duvet cover, come out of the room calmly, stand in the hallway and enjoy the safety the firedoors, smokestrips and fire retardant plasterboard I give you.

Later, whilst chatting to a friend, she asked that, if I’ve never made a claim, why bother with insurance? I explained that with HMOs there is ALWAYS the possibility of a fire.  Especially when the tenants take it upon themselves to put sellotape over the fire alarms or, to my eternal amazement, ignore the backup low battery signal which emits every 30 seconds.

So, it doesn’t matter how well maintained the house is, how many fire precautions are in place or how many baths you replace with showers to prevent flooding, are you willing to risk your cash on the odds of an unforeseen event happening which costs more than the insurance premiums?

So this year I’m leaving a well known insurance broker due to lack of customer service and unacceptably high levels of marketing emails and switching to The Home Insurer.  They understand the nature of HMOs and, from my research, seem to pretty much insure anything else.  I’m also giving their number to my tenants for quotes as it turns out quite a few of them do actually insure their room contents!  (They’re also human beings, very experienced insurers and don’t give in if the computer says “No”).  Click the link or give them a call on 0800 612 5764 and let me know how you get on.

On another note of insurance, the police turned up to take a statement following the case of Simon, his friend, a night out and a broken window. After checking that I hadn’t given permission for the friend to chuck a flowerpot through the window in October, he gave me the crime number for “insurance purposes”. I laughed and said – “Unlikely, Officer!” We’ve settled for a community order whereby, should the police find the young man involved he’s under instruction to pay me the cost of the repair. When I told Simon he replied, “Sod that, I’ve already told his girlfriend I’m going to kick his head in when I next see him”.

There’s nothing like a bit of civil justice, eh?

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Confessions of a Tenant

One great upside to this landlord business is how it puts you in touch with people you’d probably never encounter.  I’ve met tenants with a variety of hobbies from body building and fishing to alcohol and drug abuse and a bit blackmailing on the side.  Never, ever, though have I come across Linda’s hobby in either a social or professional capacity.

Linda is 55 years old and a Dominatrix – she doesn’t get paid otherwise this would be classed as prostitution.  The confession came about yesterday after she asked for a bigger room to accommodate her newly acquired wooden Cross.  Here’s how the conversation went:

Me: “What, a crucifix?  Are you very religious?  There’s a church over the road with loads of them”

Linda: “No, it’s a special cross to put people on but I only want to store it here, not use it” Continue reading

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No Home Comforts for Those on Housing Benefits

I’m reluctant to publish guest posts, but this excellent article written for me by Alex Murray of Safesite Facilities neatly encapsulates my experience on the front line of accommodating housing benefit tenants. There’s an additional, heart warming story at the end to prove landlords aren’t all inflexible, greedy sods.

No Home Comforts for Those on Housing Benefits

When “non-smokers only” started appearing in property-to-let listings in the UK, it was widely acknowledged as positive action which directly reflected the attitudes of British society and its wish to be free from the stench and alleged ill-effects of smoking.

Fast forward to 2014.  Although “non-smokers only” still appears, another two words, which first crept in during 2008, have begun to take prevalence.  Again, two little words which are accommodation-ad specific, but once more seem to represent the attitudes of a society  seeking to free itself from something seen as negative, pervasive and pernicious:

“no benefits.”

Sadly though, this advertisement addendum is far from a positive reflection on 2014’s British landlords and society.

How did it come to this?

Since the coalition came to power, the days of government and public benevolence or relative even-handedness towards those claiming benefits have been numbered.  Along with the government, much of the British media have stood in line to condemn benefit seekers as “lazy” or “scroungers” whilst fly-on-the-wall documentaries such as Benefits Street seek to demonstrate to the remaining public who display a live-and-let-live attitude towards others that they might be misguided in not jumping on the judgement band-waggon; after all, an alternative programme title might have reflected the difficult cycles some vulnerable families find themselves trapped in, but no, Channel 4 chose Benefits Street.

After the frosty reception which greeted their plans for the Bedroom Tax and the on-going disability benefits and ATOS Work Capability Assessments (as in don’t give ATOS) debacle, the government then rolled out its Universal Credit scheme nationally in October 2013.  This scheme replaces, amongst others, the long-standing housing benefit and involves making single monthly payments directly to claimants.  From this, claimants are expected to make their own rent payments direct to their landlords.

Government Assurances – for the Landlords

Although the government is adamant that Universal Credit gives landlords greater protection from tenants who fail to pay – review of payments kicks in after just one month of arrears – this hasn’t been enough for landlords.

A recent survey, conducted by SpareRoom.co.uk, revealed that landlords have lacked confidence in the government’s systems for handling benefits, largely since the introduction of Local Housing Allowance (LHA) within the housing benefit system, in 2008.  This change, which also allowed payments to go direct to tenants, was identified by 88% of landlords as having a negative impact on their businesses, through late payments and damage to their property.

With their confidence, revenue and portfolios already shaken from LHA, 6 out of 10 landlords (57%) state that they now refuse to accept tenants on benefits.  Of those landlords still willing to take housing benefit claimants as tenants, over half plan to will stop when Universal Credits become fully functional (around 2016) and several large property investors, including Kent property tycoon Fergus Wilson, have already served eviction notices on current benefit-claiming tenants, as reported by the BBC.

Assurances for the benefit claimants?  Anybody?

With low levels of social housing stock, eviction notices in hand, the “no benefits” banner across the rental sector and the benefit shakeup generally causing unknowns for those finding themselves claiming benefits (including reliable, responsible, hard-working families and pensioners), what hope is there for those relying both on benefits to make ends meet and the rental sector for a roof over their heads?

In truth, not much.

Whilst the landlords can gain the same (if not more) money by letting their properties on the open market, housing benefit claimants have no alternatives, just further belt-tightening.  This is inevitable as any landlords still willing to rent to them increase rents to match their own increased “risk” and to pass on their additional buy-to-let mortgage and insurance costs, which have risen considerably for landlords renting to the benefits sector, as many buy-to-let lenders also coin in extra cash from others’ misery.

As Matt Hutchinson, the director of SpareRoom.co.uk reflects: “the rollout of universal credit is set to make the situation even worse.   With rents rising and the welfare budget suffering from further government cuts, the outlook for tenants reliant on housing benefit is getting bleaker.”  Not only that, but thanks to the divisive “no benefits” mentality pervading the rental sector, the outlook for our prospects as a cohesive, empathetic society looks pretty bleak too.

Thank you, Alex.

55p and a Cat Called Bill

A couple of weeks ago, John contacted me through a friend.  An eloquent, skilled barber who had numerous men’s grooming awards under his belt but, following a breakdown, had been forced into sofa surfing whilst trying to get to grips with his own recovery.  How easy is it to recover your self esteem when you’re sleeping on a lumpy sofa in someone’s living room, with no privacy or hot water?  His only stable, trusting relationship was with Bill, a nonchalant black and white cat who clearly has no idea he holds his master’s wellbeing in the pads of his paw.  All John had to offer was 55p in his pocket and a promise that Bill wouldn’t pee in Jim’s newly planted containers.  All I have to do is to help him fill in the forms, wait around 5 weeks for the claim to be processed and I will hopefully have 2 very happy, contented, mentally stable tenants for a long, long time (and I get to stroke one of them).

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Keeping your HMO Looking Lovely

Keeping your HMO in good decorative condition is an often overlooked and boring part of the landlord duties (especially once the novelty has worn off).  In the beginning it’s obvious to set up the building looking new and clean – after all, “Shiny Sells” one letting agent told me.  Depending on your tenants’ standard of care, the property can quickly become scuffed, shabby and develop a strange musty smell. 

With single lets, a landlord expects to have to do a light refurb (if they’re lucky) at the end of each tenancy to freshen their product up to sell, but in HMOs you can be constantly selling rooms with quick turnarounds, so don’t have the luxury of waiting until the paint has dried.  This became screamingly obvious to me this September with 14 room changes.  FOURTEEN!! A few people left, then existing tenants wanted to upgrade, move to join friends or find a room with a view.  After a while I became reluctant to answer the phone and had to set up a wall chart just to track the movement and tenancy dates of each resident.

Donning my Marigolds I was lucky enough to get away with a light dusting in most of the rooms and only had to carry out a full on refurb of carpet and furniture in one room.  I had my light bulb moment when showing some applicants around a house which has seen little to no movement for a year and realised the bathroom was looking tired and grotty.  It’s difficult to ban the bathroom for 24 hours whilst the new mastic dries.  The room turnarounds were often less than a few hours so it was a case of clearing out the rubbish, crazily spraying Febreeze and checking under the bed for forgotten porn mags.

All this change means new tenants to train, an increase in lockouts as they forget the bedroom doors are self closing and the inevitable clash of personalities who struggle to exercise tolerance.  One poor guy is being bullied by four Spanish ladies for constantly leaving his dirty dishes in the sink.  “If I want to be nagged, I’d be bl**dy married!” he grumbled.

There is a cleaner who goes into each house to “do” the communal areas once a week.  Unfortunately, he was sacked last week by two Portuguese chambermaids who declared that they could do the job better and for free.  Taking cleanliness a stage further I bought those plastic runners for the hallway to extend the life of the carpet, only to find that they’d been taken up and chucked under the stairs so I put them back this afternoon.  This is a game which could go on forever…

A quick update on the tenants: Tom has a job.  A job which is six days a week and he’s now held for three weeks which is two weeks and 5 days longer than I thought he’d handle it.  The only problem is, he gets a full month’s pay mid October and I fear that we’ll find him in a gutter having spent his entire earnings before I’ve managed to relieve him of his rent.  Simon also has also secured himself a job so he can now afford to install his own dedicated broadband connection for gaming online.  At least he’s not looking to move in with a girlfriend, but since his new employer ordered him to wear deodorant, you never know.

And finally, one tenant gossiped that Colin had been making le cinq á sept calls to the new Polish lady downstairs .  So I asked how she was settling in and was he making her feel welcome?  “Oh yes” he replied “She’s lovely”.  “But how do you communicate as she doesn’t speak English?” 

“We use Google Translate and understand each other perfectly”.  I would have thought the computer would have got in the way

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Another One Bites The Dust

You may remember my posts about Andrew – a serial gambler, unable to hold on to any money long enough to throw my way.  I haven’t told you the whole story and, at risk of being stoned by fellow landlords, here it is:

Andrew came on the recommendation of another tenant who said he would vouch for him (first warning!).  After only a couple of weeks he’d stopped paying the rent, resorting to pawning his cracked iPad.  Over the months that followed he attempted to “go straight” and really, really tried but just couldn’t do it.  We had long conversations about his childhood in foster care, how his drug fuelled parents locked the front door and went on holiday leaving him to care for his three younger siblings when he was eleven with no money (he was so desperate he went to a phone box to call the police) and his disrupted education culminating in anyone remembering to send him to sit his GCSEs.  He couldn’t read or write except for designer labels and betting odds and was doing his community service for holding up a bookies.  He moved to our town to be nearer his mum who promptly left, abandoning him yet again.

On the plus side, he was a cheeky, lovable, charming rogue who was a good father to his lovely young son and managed to attract a stream of beauties.  He even had me wrapped around his little finger with his desire to make life better, get a proper job and be self sufficient.  We budgeted, I showed him how to eat on £25 a week, we confronted his debts and stayed in regular touch.  He even managed to get a job, but was sacked after screaming at a waitress after a couple of weeks.

I helped where I could: gave him the train fare to work, bunged him enough money to eat until payday, lowered his rent to the LHA level whilst he got on his feet and even paid off the bloke who was “going to beat up that pretty little face” when he stole and gambled some takings.  It wasn’t a lie, I heard the phone call and my heart went out to him as he sobbed under his duvet.

I’m a patient girl, but realised that as my own 6 year old son grows up and learns more sophisticated ways of winning my affection (“If I tell you I love you, can I have a biscuit?”), Andrew wasn’t growing up at all.  I showed him a £10 note and asked “What do you see?”  He replied “A chance to make £20 or £50”.  I said I saw a few meals or a pair of kid’s shoes from Asda and soon realised this was an illness I couldn’t possibly overcome for him.  He even went to Gamblers Anonymous to appease me but didn’t return for a second meeting.

His usual trick was to obtain expensive mobiles on contract and sell them on – I reckon he’d done this three of four times in as many months and was becoming even more desperate.  There’s a CCTV photo in our local paper under the title “Man Wanted For Cash Machine Damage” and he looks suspiciously like him.

Enough was enough when I could see that it didn’t matter how much I helped, listened or pointed him in the right direction it was clear that he needed more.  I suspect his life has been guided by social workers, foster parents, etc. all deciding what was best for him so, when he left the system and his brothers were already in prison, he just couldn’t see a way to lead a “normal” life.  He’s bright, kind, charming and could have so much potential  but am more annoyed that he couldn’t see it himself when I should be angry at the £700 rent arrears he owed me.

Yesterday he left after I went to file court papers.  As a landlord, I’m happy to have the room back but, as person, I wish he could have found the path that would make his dreams come true – i.e. putting together a home, family and job which he had never experienced.  I wish him well and understand he’s left town but I don’t think he even knew if that was the truth or not.

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Busy Christmas and New Year Plus A Narrow Escape.

Christmas and New Year were far from quiet.  It kicked off with the Poles next door partying and arguing till the early hours and frantic texts from my tenants who had to get up for work the next morning.  We happened to be in town when one text came through at 10.45pm so decided we’d check out the noise pollution for ourselves.  Kids in the car, we parked outside the house and listened……..and carried on listening.  Nothing, apart from the low hum of conversation so returned home and kids stopped rolling their eyes in boredom and repeating that they will never, ever become landlords.

During this time I was working on getting a young lad into a single room.  He’d been ousted by his parents at 16 and gone to live in supported accommodation where he was allowed to stay until he turned 19.  Speaking to the social workers on duty they were less than enthusiastic about him (strange, as I thought they needed him to move on), but wouldn’t give a reason why.  The more I met him so we could navigate the benefit system, the more he grew on me and I really liked him.  We’d also had the “zero tolerance” drug talk and he assured me he kept his weed smoking to the park at weekends.  He wasn’t particularly quick in getting the paperwork back to me but I put that down to lack of literacy skills and his getting the correct paperwork from Housing.

My Narrow Escape

That weekend, much to my daughter’s horror, our local PCSOs stalked me round Boots and warned me of the penalties of shoplifting (which I wasn’t, it was clearly their idea of a police joke to brighten up their Saturday afternoon beat).  “Oooh, good!  While I’ve got you here, have you heard of XXXX?  Also, we’re having some problems with noise at number XX and wondered if you could keep your ears out whilst on the beat, especially Friday and Saturday nights”.  Turns out the young lad was a well known drug dealer in town, having been convicted a couple of times and the noisy neighbours were on the police’s “being watched” list.

The moral of this story?  I would never have found out these details without local knowledge and when I asked my potential tenant about his failed reference check, he said “Oh yeah, forgot to tell you” and put the phone down quickly.  His mum texted me on Christmas Day asking why he couldn’t have the room – my response: “He failed the referencing process.” and I didn’t hear another word. Shame, I really did want him to have that room but just couldn’t risk the company he was keeping.

New Year

Just as I was engaging in a humiliating game of Wii Dance with my nieces on New Years Eve away from home, first text came through and Petra had locked herself out of her room.  Another text on the back of this from Ted to say Helga had locked herself out.  “Don’t you mean Petra?” I said.  I lined up the builder to get the spare set of keys to let her in the following day.  A few glasses of wine later a text read “It’s OK, I’ve got myself in. Petra xx”  then another, “It’s OK, I managed to get Helga into her room.  Ted”.

It was about 10pm by this time and I was trying to pace myself “Ted, her name is Petra NOT Helga and you’ve been living in the same house as her for 3 months!  Thanks for sorting it” (without the spare set of keys I don’t know how).  Returned home a few days later, bumped into Petra and Helga who said “Imagine, we’d both get locked out on the same night!”  Ted must have thought I was bonkers.

The next story is sadder:  one of my tenants had a mental breakdown shortly after new year.  His head was so full of “noises” that he spent the day drinking, came home kicked the bathroom door off its hinges, grabbed a knife, banged on the other resident’s doors (who called the police), left the house and mistook the NCP car parking attendant for an assailant and attacked him.  I was called to make a statement and he ended up in court the next day and released on bail.

I’m not going to say much more at this stage as I am happy for any of my tenants to read what I write about them as all the posts are factual.  In this guy’s case, the issues run deep but suffice to say, he’s been with me for four years, an asset to the two houses he’s been in and, the following day, we spoke more in one hour than we had during his entire tenancy.  He isn’t a danger to the other tenants, they all know it was out of character and are supporting him whilst the NHS mental health system work out what to label him as.  Before anyone makes a judgement:  I reckon the events in his life had just become too much to bear and the drink made him do stupid things – haven’t we all done that at some point (but not with a knife!)?

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One Good Turn Deserves Another

My blogs have lapsed over the last six weeks but this doesn’t mean nothing’s been happening and I’ve reached the financial stage where I can stick my slippers on, grab a cocoa, put my feet up and watch “Homes Under The Hammer”.

Instead I’ve been busy setting up two HMO’s for an investor.  It’s taken me back to where I started five years ago trawling the charity shops for decent furniture,  remembering all the items needed to kit out a kitchen and explaining to the electrician the importance of tamper proof thermostats.  The difference this time is the investor was keen to get the project right first time and make the rooms look fabulous so very little maintenance will need to be carried out in the near future.  You can read all about the project here.

In the meantime, last month Andrew got himself a job as an assistant chef in a pizza restaurant and he was so excited that he was finally going to be working legitimately.  We had a chat and I poured cold water on his enthusiasm by asking how he was going to pay his £90 a week rent.

Andrew: “Oh, yeah, I hadn’t thought about that.  When will I get paid?”

Me: “Well, more importantly how much are you going to be paid?”

Andrew: “Oh, I don’t know.  About £6 an hour”

So we did some calculations based on his contract and expected overtime, deducted National Insurance and emergency tax after explaining what they were for and discovered that it wasn’t quite the amount he was expecting.  And here was the next issue:

Me: “If you get paid in arrears next month, do you have any savings to get you through this month?”

Andrew: “No, I haven’t got any money.  My ex-missus is screaming for her £20 a week child maintenance, I owe my girlfriend money and I owe you money”

Me: “How are you planning to get to work?”

Andrew:  “I’ll get the train it’s cheaper than driving”

Me: “You don’t have a car”

Andrew: “Yeah, but it’s still cheaper than driving”

So, we left that one.  In summary, he didn’t have any money, had a job to go to in another town the next day and wasn’t going to be paid until 4 weeks later.

Me: “OK, I’ll do you a deal.  I’ll pay for your train ticket to get to work and give you £25 a week for food.  Don’t ask me for any more and contact me when you’ve been paid so we can work out a repayment schedule.  Also, remember it’s the chef’s job and the manager’s to shout at you so don’t retaliate”

Andrew: “Nah, I won’t be there for long anyway.  I got plans.  Anyway, I’m used to my social worker ordering me around”

Me: “Just remember you’ve got no work experience, a criminal record, sketchy reading and writing skills so you need this job to give you some credibility for the future.  You’ll need to stay there a while for it to look good on your CV”

Andrew: “Yeah, good point. “

We made arrangements to meet a few hours later at the railway station so we could sort out his railcard and as I left he gave me an uncharacteristic hug and said “Thank you for helping me out.  No one’s done that for me before”.  I replied “Don’t be too grateful, I still think you have the capacity to screw me over.”

A month on and he’s still in the job, knackered but proud of himself and an expert in rolling pizza dough.  He’s been paid and, after paying his debts, still owes me rent and his expenses but I’m first on the list for October’s pay.  For anyone thinking I’ve laid myself open to be taken advantage of I do have any insurance policy: he accepted a Section 21 notice which will be invoked it he cocks this up.

At the station I noticed he was wearing a Hollister T shirt (clothes shop popular with teenagers).  “You won’t be able to buy those for a while until you get yourself sorted.  My kids put Hollister clothes on their Christmas list” I said.

Andrew: “Buy? Oh, this T shirt – nah I didn’t buy it.  I can get your kids some if you like” he replied.

Me: “Er, no thanks.  They can wait and I’ll give them vouchers”

A couple of days later and he sends me a text to say his girlfriend was about to give her Hollister branded clothes to a charity shop and did my girls want first choice?  “Yes!!” they screamed  excitedly.  There’s a first – I’m now accepting charity from my tenants!

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