Landlord responsibilities do you really understand them?

Video Transcription:

Hi guys, so I had a great question on YouTube and basically it comes out of the interview with Jim Kirby, who is one of our investors and mates for over 15 years we've known him and he's become a good friend over that time, and it's amazing what he's achieved and now he's gone through this full cycle. So he's been in employment, changed jobs and also now retired and living off the retirement or living off the result of our efforts. And the question came and it basically said, "Well hold on a sec. Jim talks about how we do everything and that, and one of the things, the comments that were made was, does he understand his responsibilities?"

Now there are two parts to that question. The first is absolutely. The approach we take and the way we do it is we explain things to you. So you always are at a point where you understand what's going on in your portfolio. That's the first thing. So 100% that's the case. The other side is this. The legislation has changed so much of late, so much. There are so many changes. I mean, I currently am studying for my level four ARLA property sales and lettings and management. So that's two certificates, separate ones that I've got to have. Six subjects each, two of my overlap. So I guess there are 10 subjects in total. Okay? So 10 subjects I have to basically learn. And there's two books, this thick, of stuff. And the reality is there are over 170 pieces of legislation that now affect your property. And that's in the letting side and the management side. The reality is there's more than that when you factor in things like fair tradings and all this sort of stuff.

But the bottom line is, let's just stick with 170 plus. Does every individual who we work for, investor, understand all those 170 pieces of legislation in the amount of detail that is required by the courts and by the government now? And I would say that there'd be very few landlords, do-it-yourself landlords who really understand the impact of those legislations.

And let me tell you, at the end of the scale, and this is how punitive some of these things are. Unlimited fines and imprisonment. So investors face unlimited fines and imprisonment for some things, five grand here, 30 grand here if they don't adhere. It could be three times the deposit. It could be... There are so many different things that affect them from these different pieces of legislation. I mean, it's a horrible situation to be in. And unfortunately, even as someone who manages 1200 properties, okay, the things that we have come up are amazing. And the lack of support that the government, that the courts give landlords now, it is appalling. Absolutely appalling. And I'll tell you some stories in another video.

So the question is, do they understand their responsibilities? I don't think anyone understands their responsibilities in full unless you're a barrister in law specifically about land law, and landlord and tenant, and Housing Act and that sort of stuff, because now it's not just one act. It's multiple acts that you need to understand. And that's why I've had to go back into the books and learn, this partly because of this ROPA, which is the Regulation Of Property Agents, that's coming in... Well, hasn't come into place but is likely to come in place within the next two years, where everybody will have to be qualified.

Now the great thing is all of our staff have those qualifications or are working towards those qualifications. And we've been doing that for the last really three, four years with 100% commitment, and everyone has to have that within the first 12 months. And that's what we've pushed for. Why? Because it has become now to the point where everybody has to understand their responsibilities and we can't rely on landlords to know two books like this of regulations and that sort of stuff. So we do it as a property agent on their behalf.

So that's where that comes down to. Our investors, make no mistake, set and forget, and the whole concept of effortless property management and having somebody else do it for yourself and "delegate the task, not the responsibility" and all these, they're great terms but they actually mean something in our business. And I really want to get that across to you, that they actually mean something in our business. And therefore most of our investors understand their responsibilities, maybe not in the detail that they would need to if they were running the property themselves, but they're paying us to do that. So the requirement is that we know that, all right?

And make no mistake, that's what we're continuously working towards. Our team get continual exams and tested, and they're getting the qualifications and all these other things to keep them up to standard. All right? So hopefully that answers that question because I think it's an important question. I think if you're out there and you're a landlord and you don't know what those 170 pieces of legislation are and you're managing the property yourself, well my gut feel is you should not be managing the property yourself as a landlord investor unless you are full-time in this industry and you understand that and you're prepared to accept that and put the time in that's required.

Because if you're not, then there are huge risks involved. The slightest thing that hasn't been registered. Deposits registered within 30 days, otherwise that's it. You can't unregister them afterwards and claim back. For instance, having the prescribed information sent out with the tenancy agreement. If you don't do that, then you can't claim a section 21. And all these sorts of things, there are so many different little intricacies that you need to know.

All right, guys. But anyway, hopefully, that answers. See you later. Have a great day. Bye.

Brett Alegre-Wood
February 21, 2020

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