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Thank s again, I've just emailed the HA with some of your queries included. I'm due to hand over on Monday, so a bit tight on time, however, I want to ensure it's all clear before signing the agreement. I'll keep you updated. Regards, Colin
A couple of thoughts that come to mind:
1. Who maintains the garden? If it is down to the tennant, expect to find a jungle with 3 months as they will be highly unlikely to cut the grass.
2. If at the end of the 12/24 months you do not want to extend the lease, how will the LHA remove the tenants? especially if they have no other temporary housing available and the tenant refuses to move to a B&B. Will the LHA carry out a section 21 eviction.
A section 21 is quite common amongst LHA's in London, so nothing really to worry about. However its always good to know this before hand.
Like other have said, there are pro's and cons but in large it depends on the tennant you get.
What are the reasons that have made you go down the LHA route?
Thanks TSR, some valid points made which I've just emailed the HA about. I'm due to hand over on Monday, so a bit tight on time, however, I want to ensure it's all clear before signing the agreement. As for why an LHA; 2 lettings agents suggested £740 and £725 per month and would charge me a finders fee and 8% ongoing. I was aware of a charity to help Syrian refugees and made some phone calls. The HA got in touch and we agreed on £700, incl maintenance, for 2 years, with a 12 mth clause. LHA rate is £500. I got the impression that it's not temp accommodation, but have asked the question in my recent email. Regards
By it's very nature (2 yr lease) it is Temporary Housing - and if occupants still in situ at end of 2 yr lease you would continue to get paid the £700 pcm - until either they leave or you negotiate a further lease period.
When LA takes such property they often cut grass 4 x pa (spring/summer) via their subbed out grounds maintenance contractor - but that would need a close eye keeping on it to ensure that is adhered to - ask HA about it and get it included if you can.
Good evening LandyLordy
The HA have amended the agreement to further detail maintenance responsibilities. They cover the following, whilst, as suggested, building, roof, ch boiler is my responsibility:
Provide 24 hour repairs service including out of hours service
Maintenance of landscaped areas
Ensure yearly gas servicing is completed
Responsible for cyclical repairs and maintenance
They said they don’t produce condition reports, however, I can include photos as part of the inventory.
They've said the property is not temporary accommodation, it is being procured for the purpose of being a permanent residence for the family who will be assigned to it via the programme. After 2 years if both parties are happy they would look to extend the lease as the family will have 5 years leave to remain. If I gave notice on the agreement then they would be serving a section 21 notice of eviction on the family.
Thanks again for your help with this, you’ve sign posted some areas I may not have considered and I’m very grateful.
HA seems somewhat desperate for the accommodation as they are compliant - small point on later 5 yr lease potential is that rent would be fixed for the duration so would need to be at a decent rate at outset and overall provided you have no emotional attachment to the property and assuming it is handed back in a good lettable condition you are on to a winner.
As an aside, how did you get on with your insurer and mortgage company (if you have one)? I looked into a similar scheme admittedly several years ago and such a scheme fell foul of clauses in both cases in respect of allowing subletting.
In addition whilst neither my mortgage or insurer had any problem with tenants in receipt of benefits , the did have clauses in respect to accepting “local authority referrals”
In addition my local authority would hold me responsible in the event of any problems in respect to antisocial behaviour etc.
I decided not to proceed, this was in the early 2000’s , at the time the home office were giving contracts for housing locally to those with effectively old hotels willing to house asylum seekers and refugees, it made some people very wealthy.
Lots of good points in the previous comments.
Regarding the mortgage, I’m changing from a resi, as I’m moving to Wales, to a BTL. I currently have permission to let and expect to change to a BTL in the next few weeks. I’ve been upfront with the broker about the HA and the deal, which is above the LHA rate, however, I will raise your points with them next week to ensure validity.
The HA have suggested that in the longer term, they may well aim for a 5 year term, however, this is my first BTL, so trying to cover all bases.