Monday, February 18News For London

A Realist’s Guide to Renting in London

Recent data from OnTheMarket.com revealed that Londoners spend up to 61% of their income on rent, with Camden being the most expensive borough. This follows a study by the trade union GMB which found that between 2011 and 2017, rent prices for two-bedroom flats in London increased by 25.9% to an average of £1,500 per month while wages only increased by 9.1%.

Source-Canva

Today, in a letter seen by The Guardian, Sadiq Khan said that he is considering the introduction of rent controls in London: “The housing crisis is now having such an effect on a generation of Londoners in favour of rent stabilisation and control are becoming overwhelming.” Khan’s proposed changes focus on “no-fault evictions”, where landlords are able to evict tenants at the end of their initial fixed term which campaigning group Generation Rent claim the leading cause of statutory homelessness since 2012.

While the cost of renting soars, CitizensAdvice.org found that more than 70% of renters in the UK have experienced health and safety issues during their current tenancy and of these issues, 40% were present when the tenant moved in. Meanwhile, BBC News recently reported that certain letting agents were demanding non-refundable deposits from tenants to view properties.

This information paints a grim picture of an overpriced, underregulated and low-quality rental market in London, especially for graduates who are estimated to earn a starting salary of between £19,000 – £22,000, according to GraduateJobs.com. A graduate earning £22,000 would take home £1,529 after tax, around the average cost of rent in London according to GMB. Even the much more optimistic ‘High Fliers’ average graduate salary of £30,000, focusing only on the top 100 graduate employers, yields a monthly take-home pay of £1,982 after tax.

We spoke to tenants, landlords and activist groups across London to construct a guide to renting in London on a realistic salary, and how to avoid the pitfalls that recent graduates in the city so often fall into.

Avoid letting agencies

If the aforementioned BBC article shining a light on the hidden fees letting agents sometimes employ wasn’t enough reason to avoid them, WestminsterWorld spoke to Audry, an American journalism graduate who was forced to leave her flat in Dalston after a persistent leak seriously damaged her room and left her ‘sick and depressed’.

“I moved in and everything was fine, but shortly after the first time it rained there was a leak in my room,” Audry told us over the phone. Immediately, she contacted her landlord. “It took a little too long to get it 0fixed. Finally, the guy came to fix it a couple of weeks later, but it happened three or four more times…It would be streaming down my wall, I was getting sick a lot.” She thinks that the landlord had hired cheap, underqualified labour to try to fix the problems, to no avail.

Audry was forced to move out, but she knew it would be difficult to reclaim her deposit since the landlord was trying to fix the problem. After the leak caused her fireplace to collapse, the landlord agreed that she could no longer stay there, however, this led to more problems as the flat was rented through an agent.

“The agent was super sketchy about me moving out and said they had to hold the deposit because it was kept inside a tenancy scheme until the end of the lease,” she recalled. The agent even suggested Audry’s flatmates lend her the money for the deposit while she waited almost year for her tenancy to expire, rather than just give her the money.

Due to government regulation, all tenancy deposits must be stored in a Deposit Protection Scheme so that a tenant may receive their deposit at the end of their stay. “I finally called the deposit scheme myself and they told me that he [the agent] has the authority to release it.” Eventually, the agency released Audry’s deposit, but she said that he treated her like a “dumb, naïve little girl” and spoke in a condescending manner. Audry thinks that the tenant took advantage of her and her flatmates being younger women.

After this arduous process, Audry found another flat that was rented out by its owner: “It felt so much more personal, and they actually treat you like someone who has feelings, rather than a corporation.” Audry’s advice for newer graduates looking to rent in London? “If you can, don’t go through an agent”, she tells us decisively. “It’s kind of hard to find properties that aren’t through an agent but try to find something that is a bit more personal.” 

SpareRoom – Friend or Foe? 

For many young Londoners, the prospect of renting a flat separately remains a pipe dream as the disproportionate gap between their salaries and the renting costs continue to widen. Most resort to Spareroom.co.uk as a last resort to find a haven. The flat sharing website is famous on the internet in helping recent graduates and students alike in finding suitable and cosy rooms without emptying their wallets. However, it comes with its own caveats. The website has been invaded by letting agencies which effectively defeat the entire concept of Spareroom. Thankfully filters have been set in place which helps differentiate between agents and private landlords.

Darius, an engineer from Harrow, made use of Spareroom when looking for somewhere to live: “The first thing I did was go on SpareRoom”. Darius told us: “I quickly noticed that there were two different types of options. The first was you rent through an agency and the other was through a private landlord. With the agency, everything was very organised, but there were additional fees.” Darius filtered down the results to include only private landlords, but still admits that there’s a degree of trust required within this option: “you need to judge, based on your viewing, whether you can trust the landlord.”

Audry made use of the Spareroom to secure accommodation twice and considers Spareroom as a valuable resource which needs to be handled with care. Speaking to her about her the website and its effectiveness she said: “Since I’m not from here, I think it’s quite a good resource to find a place to live. I don’t think I would have been able to find my own place if it weren’t for Spareroom. But I do kind of agree that there’s not much regulation, it can be kind of sketchy. There’s almost an element of trust that goes into it.”

Check, check and check again

Data from CitizenAdvice found that 40% of health and safety issues in rented accommodation were present when the tenant moved in, so when an agent or landlord is showing you around a property, be sure to check anything that could be a potential risk. The Homes (Fitness for Human Habitation) Bill 2017 – 2019 is an amendment to the Landlord and Tenant Act which requires landlords and letting agents to maintain rented accommodation “in a state of fitness for human habitation.” It’s worth reading this document before you start viewing flats or houses, as it will highlight some important things to look out for before you sign the contract.

Darius’ number one piece of advice for tenants, especially those going through a private landlord, is to ensure that you have everything in writing. Darius stayed with one private landlady who agreed to rent out a room for £500 per month, a reasonable cost in London. After a week, she wanted to increase the rent to £800 per month. “I negotiated over the phone, so it wasn’t black and white [referring to a contract]. I hadn’t signed anything at the point where she asked for more money, so I left the house and looked for somewhere else,” Darius told us.

Darius also told us that he once arrived 20 minutes early to a house viewing, to find that the landlord had not yet cleaned the property. “If you arrive early, you can see the house as it really is,” Darius told us. Obviously, agents and landlords will clean a property before a potential viewing, but this can hide the true nature of some problems and the care taken into maintaining the house for the rest of the year. “I arrived for a house viewing 20 minutes early, they didn’t clean the place, so I saw it in a condition where it was super messy. I said ‘no’.” Darius did not sign for this house.

Claire, a landlady based in Canada Water, told us: “before you sign the contract you need to check everything and if there’s anything you don’t agree with, negotiate with the landlord.” Claire pays an extra fee to her letting agent to conduct an inventory check before a tenant moves in and after they move out – before signing a contract, make sure to check this inventory to see if any items are damaged. Claire told us that she is not unreasonable when it comes to deposits and expects some depreciation with things such as furniture: “If they do something big, like they use a knife to cut my sofa, then I need to charge.”

“If they’re really not happy with this, they can go to court. They can put everything to the court because, as the landlord, we have evidence and the tenant has evidence,” the landlady told us. She went on to add: “the thing is, the court fee is really expensive; some people, some students, they’d rather lose the deposit than pay for the court fee.” The fear of going to court and losing is enough for some people to not battle to save their deposit. Audry, the tenant from Dalston, contacted the deposit protection scheme because she was owed over £1000 and her landlord agreed that the flat was uninhabitable.

Source-Anoushka Pinto

What does all of this mean?

From the interviews we conducted and personal experience, it seems that the London rental market relies on an imbalance of information and experience between tenants and agencies. This is especially true for graduates, who will often be entering the rental market for the first time. Both Audry and Darius told us that there is a degree of trust required when renting through a private landlord and when dealing with such expensive decisions, care must be taken that you are making the right decision.

On the other hand, landlords like Claire seem to thrive within this often murky, distorted market. The idea that landlords and agents operate under the assumption that they can hold a tenant’s deposit because there’s less risk of being taken to court is as sinister as it sounds, and through our investigation, we’ve found real life examples of this abuse of power.  If Claire is to be believed, renters in London have a choice: either pay massive amounts upfront to rent with a trustworthy agency, or go with a smaller, initially cheaper agency and risk hidden fees: “Professional agents will charge you a one-off fee that might be really high, or higher than the other agents, but they don’t have all those hidden costs.”

All hope is not lost, however. Two organisations in particular are fighting for a fairer London rental market. Renters’ Rights London describe themselves as the “voice for 2.7 million renters in London”, campaigning for affordability, quality and power for tenants by empowering them with information. Their website provides links to area-specific information, testimony from tenants and individual advice.

Generationrent.org are also campaigning for improved renters’ rights and are the organisation that revealed the link between no fault evictions and homelessness. They are currently fighting to end Section 21 “no fault” evictions and have amassed nearly 10,000 twitter followers. WestminsterWorld reached out to both organisations for a comment and we are awaiting a response.

We also reached out to several legal firms for definitive legal advice surrounding hidden agency fees. On multiple occasions, we were asked by firms to pay for legal advice. Eventually, we contacted the Competition Markets Authority for information about hidden fees. They provided us with a link to the Gov.UK section on protection law for lettings professionals, which can be found here.

 

Roles – 

Words – Ethan, Upanishad

Interviews – Zhenyi, Ethan, Anoushka

Audio editing- Zhenyi

Visual Media – Anoushka