Episode Transcript
[00:00:11] Speaker A: Let's Talk, let's an original podcast from the Lettings Hub. Hello and welcome to the latest episode of our podcast, let's Talk. Let's. I'm Heidi, the CEO of the Lettings Hub, the tenant referencing business that got good at tech. And let's Talk, let's is our regular roundup of news and views on on a whole range of subjects spanning the private rented sector. In our session today, I'm delighted to be joined by Julie Ford from Gothard Row Property Services. But more than that, Julie is an advisor to the private rented sector, is also a freelance property writer, TV property commentator and a civil and commercial mediator. Julie has also worked in property and asset management, setting up lettings companies, is the founder of a property network in Hemel Hempstead and St Albans which provides support to landlords and investors. So welcome to our pod. Julie, please introduce yourself and tell our listeners a little bit more about you. You've obviously got an incredibly varied experience of the private rental sector and I think this is going to be an interesting one.
[00:01:13] Speaker B: Hi Heidi, thank you for having me. Yeah, I think I've done this pitch a million times so it shouldn't take too long. I started out in new build sales and quickly realized that I couldn't sell anything to anybody. But when people came back and said there was something wrong with their new build, automatically I could find a problem and solve it. And really very quickly I found out I was a problem solver by trade, so quickly moved into property management and lettings because I was solving everybody's problem on a daily basis. My directors, my landlords, my tenants. So absolutely love that.
I then worked my way up to be the head of property management for a property and asset company in London, managing portfolio properties for a list celebrities, footballers, Formula one drivers, can't mention many of them, but I can actually say Ricky Gervais was one of my landlords and I'm very proud of that.
[00:02:06] Speaker A: Did he.
[00:02:06] Speaker B: Sorry.
[00:02:07] Speaker A: Because he's a big animal fan, isn't he? Ricky Gervais, did he have many animals that needed to move in with him? Can you remember?
[00:02:14] Speaker B: No. But he did allow his tenants to have pets if they wanted to. So he was very pet friendly. Landlord.
[00:02:19] Speaker A: Yeah, yeah. Okay, good.
[00:02:22] Speaker B: So from then on my mum became terminally ill so I left that job to look after her until she passed away and that took me to Norfolk and I was like, what am I going to do here? So I set up my own lettings and property management company there. Grew it from nothing to managing 500 singlets. I then sold the business and came back to my home of Essex and basically started working in third sector. So as some people say, I went over to the dark side and I started working as a housing and homeless law specialist for the citizens of ice. I was there for six years.
From there I then started to work for a local homeless charity as a lease options manager. And then from there really, I took the step to become a consultant in the industry, working with the property redress scheme, landlord action.
I'm a trainer for the nrla, a former trainer for shelter trained and qualified mediator. I've mediated probably over 500 landlord tenant disputes and I now specialize in renterias management.
[00:03:27] Speaker A: Wowza.
And obviously we don't do a video on the pod, but Julia is still a fairly young lady. Like it makes it sound like with that whole career that she might be ancient. She is not at all.
[00:03:41] Speaker B: I started when I was two.
[00:03:43] Speaker A: Yeah, that's it, that's it. So this is actually our last POD recording of the season for 2024 and we're very much all deep in planning and preparation and looking forward to 2025. And of course, the Renters Rights Bill is a major talking point on the year ahead. You're a mediator, Julie, and I assume that you understand both sides of the picture and you're very used to kind of understanding that when it comes to relationships with tenants and landlords. What are your views on the bill? Do you think the balance is right? Is it tilted too much one way? Are we heading for a problem or is it going to kind of sort itself out like previous changes have?
[00:04:26] Speaker B: I think that's a really difficult question to give a direct answer to. It's the biggest change in legislation that we've had for 30 years. And having read all 286 pages of the bill, there's a lot in there that either doesn't need to be in there or just hasn't been thought through.
The Conservatives didn't bring it forward when it was the former Renters Reform Bill because they realized there was still quite a lot that needed to be tweaked and adjusted. Unfortunately, the New Labour government just wanted to rush it through and I think more of an ego thing, so they could go, look what we did that the Tories couldn't. The bill isn't balanced by any stretch of the imagination and weighs very heavily on tenant rights. I mean, look at the name of it. It's the Renters Rights Bill, not the Landlord Rights Bill. So it's already telling you where its trust lies.
From a practical perspective, there really isn't anything we can do once it's enacted. We just have to abide by its legislation. However, there's a lot of grey areas in it and I think we will see an awful lot of case law come through to close those grey areas and make things a lot easier for people to understand. But of course, up until case law happens, we are still sort of flailing around in the dark a little bit.
[00:05:42] Speaker A: Yeah. And like, from obviously, you know, the people that you interact with on a kind of a daily basis, how do you really think landlords are feeling and what is likely to happen when it does come into effect? Or do you think lands are already making decisions now, I. E. Selling up, I. E. Serving Section 21 to try and get a better tenant trying to put rent up. Do you think it's already happening?
[00:06:07] Speaker B: I do think it's already happening, but I think it's a bit of a 50. 50. You've got maybe 50% of smaller landlords with maybe one or two properties haven't even got a clue. The Renters Reform and the Renters Rights Bill is round the corner. They don't even know it's happening. They're oblivious. Then you've got another percent that is aware it's happening but won't do anything until it happens. And then you've got the people that are already making provisions for things that they're probably not really clear on, they're selling up or they're looking at trying to secure tenants into longer tenancies, which unfortunately is a bit of a false economy because the fixed term tenancies that we agree now will automatically be dissolved as soon as the bill is enacted anyway. So I think that there's a lot of uncertainty and a lot of confusion out there for landlords as to what the Renters Rights Bill actually means for them. The key points of abolishing Section 21, people understand that they can't evict a tenant, but a lot of people don't actually understand what the section 21 is to start with.
[00:07:07] Speaker A: Yeah, understand. And I think obviously one of the things that. Going back to your point, there was a survey done recently on landlords and their awareness of the Renters Rights Bill. And I think it was 15% of them had no idea that even existed. I think it was about a further 38% and had heard the words, but had no idea what was included. Now that's obviously over 50% of, you know, landlords that, you know are maybe not using an agent or maybe some of them are. Actually, you know, I think it was irrelevant and I don't know if the industry knows yet what to say or because they haven't necessarily got the solutions. How do you think the kind of communication is going to potentially fall out and when is it really going to kind of hit home? And there's some much clearer messages being given to landlords, agents, tenants.
[00:08:00] Speaker B: Again, that's really hard to answer because we don't know how the government is going to promote the new rules once they come into force. Matthew Pennycook has said that he understands people need time to adjust, but he's also said that as soon as he got the opportunity to get Royal Assent, he's going to bring that act in. So those two sentences, a bit of a juxtaposition.
I don't think there is enough vocal noise out there about this bill.
I talk to agents on a daily basis and there are a lot of agents out there don't even know it's coming in.
And those that do, again, a bit like the landlords that were surveyed, just don't really understand what it means for them. And then I speak to some agents who just take it as a complete death knell to their business and that's it. As soon as the bill comes in, I'm going to be selling up and closing the door. So there's no real understanding of what this new legislation really means for the private rented sector. And as I say to landlords and letting agents that I speak to, actually, this is a great opportunity, if you want to look at it that way, because this is a time to really go through your business systems and get rid of all the old stuff. The 20 different versions of an AST that you've got, they can all go in the bin now. You're going to have one tenancy. Just clear it all out. Also, look at how your business runs. You know, how can you profit from this new legislation? Look at all the things that landlords will need from you as an agent and start streamlining your business retraining staff. You're going to lose renewals overnight. That's going to happen. So if you're a bigger business with a renewals clerk, what are you going to do with him or her? Retrain them to do one of the new tasks that are coming in with the Renters Rights Bill. It's an absolute opportunity, if you're willing to look at it that way.
[00:09:52] Speaker A: And I think the private rental sector, all of us that have been in it for a long time, have experienced a huge amount of change, like continually throughout.
I've been in it for about 20 years, but it's been continuous in terms of one thing or another. And I do think we're pretty good at adapting, and I 100% see it as an opportunity. I think if you don't take that view, it's a very depressing place, actually. You achieve nothing. You're just circling and you're not going to do anything practical. And I think it is now the time that, although you're right, there are some gray areas of the bill and it's not necessarily all clear. And I think there's obviously some debate going on and we'll talk about the timing in a second. Actually, we roughly know, you know, 90% of how it's going to be. You know, the intention is there in terms of what's going to happen. And so people can start making plans now, really. So let's kind of talk about timing then, because I think originally there was a lot of talk about the. The bill's going to get enacted in summer, summer 25. And I think that's kind of what everybody was aiming for or had in their head, you know, or maybe when we wake up in 2025, we need to start doing things about it or, you know, that's kind of a point in the sand where we can work to. What's your estimate now? And I know, again, it's a difficult question because we don't know what we don't know, but how do we think it's going to play out from here?
[00:11:11] Speaker B: I mean, it's 100% that it's going to be coming into force in 2025. That's 100%, but it's when that's going to happen. So we've still quite a lot of parliamentary process to work through. It's had its second reading in the House of Commons, it's gone through its reporting stage. So now we're just waiting for the third reading. And we did expect to have that before Parliament closed for Christmas. It's not been tabled yet. So obviously that's going to happen when Parliament reopens in January. And then it is literally a case of how quickly they can whoosh it through the House of Lords and into Royal Assent, realistically, from how the other bills that are going through Parliament, how quickly some of those need to go through. We know there's a big focus at the moment on the Assisted Death Bill, so there's a lot of people focused on that I would probably expect to see it sort of the end of quarter two, the beginning of quarter three of 2025, realistically.
But of course it could be a little bit later than that, depending on parliamentary process.
[00:12:18] Speaker A: Yeah. So, irrespective, we need to get ready and we need to do some planning. Now, from what we have heard, kind of sitting a bit more on the edges of this, that maybe the most singular concern for landlords and agents is that without a Section 21 notice, it's going to be difficult for landlords to get vacant possession.
I think a Section 21 notice is used sometimes just for the no conflict type of eviction, where actually you don't want to have to gain loads of evidence to prove something.
What are your instincts, I guess, around what will happen on a practical level when it comes to tenants who are either refusing to leave or struggling to pay their rent? Do we think there's going to be kind of changes in terms of how we actually approach the problem?
[00:13:02] Speaker B: I think it's not that there will be. There has to be, there has to be changing on how we approach this. So ultimately, as you've already touched on, a section 21 for me is the lazy option. You just serve a section 21, you don't need to tell the judge anything, you get your eviction. Thank you very much.
But nine times out of 10, landlords will not evict a good tenant. They don't wake up on a Monday morning and go, oh, I think I'm going to evict my tenant today. They evict tenant for a reason and usually that's rent arrears or antisocial behaviour. But the process under section 8 is a little bit more admin heavy and obviously it needs going to court and a hearing, so the timelines are longer. So section 21 has just been the easy option. Landlords are still going to be able to evict. Absolutely. And they're still going to be able to evict for the reasons that they would have used a section 21. It's just now they'll have to go through a process.
Now, Angela Rayner did say in Parliament that she was looking to digitalise the court service. So what we expect, that is ones where you wouldn't need necessarily so much evidence, like landlord moving in, landlord wanting to sell those sort of grounds. We would expect those to be digitalised and maybe a similar process to what we're seeing with Section 21, where actually there doesn't necessarily need to be a hearing or it can be an Online hearing, a phone hearing to make things much smoother. But we don't know what that looks like yet. We have to assume.
But ultimately, if you've got to go to court to get your possession, the courts are already backed up from COVID they're still not quite got themselves back online. And more people going to court is simply going to mean it's going to take longer. We know from the last English housing survey that the average time from service of notice to eviction is 24 and a half weeks. Now, that's a long time and if that's going to be extended, then landlords need to be prepared to look at other options of how they can get possession of their property back. So if you've got rent arrears, for example, you can work with a tenant really early on, rather than having to wait for them to now be three months in arrears, then a four week notice. So technically, four months in arrears before they can even go to court, that's not practical. So it's about how we communicate from day one, setting the boundaries with tenants. If you're a day late and a penny short, I will be picking up the phone and finding out what the issue is, but then also understanding how you can signpost your tenants or support your tenants if they're genuinely in a pickle where they can't afford the rent. There's £1.7 billion worth of funding available for you to tap into that can support tenants that are in rent arrears and it's just not tapped into.
But communication is the key. If the tenant can't pay, they need to be picking up the phone and not be frightened of saying, look, I'm really struggling.
If you look at large companies, for example, they all have a debt collection department who are trained completely differently from their customer service guys. They work with the debtors because they've figured it out. It's better to work with someone who owes you money than go straight to court and throw more money down the pan. Because you're going to set up a payment plan, you're going to, you know, retain those relationships with those people and ultimately it improves your reputation in the industry as well.
[00:16:21] Speaker A: Yeah, 100%. And there's loads of things I just want to pick up on, actually, in terms of what you've said there. So with 24 and a half weeks rent, you know, kind of outstanding before eviction happens, at the moment, would that likely to be extended? That's the problem. And I remember many years ago we used to say, you know, to a landlord, you need to have insurance unless you have, you know, three months rent in your bank pocket that you can afford to lose at any time, because that's how long it's going to take to get a possession if something goes wrong. If you haven't got that. Well, that's, that's a totally different story now, you know, a landlord needs at least six months and you're right, you know, it's going to be even longer before we can even ask the tenant to, you know, to go to court and go through that process. I think the other change is, is because it's going to be on a Section 8 basis rather than a Section 21. There's always going to need to be representation in court, which is very different to obviously how it works at the moment. So again, there's way more stress and pressure, I guess, on anyone that is taking that case to court, whether that be the landlord or the agent. And for me, I just keep coming back to how key communication is exactly to your point on the debtors thing or mediation or understanding what the alternative options are. And we've had landlords in the past that have paid tenants to go because actually it's a way better option to say, look, I'll give you your deposit back, I'm going to give you one month's rent for a new house and please just go to that as a solution. Although that sounds a really bonkers scenario, it's still better for the landlord in a lot of cases than going through a process where the tenant potentially is going to, even the tenant can't do the right thing. Sometimes they have to sit there to be evicted to then get rehoused. So it does seem a bit of a bonkers system.
[00:18:08] Speaker B: No, I absolutely agree. And in my time mediating, you know, most of my mediations have been rent arrears and a lot of the time that is the solution. The solution is pay the tenant to leave. Because if you go to court it's going to cost you however much it's going to cost you, especially if you use a solicitor or an eviction specialist. If you can pay the tenant half of what you'd have gone to court for with still no guarantee that you're going to get those rent arrears paid to you, ultimately you just want your property back and the problem gone. Paying a tenant to go, that solves that problem.
[00:18:42] Speaker A: And I think one of the things that the industry is a bit flawed in the industry really is obviously normally if something goes to Court for a multitude of reasons, the CCJ is put against the tenant's name or not the tenant, a person's name. But in the case of eviction, that never happens unless the landlord pays extra for that judgment to be granted. And therefore their kind of record as a tenant is still blank when they go to rent the next property and the next one and the next one. And I just wonder if that was a change in the industry, whether there would be a change in behavior from some of the tenants, especially with the renters rights bill coming into force. Obviously a tenant only has to give two months notice and they can go. They're not held to a 12 month tenancy or anything longer. I don't know if you have any views on that.
[00:19:33] Speaker B: Yeah, absolutely. I mean, the thing is, if we don't pay our mortgage that goes against our credit history, there's automatically a default on there. There isn't that mandatory requirement when you're paying your rent. However, there are certain credit file companies that do allow you to do that. So it used to just be one called Credit Ladder which you could get your tenant to put their bank account onto Credit Ladder and every time they paid their rent, it upped their credit file. So of course as soon as they didn't pay their rent, it defaulted their credit file too. So that was trackable for the next landlord. A few others have now jumped on board as well. I think Equifax and Experian are now also allowing rent payments to be tracked on credit file. So that's something for landlords and agents to consider to help sort of monitor these tenants that are being evicted for rent arrears. But then the CCJ doesn't get followed through if it's already on their credit history. They can't really escape that.
[00:20:34] Speaker A: Yeah, yeah. And then it comes down to referencing companies and what access to certain types of data. We have to be able to then use that kind of, I guess in the Coca Cola formula to kind of assess tenants. And maybe we're better placed to be able to do that than an individual landlord trying to make an assessment on their own. So getting some help and making sure the right tenants go into the property at the very beginning. I also am a bit of a bang my drum about that one going forward because I think it's really important. Although we don't have a crystal ball, I do think we should be able to use lots of information, data, tech people, everything to really make a really good assessment.
Now, Renters rights bill aside, as you say, it kind of Comes down to people and trying to foster a good relationship. And not every tenancy goes wrong. So, you know, we are talking luckily about the minority of tenancies. But do you have any advice or any tips you can give us on how people can best foster positive relationships to try and if something is starting to, I guess, start to tip in a in the wrong direction, that getting in there quickly can save the day?
[00:21:49] Speaker B: Yeah, 100%. The sooner you address an issue, the quicker it can be resolved because ultimately if you let something drag on, that problem then gets to a point where people don't want to communicate, the relationship has broken down. Now you don't know what to say because it's six months since the problem started. So absolutely. Getting in there as soon as you possibly can and not being afraid to pick up phone. I say this to agents and landlords all of the time. Pick up the phone and speak to the other person. Because if you're sending an email or a text message or a WhatsApp, my pet hate, by the way, the person on the other end receiving it is reading it in the frame of mind that they are in, not the tone of voice that you've sent it. So you could have spent hours painting over this email to make sure it's just perfect. They're going to read it in the frame of mind they're in. So if they've got the ump or they're scared, that's how they're reading it. And they're not going to respond with someone's tone of voice. You can hear how it's being put across. You can hear if someone's scared, angry. All of those things come across in tone of voice and it's something we certainly work with as mediators. Body language as well. You can tell if someone's closed their body language off or if they're open to talking to you. So all of those key things are important. But as I say to landlords and letting agents on a daily basis, please understand you do not work in property. That's your product, but you don't work in property, you work in customer service. Treat everybody as a customer and I promise you things will turn out differently.
[00:23:18] Speaker A: Have you got any particular case that you can really remember that was one of those really key lessons learned in terms of follow the steps, do all the things right and you can get a really good outcome?
[00:23:32] Speaker B: Yeah, I do. I do, actually. It's a few years back now, but it sticks in my mind completely because the numbers always shocked me. So a landlord came to me, he had a letting agent managing the property, fully managing it, but the tenant had got herself into just over 18 months worth of rent arrears. So that's a lot of money and it's a lot of time that the tenant hasn't really been interacted with. So as a mediator, I reach out to the tenant, see if she's happy to communicate with me.
Initially she wasn't, but I won around in the end and what I always do is have a first conversation with the tenant before the media mediation starts, just to work out where we're coming from here. Is this a can't pay? Is it a won't pay? What's the underlying problem? Because usually what is on the surface isn't actually what caused the problem at all. So I'm having a chat with this tenant and first of all, you've got to let them get it off their chest, they've got to vent themselves so they're going to get it out. So we've got it all out. And basically it turned out to be a case of 18 odd months ago. The landlord had gone round and done a property inspection and as he walked in the porch he'd knocked a plan pot off the side and the plant pot had smashed. That plant pot was her great aunt and had been in the, in the family for years and years and years and she was devastated. He never apologized. So from that point on, which didn't pay him, that was his punishment.
[00:24:57] Speaker A: Wow.
[00:24:57] Speaker B: So I said, what do you want? What can I make? What can I do to make this better? And she said, I want an apology so I can do that. So I got the landlord to write a formal apology. He also sent flowers and a box of chocolate and she had been saving that rent for the last 18 months. So poof, it all appeared in his bank account. Problem solved.
[00:25:16] Speaker A: Amazing.
That is staggering, isn't it? Because you would have thought at some point in that 18 months. Well, for me I wouldn't have the patience to wait probably more than 18 days, but. But for 18 months that just a conversation needed to happen, like nobody had.
[00:25:31] Speaker B: Asked her the direct question. They'd all phone, where's your rent? Where's your rent? Where's your. Nobody had said, what's wrong? Nobody has asked for her point of view. That's all I had to do.
[00:25:42] Speaker A: Wow, amazing. There we go. So let's kind of look forward then. You know, this is our last episode, as I mentioned, for 2024. So what other delights have we got in the next 12 months. What have we got in 2025?
[00:25:58] Speaker B: Wow, that's a really broad question.
I think we've got a lot of instability and I think we've got a lot of learning to do and a lot of adjusting to do. The renters rights bill is going to bring chaos to the industry.
You are going to see a lot of smaller letting agents probably just close their doors. You're going to see a lot of smaller landlords probably just sell up. But I anticipate that those properties aren't going to be available to first time buyers per se. I think they're going to be snapped up by the larger limited company landlords who will just bring them straight back into the private sector.
Or you'll see the smaller landlords want more security and putting those properties into long lease social housing, that sort of thing.
But for us as agents, realistically, we just have to be ahead of the game. We just have to start thinking one step ahead of where this is going to be putting us. Making sure from a referencing point of view, we are stricter with our referencing, we won't be able to take rent in advance anymore. So if someone fails referencing, what are our fallback plans for that? Because obviously we don't want to leave people homeless just because they've got a CCJ for a mobile phone bill which actually would have no direct effect on their rent.
And ultimately, looking at what we want from our properties and our businesses in the future, the next five years, you know that horrible interview question, where do you see yourself in the next five years? I think we need to be looking at that because ultimately this government is going to be in here for the next five years. We have to know what we're working with for the next five years.
[00:27:32] Speaker A: I guess going to that point, you know, this government being in for five years, this could just be the start. You know, this could be phase one in terms of change and there could still be more to come and maybe we just have to kind of suck this up, get on with it, make the absolute best of the situation and get ready for whatever else happens. And you're right, Julie, in the fact that this is an opportunity because not every agency will get ready, not every supplier will change, not every landlord will know what to do. And actually if there was ever a time they need professional help and someone to turn to to get a little bit of advice and support, it's probably going to be in 2025.
[00:28:11] Speaker B: Yeah, absolutely. And you know, we look at the, the landlord associations, for example, such as the nrla, they've got a hundred and ten thousand landlord members but when you actually look at the sector and you know there's over is it 3 million landlords. So although they've got the landlord voice, they haven't actually got a high percentage of the landlord bodies. And I think that's the key again, you know, we've only got, is it 17,000 letting agents in the country, you think we've still got nearly 3 million landlords.
We're not really being well represented and I think now is the time that we don't need more legislation, we need more regulation and there's a difference because there's enough legislation out there. We have 169 acts and 402 regulations and nobody really enforces those. So what we need is more enforcement, less legislation.
[00:29:05] Speaker A: Brilliant. Thank you. And what a way to end. So thank you very much and for all of our regular listeners of let's Talk Let's. They know that we don't let any guests leave without kind of getting a funny story or anecdote of something that's happened. And I imagine you have many in the archives. Julie, in all honesty, can you share with us our Last one of 2024?
[00:29:28] Speaker B: Yeah, absolutely. And again, this goes back to when I had a letting agency myself. So a few years old, I'm afraid this was a bog standard day for doing property inspections. I had one particular property that I only inspected once a year because it was always so immaculate. Tenant always paid the rent on time, there was never an issue.
Her job was a sex worker and she worked from home and we were aware of that. Probably why the property was so immaculate because obviously that's her place of work and she was always the last one on my property inspection list.
So I went round to do the property inspection, knocked on the door and let myself in, as I always did.
Went round, got up to the upstairs, did the downstairs, got up to the upstairs, walked into the bedroom and as you can probably imagine, she has a client.
She was just like, whoops, you know, she wasn't too bothered. The client, however, was mortified because he was actually my boss.
[00:30:33] Speaker A: No way.
[00:30:34] Speaker B: Yeah, absolutely. So that was a case of we never spoke of it again.
[00:30:41] Speaker A: Oh my God, that's the best story I've ever had on here. Yeah, honestly, that's a great way to end the year. Oh no. God. Crikey. Oh, wow, how embarrassing. Brilliant. Well, there's a lesson in there, I'm sure.
Julie, thank you so much for your time.
For all of our listeners, to ensure you never miss an episode of let's Talk. Let's Please follow us on Spotify or wherever you listen to your podcast. Please leave us a review. Thank you so much for listening and all of your support in 2024 and wishing you, your team, your families, a very merry Christmas and a brilliant 2025. Let's talk. Let's an original podcast from the Lettings Hub.
