Posted by Caroline Preist, Partner
Property disputes: short term and hen party lets
The Property Ombudsman Scheme received 16% more complaints last year than the previous year. Our Property Disputes team comment on the trends and highlight some scenarios that they have seen.
Short term lets
Short term letting/ hen party lets is a major issue for our clients. Issues often arise around properties that our clients let out while they are away: for instance, when clients let out a flat in London while they are living in the country, or conversely, their house in the country while living in London or abroad.
Owners tend to put the property with agents (rather than manage the lettings themselves via Airbnb or a similar platform). Agents often persuade them to enter a long-term arrangement with the agent, who then arranges the short-term lets. When they find that there are problems they find they are tied into the agency agreement and cannot get out without paying a penalty.
Recent cases have included a flat in a high quality development in London where the client paid agency fees for 2 years upfront and then found that the freeholder threatened to forfeit her lease within the first 3 months due to the behaviour of the tenants – short term leases were also prohibited.
Another case included a country house outside Bath, let again for long period through an agent to a company that used it primarily for hen parties. The letting agreement did not reflect the reality of the situation and the client found himself paying out huge amounts of money for repair works on the domestic water and waste disposal systems when the tenant converted living space to bedrooms and allowed up to 12 people to occupy. The neighbours were unhappy at the noise too.
How to avoid these situations?
What we take out of it is that clients should not only check whether the covenants on their properties (houses or flats) allow then to let them for short term lets but also whether the agreements they enter into with the agents are fit for purpose – an assured shorthold tenancy that many people are familiar with is not at all appropriate in what is, in effect a business arrangement.
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