A helpful guide to keep things simple
Glossary
A
Access
An agent must keep written records of keys held and inform tenants of any access required in accordance with the terms of the tenancy agreement, except in cases of genuine emergency.
Additional Person Fee
A charge for every additional person to be included in the tenancy agreement.
Affordable Housing
Affordable housing includes social rented, affordable rented and intermediate housing, provided to households whose needs are not met by the market. (See explanations of these terms below).
Affordable Rented Housing
Affordable rented housing is let by local authorities or private registered providers of social housing (housing associations) to those who are eligible and qualify for the Council’s housing register. Rents are above target rents but are not in excess of 80 per cent of local market rent.
Agency Agreement (Landlords only)
When dealing with an agent landlords should ensure that they understand the services to be provided and that they are recorded in the agreement. Services range from finding a tenant, carrying out referencing, drafting a tenancy agreement, arranging an inventory, check-in, or for the rent collection and management of the tenancy thereafter.
It should be clear how long the agency agreement runs for; how it can be terminated, the notice required, and whether there is any continuing liability for any costs after it ends. The agents terms of business should include all fees and confirm whether they are a member of TPO or another redress scheme. When you sign the agreement you are entering into a legally binding contract under which you will incur a financial commitment.
Ensure that you have read and understood the terms of the agreement and understand the commitments you will be entering into with Warwickshire Residential Lettings or the landlord. Do not feel pressured into signing and be aware that if you sign the document in your home or at your place of work you are entitled to cancel it within 14 days.
Arrears
Any late or unpaid rent.
ARLA
The Association of Residential Letting Agent, the UK’s foremost professional body for letting agents.
Assured Shorthold Tenancy (AST) agreement
The standard tenancy agreement normally used for residential lettings.
Assured Tenancy
This is the type of tenancy agreement usually offered by housing associations. Tenants can continue to live in the property for as long as they wish, as long as they do not break certain conditions set out in the Housing Act 1988.
B
Beneficiary
The individual(s) designated to receive the benefits from a policy.
Break Clause
A break clause (or a ‘break option’ or ‘option to determine’) is a clause in a lease which provides the landlord or tenant with a right to terminate the lease before its contractual expiry date, if certain criteria are met.
Buy to Leave
Residential property bought and deliberately left empty.
Buy to Let
An investment where you buy a property – usually with a mortgage – and rent it out.
Brownfield
The term generally used to describe land that has been previously developed, and may be available for re-use.
C
Check out
The process of checking a property after a tenant has vacated. Normally only done when an inventory was carried out at the start of the tenancy. The condition of the property and the contents is checked against the inventory and the report is used as evidence for the settlement of the deposit.
Choice-Based Lettings (CBL)
Choice-based lettings schemes are designed to allow an element of choice for people applying for council and housing association homes and existing tenants who want a transfer. As properties become available for letting, full details are advertised on the Home Connections website and applicants assessed as needing to be rehoused can bid for available properties.
Compulsory Purchase Order (CPO)
A legal order that allows certain bodies to take over land or property against the wishes of the owner. There is a lengthy legal process involved and the majority of those directly affected receive compensation.
Common Housing Register (CHR) or Housing Register
The Council’s list of people applying for social housing including
housing owned and/or managed by the Council and housing associations. People have to meet certain criteria to join the register and it only includes those in the greatest housing need.
Community Infrastructure Levy (CIL)
A charge that developers have to pay to local authorities when undertaking new building projects. The amount charged relates to the net increase in gross internal area floorspace arising from development. It is used to fund infrastructure that is needed to support development for example, creating additional school places or GP services.
Communal Gardens
Gardens which are shared by residents of a designated block or blocks but are not open to the public.
Community Gardens
Gardens which are managed or maintained by a local community or residents’ group.
Council Tax
Levied by local councils to cover the cost of local amenities and services.
D
Decanting
The process of moving residents from their homes while improvements are carried out. It also describes the process where a block or estate is to be completely redeveloped, and residents are moved to allow redevelopment to take place.
Decent Homes Standard
Introduced by government to ensure all social housing meets a minimum standard. The standard requires the property to be free of health and safety hazards, in a reasonable state of repair, having a reasonably modern kitchen, bathroom, boiler and adequate insulation.
Deposit Protection Service (DPS)
Draft Contract
Unconfirmed version of the contract.
E
Energy Performance Certificate (EPC)
All properties let for private residential purposes must have an EPC. It is used to report the energy performance of a property. More information concerning Energy Performance Certificates can be found here.
Equity Loan
A loan given to help buy a home. The loan is only repaid when the home is sold, and its value relates to the value of the home. So if a home rises in value, the amount to be repaid increases proportionally.
F
Fixed Term Tenancy
A tenancy with a specified start and end date.
Flexible Tenancies
These are fixed-term tenancies issued by councils and registered providers. The lengths of the tenancies vary. They are generally five years or more, but can be two years in exceptional circumstances.
Freehold
Where the property owner owns the land as well as the property situated on it. It gives the owner the right to occupy a property indefinitely.
Furnished
A property that is let with all furnishings a tenant would need to live comfortably.
Furnishings
The contents of the property included as part of the rent.
G
Garden Squares
Gardens which are shared by residents of designated housing but are not open to the public.
Gas Safety Check
Landlords are required to arrange of a gas safety check to take place annually on rented properties. This must be carried out be a registered engineer.
Gas Safety Record (GSR)
A document which shows that gas appliances (including a gas meter) has had an annual gas safety check carried out by a registered engineer. Landlords are legally required to have a GSR produced annually.
Gold Package
A service level offered to landlords by Warwickshire Residential Lettings.
Green Belt
A designated area of land around towns and cities where development is not
permitted.
Ground Rent
Regular payment leaseholders may make to the owner of the freehold.
Guarantor
Someone chosen to guarantee the payments of rent for the tenant should they fall into arrears.
H
Holding Deposits
Where a prospective tenant is asked to pay a holding deposit, the agent must provide that person with a written receipt detailing the charges and fees that will be offset against the deposit (if any) and the terms of repayment or forfeiture should the tenancy not proceed. The agent should also explain the purpose of the payment (for example, removing the property from the market while references are being undertaken). Any deductions from the deposit must be reasonable and must take account of the specific circumstances of the situation and the services actually properly provided.
Home Buy
A range of government schemes designed to help people buy houses through devices such as shared equity, shared ownership, and other forms of low cost home wnership.
House in Multiple Occupation (HMO)
A term applied to a property which has three or more tenants who are not a family unit.
Housing Association
A not-for-profit organisation set up to provide low cost housing. Housing associations range from small community-led groups to larger organisations involved in house
building and development, often accessing funding through the Homes and Communities Agency, or private backers. Many help tenants through specialist housing, for example sheltered housing or housing with support services. Many housing associations also operate home ownership schemes such as shared
ownership or HomeBuy. Housing associations are usually private registered providers of social housing (formerly known as registered social landlords) and regulated by the Tenants Services Authority.
Housing Revenue Account (HRA)
A record of income from housing and expenditure kept by local authority housing departments. This must be kept separately from the local authority’s other finances.
I
Illegal / Criminal Activity
Allegations of illegal and criminal activity (e.g. fraud) should be referred to the relevant authority (such as the police) or regulators (such as Trading Standards) who are empowered to undertake enforcement action. The Ombudsman does not have regulatory powers and cannot consider allegations of illegal or criminal activity.
Independent Tenant and Leaseholder Advisor (ITLA)
A person or company that is appointed to provide a group of residents with independent advice about housing issues, usually where there is a possibility of housing being redeveloped. The service is usually paid for by the housing authority,
but residents will oversee the work the ITLA does to be satisfied that the advice is truly independent.
Inflation/Deflation
Inflation is the rate at which prices for goods and services are rising across the economy, decreasing the purchasing power of currency. Deflation is the opposite process – a general decline in prices. These processes have a specific significance to councils’ and housing associations’ finances, because the rents they charge are index-linked to the retail price index, the most commonly used measure of inflation. This means social rents rise or fall in line with inflation. Inflation/deflation is expressed as a percentage.
Inspections
The nature and frequency of inspections will be decided between the landlord and the agent. This will only apply if the landlord has a property management agreement with the Warwickshire Residential Lettings. Tenants should be informed of access requirements in accordance with the tenancy agreement, except where there is a genuine emergency.
Intermediate Housing
This is aimed at people who do not qualify for social housing, but cannot afford full market rents. Intermediate housing includes shared ownership, shared equity schemes and discounted market sales schemes. There are also intermediate rent products available (see below). To be eligible for intermediate housing a household’s income must be less than £71,000 per annum (for a one or two bedroom property) or £85,000 pa for a three bedroom or larger property. These figures are reviewed each year.
Intermediate Renting
The rent charged for intermediate housing is above social rent but up to a maximum of 80 per cent of the market rent. Intermediate rent tenancies are not social housing tenancies. A person living in an intermediate rent property will have an Assured Shorthold Tenancy (used in the private rented sector). The length of the tenancy is usually set between one and five years.
Introductory Tenancy
A tenancy for a trial period of 12 months. Since 12 February 1997 introductory tenancies have been imposed on all new tenancies granted by local authorities and housing associations. They were introduced in law to give housing providers greater powers to deal with antisocial behaviour. They can be extended to a maximum of 18 months.
Inventory
An inventory is conducted before the tenancy starts to provide an accurate list of the rental property’s contents and their condition.
J
Joint Venture (JV)
This is the term used to describe where the Council is working in partnership with a developer or housing association to deliver new projects.
L
Land Registry
The Government organisation that holds records of all registered properties in England and Wales.
Landlord
A person who owns a property and allows a tenant to live there in exchange for monthly rent.
Landlord Fees
When dealing with Warwickshire Residential Lettings you should ensure that you understand the fees being charged for the services that we are providing. Fees might be collected as a single amount at the start of the tenancy or as a monthly deduction from rent received or a combination of the two. Generally, costs associated with the setup of the tenancy agreement (such as referencing) are charged to the prospective tenant.
Leasehold
Tenure where the homeowner does not own the freehold, but instead has a long term lease. Leases are most often for 99 or 125 years. The homeowner pays ground rent to the freeholder.
Letting Agent
Warwickshire Residential Lettings are the letting agent who assists the landlord and tenant with the let. Service levels will vary and will be agreed between the landlord and Warwickshire Residential Lettings, the letting agent.
Local Plan
The Local Plan sets out the Council’s planning policies in one document. This is sometimes referred to as the development plan (along with the London Plan) and contains a chapter on housing policies (currently chapter 35). All planning applications need to be determined in accordance with the Local Plan.
Low Cost Home Ownership
This covers a range of schemes intended to help those who cannot afford to buy a home on the open market to get onto the housing ladder, normally by buying a part share in a property through initiatives such as HomeBuy.
M
Managing agent
Warwickshire Residential Lettings or another agent who manages the day to day running of the property on behalf of the landlord. The landlord remains legally responsible for the property and repairs but the agent works on the landlord’s behalf.
Maintenance and Repairs
The tenancy agreement sets out the landlord and tenants maintenance and repair responsibilities the agent (WRL) is not a party to that agreement. The tenancy agreement is between the tenant and landlord. If Warwickshire Residential Lettings is managing the property our role is to receive notifications from the tenant and pass these to the landlord. It is then up to the landlord to take the necessary action which may involve instructing us or other third parties to deal with the problem.
Landlords have a responsibility to understand and comply with their legal obligations relating to gas safety, electrical installations, the landlord is responsible for ensuring that the property is safe to let.
If the tenant requires action to be taken in regard to facilities at the property before they move in, these specific conditions should be written down and agreed by the landlord at the same time as their offer.
Mansion Blocks
Purpose built blocks of flats positioned next to a road or street.
Marketing
Warwickshire Residential Lettings (WRL) must comply with various requirements about how To Let boards are displayed, how viewings are conducted, and whether marketing should continue after an offer is received. WRL are legally bound under the Consumer Protection from Unfair Trading Regulations 2008 to describe a property truthfully and provide material information to allow potential tenants to make an informed transactional decision. Lettings particulars should give a general description of the property and will highlight, for instance, the type of heating, double glazing installed, or appliances or furnishings that may be included in the tenancy. The agent will not have tested any facilities but if they are of particular importance to you it is wise to question the agent further and he can ascertain the relevant information from the landlord on your behalf.
N
National Planning Policy Framework (NPPF)
Sets out the Government’s planning policies for England and how these are
expected to be applied, alongside the Government’s requirements for the planning system.
National Planning Practice Guidance (NPPG)
Sets out practical guidance on the implementation of planning policy.
Negative Equity
Financial term used to describe a situation where a loan becomes worth more than the asset it is secured against. In housing it typically applies to mortgages where the value of the property falls below the amount borrowed to buy it.
Negligence Claims
Negligence is a term with a legal meaning and only a court can decide if an agent’s actions or inactions were negligent. The Ombudsman cannot decide claims of negligence and cannot speculate on what a court may decide. Consumers should seek legal advice if they wish to pursue a negligence claim.
Non- Resident Landlord (NRL) scheme
The scheme that sets the rules for how overseas landlords pay tax.
Notice
A declaration given by either a landlord or tenant that the tenancy agreement is coming to an end.
O
Offers
When an offer has been accepted Warwickshire Residential Lettings must inform the applicant whether or not marketing is to continue.
Ombudsman
Independent professional bodies who investigate complaints on behalf of customers against estate agents, solicitors and insurance companies.
P
Part-furnished
A property let with some furnishings, most properties will provide white goods.
Part-possession
The term used when a property is being sold, where a tenant has legal right of occupation.
Pay to Stay
The proposed Government policy to charge social housing tenants with household incomes of £40,000 and above in London, and £30,000 and above in the rest of England, an increased level of rent for their accommodation if their rent is currently being subsidised below market rent levels.
Platinum Package
A service level offered to landlords by Warwickshire Residential Lettings. This is our comprehensive, hassle free service requiring minimum involvement from you. Whatever is required by you or the tenant, we take care of it.
Portable appliance testing
A test carried out on electrical appliances. The test is not legally required, although the landlord is responsible for ensuring any appliances provided are safe to use.
Possession Order
The court order that allows a landlord, or lender in the case of homeowners, to take
possession of a property.
Portfolio
When a landlord lets more than one property, this is called a ‘portfolio’.
Premium
Premium Payments to the insurance company to purchase cover.
Premium Protection
Covers the cost of policy premiums during periods of unemployment due to illness or injury. Also known as waiver of premium.
Private Garden
A garden for the exclusive use of one household.
Public Gardens
Green spaces which are open to everyone. Registered social landlord or registered provider An organisation registered with the social housing regulator, the Tenant Services
Authority, under the Housing Act 1996. Most are housing associations, although housing cooperatives and local housing companies are also registered.
Q
Quiet Enjoyment
A term entitling the tenant to operate the premises without interference from the landlord.
R
Recommended Rents
The rental figure given by Warwickshire Residential Lettings (WRL) to the landlord should represent current market conditions. WRL must be able to support any figure given, and, wherever possible, it must be based on comparisons with similar properties in a similar location. The landlord is free to set the rent at whatever level he sees fit, regardless the agents recommendations.
Reference
A process by which an applicant (ie. the tenant) is credit checked, as well as checks on their income and residence.
Rent
A fee (usually monthly) paid in exchange for accommodation.
Rent Arrears
Under the tenancy agreement the tenant agrees to pay the landlord a set level of rent, often on a specific date each month. Where Warwickshire Residential Lettings has been instructed to collect rent, they should have procedures in place to notify both landlord and tenant (and guarantor if relevant) in a timely manner, of rent that has become appreciably overdue and take suitable steps to notify rental warranty insurers (if appropriate) as necessary. However, regardless of whether the agent has been instructed to manage the tenancy, the responsibility to pay the rent rests with the tenant. The agent will not be party to the tenancy agreement, therefore, any claim for rent arrears should be directed to the tenant citing their obligations as set out in the tenancy agreement.
Rent Collect
A service level offered to landlords. As well as finding you a tenant we’ll also take care of collecting monthly payments on your behalf; this leaves you to organise other tenant matters, the property maintenance and adherence to legislation.
Repossession
When loans are in default the mortgage lender can repossess the property and sell it so they can repay the debt.
Reviewable premium
Premiums are very likely to change over the term of the policy, an insurer may choose to review premiums at set intervals such as every three or five years.
Right to Buy
The policy introduced under Margaret Thatcher’s Conservative government that gave council tenants the right to buy their homes from the local authority at a discounted rate.
Right to Rent
The Right to Rent scheme, which helps to make sure that people renting property in the UK have a legal right to be here, was rolled out across England in February 2016. This Right to Rent law means that landlords or the letting agent must carry out identity checks on every tenant before they sign a tenancy agreement. Further guidance from the Home Office can be found here https://www.gov.uk/check-tenant-right-to-rent-documents.
S
Section 106 Agreement
This is a planning agreement between a local authority and a developer. The local authority only grants planning permission if the developer offers some benefit to the local community, for example low cost housing, education facilities or improved public spaces. The agreement applies to the land, not the developer, so future owners will need to take it into account.
Secure Tenancy
Type of tenancy that is granted by local authorities. The minimum tenancy terms and conditions are set out in law. Tenants have a number of rights and can remain in a property unless the tenancy terms and conditions are broken and a court order has been obtained. In some circumstances the tenancy can be passed on to a relative.
There are now two basic types of secure tenancy: ‘periodic secure tenancy’ and ‘flexible secure tenancy’. A periodic secure tenancy is often called a permanent or lifetime secure tenancy. The resident can continue to hold their tenancy indefinitely, as long as they comply with the terms of their tenancy agreement.
Flexible secure tenancies were introduced in 2012. They are granted for a fixed term of a minimum of five years (or two years in certain circumstances). Towards the end of the five year term, the landlord carries out an assessment to decide whether to grant a further flexible tenancy. In most cases this is granted. Flexible secure tenants have the same rights as periodic secure tenants.
When a resident moves into a Council property, they may first be given an introductory tenancy (depending on the tenancy they held beforehand). More information on introductory tenancies is provided above. If the landlord does not take action to terminate an introductory tenancy it will automatically become a flexible secure tenancy.
Security Deposit
A sum of money taken from the tenant at the beginning of the tenancy held against non-payment of the rent and any damage to the property (above and beyond reasonable wear and tear).
Service Charge
Charge paid to landlords or, in the case of leaseholders to the owner of the freehold, in exchange for maintaining communal areas of a development.
Set Up Fee
A charge for setting up a new tenancy. The cost covers referencing the tenant, drafting the tenancy agreement and registering the deposit with a Tenancy Deposit Scheme.
Shared Ownership
Scheme that allows people to buy a part share in a home, if they are unable to buy the whole property, with another party – often a housing association – retaining the remainder. Shared owners can often increase or decrease their stake in the home, thorough a process known as staircasing. Shared ownership schemes are offered through Registered Providers, and are typically between 25 per cent and 75 per cent share of the home’s value. A capped rent is paid on the remaining share. Shared ownership properties are always leasehold.
Silver Package
A service level offered to landlords by Warwickshire Residential Lettings.
Social Rented Housing
Rented housing owned and managed by local authorities, housing associations or Registered Providers. Also see target rent.
Social Sector Size Criteria (Under-occupancy charge/‘spare bedroom tax’)
Part of welfare reform that cuts the amount of benefit that people under pension credit age can get if they are considered to have a spare bedroom.
Staircasing
The process of buying some, or all, of the remaining shares in a shared ownership home.
Starter homes
These are homes which will be sold at a discount of at least 20 per cent. The only eligibility criteria are that purchasers must be under 40 and live in the UK.
Subject to Contract
Words used to indicate that an agreement is not yet legally binding.
T
Target Rent
This is the rent charged for socially rented properties. Rent levels are worked out using a nationally set formula which is based on the value of the property, the number of bedrooms it has and average earnings for a manual job in the area.
Temporary Accommodation (TA)
Housing such as Bed and Breakfast (B&B), hostel accommodation or privately leased accommodation that councils may use to accommodate households who are homeless.
Tenancy Deposit Scheme (TDS)
A landlord is legally required to register the tenant’s security deposit in a Tenancy Deposit Scheme which protects the money for the tenant and will assist with any disputes at the end of the tenancy.
Tenant
A person who lives in a property owned by a landlord in exchange for a monthly rent.
TPO
An independent body to which landlords can refer any complaint should the agent fail to address it to their satisfaction.
U
Unfurnished
A property let with no furnishings.
