Argyle Housing Group - PSL Scheme F.A.Q. /h3>

Who are Argyle Managed Estates Limited and Argyle Leased Estates Limited?

Both companies are members of Argyle Housing Group, an established organisation of private landlords specialising in providing social housing solutions to London Boroughs. Argyle Housing Group has been in business providing social housing to Ealing Council for over 15 years with a strong reputation for quality and reliability of service. Our track record of excellence has led to us being invited by Ealing to work with the Council in operating its new flagship PSL Schemes. We have our own specialised housing officers, repair and building teams as well as our own legal department.

What is the PSL Scheme?

PSL stands for ‘Private Sector Leasing’, and at present there are two versions of the Scheme namely PSL and Choice, each approved between the Council and the Government.

Argyle Leased Estates Limited is responsible for PSL and Argyle Managed Estates Limited is responsible for Choice. Hereafter, both companies will be referred to as ‘Argyle’.

Local and central government strategy and planning for housing is continuously being reviewed to reflect various factors, including changes in demographics, the economy and the political values of the government in power. As such, any scheme is potentially subject to alteration or for new initiatives to be introduced.

Depending on council demand, your property will be submitted to either of the above schemes. For this purpose, there is an assignment clause whereby the lease can be assigned between Argyle Leased Estates Limited and Argyle Managed Estates Limited. It makes no difference as to which scheme your property is assigned as you will be paid your rent in any event until the end of the term of the lease or earlier determination of the lease as set out below.

How do the PSL Schemes work?

Argyle Managed Estates Ltd, Argyle Leased Estates Ltd and any other Argyle Housing Group members provide housing stock to the Council. We use our own considerable stock and we also lease suitable properties from other landlords. Where we lease properties, we lease from you the landlord on terms which allow us to sublease the property to Ealing Council. The Council then allows a homeless family to occupy the property on a non-secure tenancy, the terms of which are governed by the Housing Act 1985. These terms allow possession to be obtained quickly from an occupier if the occupier damages the property or ceases to be entitled to be housed by the Council under its statutory obligations for the homeless. Argyle is contracted by Ealing to control and manage the properties provided to the Council to ensure a quality service to landlords, the Council and the occupiers alike.

Who pays the rent?

Argyle pays your rent because we are your tenant. The lease we take from you will usually be for a period of 3, 5 or 10 years. We are responsible for paying your rent in accordance with the terms of the lease . The Council and the occupier are not responsible for your rent. As far as you are concerned there is no DSS/Housing Benefit participation so you will not be asked to repay any rents. In respect of leases over 3 years in term, there will be a rent increase in line with the Retail Prices Index once the first 3 years of the term have expired.

Who is responsible for keeping the property in repair?

During the term of the lease with Argyle, you as the Landlord are responsible for complying with the Landlord’s obligations, including repairs. This is the same as if you were renting out your property directly on the private market. This is because it is a statutory requirement of the Housing Act 1985 that residential landlords are responsible for repairs. However, Argyle will carry out many minor repairs (‘running repairs’ *) as these arise. Where other repairs are required we will notify you. You will be given a period of time under your lease to complete repairs if you wish to undertake this task yourself. If you do not complete these repairs in time or, alternatively, would rather we carried these out for you, then we will make an agreed adjustment in your rent receipt. We have our own dedicated in-house repairs and building team and our costs are therefore competitive compared to outside contractors.

* ‘Running repairs’ are things like leaking taps, loose carpets, loose bannisters, minor plumbing such as washers and minor drainage problems or toilets, doors coming off hinges, broken locks, broken guttering, jammed windows, broken glass, loose paving and so on. It is not possible to give a comprehensive list of what might be included. Instead, we limit ourselves to defining running minor repairs as those where the material cost does not exceed £25.00 plus VAT for any single repair and does not exceed £100.00 in total for any one year AND the labour element does not exceed one hour for each single repair and does not exceed 10 hours labour in any year. Note that any unused material/labour allowance cannot be carried forward to a subsequent year. If there were a long list of repairs arising on any one occasion and the total cost of these exceeded £25.00, we would then usually ask you carry out the repairs.

You should note that there is no obligation in your lease for us to carry out any running repairs at all. We carry them out at our discretion in order to make managing the properties easier for ourselves and the occupiers. Please keep in mind that although we will often carry out minor running repairs, provided they are minor, by doing this you are not absolved from your responsibilities as the Landlord for carrying out all repairs.

Who is responsible for managing the property?

Argyle are required by the Council under their own leases with the Council to manage the properties within the relevant scheme on the Council’s behalf. We have a dedicated mobile team which inspects properties frequently. All visits to properties check for the state of repair, any damage and that the property is occupied. Each property will be fitted with a small data control strip for this purpose. All visits are computer logged by the mobile team who are equipped with data-guns and where possible operate in satellite tracked vehicles. Any information recorded is confidential and for Argyle’s internal use only. We operate a 24 hours, 7 days a week service under our contract with the Council.

Who is responsible for insuring the property?

You the landlord are responsible for insuring your property. Please contact us if you would like us to recommend our insurance brokers.

Who is responsible for statutory compliances (NICEIC Electrical Inspection Certificates, Annual Gas Inspection Certificates etc)?

You are responsible for these. We require the following certificates:

• Gas (CORGI) certificate
• Domestic Electrical Installation Periodic Inspection Report (NICEIC)
• 3 Star gas contract
• Insurance details
• Mortgage details (if applicable)

Please note the CORGI and NICEIC must not be more than 3 months old when the property is seen by the council. All furnishings must comply with the Furniture Regulations 1993 (Fire) (Safety) (Amendment), Statutory Instrument 1993, Number 207. If you want to check this yourself you can obtain a copy at www.hmso.gov.uk free of charge.

What furniture do I need to provide?

Sitting room: 3 piece suite, dining table and chairs

Kitchen: cooker or oven/hob, fridge freezer, sufficient cupboard space

Bedrooms: double bed in master bedroom, 1 or 2 single beds in other bedrooms depending on size, wardrobes and chests of drawers in each bedroom.

General: appropriate floor covering in all areas, curtains/blinds and nets on all windows, lamp shades and bulbs.

All beds must have headboards and new mattresses.

We recommend landlords do not buy furniture until their property has been matched with a tenant as some tenants may have furniture of their own which they would prefer to use. All furniture must be sufficiently serviceable to last the period of the lease.

If I wanted to terminate my Lease early, can I do so?

No, save where the Lease allows you to do so if there is a breach of a Tenant’s obligations and or non payment of rent.

Can Argyle terminate the Lease early?

Legally yes but it is very unlikely we would ever wish to do so. We would only terminate in certain circumstances, for instance:

• You do not carry out your own obligations.
• The house is destroyed beyond early repair.
• The Council asks us to agree to assign their sublease to a Housing Association and that Housing Association will not agree to continue the terms of the sublease. The Council will only be able to request an assignment of the PSL/Choice sublease if there is a change in the Council’s own statutory obligation to house homeless families. Most professionals working in social housing do not think this is very likely in the next few years.
• If funding for either scheme ceased due to some factor such as a change in political policy or Ealing Council became “bankrupt”. We at Argyle regard this as an unlikely risk, but like most things in life, nothing is guaranteed.

Is there any limit to the number of properties I can bring into PSL or Choice Schemes?

No.

Who will be responsible for getting vacant possession at the end of the Lease or if the occupiers damage the property at any time during the Lease?

Argyle is your Tenant and is responsible to you. We will give you vacant possession at the end of the lease term. In addition, if the property is misused by any occupier we will remove them from the property, if necessary, using a Court Order as we are entitled to do under our contracts with the Council. In the unlikely event that this is necessary, no charge will be made to you as it is our responsibility.

If the property is in poor condition at the end of the lease, who will be responsible for the costs of refurbishment ?

Normally, you as a landlord would bear this cost. BUT, if the property is in a condition which is worse than fair wear and tear, taking into account the condition it was in when the lease commenced, as shown in the schedule of Condition annexed to your Lease, then we will pay you up to £1,000 towards the costs of dilapidations. Alternatively, if the damage is due to an insured risk, you will be entitled to claim on your or our insurance cover.

I’d like to know the legal status of the arrangements under the PSL and Choice Schemes?

The lease granted to us by you and the sublease we grant to the Council are not business tenancies under Part 2 of the Landlord & Tenant Act 1954. They are excluded from protection under that Act, because neither we nor the Council can occupy the property. Both leases are expressly excluded from being assured tenancies of any kind by the terms of the Housing Act 1988 (as amended by the Housing Act 1996). The implication is that neither we nor the Council can claim security of tenure under statute after the term of the lease expires if you do not want to grant us a new lease.

The respective leases determine the entire obligations between you and Argyle and between Argyle and the Council. There is no direct relationship between you and the Council or the occupiers. The occupiers of the property occupy on a weekly and temporary basis only under Non Secure Tenancy Agreements controlled by statute. They have no security of tenure as a result.

This means when the lease expires, you are entitled to vacant possession of your property from us and, in every case, we will aim to do this unless you wish to renew the lease for a further term. We have no right to a new lease but we may ask you to consider a new one in the 9 months before the lease expires. Remember, however, that if you want to have your property returned to you before the end of the lease, you will not be able to do this except in the unlikely event that we have failed to pay you your rents as they fall due.

It remains unlawful to seek possession of any occupied property without a Court order. You will be entitled to receive rent and/or mesne profits equal to the rent in the unlikely event that your property remains occupied at the expiration of the lease. We, not the Council, will be responsible for paying you if this happens.

Do I have to pay any legal costs in relation to the Lease of my property?

No. You do not have to pay any legal costs associated with you granting a lease to us. While we cover all of these, please note that we do not cover any costs you may incur in seeking your own advice from a solicitor or any costs that might be charged by your mortgage lender for consenting to the lease. (Most lenders do not in fact charge for this).

'Legal costs’ do not however include any Stamp Duty, now known as Land Tax. In some cases your lease with us will attract Land Tax.

No account is taken of the provision in the lease for rent reviews by RPI indexing. Our legal team will be touch with you to tell you how much duty is payable.

Who pays the Land Tax (Stamp Duty)?

If Land Tax is due in relation to the lease that you grant to Argyle, you will pay the principal tax as calculated and we will pay the duty due on the Counterpart.

Land Tax can only be paid by having the relevant documents stamped by the Stamp Duty Office of the Inland Revenue. (Longer leases may require registration at the Land Registry.) We will send leases in bulk for stamping through our legal team who will be responsible for settling the duty. We will pay the duty due from you on your behalf and later deduct this from your rent.

Is it possible to avoid Land Tax?

The only truthful answer is No.

If any Housing Supplier tells you that you can avoid Land Tax you should have nothing to do with them.

What do I need to do to grant the lease to Argyle?

Once we have seen your property and have agreed terms, we will send you two copies of a draft lease relating to your property. Please keep both these leases in a safe place and do not sign them until requested by our legal team. Please remember that the terms are not negotiable because they are governed by the Ealing PSL Schemes operated by the Council.

You are at liberty to engage a solicitor at your expense if you wish, but please be assured that the formalities of completing your lease to us are in fact quite straightforward.

What else...?

When we are ready to take a lease from you a member of our lettings or our legal teams will telephone you. He or she will ask you to confirm your identity and then take you through the first two pages of the lease and confirm with you the following details

• date of the intended lease
• term of the lease in years
• rent commencement date
• commencement and expiry dates of the lease
• monthly rent
• monthly rent payment dates
• amount of the first payment

Once these have been confirmed with you, you will be asked to fill in these details on the two copies of the lease we have sent to you. Please sign these when requested and initial the insertions you have made. Then have your signature witnessed where shown at the end of the lease and ask your witness to put his or her initials next to your initials where you have filled in the first two pages of the lease. Once you have done this, send both leases to us so we can complete formalities such as stamping. Of completion of the formalities, we will return one of the signed copies to you for your records.

We will only be able to make your property available to the council schemes if you have carried out any required pre-letting repairs and given us your Gas and NICEIC certificates and insurance details and your mortgage lender’s consent (if you have a mortgage) has been confirmed to you.

We will also require you have signed a copy of our Management Agreement and given us a cheque for £235.00 (incl. VAT) to cover administration and survey costs made payable to Argyle Managed Estates. A copy of the Management Agreement will be sent to you with the provisional leases.

IMPORTANT

Please note, the occupiers will sign in advance their Non Secured Tenancy Agreement (NSTA) with Ealing Council in advance of occupation of the property.

In order to ensure certainty and avoid undue inconvenience we will ask that you release your keys, certificates, signed management agreement and management fee in advance to Argyle and prior to any occupation of your property. Your property will not be made available to any Scheme unless keys, etc., are released to us in advance. Your parting with possession of keys, etc., to Argyle will be deemed to be your irrevocable permission for us to lease your property to Ealing pursuant to their Schemes. If for any reason you withdraw your consent subsequent to parting with possession of the keys, etc., and prior to occupation by an Ealing NSTA occupant you will be deemed liable for all consequential losses.

Although we will ask you to release your keys in advance we will not physically hand them over to Ealing’s NSTA occupant until we are satisfied that they have completed all the necessary formalities and that payment of rent will be forthcoming from Ealing and/or the NSTA occupant.

Monday will be the Rent Commencement Date. We will post a cheque for your first month’s rent within 2 months of receiving your signed leases from you. All future payments will be two months in arrears and will be by Standing Order to your nominated Bank Account.

As part of our security and fraud control protocols, we cannot send our cheque without the signed leases in our possession. Please make sure that you post the leases as soon as you have signed them and had it witnessed as indicated above.

What are the main advantages of joining a PSL Scheme with Argyle ?

Solid Rent Guarantee: Unlike the private sector renting market, your rent receipts are absolutely guaranteed and paid in arrears directly to your bank account. There is no DSS/Housing Benefit involvement either as far as you are concerned. You get the agreed rent every month in arrears.

Continuity of Rent Receipts : You will get your Rent every month in arrears whether the property is occupied or not. By comparison most short term private lets are empty and hence not receiving any rent for a considerable time every year.

No Tenant claims : We are insured for claims from occupiers. You will still need to have sufficient insurance cover for yourself but claims are more likely to be made against us. We are required under our contracts with the Council to carry separate insurance for such claims.

Reliable on-site inspection and management : There is no need for you to continually check your property yourself. Under our Council contracts, we are specifically required to visit your property at regular intervals.

No commission : We are not agents so we do not charge you commission or VAT. We are your tenants and we will pay you your rent in accordance with the lease.

Reliable tenants : Argyle Housing Group is proud of its reputation as a specialist operator in the social housing sector. Our performance is monitored by the Council with whom we work closely on a daily basis under the PSL Schemes.

Easier life for you: With the PSL scheme operated between Argyle Housing Group and the Council of the London Borough of Ealing you do not have to worry about things such as:

• estate agents/lettings commission
• potential loss of rent
• possible Court and Bailiff action to evict tenants
• possible Court and Bailiff action to collect unpaid rents
• disputes with Housing Benefit over rental reclaims
• simply looking after your investment in the property.

Rent increases: Raising private sector rents can be difficult and the risk of the tenant defaulting or leaving without paying the rent due can be high. We offer in the case of leases over 3 years in term an RPI Indexed rent increase at the end of every 3,6 or 9 years of a Lease.

Rest assured : Argyle Housing Group and all its staff are fully committed to having a long and happy working relationship with you.

Support : We have 24 hour support for our tenants in the event of any emergency.

IMPORTANT: This document is for guidance only. It does not form any part of any contractual relationship or lease between you and us and all liability for error or otherwise is expressly disclaimed. Please note that all invoices regarding services provided irrespective of the Ealing Scheme and Argyle company involved will always be issued by and be payable to Argyle Managed Estates Limited.