It was only a few weeks after the tenants found and verified by Foxtons moved into Anne and John Day’s luxury two-bed flat in Lewisham, south-east London, that the complaints began.
Rubbish strewn outside the flat – a property valued at more than £400,000 – angered the neighbours. Lots of visitors arrived at all times of the day and night. Noise levels rose. After five months, the tenants went into arrears.
Over the next year, the problems went from bad to worse. Police were called by neighbours reporting anti-social behaviour. Council tax and utility bills went unpaid.
It emerged that the two women on the tenancy agreement (now believed to have left the UK) were subletting, with nine different names on post addressed to the flat.
“We had several quite vocal residents in the other flats who complained. They didn’t want to complain directly, as they thought they would be intimidated,” says Anne Day, a retired NHS worker who bought the flat some years ago – her only property investment – for her son to live in when he is older.
As the problems deepened, the Days demanded answers from Foxtons. Surely they had checked out the tenants before recommending them? Surely they had taken up references and examined their income and salaries to make sure they could pay?
But the answers left the couple bewildered. Nearly two years later – with the tenants finally evicted and the Days over £11,000 out of pocket – they are still battling Foxtons for the return of its £3,769 in fees.
The rent was not cheap. At £1,473 a month, only tenants with a good income could keep paying.
The Days pressed Foxtons for a copy of the references, only to find that one tenant earned just £1,000 a month working part-time in a betting shop, while the other earned £16,700 a year. “When we finally received the reference material, it revealed that the job references were dated after the start of the tenancy and cannot have been received by Foxtons beforehand,” says Day.
“It showed that the tenants worked part time and that one received a student loan. Their combined income, net of tax and after the rent, was a mere £8,700 a year, or £4,350 each. So they each had £363.50 a month for utility bills, personal bills, travel and food. Foxtons didn’t see this as a problem. “From what we could see of the bank accounts, there was one with £10 going in several times a day, then chunks of statements missing, then a sudden injection of £3,000. I got the sense Foxtons had gone through the motions of asking for bank statements, but not actually checking them.”
Day says that her evidence is that Foxtons only received three days and seven days of bank statements from the two tenants. “As to the work references, one of the tenants appeared to have worked only since the previous week. Looking at the figures, even if they spent 100% of their income on the rent, it would still not have been covered. They were totally unsuitable tenants right from the start.”
Foxtons is adamant it has done nothing wrong. It told Guardian Money it was “deeply sympathetic with Mr and Mrs Day. This is not how any landlord should expect their tenants to behave”.
But it added: “We can confirm that all appropriate due diligence for these tenants was carried out at the start of the tenancy. We collected copies of ID on both tenants (and a visa where appropriate); we collected proof of address documents for each applicant, copies of the applicant’s bank statements, proof of employment and character/landlord references. All of these were verified and a background check undertaken on each applicant, including checks for any CCJs (of which there were none). There was nothing that suggested these applicants would not be suitable tenants, or that the outcome of the tenancy would be unsatisfactory.”
Foxtons added that the landlords received 15 months’ rent before the tenants stopped payments. It has now offered a pro-rata reduction in fees for the months where the tenants did not pay.
The Days – who have obtained a county court judgment against the tenants, although no repayment of arrears – are considering legal action against the company.
“Our complaint still stands. We cannot see how anyone could have reviewed the responses, so therefore we refute that due diligence was followed. The inference from Foxtons is that, as it was 15 months before rent ceased being paid, the due diligence is distanced enough to prove it had no bearing,” says Day.
“In fact, rent arrears occurred throughout the tenancy, at one point after four months. They may have gone through the motions of applying for employment references bank statements and CCJ searches but, unfortunately, and what my issue is about, is that it was done too late and nobody reviewed them.”
Your letting agent has to be a member of one of three bodies: the Property Ombudsman, the Property Redress Scheme, or Ombudsman Services. Citizen’s Advice says: “Explain your problem and tell them what you’ve done to solve it. Include a copy of the letter you sent to your letting agent. If the complaints body decides your letting agent hasn’t acted correctly they can tell them to make changes and in some cases pay you compensation.”
More complaints about letting agents to the Property Ombudsman come from landlords (49%) than tenants (45%). The average lettings award in 2017 was £625.
Most complaints were about management issues, communication and record-keeping; or tenancies, inventories and deposits.
Letting agents also come under the Consumer Rights Act, which requires that they act with due care and skill, take a reasonable amount of time to do something, and charge a reasonable amount of money.