‘My tenant refuses to leave owing to shortage of homes’

Landlords are battling tenants who are refusing to leave properties because there is such an extreme shortage of rental homes that they cannot find anywhere else to live.

The shortage of rental properties in Britain has become so severe that an increasing number of tenants are ignoring eviction notices and staying put until they are forcibly removed, letting agents have warned.

Kate Watts, managing director of Roberts Watts estate agents in Cleckheaton, West Yorkshire, said: “Tenants are just refusing to move out. We serve notice and they say they are not going anywhere because there is a shortage of properties.”

One reader has a portfolio of 34 properties spread between the Midlands and the South West, some of which she manages for her elderly father. He needs to sell a property in the West Midlands to cover the cost of his care, but they are struggling to get the property back from the tenant.

After six months of struggling to find somewhere to buy, the tenant moved into the rental property. “Now we want the property back but she still can’t find anywhere to buy and she also can’t find anywhere else to rent. I’m even looking for houses for her. I’ve even volunteered to help her move with our van,” she said.

Greg Tsuman of Martyn Gerrard estate agents noted a property in

Muswell Hill, north London, where tenants’ refusal to leave has put a property sale at risk. The landlord served notice and the tenants said they would vacate. “We got three asking price offers. Then the tenants realised that there was nothing else on the market. Now they’re saying they will wait for the bailiffs to come. The landlord is in complete limbo.”

He added: “It’s becoming increasingly common, but this is just the tip of the iceberg where tenants are so desperate they will just stay put.”

Once they have signed a contract, tenants have a right to stay in a property until they are removed by an enforcement officer. But landlords face record waiting times in the courts as the system is creaking under the strain of staff shortages and the pandemic backlog.

This is being exacerbated by an extreme imbalance between supply and demand in the rental market. “Normally we would have 25 properties available to rent and only one person wanting to view,” said Mrs Watts. “Now we have seven properties and 15 to 20 people who want to rent each one.”

Nationally, the average letting agent had 142 tenant applicants registered on their books in February, a 73pc increase on 2021, according to Propertymark, an estate agents’ body. But each branch had an average of just five newly listed rental properties – a 44pc drop from a four-year average of nine.

Many tenants are also newly priced out of the market as a result of recent soaring rents. Asking prices outside London are up by 11pc year- on-year, according to property website Rightmove. In the capital, rents have jumped by 14.3pc – the largest annual increase recorded in any region since the site’s records began.

“They are in tenancies where they are paying preCovid prices: if they move, they will have to pay maybe another £200 per month,” said Mrs Watts. “They can’t afford it.” One property that she was letting out for £595 a month is now going back on the market for £750 – a jump of 26pc. Mr Tsuman noted a recent case where tenants in a house in Southgate, north London, handed in their notice because they wanted to leave the property. “They had paid £1,275 a month. We put the property on the market and within hours we had asking price offers at £1,400. We had the contracts signed and were just about to execute the deal when the old tenants called and said they couldn’t find anywhere to move to. They said they hadn’t believed us when we’d said there wasn’t anything on the market.” They agreed to pay £1,400 a month and stayed in the property.

Many landlords sold up during the pandemic, adding to the lack of supply. In London, huge rent falls during the peak of the pandemic, when in some areas they crashed by as much as 30pc, were a further push factor, said Mr Tsuman. Now rents have bounced back, but high stamp duty costs and government plans to introduce new energy efficiency targets and abolish so-called “no- fault” evictions are major deterrents to new investors.

The investor with 34 properties is selling her portfolio because of the lack of protection for landlords. “Financially and health-wise it is not worth it. I have tenants threatening to kill me and burn my house down,” she said.

Timothy Douglas of Propertymark said: “The growing imbalance between supply and demand is the root cause of the intense pressure on the sector.”