A high-profile case seeking to protect tenants from ‘ghost landlords’ has failed.
The legal challenge was brought in response to a surge in rent-to-rent arrangements. These allow companies to rent an entire property from a landlord, and then rent individual rooms out for profit. Housing campaigners assert that having a ghost landlord in this manner can leave properties in poor condition and tenants without recourse, and that some property owners use such businesses to avoid legal consequences. But property owners have stated that they, too, have been victims of these rogue operators, and welcome the protection this judgment provides.
The Supreme Court considered whether rent repayment orders for housing offences should be made against immediate landlords, or the ‘supreme landlord’ when there is a chain of tenancies involved.
It ruled that rent repayment orders can only be made against the immediate landlord.
The court said that rogue landlords can face other sanctions such as fines and banning orders, and it is for Parliament to decide whether these are sufficient and take action accordingly through legislation.
The National Residential Landlords Association (NRLA) stated the decision provides much-needed clarity to landlords who were concerned that they could be held liable if secondary businesses rented out their properties in substandard conditions.
However, housing campaigners responded to the decision with concerns that the decision will serve as a “blueprint” for landlords looking to avoid meeting their obligations for their properties.