Conflict of interest?

[Grampa]

My local council have their own "letting agency" which they run which all properties they take on are used for HB tenants it is run by the housing dept and they charge landlords 8%. I have always said that surely that must be a conflict of interest as a agent works for the landlord but according to them it isnt even though the council work to keep tenants housed regardless of their behavior.

So I couldn't resist asking their housing officer when he was inquiring on an eviction process they have to do in a conversation on a unrelated matter. ME: So when you served the S21 on your tenant with your agent hat on, on behalf of the landlord did you then put your council hat on and advise the tenant to stay put until you get notice from the court bailiff?" 

For some reason he didnt like my question and changed the subject.

Does anyone know of an authority that the council can be reported to over a  conflict of interest that isn't the actual council. 

[Richlist]

IMHO Local Government run agencies are likely to become the norm. My understanding is that there are already a few around the country.....I am talking England, not Scotland.

Hackney, Luton, Canterbury, Haringey to name some all operate them.

I guess their argument is that they are usually already the largest social housing managers in their areas and by taking on the work they can squeeze rents and better control supply.

Where is the conflict of interest ? 

Landlords sign their properties over to the Council to manage and are usually subject to detailed contracts. I would expect any potential issues to be addressed by the council legal team who draw up those contracts. Have you obtained/ read the contract?

[Grampa]

Yes but if the same department and people are advising tenants what to do when served notice where do the loyalties lie?. If me as a agent said to a landlord i have served a s21 on your tenant giving 2 months notice but i have also advised the tenant to drag out the process and force you (the landlord) to get a eviction notice from the court and then stay on until the bailiff turns up which will be a extra cost I wouldn't be very popular with my landlord. 

Agents are always criticised for taking the tenant side and losing focus on who the client is. Surely  this muddies the waters? What if the council/agent made a mistake with their s21? This can happen, there is then going to be people who will question if it was deliberate especially if that councils budgets are under pressure from the excessive cost of housing tenants in B&B's or emergency housing when they get evicted.

I think as a bear minimum these council agents should be run independently with dedicated staff  at a different location.   

Maybe because I have had over the years a number of tenants spout "we are not leaving and the council have advised us to wait until the bailiff turns up" I look at it in a different way. 

I take your point that the council are already a social housing provider but the local authority  own the council houses and therefore are their own landlord so can add as they wish (within the confines of the law).  

[Richlist]

I don't disagree with anything you've said but the devil is in the detail.

The potential for problems only arises if the contract allows that. Normally a landlord signs over the property for a fixed period e.g. 3 years. Rent is guaranteed. Landlord can't get the property back during that period etc etc so your s21 question is unlikely to arise.....but is probably covered with the contract.  Any requirement for bailiffs or court attendance would be the responsibility of the council surely ?

My understanding is that the owner/agent relationship is totally different to the private sector and the conflict of interest does not apply because all responsibility is handled by the council.

[Grampa]

No, they are acting in the same manner as a "normal" agent with tenancies that are 6/12 months and no guaranteed rent arrangement.

[Richlist]

I'm not familiar with those arrangements and if that's the case then I would think it would, as you suggest, need to be handled by a company independent of the local council.

Unless we are both missing something, if it's not handled independantly I can't see how that could, in any way, be an attractive proposition for a landlord given the increased risks.

Edit

But as we know there are always going to be landlords who don't consider risk vs return and are happy to have an 'official' body deal with their rental because they assume everything will be dealt with perfectly. 

[Melboy]

I had an experience dealing with the local council some 8 years ago re letting my flat. It confirmed my belief that I would never want to get involved with the local council in any shape or form in the future. At that time the incompetence of handling simple enquires and due process by the council department was quite unbelievable. 

[Mortitia]

Grampa you could try trading standards but I don't think you'll get far.

Best bet is to take the Melboy stance and don't use them.

 

[Richlist]

I think there is a vast difference in the performance of local council housing departments around the country just as there is a vast difference with lettings agents.

I wouldn't criticise all of them as its going to be neither accurate or helpfull.

We all have our own opinions of our individual councils based on our own experience. Their performance is going to depend on the capability of the person running the operation and the people who work there.

[Grampa]

It doesn't have a direct effect on me i just feel they shouldn't be encroaching on my territory where arguably they have a unfair advantage and in my opinion also a conflict of interest.

I might just be getting Grumpy and belligerent in my old age.  

[Richlist]

I agree.

If I were a lettings agent I'd feel exactly the same way as you.

I'm already grumpy and belligerent most of the time....as readers of this forum will attest. But, I don't think we should use that as an excuse for feeling the way we do.

Councils running their own lettings agency should be consigned to room 101.