Big Residential Development will start next door

[Luigi]

Would like to seek some advice from you.

For the flat I currently rent out, there will be a big residential development start soon just next door. It probably will continue for about 2 years. For long term, I do see the value as it will replace the current building merchadise shop with residential accomodation. But for next 2 years, it is definitely going to impact my rental. For example, my tenants have already raised their concerns with me about this.

I just want to understand where I stand if I ask for some compensation from the development company. And what could be the right level of compensation, like 25-30% of rental income? This is just to compensate the loss I may have to incur due to the rent deduction to attract tenants and longer gap in-between tenants.

Appreciate your inputs, esp. if you had or are aware of similar cases happened before.

[Richlist]

I very much doubt you will get any compensation.

Did you raise your concerns at the planning stage, were they addressed, what responses did you receive ?

In some cases builders are restricted to what hours they can work and are required to physically protect and from an H & E perspective any adjacent buildings in order to minimise the effects of the building works. You need to be in touch with the local planners not necessarily the builders.

[Grampa]

There are a number of issues here.

1 A tenant can not expect any special treatment that a owner occupier wouldn't get. So if you were living in the property your self would you be entitled to any compo?

2 I don't think a tenant will very easily get out of a fixed term agreement if they don't like the building works going on. So as long as you have informed them and if they are good tenants sign them up for a year or 18 months.

3 You would have to clarify exactly what your loss was to try to make a claim against the building company. Such as professional valuations from ideally ARLA lettings agents that clearly shows what the difference would be in rental income.

I don't think you would be able to claim (but could be wrong). The building works should only be carried out during the working day and that may be classed as acceptable.

[Luigi]

Thank you all for the reply. Looks like it is not easy thing to do but will have a try.

My tenants are on on 6 month tenancy agreement with rollover. Now they can move anytime with one month notice. I think no matter how, the development will impact my rental. As a tenant, you wouldn't choose a flat with development going on next door unless the price is attractive enough.

[Richlist]

Now they can move anytime with one month notice

NOT strictly true, as one of my tenants found out this week, to his detriment.

As a tenant, you wouldn't choose a flat with development going on next door unless the price is attractive enough.

That depends on a number of things...... you didn't answer any of my questions !

[Luigi]

Had a chat with planning officer. The concerns around my rental is not in their planning approval consideration. They only consider the impact once the building work is complete. The builder is required to work only during agreed working time Mon-Sat.

My point is that no matter how the development is managed, there will be impact on tenants. Which means impact the attractiveness of my flat for next 1-2 years while the development is on going.