House To Rent, No Experience Required

Podcast Episode 05. Independent living means having your own place to live. Finding that place isn’t always easy. In this episode Julia, a landlord who is renting out a property to young people with additional needs, tells us why. We hear that finding a place to rent requires perseverance and sometimes a dose of optimism. For the landlord, it requires thinking more about the person and less about their credit score. For a parent, there are strategies for making it easier for a young person with additional needs to find a place to live in the private rental sector. If you’re a landlord already, hear why renting out to young people with additional needs makes financial sense as well as social sense

Show Notes

[0.45] –   All about Julia and her background
[1.30] –   The difficulties in finding a house to rent
[2.30] –   Why some of these difficulties arise
[3.40] –   Why a credit history matters
[5.20] – Why a higher deposit night be needed
[7.00] – The role of parents
[7.45] – The different challenges of different types of tenants
[8.30] – Why people with additional needs make good tenants
[9.00] – Ways to put support in place
[11.15] – The many advantages of taking tenants with additional needs
[13.15] – The benefits of being part of the wider community for the young people
[14.00] – The lack of actual tenants?
[17.00] – Practicalities of house size and layout
[18.00] – Don’t dismiss the private sector and approach agency’s and landlords

Key Takeaways
Perseverance and being honest up front about what is required
Look at ways to build a credit score
If you’re a landlord look at person not just their credit score

Show Full Transcript
Podcast Transcript
DEBRA: This week we’re talking to Julia who is involved in providing housing for people with additional needs. She’s a mainstream landlord as such but also some of her houses are rented out to people with additional needs. We’re going to talk to her about how that’s come about, what it means and some of the challenges that she’s faced and also the good parts of it. Welcome, Julia.

JULIA: Hello.

DEBRA: So tell us a little bit about your personal background and the motivation for getting involved with housing for young people with additional needs.

JULIA: I am mother to a thirteen-year-old with a profound speech and language disorder, so didn’t have a background in housing as such. I recently became a Buy to Let landlord. I have approximately 25 properties and didn’t plan to do a bit for society or anything. Actually fell into having one house with three down syndrome adults in it. It wasn’t a deliberate business ploy. They approached our agent and that’s really how it all started but the more we thought about it as a couple, the more it seemed to make sense to give these people an opportunity.

DEBRA: Do you know anything about how long the people that approached the agent had been looking?

JULIA: In fact, one of the tenants had lived independently previously, not with the people he’s now living with in our house. That had broken up for a variety of reasons I understand. They had been looking for a while. My understanding from the family is that actually the hardest bit of the whole process was physically finding a house. I suspect it’s probably quite a traumatic thing, the three sets of parents would go and look around property, not always with the young people. And quite often, they would offer on the spots and get total, call you back, the minute it was made clear what their needs were and never hear anything again. So I know that they looked at a lot of properties, offered on a lot of properties and didn’t get anywhere. I think honestly landlords have a choice. They can take you normal family and they probably do have to think slightly outside the box…

DEBRA: Why do they think “I’d rather have someone else and not someone with additional needs?”

JULIA: Lack of understanding, if you’re going to put it generally. I think it was down to not knowing what pitfalls are, not being sure, and quite frankly, there are normal alternatives. Nothing sticks on the market for very long. Why take a rish when you don’t have to? And landlords are in it, it’s a business for them and while I create additional work, lots of landlords don’t like sharers. These special people will always be sharers. They’re genuinely not couples or families. Lots of landlords will also stipulate no DHS, no counsel-funded. So lots of landlords, categorically, say no to that up front which would obviously exclude these types of people. So yes, it’s the sharers ideas and those payments.

On top of that, the other barrier for the parents and the young people is that genuine they don’t have paid employments so they will fundamentally fell a credit check. They possibly have never had bank accounts. They’re not like the average teenager that goes out with a debit card from the minute it turns 15th or 16th and into iTunes and paying for everything. They probably haven’t had a normal framework so if they’re not going a bank account, they don’t have credit history. So credit reference, checking them, they will most certainly fail that because they haven’t gone having credit cards, they haven’t got a car loan and all those things that build up your credit history.

So when you guys do reference check them, obviously, its ID, current address, birth certificates or what have you, passports. They probably have all of those. But the minute it gets to the credit reference check, they’re almost certainly going to fail it. And most landlords will say, “I’m not in touch with people who fail a credit reference check.” Well I think you have to look at why people have fail a credit reference check but why should the landlord go out of his way to consider them? You probably employ an agency to do all these reference checking for you and a little bit detail on rent within the UK and all these new roles, why make an exception? They fell the credit reference check and there are normal person you would in touch them. So I suspect that that’s the other one that they will all struggle on.

So for us, it was do they understand the agreement and are we happy to take somebody that will effectively fell the credit reference check. You do the other checks and in fact, I don’t think the house I have went through the credit reference check. It seemed pointless. They were quite upfront about their bank accounts situations and we left it at that. The other thing on top of that, they’re genuinely in circumstances like landlords will expect too much high deposit. So then immediately disadvantage.

So for the house I have, I actually have a full month deposit vs a standard one and a half months deposit. The other way round it is to offer a larger up-front payments so I think we had something like additional four months paid in advance. Obviously after running a while, that then disappears. So that the cash needs seen, for the parent funding the young person or local authority funding that young person, the up front cash costs are higher than beyond for your normal tenant coming in. They’ve suddenly got to find four months deposit, rather than one and a half months deposit.

Obviously that’s the landlords’ to discretion and I suspect it was actually the parents that suggested that formula. I never requested it. I suspect that they could live off with it not knowing us and not wanting to do lose another house. I think with hindsight, it must have been very difficult. You don’t take three twenty-five-year-olds round the property, handed out the property, handed out the property and try and explain to them that they could live here and this could be you bedroom and the live-in carer would live in this bedroom overnight and to then have them cut down and be disappointed, repeatedly and repeatedly. I suspect what the parents are not doing is getting round house after house after house and not taking the young people because you can’t put them through that level of disappointment. It must be frustrating enough as a parent at least as the person concerned and understanding that rejection. It’s very hard for some of these people. They will take it more personally or they will reason trying to understand it.

DEBRA: The parents know each other?

JULIA: Yes, this set of parents definitely do and it is one particular parent that has instigated that organized and done it all effectively, privately. This particular houses is three adults currently all male. We have had one change of tenant. But that’s standard. I would have other houses we share as well, one will go and a new will come in. So that’s nothing unusual in the Buy to Let market.

DEBRA: Who found that tenant?

JULIA: They found that tenant and generally that’s how it works. So we had six, we paired it when there was only two of them in the house and they covered the additional rent because all three are equally and separately liable within the law for the rent.

DEBRA: So what about the ongoing challenges, is there anything different about having young people with additional needs as opposed to other types of tenants?

JULIA: Yes and no. I think, every set of tenants we have very different. You get some that you never hear from and some that are on the phone every five minutes. So there is a huge variety out there anyway. With regard to this particular house, no I wouldn’t say that I get any more or less. The parents are extremely grateful and understanding and the easiest of actually all my tenants to deal with.

If I was completely honest, they do have downs and one of those issues is that they tend to be quite heavy-handed. So it’s silly things like sliding doors, coming of tracks, perhaps they pull over the curtains a bit too much but you’d be surprised what the average five year old can do. So it’s not radically different to a normal house and the normal setup.

Personally, the advantages are they don’t tend to drink, they don’t tend to smoke, they don’t tend to have two dogs and two cats and they don’t tend to have toddlers drawing on walls and five year olds plus drinking mama. So generally, I think the house is getting in better condition. It’s actually much easier. I have one single point of contact generally. Well it’s quite once quite easy. I have said it’s probably one of one of low maintenance properties.

Personally, I think it’s great they have a live-in house manager. I think they have 5 that rotates throughout the week. It is there from sort of 3:30 in the afternoon until 9AM the following morning. And that house manager is responsible for sort of everything; from making sure that they do go to bed, doors are locked, they shower. They do have routines up as to who clears the kitchen, who does the house work, who empties the dishwasher, who does the garden. Exactly how you would ideally you want a shared house to be run.

DEBRA: And the housekeeper, did you say house manager?

JULIA: I guess you call it a house manager, yes.

DEBRA: And they’re paid for by?

JULIA: They are paid for by the parents so it’s described to me that the parents effectively receive three pots of money. One is a housing allowance, another is a staffing allowance and the third pot is really the disability living allowance and sort of other ad hoc allowances that they may get. And those three pots combined are adequate to fund the rent, the staffing of the house and for them to do cinema or night clubs or what they wished to do. My own understanding is that none of the three have paid employment. They do have somewhere that they spend four days a week. The fifth day is generally spent in the house and they have almost like a PA that comes in and does that, attending them and make sure they change their beds…

DEBRA: And that’s not the house manager?

JULIA: No, it doesn’t seem to be. In my understanding is that the house manager is a rotation of 5 staff in the evenings whereas they have a separate person during the day that drives them to their activities, and what have you. And again, that’s all funded by those pots. They don’t necessarily spend all day together. So four days a week, they tend to be out of the house, the fifth day in the house doing house chores, like the rest of us. And I understand that these guys tend to spend their weekends with their parents, not always but quite often they go home on Saturday and Sunday.

DEBRA: So in terms of, you’ve said lots of reasons why landlords wouldn’t do it, is there something that inspires you to sort of think that this is something that “I’m glad I’ve done it” now?

JULIA: Yes, definitely. I almost positively discriminate. I suppose that’s the best way of phrasing it. I have a set of eternally grateful pair of parents which is it’s very rewarding in itself. They’re very understanding, they’re very responsive, very appreciative. I think it’s fantastic that it’s working and they have now been in coming up three years. Personally, from a landlord’s point of view, three years in a single property with no break is obviously financially ideal, that’s what you want. You don’t want huge turnovers and huge vacant period.

I certainly don’t consider them to hustle me more on a day to day basis with queries and issues than any other. I suspect that they continue to be long-term tenants. If you look at the demographic of these people, they are not going to be in a position to buy so they will be long-term tenants. And actually as a landlord, that’s absolutely ideal. That’s what you’re looking for. That’s what your business model wants. You don’t want them vacating every six months and during around that, doesn’t pay.

The issue I find is that actually there aren’t many out there that want this. There are obviously various other alternatives for these people. A lot of them are privately companies that organize housing with minimum stock into estate but they are run for profits. And I think probably end up feeding a bit more like residential care than really living in your own house on a normal street; your own car parking spot and your own little backyard actually having to pay bills and really be independent and shop for yourself. You’re not within a special needs community. You are actually living on a normal street.

DEBRA: You think that’s the big advantage for them then?

JULIA: I think so. My understanding is that there’s one particular boy that actually wanted and asked to live independently. He instigated this, it was not the parent’s desire, initial desire. He’s got to live independently and he’s got to live in Coronation street and he actually wanted himself to move like his brother and sister had and to live independently. And actually, I think that is what my daughter is going to want. She thinks she’s normal. So she wouldn’t want to not to be in a in-house.

DEBRA: So she wants to have what’s normal…

JULIA: I think normal is still living with your parents at 14 these days, isn’t it?

DEBRA: In that case, she might be normal, wouldn’t she?

JULIA: No, she might be the abnormal one.

DEBRA: So you said there’s no one… would you do more houses like this?

JULIA: Yes, definitely. And I’ve spoken to the agents and said I would actively seek them out. I’m staying here I want to do more of these and very happy to consider it and as I said, to let those things go; the credit reference, the whole tenancy agreement, that whole worry, the whole deposit issue, the upfront payments. I’m quite happy to negotiate and be open. And they said, well in fact, the house you’ve got is the only house we’ve approached. Which does surprise me slightly. I can’t think why. Maybe too many parents of these people find the whole idea of trying to organize it and set it up and keep it right are slightly terrifying prospect as well. They didn’t want to live independently and they don’t want to take that risk and push them out.

DEBRA: Couldn’t be the assumption that they won’t find anyway because as you said those parents have had a long, atrocious journey?

JULIA: Yes, I suspect. It’s probably to make sure everything… If it was me, then yes, I would be sitting there in the evenings thinking of the barriers rather than the wonderful idea that it is. I would be sitting, “I think this is going to be tough than I expecting”.

DEBRA: And the disappointment element as well? Because if you were to put that to your son and daughter and say, “This is an option” If you can’t then deliver…
JULIA: That seemed to be like an ongoing issue with our kids. In my view, it feels like a daily battle if I’m honest. You think you can do something for them and when actually when push comes to show up, you can’t. You know, if you’re trying to set up a bank account to arranging accommodating or schooling they are more out of your control than with the normal…

DEBRA: But to be fair, what you are doing shows that it can be done.

JULIA: Oh yes, absolutely. When actually, when push came to show up in, it was relatively straightforward. It all went through fine, there were no delays, they do what they wanted, and as I said, I would happily do again and be open to different suggestions. I think it does take one very proactively parent to take to sort of control of the situation and somebody has to organize that staffing. And as far as I’m aware, it is done by parent and not the local authority so somebody’s gotta do that recruiting, payroll issue, somebody’s got to sort that. And possibly that feels quite a burden.

It doesn’t seem a risk because actually I think there’s a huge benefit. All our houses are within walking distance from the mainline train station. All of them are walking distance of the supermarket, and on bus routes. A well-placed. So I would say that all our properties are ideal for this. What they obviously do need in this circumstance is always bathroom for that house manager overnight. So, if it’s a full-bedroom house then it has this little nursery then that effectively the house manager’s room overnight. So you are then looking at sharing the cost between 3 rather than 4.

DEBRA: For what is intensively a 4-bedroom house?

JULIA: Yes. But it does mean that the bathroom and the nursery does lend itself to this situation and obviously, a lot of property around here, there are a lot of bathrooms out there so I don’t see why not. I suspect that the bigger issue is that in order to make it sense, you do need 4 or 5 bedrooms rather than 2 or 3 bedrooms. My understanding is that they really enjoy the independence and living with their mates, just like any other 20 something year old would do.

DEBRA: But without the parties…

JULIA: Well apparently not. I can’t see any evidence of it so I’m not complaining.

DEBRA: So finally, just some advice, what would you say to parents of young people looking for accommodation?

JULIE: My advice I think would be, don’t dismiss the private sector. My understanding is that the money is there, if you apply for it correctly to make this happen. I think as far as approaching letting agents and for them to then approach their landlords on their books, I’d be quite open it upfront about it from the very start. So make it clear why they’re not going through a credit reference check. Be completely open and upfront. And effectively, put yourself through and go and see properties where landlords are aware upfront and happy to accommodate you. There isn’t any point wasting 40 minutes every Saturday looking at house after house after house. If you’re going to fail, DHS hold, credit reference, whatever tested is that landlord considers absolute paramount for them to feel happy and comfortable.

I think if you approach private landlords in a sensible of well-thought out way and just be honest. I personally don’t see any reason why you make a better or worse tenants. Certainly not on our personal experiences, it’s behind this successful. And would happily do it again. For us, it’s actually finding them. It’s who to approach to say “Hey, we have this housing stock would you be interested?” Actually, approaching local autistic units or whatever, and going to the local authority, in our case Kent County Council, it would be quite hard to physically advertise ourselves. Make yourselves visible and available.
DEBRA: Thank you, Julia for those useful insights into your experiences as a landlord. So the key takeaways for this podcast, well to me as a parent is to persevere and to keep believing that there’s someone out there willing to do things that a little bit differently. So if you’re looking for a rental property, go out, approach agents and be upfront about what you want you need. And another takeaway is to plan ahead in terms of things like the credit score. And I certainly be looking at ways I can make sure my daughter actually has a good credit score as gets older. And finally, if you’re lucky enough to have any investment property, is to think outside the box; consider all types of tenant and their merits, not just their credit scores.

Thank you for listening to the JourneySkills Podcast.  Please subscribe to this podcast and let me know what you think at www.journeyskills.com/podcast.  If you have a journey to share I would love to hear from you just email me debra@journeyskills.com

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