The inside track on property guardianship
Kirstie Sowter, a senior solicitor at Greenwoods LLP, is one of a very small number of property guardianship legal experts in the UK. She gives us an insight into how the quickly expanding property guardianship business model could affect you and your company.
Property guardianship is a fast-growing alternative housing model in the UK and across Europe which originates from the Netherlands. It involves private individuals protecting empty buildings through their occupation.
The guardianship model offers the building owner the security that comes with having someone occupy their property. The individual ‘guardian’ gets accommodation for comparatively low cost to the private rented sector.
It’s a growing business model as it helps landlords secure empty buildings and deal with empty building rates while simultaneously helping to house those who may have been priced out of the market, especially in the City.
How might it affect your company?
If your company suddenly finds itself with an empty building, property guardianship might appear on your radar as a viable option. A growing number of old commercial outlets are being filled with property guardians.
How does it work?
Owners of empty properties may have plans for redevelopment or change of use of their building but, for whatever reason, may encounter a stopgap period before those works commence.
That property may be a prime target for squatting or copper theft amongst other things. Building owners can therefore engage the services of a property guardian provider (of which there are now many) to manage the property and enter into licences to occupy with individual property guardians.
A licence to occupy (as opposed to an assured shorthold tenancy) suits short-term, temporary and flexible arrangements. Assuming the owner needs the building back (usually giving 31 days’ notice); the provider will then serve a notice to determine the licence on the property guardian giving them at least 28 days’ notice in accordance with the Protection from Eviction Act 1977.
The future of property guardianship
According to a survey carried out by the Empty Homes Network, 83 per cent of those taking part in the poll said that they wanted the Government to place more emphasis on using empty homes to help tackle the housing crisis rather than simply developing new builds.
Until those empty homes are re-developed and the housing crisis is resolved, property guardianship will remain as a popular option for many individuals struggling to afford standard rents.
It also remains a popular choice for business owners, with a number of established property guardianship companies now competing for those empty buildings and offering building owners attractive propositions.
The biggest industry issue at present is ensuring that the business model continues to work whilst ensuring that property guardians are protected. Property guardianship is currently somewhat of a hybrid in legal terms. As previously mentioned, it is not a tenancy and therefore the property guardian does not have the same rights as a tenant: exactly what rights the property guardians should have is currently not clear.
We attended the Empty Homes Conference 2017 last month and heard from Rex Duis, founder of Property Guardians UK. He has been a property guardian for several years, occupying multiple properties and being managed by many of the lead providers.
Whilst Mr Duis describes himself as a ‘property guardian activist’ he understands the commercial objectives of the providers but wants to ensure that standards in properties are raised and that property guardians have more privacy, security and transparency about their rights; he agrees that they do not fit in the tenant category.
Mr Duis has already drafted a 37-page ‘Property Guardianship Charter’ but we understand it is currently being updated and a new version is expected imminently. For now, watch this space – but we will, of course, keep you updated.