There can also be a direct impact on rental values; you may not be able to charge ?Westminster? rents in Worthing, but a well-maintained property can be priced at the highest level local conditions allow.

But there are other reasons to ensure that your property is kept in good order. For example, when applying for a ?Houses in Multiple Occupancy? (HMO) license the authorities are more likely to look kindly on your application. It will also be easier to demonstrate that your property is compliant with building and fire regulations now that Fire Certificates are no longer issued by the Fire Brigade.

The Regulatory Reform (Fire Safety) Order 2005 imposes strict duties on the ?responsible? person (often the property owner) to ensure a risk assessment has been undertaken by a ?competent? person and an emergency action plan instituted. It applies to virtually all premises including:

?offices and shops;

?common areas of houses in multiple occupation;

?pubs, clubs and restaurants; and

?factories and warehouses.

Purely domestic premises occupied by a single family group are excluded.

Because fire inspection and certification no longer take place on commercial premises, additional steps should be taken by property owners (and, in many cases, by occupiers) to ensure premises have the fire risk they present properly managed. If a property burns down causing injury or loss of life, the owner will not be able to escape responsibility. They could be held to be negligent by failing in their statutory duties.

Landlords? Legal Responsibilities

Unless another party has accepted responsibility in writing, property owners are legally responsible for the safety of people occupying or using their premises. Where there is a full repairing lease then it is possible that the lessee will be held liable for any injury caused to people (or damage to their property) as the result of negligence in property maintenance.

However, it is seldom possible completely to avoid responsibility as a property owner. Even where a repairing lease is granted, the owner may be liable under certain circumstances. It could be decided that the property owner has failed to ensure that the premises were properly maintained in line with the obligations imposed by the lease. An example of this might be where the property let was next door to premises occupied by the landlord, who could easily see that it was in disrepair but did nothing about it.

And, of course, if a property is empty for any period, the landlord could well find that he or she is responsible by default. If premises are not properly secured then minors, to whom a duty of care is absolute, might gain access. If they come to harm, the property owner may be strictly liable for injuries sustained.

How can landlords reduce the financial risk?

Besides taking steps to ensure that property is properly maintained, the landlord or property owner should ensure that public liability insurance is in place. That way, in the event of alleged negligence, the insurance company will step in and handle any claims.

Of course, the policyholder is not absolved from the need to take due and proper care, but if this has been done to the best of the landlord's ability, then at least no financial penalty should be suffered. Specialist generally provides property owner's liability cover of at least ?2 Million indemnity for any one incident. However, with ever-increasing legal costs many suggest that ?5 Million is the minimum limit that should be selected. It is wise to seek specialist advice from an insurance broker who can recommend appropriate cover and provide guidance on risk management.