Colder winter months can increase the likelihood of properties being occupied by squatters. Although the practice has been illegal in residential properties since 2012, commercial properties remain exposed. Squatting can lead to significant financial consequences for landlords and property owners, including higher insurance costs, or an inability to secure cover.
By taking steps to prevent squatters gaining access to properties, owners and landlords can keep their assets safe, and reassure insurers as to their exposure.
Squatting definition in the UK
Squatting is the act of deliberately entering a property (opens a new window), whether it is empty or not, usually without permission of the owner and with the intention of living in it. The term ‘squat’ has been in use since the 1960s, when groups of young people began seizing control of abandoned buildings, often marked for demolition or redevelopment. They wanted to counter the trend towards urban development by transforming derelict spaces into homes.
Today, people may decide to squat in a property for various reasons, most commonly as a result of homelessness. Although squatting takes place year-round, the frequency of squatting is typically greater in winter, for the following reasons:
Limited availability of shelter spaces – combined with already-existing high housing costs and financial difficulties, this can push individuals to seek alternative places to stay during the colder months.
Protection from harsh weather – squatting in vacant properties offers warmth and shelter, and provides a means to escape rain, snow, and freezing temperatures.
Reduced visibility – the longer nights and inclement weather in winter can provide squatters with a degree of anonymity, making it more challenging for authorities and property owners to detect their presence.
Squatter rights – residential vs commercial buildings
Squatter rights in the UK vary depending on whether the occupied property is a residential or non-residential property.
The enactment of the Legal Aid, Sentencing, and Punishment of Offenders Act 2012 (opens a new window) brought about significant changes in the legal landscape as it relates to squatting. This legislation made squatting in residential properties a criminal offense, streamlining the eviction process for residential property owners.
However, when dealing with squatters in non-residential buildings or land, a nuanced legal approach is required. Squatting in these properties is not in itself a crime, although squatters may commit other crimes when entering or staying in a property, such as causing damage, theft, unauthorised use of utilities, or refusing to leave when ordered by a court.
After they have occupied the building for the necessary period of time stipulated by law, the person in question may claim ownership of the property, provided they meet certain legal requirements. To remove squatters, commercial and property owners will typically need to apply to the court for a possession order.
Impacts of squatting
Dealing with squatters on a property can be a difficult and stressful experience. For landlords and property owners, the presence of squatters can have significant financial consequences, such as:
Lost rental income – squatters occupying a property can prevent landlords from collecting rent from legitimate tenants. This can impact cash flow and hamper landlords’ ability to cover mortgage payments or property expenses.
Legal costs – landlords may need to take legal action to regain possession of their property. This can be a lengthy process, and may lead to significant financial outlays, including court fees, legal representation, and other related expenses.
Property damage – squatters may not take proper care of the property, leading to damage or deterioration of the premises. Landlords may need to invest in repairs and renovations to bring the property back to a rentable condition, incurring additional expenses.
Security costs – landlords may need to invest in security measures to prevent future squatting incidents, such as installing stronger locks, security systems, or even hiring security personnel.
Reputational damage – this could potentially negatively impact a landlord's business, such as making it harder to attract tenants.
Apart from the above, landlords of vacant properties (including those with squatters) may find difficulties when it comes to arranging insurance. Insurers may be reluctant to provide cover for vacant properties, or they may charge higher insurance premiums in return for providing cover. These higher costs can be significant, placing further strain on landlords’ finances.
Securing a property from squatters
Effective management of vacant properties can help landlords and property owners to reduce the risk of squatting, reassure insurers as to the extent of their risk, and help to secure better terms. Although all types of property can benefit from effective management, it is particularly important for commercial landlords and owners, who may not benefit from police support when trying to secure an eviction.
Measures to minimise the likelihood of squatting include:
Locking all doors, windows, gates, fences, etc. securely.
Removing potential access points, such as scaffolding or tree branches
Constructing physical security deterrents (e.g. perimeter fencing, concrete barriers)
Installing CCTV surveillance, alarm systems, and security lighting
Organising visible security patrols to signal that a property is under surveillance
Maintaining the appearance of the property (e.g. repairing frontage, cleaning driveways) to reduce signs that it remains vacant or unoccupied
Conduct risk assessments of the full site (including not-standard exists e.g. fire doors, roller shutters)
Isolating key utilities (e.g. electricity, water, gas) to reduce fire/flooding risks and reduce suitability for squatting
Submitting ‘Eviction of Unauthorised Occupants’ claims
Despite a landlord’s best efforts, squatters are sometimes still able to gain access to a property where they intend to remain in situ. In the event, it is imperative for policy insureds to understand how to correctly submit a claim for the costs of evicting unauthorised occupants.
To begin the process, property owners should notify their broker and loss adjusters as soon as they become aware of the squatters’ presence. They should then seek their insurer’s approval of the legal approach being taken, ensuring that the costs are agreed in advance of the claim submission.
To ensure a smooth handling of the claim, insurers must be made aware of all costs which arise during the eviction process.
For further information, please visit our Global Real Estate & Construction (opens a new window) page, or contact:
Jamie Crocker, Account Handler, Lockton Global Real Estate & Construction
E: jamie.crocker@lockton.com
