Contributed by Attwells Solicitors
23/06/2020 - Attwells Solicitors
Back in March the government unveiled a package of measures designed to protect commercial and residential tenants. three months on, the Attwells’ property law team look at the effect this will have on landlords.
When Housing Secretary Robert Jenrick initially announced emergency legislation that banned landlords in England and Wales from evicting tenants, it was set to last for three months. However, at the start of June, Jenrick extended the ban for another two months, up to the end of August.
Whilst this gives tenants some breathing room during the current crisis, where does it leave landlords who aren’t getting the money they are owed and may be struggling financially?
WHAT ARE YOUR FIRST STEPS IF A TENANT IS STRUGGLING TO PAY RENT?
The Government has talked about implementing a protocol for landlords that would help them agree affordable repayment options with tenants rather than looking at repossession, though this hasn’t yet been published.
Some groups, such as the National Residential Landlord Association, encourage landlords to be flexible, and offer temporary rental relief to tenants who need it.
At this point, it’s in the interests of landlords to negotiate and assist tenants where possible. Aside from comments by cabinet ministers in the press suggesting that vulnerable people, such as those shielding, may be given extra protection from eviction even after the current ban is lifted, the reality is that the unprecedented nature of these times means legislation could change at pace over the next few months. It’s possible the Housing Secretary could well extend the current eviction ban beyond the current August deadline.
So anything you can do to communicate with struggling renters, and offer flexible repayment terms, may help you recoup your rental money over a longer period of time, rather than end up with many months of arears, and a long wait for a court date when proceedings resume, as the backlog clears.
For example, you might agree to allow a ‘rental holiday’ for your tenant for a number of months, or a discounted rental rate, and agree a repayment plan to catch up on the arears.
What financially support is available for private landlords during the COVID-19 crisis?
The Government have extended their mortgage holiday to include buy-to-let mortgages, with the understanding that this will give flexibility to landlords to allow them to negotiate rental freezes and repayment plans with tenants.
Beyond that, unfortunately, there is little financial support for private landlords to cover lost rental income at present. However, the Attwells team are watching the situation closely and as things change, we will keep you updated.
What if your tenant won’t pay and you need to serve notice?
The Coronavirus Act 2020 has introduced new rules that landlords must follow in relation to evictions and possession proceedings. These will apply until the 30th September this year, and may be extended depending on the progress of the pandemic. These new rules state that:
Landlords must still give notice of their intention to proceed with possession of the property under either section 8 or section 21 of the Housing Act 1988.
If this notice is served before 30th September 2020, it must specify a three-month notice period before possession may commence. Previously, notices served under section 21 didn’t require a three-month period.
This new legislation is also supported by Court Practice advice that possession proceedings will now be put on hold until at least August 23rd 2020, with the possibility of this date being extended alongside changes to the Coronavirus Act 2020.
Attwells offer support and guidance to private landlords during the coronavirus pandemic. For further information call Will Oakes on 01206 239764.
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