Residential landlords in particular will be concerned about the ongoing effect of tenants who are unable to make rent payments due to the impact of COVID-19.
In addition, the Housing Secretary recently announcing the suspension of the eviction process, with no new possession proceedings to start during the crisis and emergency legislation to be taken forward so that landlords will not be able to start proceedings to evict tenants for a three-month period.
It appears that possession proceedings that have already been issued will still continue (albeit access to the court for hearings may well be restricted in the coming months) but even if possession orders are obtained, enforcing such orders may prove difficult. It is also currently unclear whether this legislation will extend to possession proceedings that are unconnected to payment of rent e.g. if the tenant is causing a nuisance.
While of course no reasonable landlord would want to leave a vulnerable tenant without a home, many will be concerned about covering their mortgages and also about how they can protect their properties from the minority of tenants who display anti-social and damaging behaviour.
At the time of writing, in-depth details about the new legislation had not been released, but Housing Secretary Robert Jenrick MP has said: “We are in extraordinary times and renters and landlords alike are worried about paying their rent and mortgage.
“The last thing anyone needs to worry about at a time like this is losing their home.
“The government is clear – no renter who has lost income to coronavirus will be forced out of their home, nor will any landlord be left with unmanageable debts.
“These changes will protect both renters and landlords ensuring everyone gets the support they need.”
This follows on from an announcement by the Chancellor of the Exchequer, where he pledged payment holidays for landlords with buy-to-let mortgages amongst a package of measures introduced in response to the coronavirus pandemic.
The payment holidays, for up to three months, will be offered on the understanding the benefit is to be passed on to the tenant.
The new announcement around suspending evictions for a three month period goes hand in hand with these earlier measures, with the idea being that at the end of the three months,
landlords and tenants will be expected to work together to establish an affordable repayment plan, taking into account the tenant’s individual circumstances.
However, there are still many questions which are unanswered for landlords and the National Landlords Association has already called for the legislation to include a degree of flexibility. This will especially be needed to help deal with anti-social tenants, as well as in working out ongoing repayment plans.
There are also concerns that suspending evictions is merely pushing the issue further down the road, with a raft of problems due to appear once the three month period is up.
While the measures proposed by the government will come as a relief to tenants and the fact that the measures for mortgage holidays will also be extended to Buy to Let landlords is sensible, this approach risks storing up trouble when this crisis is over because the interests of the tenant, the landlord and the lender will conflict at that time
It remains to be seen what the long-term implications are for Landlords, but if you have any questions, an expert from our property team will be happy to help.
