The three month outright eviction ban pledged to renters last week appears to have been watered down in the Coronavirus Emergency Bill passed by Parliament yesterday.
Last week, the government pledged to introduce a 'complete ban on evictions and additional protections for renters' affected by coronavirus.
However, the Coronavirus Bill merely extends the notice required for possession from two months to three: the Labour Party and campaign groups have complained about the change.
It’s unknown whether this was an error in drafting - the government is under extreme pressure currently - or an intentional change of mind.
This morning a Generation Rent spokeswoman said: "This legislation fails to deliver on these promises in every respect. All these measures do is extend the notice period for evictions to three months, which will provide little comfort to those faced with losing their homes in the midst of a pandemic.
“Equally worrying is the lack of provision made for rent arrears, which will stack up in the three month period. Many renters will end up with thousands of pounds worth of debt and no means of paying it off.
“Landlords and tenants are expected to 'work together' to find a solution to suit both parties from June onwards - but there's absolutely nothing to stop landlords from evicting tenants if they can't pay. Eviction is the leading cause of homelessness, so the government must act now to avoid another crisis in three months' time."
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I’d like to evict Shelter
Yip, me too!
maybe they would like to cover the arrears , i think not
Government needs to pay total rent direct to landlords for those affected
100%
‘Evictions are the leading cause of homelessness’
Noooooo! Pure genius at work!
Not paying your rent and trashing your landlords property are the leading cause of homelessness.
As predicted. Boris was far too vague in the commons the other day on this point, and the loose wording surrounding "landlords starting proceedings" suggested that they may not be removing a landlords ability to serve notice and here we are. There has been some energetic debate about supposed government sanctioned "rent holidays" and the implications for lenders and landlords, so it is useful to get some clarity for the time being at least and whether generation rent like it or not, it does afford tenants more protection getting us into the warmer months when the experts tell us the virus will be far less effective.
There is no evidence that the virus will be any less virulent in the summer months. It has been spreading in countries that have been in their summer months - Australia, New Zealand, South Africa and other African and American countries south of the equator. If self employed/zero hour contract workers are renting they're unlikely to be able to afford to pay their rent for for the coming months. The government really needs to get to grips with this.
Does this mean I can serve S.21 today but just with a 3 month length on it?
Why on earth would anyone do that?
A landlord has come to me with a problem tenant £13.5k in arrears. World don’t stop turning, Sue. I presume you’re in the south.
our morttgage companies won't give us a 'mortgage holiday'. Any mortgage payments that they don't claim will be added to the mortgage along with the continually accruing interest, which is no longer even tax deductible! Although three months of lost income certainly will be tax deductible. Personally, I'd rather have the rent and pay the tax.
What with the back log and the courts closing, how long will the whole process take if a physical eviction is needed? A 3 month rent holiday rule would in those circumstances be a result.
"Eviction is the leading cause of homelessness...."
NO, eviction is a consequence not a cause, when will Shelter, Generation Rent et al learn.
Causes are rent arrears, damaging property, anti-social behaviour, or Landlords having to sell because of the result of Shelter lobbying to drive Landlords out of business.
Its like saying crossing the road is the cause of accidents ! where do they find these Numchucks ?
Gen Igno Rent need a Reality check - and smell the coffee ( what do they expect Landlords to do ? )
The Virus hasn''t made anything FREE, Everything has to be paid for by somebody, and whilst this may come as a surprise to many Tenants support groups, this responsibility falls to the Tenant !
If the Govt are going to do anything meaningful, it would have To Pay the Tenants [ WHO ARE genuinely Affected by COVID-19 ] Rent, in Full.
I have had a trespasser in my property for over 2 years but haven’t been able to start possession proceedings due to another civil claim. Finally that was resolved and I began trespass proceedings on April 2nd now I’m being told I can’t proceed with possession despite it being against a trespasser simply because I know their name!! By the time this eviction stay is over and I eventually get this trespasser out they would have had well over 3 years living rent free at my expense. Where is the justice in this?? The corona practice direction was to prevent eviction from income loss due to the virus which is understandable but why are so many freeloaders being protected at our expense!
Emma, are you referring to a squatter when you say Trespasser ?
We are offering Free Advice during the virus period if you'd like to contact us ?
Because its cheaper for the Govt to shaft Private landlords than have local Govt ( that's part funded by central Govt ) have to pick up the pieces.
Also, Landlords are very poorly organised with only 2% members of any landlord associations, so no representation for us.
Possession Friend why join a landlords association? If they actually represented their members it would encourage non member landlords to join. Spineless associations don’t help the matter
An effective landlord Association that was prepared to go head- to - head with the Govt and had the backing of significant percentage of landlords could be more effective ( they couldn't be less than the status quo, could they )
I love the idea that Govt believes that LL and tenants should work together to resolve arrears.
So how come before this CV19 issue tenants were causing LL £9 billion in losses per year mostly caused by rent defaulting!?
Not much sign of tenants working with LL to resolve rent arrears there!
So why would tenants all of a sudden be motivated to work with their LL to resolve rent arrears?
Govt knows only too well that rent defaulting tenants will NEVER pay their rent arrears.
It also is fully aware that removing a rent defaulting tenant doesn't take 3 months to occur.
Very few rent defaulting tenants ever vacate at the expiry of a S21.
They all wait many months before a bailiff evicts them.
It will take many; many, many, many MORE months to achieve that eviction.
There will be mass rent defaulting and such rent defaulting tenants will seize upon the opportunity to live for free.
With the Court delays etc it could easily take 2 years to evict.
That is if even S21 is still around!!
Nope LL must expect massive losses.
Will be interesting to see what the HMRC response will be to LL subject to S24 and who can't pay S24 taxes.
Fictitious income which is being taxed can hardly be paid with fictitious rental income if the tenant rent defaults.
If the LL doesn't have any savings how are S24 taxes supposed to be paid??
Unlike the Govt LL don't have access to magic money trees!!
I can see HMRC making lots of S24 LL bankrupt due to their inability to pay S24 taxes caused by tenant rent defaulting.
If anything this mass tenant rent defaulting will expose how ludicrous the S24 tax policy is.
But Govt won't abolish it.
For Govt all these circumstances are just very useful coincidences for it to continue culling small LL from the PRS.
Make NO mistake LL you are on your own!
Plus what happens with LA management fees if no rent is coming in!?
Do LA still expect payment!?
With what!?
So will LA sue LL who can't pay the monthly fee cos no rent is coming in?
It is obvious that LA income will take a massive hit as well from mass tenant rent defaulting.
Can't see many LA trying to sue LL.
LL will just terminate contracts.
Paul, as you know Letting Agents collect commission on rents received, not rents due. So if not rent is paid, the agent doesn't get paid.
Any landlord that signs a contract with an agent who charges commission on rents due DESERVES to be sued by the agent.
Ahh!
I see.
I don't use LA but surely if rents aren't paid then would LA still provide a management service!!??
If as it seems they shouldn't do so then how will LL manage who rely on LA.
!?
Seems very unfair on LA.
Surely if no rent is coming in LA would be justified in suspending ALL management activity?
I guess many LA do continue to provide services effectively serviced by other LL income.
But with so many tenants defaulting I can't see how a LA would be able to do this.
They have their costs as well and are in no position to offer free management.
I've no idea how LA manage things when their LL clients tenants rent default.
If I was a LA no rent would mean immediate suspension of all management activity.
@Paul Barrett That, Paul, is the difference between a good agent and a poor agent. A good agent will support their client landlord rather than leave them high and dry.
Ahh!
I see.
But my query would be how long could such a LA sustain such free management services?
It surely wouldn't be reasonable to expect LA to provide such services for free?
I don't see how LA could sustain their business if assisting LL who have rent defaulting tenants.
But then I know NOTHING about the LA business model.
It just strikes me as curious as to how LA could provide an effectively free service?
I can appreciate perhaps in the extremely rare circumstances that rent defaulting tenants do pay their rent arrears that a LA could reasonably be paid.
But with mass rent defaulting I don't see how LA can sustain this.
LA have taken massive hits to their income and with now mass rent defaulting how do they cope!?
I'd also guess that many LL are terminating LA contracts.
It seems to me LA are being unfairly hit from all angles.
I just DON'T see how this is financially survivable.
?
Paul, we are not experiencing the mass rent defaults that you suggest. Yes, there is a reduced income stream, but we have a duty to our landlords.
Landlords have a legal duty to maintain the property, whether the tenant pays rent or not.
An agent contracts with the landlord to provide a service and, if they find that is unsustainable financially, should give notice to the landlord.
Personally I blame the Government 100% for this because they used the words "Mortgage HOLIDAY" rather than something like Mortgage payment deferral. The words holiday suggests a payment free period without comeback when, as landlords and agents know, interest still accrues and that the missed payments have to be paid, either by increasing the term of the mortgage or increased payments. Both of those facts escape the defaulting tenants and their co-conspirators, Shelter (who don't) and Citizens Advice.
I think perhaps then mass rent defaulting hasn't fully happened yet.
It will once the furloughing scheme ends.
Then it will be Armageddon!!
Millions will be unemployed and UC won't be sufficient rent.
LHA rates wouldn't even cover my mortgages.
I can see many LA leaving the industry or amalgamating with others to survive.
ONLY scale will make things survivable. The days of the small LA are over.
I couldn't disagree more, Paul. Small, independent agents are able to be more flexible that corporate agents.
Yes, having worked as a smaller independent and part of the big corporate I agree with Lyndon. Smaller agents make their own policies and processes, larger agents have them made in a petri dish at head office and there are so many firewalls that any discretionary flexibility is virutally impossible.
The smaller lettings agents have a pretty good chance of surviving this provided they have made the right decisions early enough, and continue to do so and plan for the inevitable later lockdowns. This first one was a warm up for the real thing. The bigger agencies are too big, have too many fixed costs and are run by dinosaurs, many of whom have never been agents. Look at LSL. Sacked their CEO last week. Look at Countrywide. They will be lucky to survive this. Paul Creffield has taken to writing begging letters to the Housing Minister and their share price still looks pretty ugly.
I suppose what I mean is that you can be a small LA but with lots of properties under management.
This then would cover rent defaulting tenants.
So if several LA get together with combined property the business becomes far more resilient.
It must make financial sense for small LA to combine to mitigate rent defaulting tenants of which there will be many in coming months and years.
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