MPs to examine effect of coronavirus on the rental sector

MPs have launched an inquiry into the impact of the coronavirus on the private rental sector as landlords report that high numbers of tenants fear struggling to pay their rent over the coming months.

The Housing, Communities and Local Government Committee has issued a call for evidence to examine the effect of the pandemic and Government support for tenants as well as those who are homeless.

It said: “The Government has also introduced a number of schemes intended to support people in the private rented sector, including halting evictions for three months and raising the Local Housing Allowance rate.

“However, there are concerns about the short and long-term impact of these strategies, including the quality of accommodation and access to amenities, such as for homeless people in temporary accommodation and the exit strategy when social distancing measures are reduced.

“There are also concerns about people in the private rented sector who may build up rent arrears over the coming months and still face eviction when the three month ban expires.

“The inquiry will examine how effective the Government support has been in supporting individuals in the private rented sector or who are homeless.

“It will also look at what long term strategies will need to be put in place to support both groups in the long-term, once current measures expire.”

Submissions to the Parliamentary inquiry can be sent here: https://committees.parliament.uk/call-for-evidence/122/impact-of-covid19-coronavirus-on-homelessness-and-the-private-rented-sector/

It comes amid calls from tenant groups for the Government suspend rent payments.

A poll by evictions specialist Landlord Action yesterday revealed 74% of landlords have been contacted by tenants saying they will struggle to pay their rent.

More than a third, 36%,  of landlords said they would struggle to pay their mortgage if their tenant did not pay rent this month and many said they were reluctant to apply for a mortgage holiday due to the impact on their credit rating.

Despite worries about rent being paid,  almost 70% of landlords who were asked if they could hold off serving an eviction notice if their tenant falls into arrears within the next three months responded yes.

The group has launched a rent repayment agreements template for landlords to buy that to set out agreed terms of repayment with their tenant. if necessary.

Paul Shamplina, founder of Landlord Action, said: “It is a nightmare scenario for everyone – landlords and tenants alike.

“It is really important that landlords do what they can to sustain the tenancy if possible, bearing in mind the court system is suspended and if a tenant vacates, there is a worry the property could be empty for a while.  It is about working together in a practical way, understanding each other’s limits and supporting one another as best we can to get through this.

“I know of landlords who are in a privileged enough position to be able to put a hold on their tenants’ rent and have done so.

“However, the vast majority of private landlords own one or two properties, many with mortgages, and they too will be facing the same challenges of job losses.”

 

See also the following story: ‘Mayor calls for ‘Triple Lock’ protection for London’s private renters’

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14 Comments

  1. RosBeck73

    What does it mean to ‘hold their tenants’ rent?’

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    1. Eyereaderturnedposter12

      I assume he means to place rental payments on hold…  
      contrary to the idea that some Tenants seem to have of their Landlords (being mega wealthy “fat cats”)…the effects of offering a rental payment holiday would place many a Landlord in dire straits (not to mention impose considerably more pressure on an already ailing property industry). The idea of a rental payment holiday was thankfully discarded at the outset of the “lockdown” situation (sensibly IMHO). Whilst it may ease financial pressure on tenants in the very short term…it would be catastrophic for the PRS (ultimately, detrimental for the Tenants such measures are intended to help) in the long term…only serving to “kick the can down the street” a little further than its already been.

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  2. FOXCHERRETT

    It wouldn’t be so bad if private landlords were at least included within the temporary help for the self employed ie 3 months at 80% of gross rental profits (averaged over past 3 years) subject to the £2500 max payment per month, but this scheme specifically excludes landlords, stating they aren’t ‘self employed, but instead are ‘investors’!

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    1. DarrelKwong43

      but they are investors? that is how they sell buy to let, as an investment.

      IMHO, the taxpayers should be bailing out such people.

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      1. kittygirl06

        I don’t know of any other investment that has regs galore, fines of 30000, right to rent check etc.

        BTL  has been completely removed from when it was first termed has an investment all them years ago.

        It should now be acknowledged for the  business trade it is.

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  3. Will2

    In the meantime councils charge council tax on empty properties that cannot be let due to government restriction.  So you pay tax (council tax) on something you can’t rent to pay for services that cannot be used.  How fair is that?

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    1. DarrelKwong43

      wheres does the *legislation* say a property cannot be let or even sold? 

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    2. kittygirl06

      The Nrla should look into this to see if its legal. 
      If you cannot let due to the virus then you should not have to pay council tax on empty properties. 
      It’s bad enough having to pay it at 100% bet tenancies
       
      It appears government are telling Insurance companies to pay out when companies can’t trade. 

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  4. JamesB

    No doubt the review will conclude throw landlords under the next bus again

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  5. wilberforce80

    I went to Tesco last week and filled my basket. I said to the checkout lady “I can’t pay for that for 3 months, is that ok.” She said “Yeah sure the government have told us to feed you for 90 days and then we can sort it out later by agreement”. I said “thanks, I’ll be back for more food tomorrow”.

    And then I woke up.

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    1. PossessionFriendUK39

      Its just as ridiculous as the Governments proposals for Tenants liability to pay Private rent. I think MHCLG  must have been dreaming when they wrote the Coronavirus Act, 
      oh no they didn’t, did they,  they cobbled most of it from Giles Peaker and Justin Bates script proposal legislation for the Labour party.

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  6. kittygirl06

    The Nrla should look into this to see if its legal.

    If you cannot let due to the virus then you should not have to pay council tax on empty properties.

    It’s bad enough having to pay it at 100% bet tenancies

     

    It appears government are telling Insurance companies to pay out when companies can’t trade.

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  7. kittygirl06

    This enquiry is not interested in the landlord.

    It’s all about the tenants and what else can they force on landlords.

    What bubble do these MPs live in.

    They have caused untold damage.

    The PRS is not council or HS they live on the rent and pay enormously into the economy.

    Yet they get zero help.

    The government should pay the rent for all those effected.

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  8. Mothers Ruin

    I really would like to know where Landlord Action have obtained their percentages from!

    ‘74% of landlords have been contacted by tenants saying they will struggle to pay their rent’

    I find this hard to believe since I’ve been dealing with any such enquiries and have received contact from less than 1% of all tenants with only 0.5% genuinely being unable to pay some or all of their rent. Whilst I expect this to increase at the end of April and there might be variations in different parts of the Country the percentages quoted here seem quite ridiculous to me.

    in times like these landlords are extremely relieved and dare I say grateful to be using a professional agent.

     

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