• Home
  • About
  • Clinic
  • Training
  • Eco Landlords
  • Landlord Law

The Landlord Law Blog

From landlord and tenant lawyer Tessa Shepperson

  • Home
  • Posts
  • News & comment
  • Cases
  • Tenants
    • Penalties for breaching tenancy rules
    • 15 Places for tenant help
  • Clinic
  • Podcasts
    • Interview
    • Surgery
  • Series
    • Analysis
    • should law and justice be free
    • HMO Basics
    • Tenancy Agreements 33 days
    • Airbnb
    • Grounds for Eviction
    • The Deregulation Act Explained
    • Tips

Tips for Landlords who want to offer a rent reduction during the coronavirus emergency

April 16, 2020 by Robin

tenantThis article was written by Robin Stewart, from Anthony Gold Solicitors.

Are rent reductions an option?

Many tenants are struggling with financial problems during the Covid-19 crisis and as a consequence, they are asking their landlords for a rent reduction.

Every case is different – some landlords are better placed than others to be generous, and while some tenants have lost most of their income, others will have felt little if any financial impact.

Suspending or reducing the rent will be a matter for negotiation, but when landlords have decided they are going to offer financial help to their tenants there are some traps they should avoid such as:-

  • Breaching the Tenant Fees Act 2019 or
  • permanently reducing the rent

What type of rent reduction?

If you have agreed on something with your tenant, you should make sure that both parties actually understand the details of the deal which has been agreed upon. Landlords can suspend the rent entirely for an agreed amount of time.

One way to structure this is to agree that the rent is suspended until the landlord gives one month’s notice that the rent will resume.  However, it would probably be easier to agree that the rent is suspended until a particular date, and then extend that later if necessary.

A rent reduction works the same way – you need to agree on what the temporary rent is, and for how long the reduced rent is in effect.

Instead of fully extinguishing the rent liability, landlords can agree to give extra time to pay. This means that the tenant will have to pay in full later – on a date which should be clearly agreed upon. If the tenant fails to pay by the agreed date, they could still be evicted.

Before responding to requests for reductions landlords should think about their own circumstances, and the tenant’s situation. They should also check the terms of any rent protection insurance they hold.

Formalising the agreement

It is unnecessary to have a formal contract signed by both parties (and during the lockdown unnecessary journeys to sign contracts must be avoided). However, a reduction should always be recorded in writing. That could be an exchange of emails or text messages.

If text messages or WhatsApp messages are used, both parties should keep copies. It is always better to keep screenshots than assume that messages will be available to look at later.

Periodic Tenancies

If the landlord and tenant have agreed to vary the rent during the fixed term, that varied rent could still apply when a period tenancy arises. To avoid this, landlords could agree that a rent suspension (or a reduced rent) applies for certain identified months.

That will make it clear that the reduction is only temporary.

In a periodic tenancy, the landlord may be stuck with the lower rent if the landlord and tenant agreed a lower rent and there is no agreement for the rent to be increased again later. The ‘section 13 notice’ procedure might be available to the landlord to increase the rent, but again it would be much easier to just agree specific months with a reduced rent in effect.

Granting a new tenancy

The current lockdown permits people to move house when necessary, but few people will be moving right now. If you are granting a new tenancy and you want to offer a reduced rent during the Covid-19 crisis, you could offer to accept say half the rent in the first three months.

Rent is a ‘permitted payment’ under the Tenant Fees Act 2019, but landlords are forbidden from charging an increased rent at the start of a tenancy (which would otherwise be a way to impose a hidden charge). However, there is nothing to prevent a higher rent being charged later in the tenancy.

Print Friendly, PDF & Email

Filed Under: News and comment Tagged With: coronavirus, rent

Scroll down for the comments

Landlord Law for Landlords

Are you a landlord, unsure how to manage your properties in these uncertain times?  My Landlord Law service can help you in this crisis by providing online help and guidance and giving you one to one advice in the members' forum area.

>> Find out more about Landlord Law.


IMPORTANT: Please check the date of the post above - remember, if it is an old post, the law may have changed since it was written.

You should always get independent legal advice before taking any action.

Notes on comments:

For personal landlord and tenant related problems, please use our >> Blog Clinic.
Note that we do not publish all comments, please >> click here to read our terms of use and comments policy. Comments close after three months.

Keep up with the news on Landlord Law blog!

To get posts sent direct to your email in box click here

About Robin

Robin Stewart is a solicitor and a Senior Associate at Anthony Gold solicitors. He is a specialist on residential tenancy law and the regulation of the private rented sector, has extensive advocacy experience in the First-tier Tribunal and County Court, and advises letting and estate agents on planning for changes in the law.

« Energy Performance Certificates during COVID-19 Emergency Measures
Tessa Shepperson Newsround #142 »

Posts

  • Government Guidance for Landlords and Tenants during the coronavirus emergency
  • The Lockdown Learning Project
  • Free Accommodation Websites for NHS staff during the coronavirus emergency

 

Information Posts on:

  • Keeping Records
  • Gas Safety
  • House moves
  • Property viewings
  • GDPR and Data Protection

 

Webinars

  • Landlord Law Webinar on Coronavirus and what Landlords need to Know (24 March 2020)
  • Letting Property during the Coronavirus Emergency – Two Webinars
  • Dealing with Lettings during the Coronavirus Emergency (9 April 2020)

 

Blog Clinic Posts

  • Do tenants risk penalties if they are unable to vacate at the end of their notice period?
  • Desperate landlord needs her home back but tenants are refusing to vacate
  • Accidental landlord asks what he can do when his tenants leave before the tenancy ends

Disclaimer

The purpose of this blog is to provide information, comment and discussion.

Although Tessa, or guest bloggers, may from time to time, give helpful comments to readers' questions, these can only be based on the information given by the reader in his or her comment, which may not contain all material facts.

Any comments or suggestions provided by Tessa or any guest bloggers should not, therefore be relied upon as a substitute for legal advice from a qualified lawyer regarding any actual legal issue or dispute.

Nothing on this website should be construed as legal advice or perceived as creating a lawyer-client relationship (apart from the Fast Track block clinic service - so far as the questioners only are concerned).

Please also note that any opinion expressed by a guest blogger is his or hers alone, and does not necessarily reflect the views of Tessa Shepperson, or the other writers on this blog.

Cookies

You can find out more about our use of 'cookies' on this website here.

Associated sites

Landlord Law Services
Tenant Law
Eco Landlords
Your Law Store

Legal

Landlord Law Blog is © 2006 – 2020 Tessa Shepperson.

Note that Tessa is an introducer for Alan Boswell Insurance Brokers and will get a commission from sales made via links on this website.

© 2006–2021 Tessa Shepperson | Rainmaker Platform | Contact Page | Log in

This website or its third-party tools use cookies which are necessary to its functioning and required to improve your experience. By clicking the consent button, you agree to allow the site to use, collect and/or store cookies.
I accept