As the ‘R’ number inches lower the government is looking to gradually open up the economy again. So how does this affect landlords?
Opening up the property market
As explained by Robert’s post yesterday, the Coronavirus Act has been amended to provide that activities in connection with the purchase, sale, letting or rental of a residential property are now a reasonable excuse for leaving the place where you are living.
Which means that letting and estate agents can go back to work, property inspections can take place and people can move homes.
Subject to the following:
- Virtual viewings are being encouraged. Agents must, however, take to ensure that this does not mean that some flaw or undesirable feature of the property is concealed from prospective tenants just because they cannot look around freely.
- Where physical viewings are to take place, the minimum number of people necessary can be involved, social distancing guidelines should be followed, and lots of washing and cleaning is very strongly encouraged. Open house viewings should not take place.
- Viewings should not take place in properties where tenants are symptomatic or self-isolating, or where they are clinically extremely vulnerable or are shielding.
- Repairs and safety checks should take place during the void period in between the previous tenant moving out and the new tenant moving in. If that is not possible (and it is hard to see why it would ever be impossible) then measures must be in place to minimise physical contact.
- Letting agents and landlords “should take steps to ensure any properties are prepared ready for new tenants, this may include cleaning to minimise any potential spread of the virus”.
Is this a good thing?
Polly Toynbee thinks not arguing that the government’s ‘deification of the property market’ should alarm those hoping for a more equal post-coronavirus society. Her article points out that young people need lower house prices so a rising property market is the last thing that they want.
It also seems that YOU are unhappy about the re-opening of the housing market – as a poll on Property Industry Eye to which over 1,000 readers responded (so it should be statistically significant) found as follows:
- 56% of the readers who took part believe that, in the context of Covid-19, it is unsafe for the government to have reopened the market
- 27% consider it safe to have reopened it and
- 17% don’t know.
The people responding were largely the letting and estate agents themselves of whom 65% say that their branches will be open by the end of May with 35% saying they will not be open by then.
See the full results here.
Nearly Legal has a good post, well worth reading which starts:
If I am honest, this is not how I anticipated the apocalypse to look. The streets deserted apart from roving estate agents, dead eyes above the mask, looking for someone, anyone, to force into a viewing in an enclosed space …
What news on the Eviction Stay?
There has been a recent challenge to Practice Direction 51Z – the one which stays possession proceedings until 25 June. This was in the case of Arkin v. Marshall which was rushed up to the Court of Appeal so we could have a decisive decision soon.
If you want the details this post on Nearly Legal has them but the main point is that the challenge was unsuccessful and the lawfulness of the Practice Direction was upheld.
The current stay is until 25 June but it seems housing minister Robert Jenrick has said that, depending on medical advice, this could be extended for another three months, plus the ‘pre-action protocol’ currently being developed, will remain in place (once it comes into force) for an extended period.
So landlords – don’t count on being able to progress your eviction claim against your anti-social tenant in a month’s time.
When the moratorium on eviction is finally lifted, I predict that there will be such a press of unresolved cases, that cases will be very seriously delayed.
If you are a landlord looking to evict a tenant I would advise that you ensure that your paperwork is perfect and that you use standard and straightforward grounds. Anything out of the ordinary which needs extra time will be shoved to the back of a very long queue indeed.
On the topic of the ‘pre-action protocol’ Nearly Legal has a few things to say about it.
The problem of rent
The problem is that if people have lost their jobs and are not earning any money – they can’t pay it!
There is a growing call for the government to grant renters a ‘rent holiday’. For example, this article in the Guardian looks at activists calling on tenants to withhold rent to ‘generalise a growing rent strike movement’.
Momentum are calling on Sir Keir Starmer to back ‘immediate cancellation of rents for those affected’.
However Starmer, as a barrister, knows that this is not really an option as landlords’ ability to charge rent is protected as a ‘possession’ under the Human Rights Act as explained here. So if it were removed the government would have to pay compensation to landlords. Which, Starmer points out, would not be the best use of public money.
In this article, the new shadow housing minister Thangam Debbonaire says that canceling rent entirely during the coronavirus crisis would be an “un-Labour” policy that would hand money to the well-off.
Instead, Labour has gone for a five-point plan which is explained by ‘J’ (who I understand was partly responsible for it) here. Well worth reading plus there is some good comment at the end.
Good news on Benefit
Among all the doom and gloom, a small piece of good news for landlords is the setting up of a new online service for landlords to apply for the regular monthly rent and rent arrears to be paid to them direct. You will find it here.
Sherrelle Collman, managing director of Caridon Landlord Solutions (who ran a trial on this last year), said:
This is excellent news for landlords and tenants, as well as all those new claimants who have recently been forced to sign up to Universal Credit due to Covid-19.
For those struggling to manage their finances, it provides a much simpler route for tenants and landlords to request that the housing element of Universal Credit is paid directly to their landlord.
The old paper forms, which required landlords to fill out, scan and email or post back, were not only time consuming but also took weeks process, sometimes getting lost along the way with rent arrears simultaneously mounting up.
Given how stretched DWP’s resources are as a result of the pandemic, it is fantastic that they have managed to launch this important improvement to the system which will help those struggling to manage their finances.
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