More stories of Landlords financial losses are appearing in the news as the government is struggling to protect renters in the forced lockdown conditions and are doing everything possible to hold true to Robert Jenrick's promises that “No renter who has lost income due to coronavirus will be forced out of their home”
There is a big part of that quote which is often left off the Communities Secretary promise; “Nor will any landlord face unmanageable debts”. Both in commercial and residential the pinch is getting harder with many wondering if they will ever see the money owed, while others are simply wondering if they will ever get possession of their properties back.
Landlords currently have to give tenants 6 months notice for a section 21 notice with a few exceptions to the waiting period. The primary issue for forward movement is the eviction ban which is constantly extended and is now due to end on the 31st of May, but considering the consistent extensions it is challenging for anyone to plan around that date.
The hidden issue is the ability to have applications processed through the courts, with property consultant Matthew Payne revealing concerns on the Section 21 process; “I have seen reports that the backlog may take 3 years to clear, and I suspect a political spanner will be jammed in the Court cogs to make sure many don't make it this year at all.”
The Section 8 process can also be used, with only 4 week notice required for cases with 6 months or greater rent arrears, but it also gets slowed down in the court system especially with the ability of the tenants to challenge the Section 8 requiring extended court time and the costs associated with it.
In November 2020 there was a window opened that would allow landlords to gain exemption from the ban on evictions in cases where rent arrears is greater than 9 months and was accrued before the 23rd of March 2020. Of course this will only help a select few and even then those who have applied for the exemption are finding themselves in the same line as the other landlords with county courts advising of a large backlog but refusing to comment on the size or potential wait time.
We have reported here at Peter Martin on the many approaches the government has taken or not taken including the Tenant Loan Scheme, Debt Respite Scheme and the effect of the Budget Announcement and we are sure there will be many more schemes and announcements to come as the UK tries to pull itself out of quarantine.
Written by Toby Dawson
