Universal Credit and coronavirus: government advice

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Landlords with tenants on Universal Credit have been contacted by the government in the wake of the coronavirus outbreak. A website specifically dealing with Universal Credit in light of the pandemic has now been created and can be accessed here. It runs through what happens as regards new claims – if someone is unable to work […]

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Half of landlords wouldn’t give their tenants a Coronovirus ‘rent holiday’

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A poll of landlords by LandlordZONE has found the community divided on whether they should offer tenants relief from paying their rent if they catch Coronavirus or made redundant because of the related economic downturn.

Landlords are divided on whether to offer rent holidays for tenants following the Government’s radical package of measures to protect renters and landlords affected by Coronavirus.

A LandlordZONE Twitter poll
asking, ‘Landlords, would you give your tenants
a rent holiday due to the impact of the Coronavirus?’ discovered that just over
half – 52% – wouldn’t be offering this to tenants, while 48% would.

The latest Government
announcement means there’s a freeze on new evictions and possession proceedings,
but landlords do have the protection of a three-month mortgage payment holiday on
buy-to-let mortgages where tenants
are having financial difficulties.

Tenants around the country are now
asking for reductions or breaks in rent payment, but landlord groups are warning
that not everyone will have an inexhaustible capacity to cope with lost income. 

Chris Norris, National Landlords Association director, policy & practice, tells LandlordZONE that where landlords can access support, it’s recommending that these temporary savings are used to help struggling tenants through this difficult time.

But he adds: “We should not
assume that landlords will be able to cover their costs if rent is not paid.”

Leicester Landlords Association is advising members to get as much documented information of employment as they can from a tenant, so together they can work out a payment plan while their income is reduced.

Chairman
Tony Bhaur tells LandlordZONE: “We don’t know how many genuine cases there will
be. We’re saying, I can live with the rent arrears, but you need to tell me how
you’re going to repay it when your income is restored.”

And while the Residential Landlords Association (RLA) isn’t advocating that all landlords offer a rental holiday as all circumstances differ, policy manager John Stewart says landlords should be as flexible as possible where tenants are facing difficulties. 

“Many landlords and tenants are working well together with
numerous positive stories coming to light of support being given to tenants in
many ways.”

However, the RLA is also calling
for further action to support tenants including scrapping the five-week wait
for the first payment of Universal Credit and ensuring the Local Housing
Allowance properly reflects rent levels.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Half of landlords wouldn’t give their tenants a Coronovirus ‘rent holiday’ | LandlordZONE.

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‘No one wants to see tenants forced out of their home due to loss of income as a result of coronavirus’

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Eviction specialist Paul Shamplina says the government’s recent eviction and mortgage holiday measures have given landlords no option but to hunker down and work with tenants.

Paul Shamplina, the UK’s leading residential evictions expert and co-founder of Landlord Action, has called on landlords to work collaboratively with their tenants as the Coronavirus crisis intensifies.

His comments follow the government’s decision this week to bring forward emergency legislation to block landlords from evicting tenants who cannot pay their rent because of job losses or having to look after their children as a result of coronavirus.

The move, announced by Housing Secretary Robert Jenrick, revealed that new eviction attempts will be banned for three months to give hard-pressed workers in private and social accommodation breathing space during the economic crisis.

But, to make sure landlords do not suffer, Mr Jenrick also revealed that buy-to-let mortgages would also be covered by the 12-week payment break.

“These are unprecedented times and all landlords must now work collaboratively with their tenants to come to solutions to get us through this public health crisis and move forward after,” says Shamplina.

“The measures taken are right and fair; no one wants to see a tenant forced out of their home due to loss of income as a result of coronavirus, nor does anyone want to see landlords face unmanageable debts.

Tenant mediation

“With this in mind, we will shortly be launching a
tenant mediation service which will involve Landlord Action working
collaboratively with the Property Redress Scheme to offer support to both
landlords and tenants to come to suitable arrangements for the future.

“We are awaiting confirmation from the government as
to the details of the suspension, a possible verification process, and
information on what will happen with current possession claims that are going
through the court process.

“I would urge landlords to be as flexible as
possible with tenants facing difficulties with their rent payments arising from
the current situation.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – ‘No one wants to see tenants forced out of their home due to loss of income as a result of coronavirus’ | LandlordZONE.

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RLA Wales calls on support from Welsh government for landlords

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The RLA is calling on the Welsh Government to provide more information on how its measures will affect private landlords as it outlines how it aims support the population through the coronavirus outbreak. Wales’ Economy Minister Ken Skates AM announced steps being taken to help businesses and the self-employed yesterday: “After confirming all of the […]

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Bank Base Rate cut to 0.1%

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The Bank of England’s Monetary Policy Committee (MPC) convened a special meeting and voted to cut Bank rate to a record low 0.1% and increase holdings of UK government and corporate bonds by £200 billion.

“The spread of Covid-19 and the measures being taken to contain the virus will result in an economic shock that could be sharp and large

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Landlords must now work collaboratively with their tenants

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On 18 March, the government announced that landlords will be blocked from evicting tenants who cannot pay their rent because of job losses or having to look after their children as a result of Coronavirus.

The move announced by Housing Secretary Robert Jenrick stated that new eviction attempts will be banned for three months to give hard-pressed workers in private and social accommodation breathing space during the economic crisis.

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Can I still rely on guarantors?

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If the tenant, who decides for whatever reason to stop paying their rent even if having work or the funds, and has a guarantor does this emergency legislation stop landlords from going the the guarantor for the rent.

Or is it only to stop the serving if s21 or s8 notices.

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Nearly half of private landlords prepared to “throw in the towel”

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Landlord Exodus:

Nearly half (48%) of
private residential landlords have indicated that they plan to exit
the buy-to-let market, that’s according to the findings of a recent
survey by Aldermore Bank.. This could be in protest at a punitive
taxation regime and government plans for increased regulation of the
industry, with more tenant-friendly legislation planned.

Recent events are
only likely to have strengthened their resolve as demands increase to
give tenants “rent holidays” if they are unable to pay, due to
the spread of the coronavirus crisis. The research carried out by the
challenger bank suggests that many small-scale landlords have simply
had enough.

The government’s
policy of reversing the rising trend of buy-to-let in favour of home
ownership among the young, and a drive to encourage institutional
investment with build-to-rent, is making small-scale landlords feel
decidedly unloved. Institutional investors in professionally managed
large blocks of flats, receiving tax incentives, will pose a real
challenge to the traditional buy-to-let sector.

The sector has
recently been inundated with change: the imposition of a 3% stamp
duty premium on rental and second properties; the phased removal of
mortgage interest relief; a letting fees ban; restriction on
deposits; and this coupled with new energy efficiency and home safety
standards; the imminent introduction of electrical safety checks;
and the threatened removal of section 21, to name a few, have just
been piling up as a massive burden and extras costs.

According to the
bank survey, landlords see the burden of regulatory changes as the
biggest threat to their livelihoods, followed by the tax burden and
the additional costs associated with bringing properties up to the
latest energy efficiency and electrical safety standards, not to
mention many of the other measures.

The horrendous
complexity involved in managing and meeting the more than 150 rules
and regulations now affecting lettings, some carrying substantial
fines and even criminal penalties, is simply daunting for many, and
turning – particularly part-time landlords – off the occupation.
Something like 70% of landlords own just one or two rental
properties.

Responsible
landlords see the changes hitting them hard, when the real target of
many of these measures is missing the target altogether; the rogues
are still getting away with renting out substandard and dangerous
properties, with the result that all landlords are seen as bad in the
eyes of the media and the public.

However, every cloud
has a silver lining, and with the majority, admittedly by a slim
margin (52%) still see the sector as a good place to invest. And with
good management they can see opportunities for further investment and
growth as others leave the sector.

Aldermore’s
managing director of retail finance, Damian Thompson has said:

“Private landlords
exiting the UK market would mean less choice and likely impact
negatively the quality of rental properties for tenants.

“The number of
people renting in the UK has been rapidly growing, up 1.7 million in
ten years, so it is vital there is enough rental supply to meet this
demand.

“Landlords will
need support and advice on how to manage their portfolios going
forward from lenders and the wider industry so they can continue to
support the private rented sector the way it needs to be.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Nearly half of private landlords prepared to “throw in the towel” | LandlordZONE.

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Renting to Housing Association for refugees?

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I have been asked by a Housing Association to rent one of my properties to them. They will then re-let the property to people on their list.

They guarantee the payment of rent and will be paying approximate market rate.

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EXCLUSIVE: First signs of tenant rent defaulting emerges

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LandlordZONE has heard from a mortgage broker, letting agent and landlord about the difficulties the sector is facing during the crisis.

First signs that tenants are beginning
to feel the economic pain of Coronavirus are beginning to emerge, LandlordZONE
can report.

An agent in North London,
Dreamview Estates, has told us that he’s already had three tenants unable to
pay their rent this week, including one stuck in Peru who is unable to return
to work after the country went into lockdown.

Angus Stewart, chief executive at mortgage
broker Property Master, says landlords are reporting that some tenants are late
with rent payments or may not be able to pay their rent at all.

He tells LandlordZONE: “One landlord’s tenant hasn’t been paid by his Italian company so can’t pay the rent. Where will the short-fall be met from?” The broker is also urging lenders to take an understanding approach when dealing with customers struggling to pay their mortgages due to the Coronavirus outbreak, and landlords facing loan repayment problems as tenants begin to default on rents.

Stewart also points out that, even though
landlords have now been included in the government’s plans to introduce three-month
mortgage payment holidays, the ‘interest will keep rolling up’.

Call for action

Speaking to LandlordZONE, British Landlords Association CEO Sajjad
Ahmad agrees that the Government needs to take landlords into consideration.

Ahmad recognises
that while some tenants are genuinely self-isolating, he says some might use the
situation as an excuse not to pay rent.

He adds: “What
support is there for landlords who have mortgages to pay? Some of our members are also now concerned that property
prices will drop and they will have trouble selling. I hope the Government will soon provide some
clarity.”

One landlord’s view

Ahmad’s were echoed by one of our
readers, Dave, who this morning said: “The mortgage holiday plan is no help to Landlords that are
mortgage-free on their let properties and depend on the rental income as their
only means of income.

“They can’t pick
money off the tree, are not able to claim benefits due to owning assets, which
obviously can’t be liquidated.

“All landlords
irrespective of their own circumstances will undoubtably have tenants that
struggle or are unable to pay their rent and will, I am sure, be sympathetic in
these circumstances and treat tenants with the empathy they deserve.

“With that in
mind will any Landlord groups be asking the government to provide additional
funding on behalf of those Landlords that have no income?”.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – EXCLUSIVE: First signs of tenant rent defaulting emerges | LandlordZONE.

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