BREAKING: Scotland to extend its evictions ban for another six months until March next year
Scotland’s First Minister Nicola Sturgeon has confirmed that subject to parliamentary approval, her government intends to extend the country’s evictions ban until March 2021.
Like the UK, back in March the Scottish government brought in emergency legislation to ban all evictions within the social and private rental markets until September but, unlike legislators over the border, will now extended the ban for another six months.
Welcoming the move, Shelter’s Scottish Director Alison Watson says her organisation welcomes the move to give tenants greater protection from losing their homes as the coronavirus-led economic downturn continues.
“This will give breathing space to thousands of people who’ve been hit hard by this pandemic, so they have a fair chance to deal with the work and money problems that have been forced on them,” she says.
“Today’s decision is a big win for tenants and for Shelter Scotland’s campaign. We want to thank our supporters who emailed their MSPs to demand action, and key organisations across Scotland who pushed for this outcome.
“This shows that when we work together we can win real change. We’ll keep fighting to stop homelessness and deliver safe, affordable homes for everyone who needs them.”
The announcement by Sturgeon follows a sustained campaign by Shelter to extend the ban, including an open letter sent to her housing minister Kevin Stewart, signed by a coalition of other housing and welfare organisations.
LandlordZONE has approached the Scottish Association of Landlords for comment, which we will add to this story when it is issued.
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BREAKING: Scotland to extend its evictions ban for another six months until March next year | LandlordZONE.
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SURVEY: Landlords report 87% of tenants paying rent and only 3% in arrears
Landlords have reported that over 95% of private tenants are paying their rent OR have made arrangements with their landlord to lower or defer payments during the pandemic.
The independent poll commissioned by the NRLA found that among the landlords canvassed, 87% of their tenants have paid their rent as normal throughout the pandemic.
A further 8% said had agreed a reduced rent, a rent-free period or made some other agreement with their landlord or letting agent.
And only 3% of tenants are building up arrears and are unable or unwilling to repay them – with less than a third of those in arrears or two percent of tenants, being served with a possession notice.
Further evidence that landlords are working to keep tenants in their homes comes from a separate survey which shows that 55 per cent of landlords who have granted at least one tenant a deferred rent or rent free period plan to absorb the losses from their own savings.
The NRLA is also calling on calling for the Government to introduce guaranteed hardship loans to help tenants in England who are in arrears due to the pandemic.
Ahead of the winding down of the furlough scheme, it argues that – similar to the Tenant Saver Loan Scheme launched yesterday by the Welsh Government – such loans should be provided to eligible tenants, interest-free and ring-fenced solely to cover rent payments.
Chief executive Ben Beadle says eviction isn’t inevitable where people have struggled to pay their rent due to COVID-19. “Those who argue otherwise are stoking needless anxiety for tenants,” he says.
“To offer security to tenants and landlords badly hit during the lockdown we are calling on the Government to introduce a tenant loan scheme to help pay off arrears built due to the coronavirus.”
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New Welsh £8 million Tenant Saver Loan scheme for PRS only
Loans to pay off rent arrears built during the Covid -19 pandemic will now be available to tenants in Wales following a campaign by the National Residential Landlords Association (NRLA).
The new £8 million Tenant Saver Loan scheme
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Welsh government package of support for tenants including loan scheme
The Welsh Government has provided a package of support to make sure as many people as possible facing financial hardship as a result of the coronavirus pandemic remain in their private rented homes, sustaining tenancies and avoiding eviction due to rent arrears.
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Former TDS boss joins Hamilton Fraser to head up new landlord and agent services
Former Director of Dispute Resolution for TDS, Mike Morgan, has joined Hamilton Fraser as its Legal Division Manager, heading up the organisation’s newest services, HF Assist and PRS mediation.
Morgan played a founding role in the establishment of tenancy deposit protection scheme The Dispute Service (TDS) in 2006, working at the company until April last year.
A lawyer by profession, Morgan found early on in his career that he enjoyed consumer law and alternative dispute resolution.
His experience led him to believe there must be a better way to solve disputes than spending extortionate amounts of time and money going to court. Morgan went from private practice to trading standards in Hertfordshire, where he ran their consumer advice service, helping to resolve disputes between consumers and businesses.
From there, Mike went on to be Chief Conciliation Officer at the Furniture Ombudsman, before joining TDS in its infancy in April 2006. Mike worked for TDS for 13 years, becoming its expert in dispute resolution and bringing many innovations to its work.
Morgan says his focus at Hamilton Fraser is to empower more agents to ask for help and improve their standards to avoid disputes arising.
Avoiding issues
“Over the years, I have seen countless examples where agents have gone wrong and more often than not, avoiding the issue could have been so easy.
“One of the biggest challenges letting agents have faced over the last 10 years is the constant changing of legislation.
“This is particularly true of those smaller businesses, sole traders and single branch operators who simply don’t have limitless budgets and access to their own in-house legal departments.
“In my experience, these agents often avoid asking for help or checking their processes for fear they are doing something wrong and the possible implications that may have.”
Two new services
He will also be running HF Assist, which provides support on day to day lettings matters that affect agents’ businesses, and the Property Redress Scheme’s new tenancy mediation service which encourages landlords, letting agents and tenants to find a resolution over tenancy disputes to avoid court.
“It’s great to see this new service making such a positive impact,” says Morgan.
”Mediation is more important than ever and our service is already helping landlords reach out to tenants to understand their financial position before taking possession action through the courts.”
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Former TDS boss joins Hamilton Fraser to head up new landlord and agent services | LandlordZONE.
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Courts may adjourn possession cases without Covid-19 impact assessment
Over 95% of private tenants are paying their rent or have made an arrangement with their landlord to pay a lower rent or defer payment during the pandemic according to a new survey of tenants out today.
Independent polling for the National Residential Landlords Association finds that 87% of private tenants have paid their rent as normal throughout the pandemic.
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LATEST: Jersey landlords fend off plans to extend evictions ban past September
Jersey Landlords Association (JLA) has defended the island’s private rented sector after its housing minister voiced concerns that the new owners of some apartments were planning to put up rents by 15%.
Senator Sam Mézec (pictured) is calling for an extension to the island’s rent freeze which banned any price increases or tenant evictions during the pandemic and is due to end on 30th September.
Says Mézec: “I think the difficulty we’re facing now is that the end of the rent freeze is on the horizon so landlords are now starting to look at what they can do in October once the legislation falls away. We need to overhaul some of our housing legislation to include greater protections against unfair rent increases.”
JLA chairman Peter Lucas tells LandlordZONE that Senator Mezéc isn’t giving the whole picture. “In the case he’s cited, the new landlord’s rent rise was to average market value and only increased to the amount that the States of Jersey Social Security rent contribution pays for one bed flats,” says Lucas.
“If you’ve not had a rent increase for a very long time, then a larger than normal rent increase might be justified.
“During the pandemic, we’ve asked landlords to reach out to tenants and most of the feedback we’ve had is that they’ve stepped up to the plate.”
The association believes rent controls will only mean more landlords leave the market, reducing availability and choice and causing standards to fall.
He adds: “The rent freeze was put in place in Jersey to reduce or stop people having to move home during the pandemic, in order to reduce transmission of COVID-19. Now the reason for the rent freeze has currently passed, it should not be continued without research into its likely implications.”
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Jersey landlords fend off plans to extend evictions ban past September | LandlordZONE.
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REVEALED: How new Welsh support scheme for tenants will work for landlords
Welsh tenants struggling with Covid-related rent arrears are to get help from a new scheme which pays loans direct to landlords.
The Tenant Saver Loan Scheme aims to provide an affordable way to cover rent arrears, or future months’ rent, reducing the risk of eviction and homelessness. Loans are targeted at private sector tenants who weren’t in significant rent arrears before March and aren’t on benefits.
The Welsh government is funding the scheme with an £8m cash injection, providing loans through credit unions at 1% APR. Money will get paid straight into landlords’ bank accounts and tenants will have to pay back the loan over a period of up to five years. They won’t be means-tested and loans can only be used to cover rent arrears.
Minister for housing and local government, Julie James, says: “We hope to help stop many thousands of people from eviction or homelessness, although it’s hard to put exact numbers on it.”
Private rented homes
The Welsh government is on a mission to make sure as many people as possible facing financial hardship as a result of the coronavirus pandemic remain in their private rented homes.
Last month, it extended the notice period on evictions from three months to six before possession proceedings resume in the courts in England and Wales on 23rd August. It also announced an extra £1.4m to help tenants boost their household income and manage problem debt, through the Single Advice Fund.
James adds: “The coronavirus has shone a light on housing in a way that few of us have seen before and reminded us all of the fundamental importance of good-quality affordable housing, a safe and secure home and strong and cohesive communities where people want to live and work.”
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – REVEALED: How new Welsh support scheme for tenants will work for landlords | LandlordZONE.
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Is an EICR required as it isn’t for a commercial tenant?
The situation is we have a shop unit we are letting with a self-contained upper part. This shop is one of four in a parade all owned by the same Landlord.
Some tenants choose to sublet the upper parts
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Where is Commercial Property headed after Covid?
The impact of Covid has been a rapid reduction in tenant demand for space, and when demand is reduced and supply remains the same there’s only one economic outcome – property values and rents will decline.
Across the world negative sentiment weighs on demand and drives structural change faster, as demonstrated by the thisweekinFM.com’s (Facilities Management) latest Global Commercial Property Monitor.
This global indicator, which gauges the sentiment of occupiers and investors, shows a dramatic fall in demand for space, especially in Europe, but this fall still remains above the record low it reached during Global Financial Crisis.
Investors expect to see this trend continue over the next year with further falls in capital values and rents across the world. Retail has taken a really big hit through lock-downs and the enforced move on-line for the consumer. Some retailers have commented that the pandemic has accelerated the move online by up to 5 years. E-commerce was already a challenge, Covid has made it an existential threat to the high street retailer.
Retail rents in some cases have taken a huge hit with 50% reductions in some cases. This puts property owners at serious risk of loan defaults, witness the recent Intu administration and the complete leasing re-think that Hammerson is going through to save itself.
With the current work-from-home situation offices too are experiencing a deteriorating outlook for rents and property values. On the other hand, with the boom in home deliveries, industrials and logistics investments have really come into their own.
RICS Chief Economist, Simon Rubinsohn, has been cited as saying:
“As the economic impact of COVID-19 has deepened, so too has the impact on commercial real estate. Sentiment among investors and occupiers has naturally weakened, with broad acceptance that rental and capital values will fall over the next year.
“What is clear, however, is that there will be no going back to the old normal, even after a protracted economic recovery and significant government interventions. Underlying trends have been accelerated by lockdowns, whether the global rise of ecommerce or remote working, coming to the fore, changing the nature of demand for many “traditional” commercial assets. We will see investors, landlords and tenants continue to adapt to a new reality – not least, in their approaches to office space.”
The Future for Offices
Writing for thisweekinFM.com, Paul Bagust, Global Property Standards Director at RICS, has commented on the rapidly changing face of commercial offices and how this may impact on the demand for city-centre space.
Bagust highlights three probable outcomes:
- organisations will reduce their overall property footprint,
- there will likely be a shift in location from urban to suburban
- organisations will in future place a greater emphasis on the health and well-being of workers. This could mean more attention paid to the in-work facilities provided for staff, and a more flexible approach presenteeism, allowing some home working to reduce travel and give staff a better quality of family life.
Some real estate professionals are predicting a 10 plus per cent reduction in office space footprints over the coming couple of years, with all the implications this shift has for rents and capital values in city centres. High rise blocks with thousands of workers in them are clearly problematic when you have to contend with Covid, even if the world gets back to near normal. But this view is not unanimous, some believe that ultimately there will be little change.
As always, predictions don’t always pan out or changes become a mixture, a hybrid of the old and the new. Businesses cannot operate with everyone at home, but they can certainly manage with less staff in the office at one time, certainly less time than they are used to being in the office all of the time. This new form of working with reduced travel, health and quality of life for more staff at home also has implications for mass transit systems.
As Paul Bagust says:
“The commercial office sector is under pressure, but the ‘death of the office’ has been called far too prematurely. Yes, many organisations are re-thinking their footprints and questioning the need for such large spaces in city centres – especially in the current economic climate and with the proven efficacy of remote working. But rather than disappear, office use will evolve. Property strategies will be increasingly data-led, based around the performance of buildings, and how they add value to and support the productivity of employees.”
What about Retail?
The high street was already under pressure even before anyone heard of COVID-19. Retail stores were closing at an unprecedented rate and prominent high street names, long established brands such as Debenhams were going into administration. Even mobile phone shops, ubiquitous on Britain’s high streets, were closing down. The effect of this on rent levels and property values is axiomatic, but what does all this mean for the future shape of the high street and shopping centres for 2021 and beyond?
Its not just the Oxford Streets of this world that will be affected by these structural changes: most of the retail market in the UK is in the regional cities, the larger towns and market towns around these hubs, right down to the local village store and post office – these will all come under immense pressure in a post Covid world, even if we get back to “normal”, or near normal.
Consumers are unlikely to revert back to their old shopping habits entirely having experienced the convenience of online shopping and home deliveries. During lock-down people were spending in the local stores they could access easily, supermarkets and local convenience stores, but after that often the bulk of their purchases were online.
Amazon has continued to consolidate its near monopolistic position and is the preferred option for many consumers, while the likes of Tesco and the other supermarkets have seen experiential growth in home deliveries, at a cost to themselves through eroded margins.
What are the likely outcomes?
- more customers than ever are likely to become competent at ordering online and will drift to online shopping given increasingly efficient deliver systems and convenience.
- Fulfilment cost for online retailers is a significant issue, therefore only those retailers creating significant sales volumes are likely to prosper with this.
- With many footfall creating destination stores disappearing, other high street retailers around them will suffer accordingly.
- Manufacturers are gearing themselves up for direct internet sales and home deliveries direct to the consumer, cutting out the retailer entirely, a process knows as disintermediation.
- The Covid lock-down has ignited the entrepreneurial spirit of many of the small retailers, particularly in food and drink. They have moved swiftly to fulfil orders locally and go online to keep their doors open and staff employed.
As with offices there is likely to be a short-term and a long-term effect on retail, retail property values and rents. Without a doubt businesses without some form of online presence and delivery options will suffer in the future, but delivery services have a cost, they erode margins.
As the effects of Covid recede, and we have to assume they will, even if full “normal” never returns, people will likely still want to shop in a store, for the visuals, for the choice and for the experience. It’s up to the retailer to provide the attraction, the desire to visit and a good all round customer experience, in other words they will need to work harder.
So again, as with offices, some sort of hybrid system is likely to emerge, but retailers will be faced with severe competitive pressures, high streets are likely to undergo dramatic physical change, perhaps with fewer stores and more residential, and very likely, retail and office property investors will need to be highly innovative and entrepreneurial to survive.
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