‘No fault’ evictions ban delayed until Covid is over, minister tells landlord chief

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The much-debated Renters Reform Bill that is expected to ban Section 21 ‘no fault’ evictions has been kicked into the long grass by Covid, housing minister Christopher Pincher (pictured, below) has revealed.

His comments were made to National Residential Landlord Association chief Ben Beadle (pictured above), who reports that it’s now unlikely that the reforms the bill is due to bring in will take place now until after the pandemic is over.

Speaking during the NRLA’s inaugural ‘Listen Up Landlords’ blog hosted by landlord and broadcaster Richard Blanco (pictured, above), Beadle said the government will now wait for the economic and social situation to stabilise before attempting any major PRS surgery.

“I don’t think we’re going to see social and economic stability any time soon so I think what we’re looking at is some sort of bridge between what we have now and the Renters Reform Bill,” says Beadle, who reminded listeners that the bill has yet to be formally published never mind begun its passage through parliament.

Bills normally take approximately a year to gain royal assent and pass into law, so an outright ban on no-fault evictions is unlikely before late 2022 at the earliest.

“But we know it will include measures to abolish Section 21 evictions and, whether landlords like it or not, that has widespread political support,” says Beadle.

He also said the NRLA understands the ban will not be retrospective and will only apply to new tenancies, and that he hoped it would also tidy up many of the existing pain points in the evictions process.

Once the bill does become law, it will create a new type of tenancy that can only be ended forcibly by a landlord via a modified Section 8 notice eviction which will cover rent arrears, anti-social behaviour and a landlord moving back into or selling their property.

Read more about the Renters Reform Bill.

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Residential to Ltd co for capital raising?

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I have a 10 property BTL portfolio in a Ltd Company. I want to expand, but my lender option is compromised by their current policies.

My own home is unencumbered, but I’m being rejected for finance on that because “my income is from property”.

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The looming David and Goliath battles of commercial rent arrears

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In a world where significant constraints are being placed on a landlords’ ability to recover outstanding rents, many suspect that some tenants are using the crisis to avoid paying, or avoid paying in full. This when it is claimed they can easily afford to pay, especially in the case of large international corporations.

Landlords in England and Wales (Scottish legislation differs) still retain the ability to recover full rent and other sums due to them under commercial leases, but practical difficulties often prevent this. Landlords’ urgent cash flow issues are often not helped by the fact that payments may be deliberately withheld, coupled with long delays in court proceedings.

Section 82 of the Coronavirus Act 2020 still applies. It prevents any major threats to tenants’ tenure through lease forfeiture in England and Wales between 26 March 2020 and 31 March 2021. This is whether by court proceedings or peaceable re-entry, for the majority of commercial leases, by reason of non-payment of any sums due under the lease.

Depending on the circumstances however, landlords still have other options which might include recovering sums owed by tenants of their commercial properties from guarantors, former tenants, recovering directly from any subtenants, or through going to court for debt recovery proceedings.

Last year the government published a code of practice for landlords and tenants of commercial property across the UK. It has been endorsed by a number of industry organisations including the RICS, but it is voluntary. The main principle of this is “transparency and collaboration”, the government’s aim being to encourage landlords and tenants to act “reasonably and responsibly” whilst the crisis lasts.

A recently reported court case illustrates the point about the alleged unequal balance of power between smaller-scale landlords and large corporations. Fast-food giant Burger King, owned by Restaurant Brands International, a Canadian-American multinational fast food holding company, itself backed by Brazilian-American multibillion-dollar investment firm 3G Capital, is being pursued by one landlord over unpaid rent.

The UK arm, Burger king Ltd, has proposed that its quarterly rent due from last March be waived altogether, rent due from last June be discounted by 70%, and a new lease arrangement entered into whereby rent is linked to sales (turnover rents) after that.

The UK subsidiary of Brands International leases its restaurant properties from landlords and sublets them to the chain’s franchisees. According to The Sunday Times, it is claimed that the company owes £461,174 to the owner of its branch in Queensway, west London.

The court filing by the claimant landlord argues that because of the big difference in the size of the parties, it considers that a more appropriate arrangement, in line with the code of practice, might be a deferral of some of the rent to be repaid over a period of time.

Given the size of the commercial rent arrears problem, which has been building up since the start of the pandemic, the landlord – tenant stand-off is threatening to explode over coming months. With the tenant protection measures still in place for another couple of months, and the courts likely to be overwhelmed when restrictions are lifted, there seems little by way of relief in the short-term.

Neither party in the above dispute has made themselves available for comment.

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Informing Local Authority of EICR?

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Re. EICRs, from the .gov site click here

We must:- Supply the local authority with a copy of this report within 7 days of receiving a request for a copy.

-Supply written confirmation of the completion of the remedial works from the electrician to the tenant and the local authority within 28 days of completion of the works.

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